Re Woolworths Limited

[1998] ATMO 11

TRADE MARKS ACT 1995

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

RE:     Trade Mark Application 675941 in the name of WOOLWORTHS LIMITED.

Background

On 23rd October, 1995 the above-named applicant lodged an application to register the composite trade mark as shown below in Part A of the Register (under the Trade Marks Act 1955) in respect of “Retailing and wholesaling services in the nature of supermarkets, department stores, variety stores, boutiques, speciality products stores, liquor outlets and discount stores” in Class 42. As the Trade Marks Act 1995 had come into force by the time this application reached examination, it was examined under the provisions of the new Act. A representation of the trade mark is included below.

In her first report on the application, the examiner of trade marks raised grounds for rejecting the application in terms of section 44 of the 1995 Act that the trade mark is substantially identical with, or deceptively similar to 22 registered marks and a further eight pending applications. These 30 cited trade marks all consisted of, or contained the word METRO. After the attorney made her written submissions, a number of the citations were withdrawn as being grounds for rejection. Some further pending applications had either lapsed or been withdrawn, with the result that 14 citations were maintained.

At the conclusion of her third report, the examiner suggested that the submission of evidence of honest concurrent use might produce a possible solution to the difficulty. After a request for an extension of time for acceptance, the attorney representing the applicant then requested to be heard in the matter.

The citations involving goods and the trade mark METRO solus were registration numbers:
(1) 118826(29) for “meat of all kinds”, (2) 125864(25) for various items of men’s, women’s and children’s clothing, (3) 324972(29) for “meat, fish, poultry and game including smallgoods”, (4) 333908(21) for “...all types of apparatus for watering and sprinkling ...”, (5) 335853(11) for “light fittings for street lighting or for domestic purposes but not ... for vehicles”, (6) 379183(30) for “confectionery”, (7) 432127(16) for “plastic desk top articles in this class”, (8) 500092(34) for “all goods in class 34”, (9) 510623(20) for “chairs”, (10) 511418(28) for “games, toys and playthings ... not including scooters ... or exercise bicycles”, (11) 586231(16) for “newspapers including newspaper supplements” and (12) 616481(21) for “combs and hair brushes”.

Also cited were registration number 400909(12) for “bicycles and tricycles and parts and accessories ...but not including pneumatic tyres or tubes ...” covering the mark METRO 22, and the only METRO services trade mark, application number 668454(42), initially filed for “lodging and boarding services and distribution of goods of all types”. This specification is dealt with in greater detail in later comments.

The matter came before me, as a delegate of the Registrar, in Sydney on 30 September 1997.

Submissions

The applicant was represented by Ms. Kate Johnston, of Spruson & Ferguson, who in her submissions argued that the applicant’s trade mark was not substantially identical with, nor deceptively similar to the cited marks. She argued that the trade mark consisted of two words WOOLWORTHS and METRO, whereas the cited trade marks consisted of one word. Additionally, WOOLWORTHS was a very well-known registered mark in relation to the services covered by this registration. METRO, she submitted, was a descriptive word in relation to services supplied through a city store, being an abbreviation for the word “metropolitan”. Ms. Johnston also stated that because of the inclusion of the word WOOLWORTHS in the present mark, it was not substantially identical to any of the cited marks. In considering whether the trade mark is deceptively similar to any of the cited marks, she submitted, the surrounding circumstances incorporating the inclusion of the word WOOLWORTHS in the present mark and the nature of the services provided should be considered. The attorney commented that the applicant would be using the trade mark in connection with services provided in the metropolitan area. Ms. Johnston chose to deal with the question of whether the services provided by the applicant were closely related to the goods of all of the citations which involved goods, at the one time. She submitted that if the present services were held to be closely related to the goods of the cited marks then, by definition, it would not be possible to get a registration for retailing services if the applied for trade mark was the same or close to another trade mark in any goods classes, on the basis that the retailer might be selling the goods.

