Real Estate Home Loans Pty Ltd v REA Group Ltd
[2019] ATMO 129
•28 August 2019
TRADE MARKS ACT 1995
DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS WITH REASONSRe:Oppositions by Real Estate Home Loans Pty Ltd to registration of trade mark applications 1827083(36) - realestate.com.au Home Loans - and 1852809(36) - realestate.com.au Home Loans Logo - both in the name of REA Group Ltd.
Delegate: Debrett Lyons Representation: Opponent: written submissions only.
Applicant: Natalie Hickey of counsel instructed by Corrs.Decision: 2019 ATMO 129
Trade Marks Act 1995: s 52 oppositions: grounds of opposition under ss 41, 42(b), 44, 60 and 62A pressed in respect of 1827083 – s 41ground of opposition established – opposition successful and trade mark refused registration; grounds of opposition under ss 42(b), 44, 60 and 62A pressed in respect of 1852809 – no grounds of opposition established – opposition unsuccessful and trade mark to proceed to registration.Background
REA Group Ltd (‘Applicant’) is an ASX listed company which has maintained a portal style website resolving from the domain name <realestate.com.au> where real estate agents list and consumers view residential or commercial property.
Real Estate Home Loans Pty Ltd (‘Opponent’) is a real estate mortgage broker based in Ballarat, Victoria. The Opponent owns trade mark 828907 (‘Registration’) registered from 23 March 2000 in class 36 for “insurance; financial affairs; monetary affairs; real estate affairs” for the trade mark shown below:
(‘Opponent’s Mark’)
It is the Applicant’s attempt to register the trade marks detailed below which gave rise to these proceedings. The trade marks had been examined, accepted, and published for possible registration in the Australian Official Journal of Trade Marks. The Opponent then brought oppositions under s 52 of the Trade Marks Act 1995 (‘Act’), first filing Notices of Opposition, followed in each case by a Statement of Grounds and Particulars (‘SGP’). In turn, the Applicant filed Notices of Intention to Defend (‘NID’).
Word Mark Application
Trade Mark: realestate.com.au Home Loans (‘Word Mark’) App. No: 1827083 Services: Class 36: Financial services; insurance services; loan services; provision of information and advice, including online, in relation to financial matters (‘Services’) Priority Date: 21 February 2017 Acceptance Advertised: 13 July 2017 Initial SGP Filed: 4 October 2017 Amended SGP Filed: 19 February 2018 NID Filed: 13 November 2017 Grounds of Opposition: 41, 42(b), 44, 60, 62A
Logo Mark Application
Trade Mark:
(‘Logo Mark’)
App. No: 1852809 Services: As above Priority Date: 19 June 2017 Acceptance Advertised: 16 November 2017 SGP Filed: 6 December 2017 NID Filed: 12 December 2017 Grounds of Opposition: 42(b), 44, 60, 62A
Thereafter the parties filed evidence, detailed below, in accordance with the Trade Mark Regulations 1995 (‘Regulations’).
The Applicant asked to be heard in person and the hearing took place in Canberra on 1 April 2019 where the Applicant was represented by Natalie Hickey of counsel, instructed by Jurgen Bebber, a partner of Corrs, also in attendance. The Opponent asked for a decision to be made based on its written submissions prepared by Davies Collison Cave Pty Ltd.
Evidence
The evidence in these proceedings consists of the following declarations:
Evidence in Support
·Paul Ballinger, Director of the Opponent (‘Ballinger 1’) made 19 February 2018 with Exhibits PB-1 to PB-40 (Exhibits PB-8, PB-9, PB-16 and PB-37 marked ‘Confidential’); and
·Nicholas Patrick Butera, solicitor employed by the Opponent’s representatives (‘Butera 1’) made 19 February 2018 with Exhibits NPB-1 to NPB-8.
Evidence in Answer
·Scott Andrew Holmes, Innovation and Strategy Manager of the Applicant (‘Holmes’) made 18 June 2018 with Exhibits SAH-1 to SAH-29 (Exhibits SAH-21, SAH-25 and SAH-26 marked ‘Confidential’);
·Jurgen Bebber, a Partner at the Applicant’s representatives (‘Bebber’) made 18 June 2018 with Exhibits JB-1 to JB-10 (Exhibit JB-5, JB-7 and JB-8 marked ‘Confidential’)[1]; and
·Eloise Wall, Executive Manager of Financial Experiences of the Applicant (‘Wall’) made 20 June 2018 with Exhibits EW-1 to EW-12 (Exhibit EW-5 marked ‘Confidential’).
