PPG Industries Australia Pty Ltd v DuluxGroup (Australia) Pty Ltd

[2015] ATMO 53

TRADE MARKS ACT 1995

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONS

Re:Opposition by PPG Industries Australia Pty Ltd to registration of trade mark application 1317746(2) - ENDURE - proceeding in the name of DuluxGroup (Australia) Pty Ltd.

Delegate:	Iain Campbell Thompson
Representation:	Opponent: Tim Allen and Natalia Bletcher of Corrs Chambers Westgarth Applicant: Siobhan Ryan of Counsel instructed by Nick Holmes of Davies Collison Cave
Decision:	2015 ATMO 53 s52 opposition – parties agree that s41(5) applies - degree of inherent adaptation - evidence of use - trade mark capable of becoming distinctive. s44(3)(a) also made out by Applicant. Opposition to registration not established

Background

1. In these proceedings under the Trade Marks Act 1995 (‘the Act’) DuluxGroup (Australia) Pty Ltd is the applicant (‘the Applicant’) for registration of the trade mark which appears below:

Application No:  1317746
Priority Date:  28 August 2009

Goods:Class 2: Water based coating materials for use in relation to timber floors, parquetry floors

(‘the Goods’)

Trade Mark:  ENDURE
  (‘the Trade Mark’)

Endorsements: Provisions of subsection 41(5) applied.

Provisions of paragraph 44(3)(a) and/or Reg 4.15A(3)(a) applied

1. The Trade Mark was examined as prescribed by section 31 of the Act and advertised as accepted for possible registration in the Australian Official Journal of Trade Marks on 30 May 2013.  The endorsements reflect the Applicant’s address of grounds for rejection which are further discussed below.

2. On 30 July 2013, PPG Industries Australia Pty Ltd (‘the Opponent’) filed Notice of Intention to Oppose and on 30 August 2013 filed its Statement of Grounds and Particulars which details grounds under sections 41 and 44 of the Act. The ground under section 44 of the Act pertains to the following application:

Application No:  1640544
Priority Date:  18 March 2009 (via divisional ‘parent’ 1289978)

Goods:Class 2: Architectural coating paints for coating of interior, exterior, wood and metal surfaces; paints, varnishes, lacquers, coating compositions; preservatives against rust and against deterioration of wood; colorants; raw natural resins; none of the foregoing being bookbinders' blocking varnish or mordants

Trade Mark:  ENGINEERED TO ENDURE

1. The parties have filed their evidence in accordance with the Trade Mark Regulations 1995 (‘the Regulations’). I will mention now that the parties are agreed that the Trade Mark is one that falls for consideration under subsection 41(5) and paragraph 44(3)(a) of the Act. Further, the parties are agreed that, if the evidence filed by the Applicant establishes that the Trade Mark may be registered under the provisions of subsection 41(5), the evidence also necessarily establishes the honest concurrent use of the Trade Mark such that it may be registered under the provisions of paragraph 44(3)(a) of the Act. To that end, the parties elected not to address the ground under section 44.

2. I would have reservations with the proposition that evidence of use which shows a trade mark is registrable under subsection 41(5) also automatically demonstrates that it is registrable under the provisions of paragraph 44(3)(a). This is because the establishment of honest concurrent user additionally depends on consideration of the circumstances of a trade mark’s adoption and the degree of similarity of the trade marks and goods or services under consideration (and hence the degree of confusion). These are considerations distinct from those under subsection 41(5). However, I agree with the parties that given the circumstances of the Trade Mark’s adoption and the similarity of both the goods and the trade marks presently under consideration that this approach is appropriate here.

3. As a delegate of the Registrar of Trade Marks I heard the submissions of the parties at a hearing in Melbourne on 28 May 2015.  Siobhan Ryan of Counsel instructed by Nick Holmes of Davies Collison Cave represented the Opponent.  Tim Allen and Natalia Bletcher of Corrs Chambers Westgarth represented the Applicant.

Onus & Relevant Date

1. The Opponent bears the onus of establishing one or more grounds of opposition on the balance of probabilities.[1] I note, however, that it is the Applicant which bears the onus of establishing its entitlement to registration under the provisions of subsection 41(5) and paragraph 44(3)(a) of the Act.

