Re: Opposition by Monster Energy Company to registration of trade mark application number 1859892 (class 25) - STAY Shredded in the name of Peter Balthazar

[2020] ATMO 123

TRADE MARKS ACT 1995

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

Re:Opposition by Monster Energy Company to registration of trade mark application number 1859892 (class 25) – STAY SHREDDED - in the name of Peter Balthazar

Delegate:	Jock McDonagh
Representation:	Opponent: Stephen Rebikoff of Counsel instructed by Davies Collison Cave Pty Ltd Patent and Trade Mark Attorneys Applicant: Written submissions by Y Intellectual Property
Decision:	2020 ATMO 123 Trade Marks Act 1995 (Cth) – opposition under section 52 – ss 44 and 60 pressed – s 60 considered and established - application refused.

Background

1. This matter is an opposition under s 52 of the Trade Marks Act 1995 (‘the Act’) to the registration of the trade mark filed by Peter Balthazar (‘the Applicant’). Relevant details of the application are set out below.

Trade mark:	(‘the Trade Mark’)
Trade mark application:	1859892
Filing Date:	19 July 2017 (‘Priority Date’)
Specification:	Class 25: Sports clothing (other than golf gloves); Athletic clothing; Clothing; Clothing for sports; Men's clothing; Women's clothing; Gym shorts; Gymwear

1. The application was examined in compliance with section 31 of the Act and was advertised as accepted for possible registration in the Australian Official Journal of Trade Marks on 14 December 2017. Monster Energy Company (‘the Opponent’) filed a Notice of Intention to Oppose on 14 February 2018 followed by a Statement of Grounds and Particulars (‘SGP’) on 28 February 2018. Thereafter the Opponent and Applicant filed evidence as provided by the Trade Mark Regulations 1995 (‘the Regulations’).

2. I heard, by way of video conference, the matter in Canberra on 3 April 2020 as a delegate of the Registrar of Trade Marks. Stephen Rebikoff of Counsel instructed by Davies Collison Cave Pty Ltd Patent and Trade Mark Attorneys, appeared by video conference for the Opponent. The Applicant relied on written submissions prepared by Andrew Petale of Y Intellectual Property law firm.

   Grounds of Opposition

3. The SGP nominated grounds of opposition under ss 44, 60 and 62A the Act. The onus is upon the Opponent to establish one or more of its grounds of opposition on the ‘balance of probabilities’.[1] The Opponent did not pursue the s 62A ground at the hearing.

   [1] See Pfizer Products Inc v Karam [2006] FCA 1663, and Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133].

4. The time at which the grounds of opposition must be established is the Priority Date, being the date of the application for registration of the Trade Mark [2].

   [2] See Southern Cross Refrigerating v Toowoomba Foundry Pty Ltd (1953) 91 CLR 592 95.

   Evidence

5. The evidence consists of the following declarations:

Declarant	Position	Date Made	Exhibits
Evidence in Support
Rodney Sacks (‘Sacks Declaration 1’)	Chief Executive Officer of the Opponent	10.08.18	RCS-01 to RCS-77
Elizabeth Godfrey (‘Godfrey Declaration’)	Solicitor for Opponent’s Attorney Firm	15.08.18	EKG-1 to E4KG-16
Evidence in Answer
Peter Balthazar (‘Balthazar Declaration’)	Applicant	29.11.18	PB-1 to PB-5
Evidence in Reply
Rodney Sacks (‘Sacks Declaration 2’)	Chief Executive Officer of the Opponent	24.01.19	RCS-78

1. Paragraphs 6 to 9 of the Balthazar Declaration provides that the Applicant has established and operated a gymwear and sportswear business under the label STAY SHREDDED since July 2017, specializing in athletic apparel for body builders. A colloquial meaning of the term ‘shredded’ is having well-defined or well-developed muscles or being a muscular person. The Trade Mark device is meant to look shredded in a literal sense.

2. The Balthazar Declaration states that the Applicant has used the Trade Mark in connection with his apparel goods since July 2017.

3. Sacks Declaration 1 details the history of the Opponent in the business of developing, producing, marketing, and selling energy drinks in the USA since April 2002, and in Australia since 2006. The declaration refers to the distinctive ‘Claw Icon’ that is an essential feature of the Opponent’s trade marks and appears on all its goods and marketing material.