Ms. Johnston argued that the applicant is providing specialist retailing services and is not using the mark on goods at all. She said that if the applicant’s services are held to be closely related to the goods of the cited marks because the goods are sold in the store, then by logical extension, the goods trade marks themselves should not be able to co-exist. She said that, clearly, as sale of goods “side by side” is only one test for closely related goods and services and has not prevented co-existence of the goods trade marks themselves, it should also be only one of the tests by which this matter is decided. She submitted, in relation to the citations which involved goods being closely related to the applicant’s services, that the present services bore no direct relationship to the goods, as required in the examples outlined by Lockhart J. in Caterpillar Loader Hire (Holdings) Pty Ltd. v.Caterpillar Tractor Co. (1983) 1 IPR 265 at 276.

Ms. Johnston submitted that the only service trade mark cited against this application, application number 668454, was pending and that the “distribution” services claimed were ambiguous. She said that it would appear not to be intended to cover retail or wholesale services or this would have been stated in the specification. She said that, even if the services were of the same description, the submissions in relation to substantially identical and deceptively similar trade marks should be sufficient to enable co-existence.

Ms. Johnston made other submissions which were offers to amend the specification of services to apply only to the metropolitan area and also to disclaim the word METRO, if necessary, to enable the application to proceed to acceptance.

Subsequent to the hearing, Ms. Johnston drew my attention to the registration of trade mark number 675179 in class 42 with a specification which includes “department stores and supermarkets” for the mark METRO with a device element, and also to the recent acceptance of trade mark number 668454 in class 42 with a specification of “distribution of the following goods ...” for the word mark METRO. Acceptance of 675179 and the later co-existence of 668454, in her view, opened the question of the validity of the citations on the present trade mark. I will deal with this matter in the course of the following discussion.

Discussion

The matter for decision in this instance is whether the present application falls foul of section 44 of the Trade Marks Act 1995, specifically sub-section 44(2), which reads:

(2) Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant's trade mark) in respect of services (applicant's services) must be rejected if:

(a) it is substantially identical with, or deceptively similar to:

(i) a trade mark registered by another person in respect of similar services or closely related        goods; or

(ii) a trade mark whose registration in respect of similar services or closely related goods is         being sought by another person; and

(b) the priority date for the registration of the applicant's trade mark in respect of the       applicant's services is not earlier than the priority date for the registration of the other trade mark in          respect of the similar services or closely related goods.

As the examiner had maintained that the trade mark was deceptively similar to the 14 cited trade marks, the question of substantial identity was not raised as a ground for rejection in the third examiner’s report.

On the question of deceptive similarity I must first turn to the tests described in Australian Woollen Mills Ltd. v. F. S. Walton & Co. Ltd. (1937) 58 CLR 641 at 658:

In deciding this question, the marks ought not, of course, to be compared side by side. An attempt should be made to estimate the effect or impression produced on the mind of potential customers by the mark or device for which the protection of an injunction is sought. The impression or recollection which is carried away and retained is necessarily the basis of any mistaken belief that the challenged mark or device is the same. The effect of spoken description must be considered. If a mark is in fact or from its nature likely to be the source of some name or verbal description by which buyers will express their desire to have the goods, their similarities both of sound and of meaning may play an important part. The usual manner in which ordinary people behave must be the test of what confusion or deception may be expected. Potential buyers of goods are not to be credited with any high perception or habitual caution. On the other hand, exceptional carelessness or stupidity may be disregarded. The course of business and the way in which the particular class of goods are sold gives, it may be said, the setting, and the habits and observation of men considered in the mass affords the standard. Evidence of actual cases of deception, if forthcoming, is of great weight.

For a consideration of the principles involved for deceptive similarity of trade marks, where one trade mark is encompassed within another, as is the present case, almost all of the tests listed above must be considered. No single general principle can determine whether or not the trade marks are deceptively similar.

One test outlined in Australian Woollen Mills, supra, considers “the course of business and the way in which the particular class of goods are sold gives, it may be said, the setting”. In this regard the modern practice of the use of housemarks and individual product marks on some lines of goods, especially by large multi-national companies is, in my opinion, extremely common. Use by the applicant of the WOOLWORTHS METRO mark to identify its retail services could very easily be seen as use involving a line of METRO goods in conjunction with their well known WOOLWORTHS trade mark.