   [1] Pfizer Products Inc v Karam [2006] FCA 1663; 237 ALR 787; (2006) 70 IPR 599; [2006] AIPC 92-146 per Gyles J at [6] to [26].

2. The relevant date at which the grounds must be considered is the filing date of the Trade Mark.[2]

   [2] Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592; The Seven Up Company v O.T. Limited (1947) 75 CLR 203 at 211; Rael Marcus v Sabra International Pty Ltd (1995) 30 IPR 261 at 266.

Evidence

1. The evidence filed by the parties is comprised of the following declarations:

   In Support

   Natalia Blecher, Associate of Corrs Chambers Westgarth, made on 20 December 2013 with Exhibits NJB-1 to NJB-4 (‘Blecher 1’)
            This Exhibits declarations of:

   ·Nadine Miller Vachon dated 4 September 2012 with Exhibits NMV-1 to CONFIDENTIAL NMV-23 which was originally filed by the Opponent in relation to its (now lapsed) application no 1411681.

   ·Professor Bryan Anthony Lukas dated 19 February 2013 filed in relation to the Opponent's application no 1517498.

   Natalia Blecher made on 24 January 2014 with Exhibit NJB-5 (‘Blecher 2’)

   In Answer

   Chris Papanastassis, Sales Manager of A&V Distributors, made on 23 June 2014

   Rita Fakhry, owner of Sandpaper Plus, made on 24 June 2014

   Michael Van Rossen, Shop Manager of Adelaide Floor Sanding & Tiber Supplies Pty Ltd  made on 27 June 2014

   Matthew Winser, Part Owner of Techwood (Floor Sanding Supplies), made on 2 July 2014

   Stephen Hubbard, an Owner of ProWood Flooring Pty Ltd t/a Floorsanders Trade Supplies, made on 2 July 2014

   Phil Holgate, ex Managing Director of Australian Waterborne Coatings Pty Ltd, made on 14 June 2014 with Exhibits PH1 to PH4

   Jason Messina, Brand Manager of Applicant, made on 24 June 2014 with Exhibit JM1

   Sarah Shatkhin, Marketing Manager, Cabot’s, a division of the Applicant, made on 23 June 2014 with Exhibits SS1 to SS3

   In Reply

   Natalia Blecher dated 10 November 2014 (Blecher 3)

   Jane Watson, Head of Research at Anomaly Research and Analytics, dated 10 November 2014

2. I will discuss the above evidence as and when it becomes relevant to my reasoning under subsection 41(5) of the Act.

Subsection 41(5)

1. At the relevant date, subsection 41(5) of the Act provided:

   (5) If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:

   (a)the Registrar is to consider whether, because of the combined effect of the following:

   (i)the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;

   (ii)the use, or intended use, of the trade mark by the applicant;

   (iii)any other circumstances;

   the trade mark does or will distinguish the designated goods or services as being those of the applicant; and

   (b)if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons; and

   (c)if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken not to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons.

   Note 1:For goods of a person and services of a person see section 6.

   Note 2:Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).

2. Subsection 41(5) (‘the Subsection’) anticipates that there are degrees of inherent adaptation within trade marks such that trade marks with varying gradations of inherent adaptation will fall within the purview of the Subsection and thus require a greater or lesser use (or intended use) such that the trade mark does or will distinguish the designated goods as being those of the applicant.

3. The dispute between the parties is the degree of inherent adaptation within the Trade Mark and hence the amount of use required such that the provisions of the Subsection may be applied. An appropriate starting point for my considerations is thus an assessment of the degree of inherent adaptation within the Trade Mark.

4. In Clark Equipment Company v Registrar of Trade Marks [1964] HCA 55; (1964) 111 CLR 511 at 514, Kitto J put the test as follows:

   "[T]he question whether a mark is adapted to distinguish [is to] be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives - in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess - will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it."

5. In Cantarella Bros Pty Ltd v Modena Trading Pty Ltd [2014] HCA 48 the Court explained that the inherent adaptation of a trade mark is tested by reference to the ordinary signification of that trade mark and then an enquiry into whether other traders need to use the mark.