4. Sacks Declaration 1 provides evidence of significant sales figures for the Opponent’s products in Australia between 2009 and 2017. Further, it details significant advertising and marketing expenditure across a wide range of media, including television, internet, magazines, and at live events, primarily through the sponsorship of athletes, sporting competitions and other events.

5. The Godfrey Declaration includes as exhibits three declarations made in earlier trade mark opposition proceedings that show use of the Opponent’s trade marks in magazines published in Australia and showing circulation details of the magazines.

6. The Godfrey Declaration also exhibits various photographs, taken in a variety of Australian supermarkets, of the Opponent’s products bearing its trade marks.

7. I will discuss other evidential maters as it relates the s 60 ground below.

   Discussion

8. The Opponent nominated numerous trade mark registrations (‘the MONSTER trade marks’) in its Statement of Grounds and Particulars in support of its ground of opposition under s 44 and their reputation as underpinning the s 60 ground. At the hearing the Opponent relied on the following the MONSTER trade marks featuring the ‘Claw Icon’ to support its case:

Trade Mark:	1694311
Filing Date:	18 May 2015
Specifications:	[including] Class 25: Clothing, footwear, and headgear
Trade Mark:	1694313
Filing Date:	18 May 2015
Specifications:	[including] Class 25: Clothing, footwear, and headgear

Section 60: Trade mark similar to trade mark that has acquired a reputation in Australia

1. Section 60 of the Act provides:

   The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:

   (a)another trade mark had, before the priority date for the registration of the first‑mentioned trade mark in respect of those goods or services, acquired a reputation in Australia; and

   (b)because of the reputation of that other trade mark, the use of the first‑mentioned trade mark would be likely to deceive or cause confusion.

   Note:For priority date see section 12.

2. It is not necessary to show under s 60 that the respective trade marks are deceptively similar although such a finding can be relevant in determining the likelihood of deception or confusion.

3. Reputation is to be assessed according to the test set out in McCormick & Company Inc v McCormick[3], by Kenny J at [81] – [82]:

   What is intended by the word “reputation” in s 60? The word is defined in The Macquarie Dictionary as follows:

   reputation ... 1. the estimation in which a person or thing is held, esp. by the community or the public generally; repute ... 2. favourable repute; good name ... 3. A favourable and publicly recognised name or standing for merit, achievement, etc. ... 4. The estimation or name of being, having done, etc, something specified.

   Cf. The Oxford English Dictionary. In s 60, the word is, I think, apt to refer to “the recognition of the McCormick & Co marks by the public generally”.

   Does the evidence establish that in Australia before 9 March 1992 the McCormick & Co marks were recognised by the public generally and, because of that, the use by Mary McCormick of her marks would be likely to cause the public confusion, as for example, by the public’s mistakenly attributing a business connection between the two or attributing her product to the company?

   [3] (2000) 51 IPR 102.

4. Further, at [86], Kenny J said:

   In practice, it is commonplace to infer reputation from a high volume of sales, together with substantial advertising expenditures and other promotions, without any direct evidence of consumer appreciation of the mark, as opposed to the product.

5. The Opponent’s evidence establishes that it has for over 10 years before the priority date promoted and offered energy drinks internationally and domestically under the MONSTER trade marks.

6. Sacks Declaration 1 states that the Opponent is one of the world’s leading suppliers of energy drinks and associated products. Its MONSTER energy drink is the best-selling energy drink in the USA, and the second-best selling energy drink in the world.[4]

   [4] Sacks Declaration 1, at [13].

7. Sacks Declaration 1 states that the Opponent commenced selling its MONSTER energy drinks in Australia. Since that time, it has sold more than 80 million cans of MONSTER energy drinks to consumers in Australia, generating revenues of more than $US140 million.[5]

   [5] Sacks Declaration 1, at [31] and Exhibit RCS-3, at [29].

8. Between July 2009 and December 2010, the Opponent spent more than AU$7.9 million on marketing and promotional activities in Australia, New Zealand, and Tahiti. Between January 2011 and December 2014, the Opponent spent more than US$35.4 million on marketing and promotional activities in Australia alone. In 2025 and 2016, it spent a further AU$11.2 million.[6]

   [6] Sacks Declaration 1, at [41].