Given that some of the goods of all 13 cited trade marks which involve goods could be sold in Woolworths stores, I must conclude that “the course of business and the way in which the particular class of goods are sold” namely, involving the use of housemarks, would indicate that, in this instance, the goods provided under any one of the 13 cited METRO trade marks would be seen, by the ordinary purchaser, to be from the same trade source as the retail services supplied under the WOOLWORTHS METRO trade mark.

Although the service of retailing can be seen to be readily linked to the individual goods items within a store, because the retailer’s trade mark is used in connection with all of the goods in the store, this does not mean to say that the individual goods need to have any direct connection. The tests for goods v. goods as being similar for the purposes of s.44(1) and the tests for goods v. services being closely related for the purposes of s.44(2) are not always parallel. The general use made of housemarks in connection with retailing services elevates the comparison of retail services v. goods onto a level that is quite different from the comparison of goods v. goods. Purchasers might not believe the METRO trade mark found on, say, meat products and on clothing in the same supermarket had the same trade source - unless that source was in connection with the retailing services of all of the goods delivered in the one store. Thus any consideration of whether the actual trade marks WOOLWORTHS METRO and METRO are deceptively similar is, in essence, dependent upon how the trade marks are used in the market-place.

It is important to note that the 13 cited trade marks with the goods specifications can co-exist for the word METRO, because none fall foul of the standard tests for “similar goods”, which would prevent the METRO trade mark being registered in the name of the several different proprietors.

In coming to a decision on the deceptive similarity of trade marks where one is used on goods and the other in connection with a service, the practicalities of how the trade marks are, or would be, used must be considered. This corresponds closely with the test that “the course of business and the way in which the particular class of goods are sold gives, it may be said, the setting.” (Australian Woollen Mills supra)  It might be possible to imagine situations where a purchaser of goods would not be deceived or confused that the goods came from the same source as a service which uses the goods simply because of practical impossibility. For instance, a small business rural roadmaker would not be seen as the manufacturer of a road grader simply because the goods were used to provide the services. In the present situation, however, it could well be the case that a consumer walking into a supermarket or store displaying the signage WOOLWORTHS METRO, on finding items displaying the trade mark METRO on the shelves, would make the assumption that these goods were the applicant’s.

Although Ms. Johnston argued that the trade marks were not deceptively similar, on the basis that the present mark consisted of two words and the cited marks each of one word, I do not believe this point is persuasive when it is common for traders to use housemarks (which in this instance could be WOOLWORTHS) together with a mark indicating a specific product line (METRO). Ms. Johnston has argued that WOOLWORTHS is a well-known registered trade mark for the services of the application and, thus, no confusion would occur because the general public would readily recognise who was providing the services. That the general public would believe that Woolworths Ltd supplied the services, I must agree. I believe that the real source of difficulty, however, is that the general public would also believe that Woolworths Ltd provided the goods displaying the METRO trade mark for the reasons discussed in the preceding paragraphs.

The attorney, in her submissions, further argued that the present mark was not deceptively similar to the cited marks on the basis that WOOLWORTHS is a well known trade mark and METRO for the applicant’s retail services is descriptive of the intention to use the trade mark in “metropolitan” areas. However, for the reason outlined above involving housemarks and product marks, I do not believe that use of the two words together as a trade mark would remove the likelihood of deception and confusion. In addition, use of the word METRO, in Australia, does not have a clear single meaning for the general population. The Oxford English Dictionary 2nd Edition lists three meanings for METRO being:

(1) metre (obs.), (2) The Metropolitan Underground Railway of Paris (usu. in form métro). Hence applied to the underground railway in other countries. (Applied to London trains metro is an abbreviation of metropolitan rather than a use in English of F. métro.), and (3) Canad. The Metropolitan area of Toronto and other Canadian cities.

In addition, the Macquarie Dictionary lists two meanings as follows:

-n.  1. an underground railway system in certain cities, esp. Paris.
 -adj.  2. inner-city: this bus does the metro run.