6. The meaning of the word ‘endure’ is given by the Macquarie Dictionary as:

   endure  Pronunciation of endure /ɛnˈdjuə/ (say en'dyoohuh)

   verb (endured, enduring)

   –verb (t) 1.  to hold out against; sustain without impairment or yielding; undergo.

   2.  to bear without resistance or with patience; tolerate: *He accepted the cane as he accepted a head cold or a cut toe, to be endured and forgotten. –ronald mckie, 1975.

   –verb (i) 3.  to continue to exist; last.

   4.  to support adverse force or influence of any kind; suffer without yielding; suffer patiently.

   5.  to retain a certain stature; maintain recognition of merit.

   [Middle English endure(n), from Old French endurer, from Latin indūrāre harden, Medieval Latin endure]

7. As Ms Ryan observed at the hearing, the word ‘endure’ has (according to the above definition) an anthropomorphic quality – it is more frequently used in relation to the quality of a person rather than of a thing, such as the Goods.

8. However, the Concise Oxford Dictionary gives:

   verb

   1 [with object] Suffer (something painful or difficult) patiently:

   ‘it seemed impossible that anyone could endure such pain’

   2 [no object] Remain in existence; last:

   ‘these cities have endured through time’

9. I note that the latter definition is the past tense of the verb ‘endure’.

10. In the Opponent’s evidence, Blecher 1 gives the following examples of other traders in goods similar to the Goods using the word ‘endure’:

    • Our coatings endure the test of time...

    • Our range of protective coatings has been specifically formulated to endure the harshest Australian conditions

    • Sydney Painters specializes in the application of protective coatings that ... can endure high traffic

    • A perfect paint job that will delight, endure, and add real value

    • Painting has to endure the every day wear and tear

    • This paint will endure life in these fun rooms...

    • The grade and finish of house paint is crucial to ensure your paint will endure conditions...

    • WATCO clear wood finishes provide enduring protection against scrapes...

    • WATTYL FORESTWOOD is enduring, beautiful...

    • Delivering a quality patina and better surface endurance.

11. As Mr Allen said in his submissions, Exhibit NJB-4 to Blecher 1 provides more general examples of use by traders in the coatings and deck/flooring market of ENDURE or words derived from ENDURE. These include:

    • Sophisticated, enduring, exceptional value

    • A recoat is applied regularly to these floors due to the heavy traffic they endure

    • The environment under which a paint must endure varies widely

    • Engineered timber flooring can endure the test of time

    • The strength and toughness of timber flooring reinforces the enduring element of this type of flooring ...

    • The substrate must endure a harsh environment ...

    • Everyday accidents and elements endured by most of the decks

    • Almost every wood floor endures some expansion and contraction

    • For a look of natural beauty and a floor of minimum maintenance and enduring quality ...

    • The plank is resistant to the elements and everyday accidents endured by most decks

    • In older homes, the wood used is usually of high quality and will endure high traffic

    • All of our products are designed to endure Australia’s harshest conditions

12. However, it is not obvious how any of the examples in Ms Blecher’s evidence show that other traders ‘will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it.’  The uses of the word ‘endure’ by traders other than the Applicant cited by the Opponent do not appear to me to be infringing uses as the expressions in which the word ‘endure’ occurs are not deceptively similar to the Trade Mark.

13. In considering the inherent adaptation of the Trade Mark, I am mindful of a case decided under the Trade Marks Act 1955 concerning the trade mark YIELD, used or proposed to be used in relation to pesticides: Eli Lilly & Co v Ciba-Geigy Australia Ltd, (1984) AIPC 93-207. In that decision the Registrar’s delegate said:

    The opponent argues that, even though it may not have direct reference to the character of pesticides, the word "yield" is a descriptive term which is commonly and widely used in the agricultural chemical industry and especially in relation to pesticides, and therefore its use should not be restricted in any way. Similar arguments have been used on many occasions but, as was pointed out by Lord Wright in J. & P. Coats Ltd's Appn 53 RPC 355, the question of what is adapted to distinguish is a practical question to be answered by reference to the particular circumstances of the case. ..."Is it a word which is likely to harass or embarrass an honest trader in the exercise of his rights to use an ordinary word under Section 44 in order to describe something in which he is dealing? Is it likely to impede an honest trader in the use of the word "sheen" if he wants to use it as a bona fide description of the character or quality of his goods?"