[1] Bebber exhibits copies of seven Affidavits filed by the Applicant in the Federal Court matter of REA Group Ltd v Real Estate 1 Ltd (2013) 217 FCR 327 where the Applicant’s trade mark, realestate.com.au, was in suit.
Evidence in Reply
·Paul Ballinger (‘Ballinger 2’) made 27 August 2018 with Exhibits PB-41 to PB-43;
·Glenn Alan Sharp, Director of Sharp Accounting Pty Ltd made 27 August 2018 with Exhibits GAS-1 to GAS-2; and
·Nicholas Patrick Butera made 27 August 2018 with Exhibits NPB-9 to NPB-11.
On 26 September 2018, the Applicant filed a letter with this Office in relation to the Opponent’s Evidence in Reply attaching a Declaration of Tim Guy dated 25 September 2018 which sought to address matters raised in the Evidence in Reply. A dispute arose before the hearing as to the admissibility of that declaration. My findings which follow are independent of the matters raised in the declaration and are dispositive of the oppositions. Nothing in this declaration alters the path of my findings and so it has not been necessary for me to determine admissibility of this declaration as a separate matter.
Grounds of Opposition and Legislative Framework
The SGP filed in relation to application 1827083 for the Word Mark nominated a ground of opposition under the Act based on s 41. That ground was not raised against the Logo Mark and for that and other reasons which will emerge from the consideration of the ground I have dealt with it first.
The Word Mark and Section 41
Section 41 provides a scheme for the assessment of the capacity of a trade mark to distinguish the goods or services of one trader from the similar goods or services of another trader. So far as relevant, it provides that:
41 Trade mark not distinguishing applicant’s goods or services
(1) An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (the designated goods or services) from the goods or services of other persons.
(2) A trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons only if either subsection (3) or (4) applies to the trade mark.
(3) This subsection applies to a trade mark if:
(a) the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons; and
(b) the applicant has not used the trade mark before the filing date in respect of the application to such an extent that the trade mark does in fact distinguish the designated goods or services as being those of the applicant.
(4) This subsection applies to a trade mark if:
(a) the trade mark is, to some extent, but not sufficiently, inherently adapted to distinguish the designated goods or services from the goods or services of other persons; and
(b) the trade mark does not and will not distinguish the designated goods or services as being those of the applicant having regard to the combined effect of the following:
(i) the extent to which the trade mark is inherently adapted to distinguish the goods or services from the goods or services of other persons;
(ii) the use, or intended use, of the trade mark by the applicant;
(iii) any other circumstances.
Note 1: Trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate:
(a) the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; or
(b) the time of production of goods or of the rendering of services.
In its SGP the Opponent particularized its s 41 ground as follows:
The primary elements of the [Word] Mark are the terms ‘real estate’ and ‘home loans’.
§The term ‘real estate’ is defined in the Macquarie Dictionary as ‘property in the form of land, buildings, etc.’; and
§The term ‘home loan’ is defined in the Macquarie Dictionary as ‘a sum of money lent at interest by a bank or other financial institution to someone purchasing a house, apartment, etc’.
This indicates that the [Services] are financial and real estate services in relation to the provision of home loans for the purpose of purchasing real estate.
As the ‘.com.au’ element merely signifies that the [S]ervices are offered by reference to an Australian website, this does not add to the distinctiveness of the [Word Mark], and, as the primary elements of the mark are descriptive, the … mark is not inherently distinctive in relation to the [Services].
…
As the Applicant cannot prove that the [Word] Mark is, or will become, distinctive of the … [Services], the Application should be rejected.
But for the additional words ‘Home Loans’, those arguments have been heard in other cases involving the Applicant which have now been fully determined. Decisions of this Office have issued in the cases of First National Group of Independent Real Estate Agents v REA Group [2016] ATMO 102, Real Estate Institute of Australia & Ors v REA Group [2017] ATMO 82 and Fairfax Digital Australia & New Zealand Pty Ltd and Fairfax Media Limited v REA Group Ltd [2018] ATMO 21 (‘Fairfax’). The Applicant has also been before the Federal Court, resulting in the decision of Bromberg J in REA Group v Real Estate 1 (2013) 217 FCR 327 which is also of relevance in this opposition.