Therefore, use of the word “metro”, standing alone, to the Australian public, could reasonably mean “an underground rail system” (especially for the movie buffs among the population who view European films), “an inner city bus run”, an abbreviation for “metropolitan” or possibly even an abbreviation for “metropolis”. However, in a trade mark context, I do not believe that many “average persons” would instantly infer “metropolitan” from METRO any more so than the other options. For this reason I do not believe that WOOLWORTHS METRO as a trade mark would be inferred as a metropolitan store of the Woolworths Ltd. chain. I cannot accept that Ms. Johnston’s argument in this regard is sufficiently persuasive to say that the word METRO is a description common to the trade and that all traders have a right to use the word. Even if that word could be seen as descriptive of the services provided in a metropolitan store, the fact that the cited marks are METRO solus would still produce a major problem of possible deception and confusion for the average purchaser.

Despite the applicant’s offer to disclaim the word METRO in the present mark and/or to amend the specification of services to apply to the metropolitan area only, as it could have a descriptive connotation for the services, I do not consider either offer could overcome the possibility of deception or confusion occurring. In this regard, I turn to the words of Mr. D. Shanahan in his publication Australian Law of Trade Marks and Passing Off (2nd Edition) at p.221 where he states:

However, under s. 33 .... (The) Registrar is concerned only to ascertain whether the marks are substantially identical or deceptively similar and not with the limits of the proprietor's statutory monopoly, and may therefore regard two marks as being in conflict even where they correspond only in some element that has been disclaimed in the prior mark.

(This comment was made concerning the Trade Marks Act 1955 and s. 33 (1) and (2) of that Act, which are substantially identical with s. 44 (1) and (2) of the 1995 Act.)

Thus, I am led to the conclusion that all 13 METRO trade marks with goods specifications are deceptively similar to the present WOOLWORTHS METRO mark for retailing and wholesaling services.

One point of argument in response to the examiner’s second report was not further expanded at the hearing. This dealt with registration of trade marks containing a common element and the applicant’s attorney, in her written submissions to the examiner’s report, pointed to the case of Dial an Angel Pty Ltd v. Sagitaur Services Systems Pty Ltd 19 IPR 171 where GUARDIAN ANGEL was held not to infringe DIAL-AN-ANGEL. In a decision of this Office reported at 1995 AIPC 91-177, Hearing Officer Homann considered a similar issue. (Tecmo Kabushiki Kaisha v. Tokyo Denki Kabushiki Kaisha) In that decision, the Hearing Officer commented that a delegate of the Registrar was not entitled to speculate on whether a court would find that the use of the applicant’s mark would be an infringement of the opponent’s mark, or to decide that it would be. As such, it would be improper for a delegate to apply the reasoning in the Bubble Up case, Seven-Up Co. v. Bubble Up Co. Inc. (1987) AIPC 90-433, which was a decision involving a consideration of substantial identity and deceptive similarity of two marks in an infringement action. I do not intend to apply reasoning concerning deceptive similarity and substantial identity from the Dial an Angel infringement case (supra) for similar reasons.

Having decided that the present mark, WOOLWORTHS METRO is deceptively similar to METRO I must now consider whether the goods of these 13 cited trade marks are “closely related” to the services of the present mark as required by s. 44 of the Act if a valid ground for rejection for the application is to exist.

As service trade marks were only introduced from the time of The Trade Marks AmendmentAct1978 there is, understandably a smaller body of law available offering a consideration of what constitutes “closely related” goods and services than that available to compare “similar” goods. However, some principles have been developed to allow comparison. In one decided case, confectionery has been found to be closely related to restaurant, take-away and retail food services (Rowntree plc v. Rollbits Pty Ltd [1988] 10 IPR 539). Also, in an address given to the Victorian Industrial Property Society at the time service marks were introduced the then Registrar, Mr. F. J. Smith, commented:

The relationship would have to be close, not merely a tenuous or remote connection. Where the services are performed upon, or in relation to, or even by means of, certain goods, this is a factor which would make deception or confusion between marks used in respect of those services and goods more likely.