9. Sacks Declaration 1, at [16] states that from about 2003 the Opponent has extended the range of MONSTER products bearing the Claw Icon and the name MONSTER. Such products include MONSTER RIPPER, MONSTER ASSAULT, and MONSTER KHAOS. The Opponent is also the owner of Registration Number 1785924, where the Claw Icon is represented on an angle:

   24.     Mr Rebikoff submitted that the Opponent’s marketing strategy is not conventional, in that it is not primarily directed at television or radio advertising but instead focusses on ensuring the Claw Icon and MONSTER brand receives sustained and extensive exposure on television, on the internet, in magazines, and at live events, primarily through the sponsorship of athletes, sporting competitions and other events.[7]

   [7] Sacks Declaration 1 at [34]-[35].

   25.     Apparently this strategy has been adopted by the Opponent because such events are popular with its principal target market of young adults aged 18 to 34 (primarily males), and because indirect and non-traditional forms of advertising such as sponsorship and product placement are instrumental in reaching this demographic.[8]

   [8] Sacks Declaration 1 at [35]-[38].

   26.     Mr Rebikoff submitted that key aspect of the Opponent’s sponsorship of athletes and sporting events involves the distribution of clothing and equipment bearing the Claw Icon and other MONSTER trade marks to athletes and racing teams sponsored by the Opponent, so that consumers who look up to these athletes will see them wearing that apparel or using that equipment and associate them with the MONSTER brand.[9]

   [9] Sacks Declaration 1 at [35]-[38], and [62], examples of athletes and teams wearing clothing and equipment featuring MONSTER trade marks exhibited at RCS-12, RCS-16, RCS-20 and RCS-24.

   27.     Indeed, as noted in Sacks Declaration 1, the popularity of these products is such that the Opponent has introduced a series of different clothing ranges bearing different variations of the MONSTER trade marks, including the Claw Icon.[10] Further, many of those products feature the Claw Icon alone, the icon being oriented in a variety of ways as well as the vertical orientation shown above at [13].[11]

   [10] Sacks Declaration 1 at [49]-[53].

   [11] Sacks Declaration 2 at [8]-[13].

   28.     I also note that in the Godfrey Declaration numerous items of apparel bearing the Claw Icon offered for sale in Australia by the Opponent are exhibited, including (for example) the following item:[12]

   [12] Godfrey Declaration, Exhibit EKG-3 at p 1458.

   29.     The Opponent’s evidence provides details of the extensive brand awareness of the MONSTER trade marks in Australia. I am satisfied that the Opponent’s evidence has established the MONSTER trade marks have the requisite reputation in the Australian market primarily for energy drinks, but also the associated apparel and merchandise offered for sale at sponsored events, such events are found especially in the realms of exercise, sports and athletics.

10. But it is also necessary for the Opponent to establish that, because of its reputation in its marks, notional use of the Trade Mark on the specified services would be likely to deceive or cause confusion.

11. The meaning of the words ‘likely to deceive or cause confusion’ were discussed by the Full Federal Court in The Coca-Cola Company v All-Fect Distributors Ltd, referring to Pioneer Hi-Bred Corn Co v Hy-Line Chicks Pty Ltd[13] where Richardson J, in the New Zealand Court of Appeal, said:

    [13] [1979] RPC 410 at 423.

    “Deceived” implies the creation of an incorrect belief or mental impression and causing “confusion” may go no further than perplexing or mixing up the minds of the purchasing public ... Where the deception or confusion alleged is as to the source of the goods, deceived is equivalent to being misled into thinking that the goods bearing the applicant’s mark come from some other source and confused to being caused to wonder whether that might not be the case.[14]

    [14] [1999] FCA 1721; (1999) 96 FCR 107; 47 IPR 481, 39.

12. It is not necessary to show actual confusion under section 60, but rather a likelihood of confusion. Evidence of confusion is notoriously difficult to procure as those deceived or confused may not realise or report such confusion. Further, as the Full Federal Court stated in Australia Postal Corporation v Digital Post[15]‘the threshold for confusion is not high’. For a likelihood of confusion to exist, ‘the triggering event need go no further than mere confusion, in the sense of holding a reasonable doubt, while stopping short of actual deception or mistake’.[16]

    [15] (2013) FCAFC 153 at [70].