All of those decisions concerned the Applicant’s attempt to register or enforce the trade mark, realestate.com.au. As to the question of whether the Applicant had attained its object of distinguishing its (real estate[2]) services from the services of others by use of the trade mark realestate.com.au, the Fairfax case for example held that:
… the issue is whether other traders might in the ordinary course of their businesses and without any improper motive, desire to use the Trade Mark, or some mark nearly resembling it, upon or in connexion with their own services. I find that they would and so find that the Trade Mark is not to any extent inherently adapted to distinguish the Services from the goods or services of other persons.
[2] More precisely, class 35: Advertising of real estate property services provided through a web portal; class 36: Real estate property services provided through a web portal.
Nevertheless, all three Office decisions cited at [11] rejected the oppositions and ordered registration of the trade mark realestate.com.au. The Fairfax case is again representative of the Office reasoning. It found that:
[w]hilst the Trade Mark does not possess inherent distinctiveness, … the evidence establishes trade mark use to such an extent as to render the Trade Mark distinctive for the Services on the filing date. I am satisfied that the provisions of section 41(6)(a) apply. The ground of opposition under section 41 has not been established.
Therein lies the first point of distinction with the Word Mark before me now. The concluded Office actions all considered s 41 as it stood prior to the amendments to the Act introduced by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012[3]. The Applicant’s trade mark, realestate.com.au, now stands as registration 1486181 carrying an endorsement of acceptance subject to the application of s 41(6)(a) (as it stood). The later filing date of the Work Mark calls for its determination under the current iteration of s 41 which is more generous to the Applicant, making it clear that should there be any doubt as to registrability the decision should favour the Applicant. I have taken that into account.
[3] Section 3, Schedule 6, item 113 substituted a new 41.
Registration 1486181 covers class 35 services, being “[a]dvertising of real estate property services provided through a web portal” and class 36 services, being “[r]eal estate property services provided through a web portal” and therein lies the second point of distinction from the earlier decisions. The Opponent’s submission is that the realestate.com.au trade mark only proceeded to registration for those particular class 35 and 36 services for which extensive use of the mark had been shown and the evidence in these proceedings falls short of proving acquired distinctiveness for the Services now at issue.
The Applicant, for its part, submits that the Examiner correctly found the Word Mark to be inherently adapted to distinguish. The Office records show that the Examiner’s reasoning was that, “The mark is claiming lending services instead of real estate services, therefore removing a direct association with real estate. Not likely that other traders will need to use the tm as a whole”. The Applicant’s additional arguments are, in essence, that;
(i)the first element of the [Word Mark] is a domain name and other traders cannot have a legitimate right to use the domain name because it has already been registered by the Applicant;
(ii)the ‘idea’ of the first element, realestate.com.au, is of an online real estate portal of some kind and that “is narrower than the concept of ‘real estate’ generally”; and
(iii)so, having regard to the totality of the [Word] Mark, the overall impression of ‘realestate.com.au’ in connection with ‘Home Loans’ is of a real estate portal or online ‘shop front’ but which claims lending services instead of real estate services. The mark as a whole does not directly refer to the services offered and carries, at most, an indirect allusion to them.
Furthermore, the Applicant submits that, in any event, the evidence or other circumstances establishes that the Word Mark does or will distinguish the Services.
None of those submissions influence me to accept the Word Mark for registration. In Fairfax it was held that:
… the structure of the Trade Mark [realestate.com.au] is that of Australian country coded top level domain name. The ordinary signification of the Trade Mark from the viewpoint of persons who wish to avail themselves of real estate property services, or the advertising of real estate property services, provided through a web portal, is of an internet address to reach that portal.
The Applicant’s submission that somehow the ‘idea’ of realestate.com.au as an online real estate portal is narrower than “the concept of ‘real estate’ generally” has no appeal to me. To the contrary, I regard that trade mark as so absolutely lacking inherent adaptation to distinguish that when coupled in the Word Mark with the phrase, ‘home loans’, itself wholly descriptive as the Applicant’s own submissions show[4], creates a composite term having only one meaning – in the Opponent’s words – “home loans for the purchase of real estate …, nothing more, nothing less.” The Opponent’s submission is that in Australia there is a long-standing link between real estate and the granting of loans to purchase residential property. That submission is supported by the evidence and also seems intuitively correct to me.