In the present circumstances, the wholesale and retail services are offered in relation to the goods, or by means of the goods. If goods were not available to be sold, the services of wholesaling and retailing could not exist alone. I do not consider the connection between the goods and the services to be remote by any means. Nor can I see that the nature of the particular services is such that this would make it unlikely that the consumer would fail to make such a connection, as in my previous example of the hypothetical case of the small business rural road maker being unlikely to manufacture road graders, despite a close connection between the delivery of the road making services and the goods.

Following consideration of the goods of the cited registrations, as listed at paragraph four of these reasons, I note that each registration contains goods which are available through retail and wholesale stores. In particular, they are sold through supermarkets, department stores, variety stores, boutiques, speciality products stores, liquor outlets and discount stores. The retail and wholesale services could therefore be “performed on, or performed in relation to or performed by means of” the cited goods. Consequently, I hold that retail and wholesale services are closely related to the goods of the cited marks. Thus, I find on the basis of the 13 goods citations that this application must be rejected in terms of s. 44(2).

In coming to my decision, I have not, until now, had regard to the cited service trade mark 668454 in Class 42 for the word METRO displayed in normal upper case type script. At the time of the hearing, this trade mark was pending with a rather ambiguous statement of services. The attorney submitted that she believed that the trade marks were not deceptively similar but could say little concerning the similarity or otherwise of the services offered because of the difficulty in understanding exactly what were the cited applicant’s services of interest. The statement of services for this mark, at acceptance, now reads: Distribution of the following goods:  ....thereafter follows a list of some goods from almost all goods classes. The nature of “distribution services” is open to some interpretation, but clearly it is a service involving the distribution of goods.

I must, of course, consider nominal use of possible services that could come under that description. One definition of “distribution” contained in the Macmillan Dictionary of Marketing and Advertising by Michael J. Baker (Macmillan Press 1985) reads, “a general term which includes every function concerned with the transference of goods from the point of origin until they come into possession of the final buyer. It includes transportation, storage, merchandising, promotion, selling and packaging”. The CCH Macquarie Dictionary of Business (Macquarie Library 1993) defines “distributor = wholesaler”.  Given the cited application was lodged under the 1955 Act in class 42, a distributorship could be wide enough to include wholesaling services. The present application, of course, directly specifies “wholesaling services” as part of the statement of services. I believe that this is a service similar to the cited mark 668454.

Similarly to the discussion above involving the 13 “goods citations” I also find the trade mark WOOLWORTHS METRO is deceptively similar to METRO in this instance, particularly due to the prevalence of trade mark owners using two trade marks in conjunction in some instances and making separate use of their marks in others.

Thus, I find that the present application must also be rejected in terms of s. 44(2) on the basis of the citation of the service trade mark 668454. I have found the two trade marks are deceptively similar, and their respective services also to be similar.

In relation to the matter of the registration of trade mark number 675179 and the later acceptance of 668454 raised by Ms. Johnston subsequent to the hearing, as I am not aware of all of the circumstances which led to those acceptances, I can only comment directly on their bearing in relation to the present application. Firstly, 675179 was initially raised as a citation on this mark, but the citation was later withdrawn because the two trade marks were found to be too dissimilar. Secondly, 668454 was maintained as a citation on the present mark and, I believe, continues to be a barrier to this application proceeding.

I am of the opinion that every application should be treated according to its own suitability to be placed on the Register. This includes such factors as use in the market-place, proven reputation and many other circumstances including the state of the Register. However, when the state of the Register is a consideration, then that consideration is influenced by a responsibility to ensure that any precedent which is followed is in accordance with the law.

These thoughts are support by the words of Jacob J. in British Sugar plc v.James Robertson & Sons Ltd. [1996] R.P.C. 281 (the Treats decision) where he said at 305:

“In particular the state of the register does not tell you what is actually happening out in the market and in any event one has no idea what the circumstances were which led the registrar to put the marks concerned on the register. It has long been held under the old Act that comparison with other marks on the register is in principle irrelevant when considering a particular mark tendered for registration, .......I disregard the state of the register evidence.”

Thus the state of the Register is not a ruling.

Conclusion

From the foregoing, as I have found that the present application falls foul of s. 44(2) in respect of 13 registered trade marks and one accepted trade mark, I refuse this application for registration.

Don Nancarrow
Senior Examiner

17 April 1998.