14. The delegate then concluded:

    The fact of its frequent use is, I think, of considerably less importance than the manner of its use in assessing whether it is adapted to distinguish goods as a trade mark. Therefore although the word "yield" occurs quite frequently in agricultural parlance as is illustrated by the pesticide literature and advertising materials which the opponent has provided, consideration of the way in which it is used leads inevitably to the conclusion which I had already reached that pesticides have not been and could not be usefully or meaningfully described by the word "yield".

    I think that these objections may be based on the feeling of surprise or disquiet or even outrage that many people experience when a trader makes so bold as to adopt as his trade mark a word which is well known or widely used in the particular trade or industry. The feeling may be prompted by a number of factors ranging from chagrin at having missed the opportunity to do the same to distress at the interference with the right to use a name or description. It is therefore most important that, should that trader seek to register that mark, the Registrar as the custodian of public interest takes great care in determining whether in all the circumstances of the case that trader has discharged the onus upon him to show that he is entitled to the registration. In the present matter I have already decided that registration of the mark YIELD would not interfere with the right to use the word in its ordinary significance in the agricultural and pesticide industries. From the material before me I can find no reason to suppose that use of the mark would give rise to any confusion, deception, danger or hardship to any person.

15. Of course, the word ‘descriptive’ is no longer contained in the Act as it was in its legislative predecessor and the Courts have considered trade marks which are not descriptive but lack inherent adaptation in relation to particular goods: Unilever Australia Ltd v Societe Des Produits Nestlé SA [2006] FCA 782; 154 FCR 165; 69 IPR 255; Philmac Pty Ltd v Registrar of Trade Marks [2002] FCA 1551; (2002) 126 FCR 525; 56 IPR 452; [2003] AIPC 91-841. However, the point is good – where a word is well known or widely used in an industry, if that use is not in a manner such that other traders ‘will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it’, the lack of inherent adaptation to distinguish in that word is unlikely to be pronounced.

16. Set against the above observations are the ordinary dictionary definitions of the word ‘endure’, particularly in the Concise Oxford Dictionary which show that the word ‘endure’ may have some facility in relation to the goods.

17. It seems reasonable in consideration of the above to conclude that the lack of inherent adaptation in the Trade Mark is not particularly marked. Indeed, if pushed to place the Trade Mark on a continuum within a scale of 1 to 10 (with 1 being that which just falls within the Subsection and 10 being the lowest degree of inherent adaption within the Subsection), I would place the Trade Mark towards the lower end of the continuum.

18. Ms Shatkhin explains the background to the use of the Trade Mark in her declaration.  It was Orica Australia Pty Ltd (‘Orica’) that applied to register the Trade Mark.  The Applicant was a business division of Orica until that business division demerged from Orica in July 2010.  The Applicant became the owner of the Trade Mark and the assignment of the Trade Mark to the Applicant was recorded on IP Australia’s database on 12 March 2010.  Orica acquired the Trade Mark in October 2005 from Australian Specialty Waterborne Coatings Pty Ltd (‘SWC’).  At that time Orica purchased SWC and all of its intellectual property including the Trade Mark and its goodwill.  SWC had created the Trade Mark to use in relation to the Goods.

19. Ms Shatkhin states that Orica and subsequently the Applicant have used the Trade Mark as part of the INTERGRAIN product range sold by Cabots Woodcare.  Cabots was a business division of Orica and was transferred to the Applicant as a part of the demerger.

20. Ms Shatkhin provides details of retail value of sales for the period 2005 to 2012 – these have generally grown substantially on an annual basis – the 2012 figures being over 200% larger than the 2005 figures and which represent many thousands of containers of the Goods. 