    [16] McDonald's Inc v Future Enterprises Pte Ltd [2007] ATMO 22 at [26].

13. While the Opponent does in fact have registrations for Class 25 goods and markets them alongside it major market in energy drinks, there is no requirement that the competing marks be used, or proposed to be used, in relation to similar goods or services. The assessment of the likelihood of deception or confusion is informed by ‘the strength of the reputation of the Opponent’s trade mark(s), the inherent distinctiveness thereof, the degree of similarity between the trade marks under consideration and the nexus or connection between the goods and/or services of the parties’.[17]

    [17] Pottle Productions Inc v Rute Ithalat Ve Ihracat Anonim Sirketi [2012] ATMO 124, 40 and Qantas Airways Limited v Edwards [2016] FCA 729, 142.

14. The Trade Mark and the MONSTER trade marks are have visual and conceptual similarities, with the ‘S’ element of the Trade Mark incorporating what the Applicant refers to as ‘a stylised “shredded” S device’[18]. In its written submissions, the shredded aspect is characterized as ‘wavy stripes’ and ‘brush strokes’. The Opponent submits that this element is identical to the MONSTER trade marks’ ‘Claw Icon’.

    [18] Balthazar Declaration at [7].

15. While I cannot concur with the Opponent’s submission regarding identity, it seems to me that the tail of the Trade Mark’s S device element has conceptual similarity to the ‘Claw Icon’ element of the MONSTER trade marks. Both design elements share three lines (as opposed to the usual four of animal claws) in parallel with a jagged or wavy appearance. It could be perceived as the claw icon superimposed on a letter ‘S’. The words STAY SHREDDED are not conceptually or thematically different to the RIPPER, ASSAULT, or KHAOS modifiers referred to above at [22].

    36.     I take into account the extensive evidence of the Opponent’s history of presenting the MONSTER trade marks (including the ‘Claw Icon’) in a wide variety of different and unusual forms, particularly where the marks are used in relation to the different programs and product variants used by the Opponent. In that context, it is quite plausible that consumers who see clothing and apparel bearing the Trade Mark will have cause to wonder whether it might denote an existing MONSTER clothing line or a clothing line relating to a new MONSTER program or product.

    37.     Further, where the reputation of a mark has been extended from one product or area of business activity into another, through the process of ‘brand extension’, this can also increase the likelihood of deception or confusion.[19]I consider the extensive reputation of the Opponent in the energy drink market extends to merchandise sold as part of the overall marketing strategy of the Opponent’s primary goods.

    [19] Aussie Home Loans Ltd v Aussie Loans Pty Ltd [2006] ATMO 75 at [34]; Automobiles Peugeot v Viva Time Corporation (2001) 54 IPR 568 at 582.

16. Having regard to the Opponent’s substantial reputation in its trade marks, the conceptual similarity of the competing trade marks and the widespread use by the Opponent of clothing and apparel for both marketing and for sale as products in their own, I am satisfied that relevant consumers will be caused to wonder if there is some connection between goods bearing the Trade Mark and those for which the Opponent has acquired a reputation under the MONSTER trade marks.

17. Therefore, the Opponent has established a ground of opposition under the provisions of s 60. Having found in favour of the Opponent in terms of s 60 there is no need for me to discuss the other grounds set out in the SGP although this ground or any others in the Act may also be relied on in the event of an appeal from this decision.

    Decision

18. Section 55(1) of the Act applicable to this matter provides:

    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.

19. I have found the opposition to be successful on the ground raised pursuant to section 60 of the Act. I accordingly refuse to register trade mark application number 1859892.

    Costs

    42.     The Opponent has sought an award for costs in its favour. I see no reason to depart from the general rule that costs follow the event. As the Opponent is the successful party, I award costs against the Applicant at the official scale set out in Schedule 8 to the Regulations.

    Jock McDonagh
    Hearing Officer
    Oppositions and Hearings
    Trade Marks and Designs
    15 July 2020