21. The Goods sold under the Trade Mark have, says Ms Shatkhin, been promoted in brochures provided to flooring contractors, architects, specifiers and consumers, at DesignEx and Australian Timber Floor Association exhibitions, and sales promotion flyers and posters which have been disseminated to distributers through sales teams and via email.

22. Ms Shatkhin provides annual expenditure figures on the amount spent on promoting the Goods sold under the Trade Mark.  While not large, these figures are commensurate with the revenue figures discussed above and are also increasing.

23. Ms Shatkhin estimates that the Goods occupied about 20% of the market for the Goods at the priority date.

1. Examples of the Trade Mark in use exhibited to Ms Shatkhin’s declaration include:

1. Mr Allen observed at the hearing that the Trade Mark is used by the Applicant as a second or third tier trade mark in the above examples of use.  For example, the first picture, above, shows the Trade Mark used subservient to the trade marks INTERGRAIN and ENVIROPRO.  Thus, the Opponent argues, the Trade Mark has more work to do if it is to become distinctive of the Applicant’s Goods.  However, the literature exhibited to Ms Shatkhin’s declaration acknowledges this and promotes the Trade Mark as a ‘third tier’ trade mark:

2. I consider that the above uses are also generally consistent with the previous use of the Trade Mark by SWC in a manner that is subservient to the trade mark ENVIROPRO as appears below:

3. While it is apparent that the Trade Mark is a second or third tier trade mark, its use (whether by the Applicant or SWC) has always been associated with the trade mark ENVIROPRO which is the most dominant trade mark on the packaging – the use of the Trade Mark as a second or third tier trade mark has thus been consistent.

4. The question I must answer is whether because of the mode of use of the Trade Mark, and because of the degree of use (or intended use) of the Trade Mark and the extent to which it is inherently adapted to distinguish the Goods, it does or will distinguish the Goods of the Applicant.

5. I consider that if the rising turnover of Goods sold under the Trade Mark and increasing promotional expenditure are considered in relation to the amount of inherent adaptation within the Trade Mark, discussed above, it will come to distinguish the Goods of the Applicant.  I am not convinced by the Opponent’s argument that the Trade Mark has more work to do being a second or third tier trade mark.  The Trade Mark (in conjunction with trade mark ENVIROPRO) is not being used by the Applicant in a manner which suggests that it is a ‘limping trade mark’ in the sense that is referred to by Jacob J in Philips Electronics NV v Remington Consumer Products 40 IPR 279 when he said:

   ... what we have here is a kind of "limping mark", always used with what is obviously a proper trade mark. The same was true of TREAT which was always used with SILVER SPOON. Neither sign was ever used by the proprietor on its own. And that was evidence of a lack of a capacity to distinguish. I do not of course say that you cannot have two trade marks used for the same goods, or that a part of a sign -- a "subsign" -- cannot also be a trade mark: both FORD and FIESTA are obviously valid marks. But there are these other cases, where the sign proffered as a valid mark cannot really stand up on its own.

6. My assessment of the use of the Trade Mark is that it does ‘stand up on its own.’

7. Accordingly, the ground under the Subsection is not established – or to view this from the viewpoint of where the onus lies, the Applicant has established its entitlement to registration under the provisions of the Subsection.

8. It follows, as agreed by the parties, that the Applicant has also established its entitlement to registration under paragraph 44(3)(a) of the Act.

Decision

1. At the relevant date subsection 55(1) of the Act provided:

   55Decision

   (1)Unless the proceedings are discontinued or dismissed, the Registrar must, at the end, decide:

   (a)to refuse to register the trade mark; or

   (b)to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;

   having regard to the extent (if any) to which any ground on which the application was opposed has been established.

   Note:For limitations see section 6.

2. The grounds not having been established, I decide to register the Trade Mark.

3. The trade mark application may then proceed to registration one month from the date of this decision.  If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until the appeal has been decided or discontinued and the disposition of the application be in accordance with the Court’s order or direction.

Costs

1. The Applicant, having been successful, is entitled to its costs which I award against the Opponent at the official scale set out in Schedule 8 to the Regulations.

Iain Campbell Thompson
Hearing Officer
Trade Marks Hearings
24 June 2015