[4] The Applicant cites the following word marks as being on the Register:
§AUSSIE HOME LOANS (515542);
§ACQUIRED HOME LOANS (834779);
§KEY HOME LOANS (841031);
§WIZARD HOME LOANS (917345);
§ASSURED HOME LOANS (1033030);
§DELPHIN HOME LOANS (1040126);
§OXYGEN HOME LOANS (1100973);
§CLARITY HOME LOANS (1154324);
§RAMS HOME LOANS (1185511);
§ANCHORAGE HOME LOANS (1215818);
§RESI HOME LOANS (1353101);
§BLUEGUM HOME LOANS (1391522);
§RESPONSE HOME LOANS (1520884);
§JUNGLE HOME LOANS (1648764);
§FOOTY HOME LOANS (1711008);
§UNO HOME LOANS (1712147);
§RESOLVE HOME LOANS (1772088); and
§NAKED HOME LOANS (1830261).
§
Further, I am in agreement with the Opponent’s submission that the Word Mark is not so syntactically unusual as to lift what are descriptive words to a level of inherent distinctiveness.
The Applicant’s submission that the key distinguishing aspect of the Word Mark is a famous brand to Australian consumers and addition of the words “Home Loans” is therefore the product of the Applicant having “leveraged REA Group’s existing reputation from its real estate advertising business”[5] may influence the outcome of some other cause of complaint, but is of no interest to me in connection with either s 41(3)(a) or (b) and the issue of registrability of the Word Mark in respect of the nominated Services[6].
[5] Wall [30].
[6] See The Chancellor Master & Scholars of the University of Oxford trade as Oxford University Press & Anor v. The Registrar of Trade Marks, (1990) 17 IPR 509 where at 524 Gummow J stated: …a common law mark, even though it would support a passing off action, is not necessarily registrable.
Finally, the argument that since the first element of the Word Mark, realestate.com.au, is a domain name already belonging to the Applicant others cannot have a legitimate desire to use it, is faulty. Whilst it borrows from Kitto J’s judgement in Clark Equipment Co v Registrar of Trade Marks [1964] 111 CLR 511 where it speaks of the legitimate desire of other traders, it overlooks the warning in His Honour’s ‘preamble’ to that often-quoted passage[7] that:
[the] ultimate question must not be misunderstood. It is not whether the mark will be adapted to distinguish the registered owner's goods if it be registered and other persons consequently find themselves precluded from using it. The question is whether the mark, considered quite apart from the effects of registration, is such that by its use the applicant is likely to attain his object of thereby distinguishing his goods from the goods of others.
[7] At [512].
I find that the Word Mark is not to any extent adapted to distinguish the Services from the goods or services of other persons. It is a simple combination of two elements, each of which has no inherent capacity to distinguish the Services, added together in an orderly semantic way. When combined in the Word Mark, they continue to lack any inherent capacity to distinguish the Services.
It follows that any progress the Applicant can make hinges on proof of acquired distinctiveness and given what was just decided, it is only satisfaction of s 41(3)(b) which might advance the registrability of the mark.
Section 41(3) Distinctiveness
Application 1827083 is not the Applicant’s only attempt to register the Word Mark. The first attempt was on 16 August 2004 when it filed application 1016037 in classes 9, 35, 36 and 38. Another attempt was made on 28 September 2006 with application 1137983 in the same classes. Both applications met with now familiar objections[8] and both lapsed. Those applications were broadly contemporaneous with the Applicant’s efforts to offer mortgage broking services[9], an enterprise which entailed for a time a third party licensing arrangement for use of the Word Mark[10] and, later, a referral arrangement to a different third party[11] via a loan comparison tool available from the Applicant’s website.
[8] Butera 1, [23, 27,29] and Ex. NPB-4.
[9] Holmes, [54].
[10] with joint venture partner, Emoca Pty Ltd, (2003 – 11).
[11] with mortgage broking group Australian Finance Group Pty Ltd, (2015 – 17) who also used their “AFG” trade mark in connection therewith.
The evidence is frustrating in its attempt to show with any conviction that the Word Mark had acquired distinctiveness through use. In late 2016 the Applicant engaged an outside agency to conduct certain consumer research[12]. In November 2016, the results were presented and whilst the Applicant has claimed confidentiality in the report itself, other indications in the evidence are that “the realestate.com.au brand” lacked credibility in the financial services space[13]. Thereafter, in September 2017, a “soft launch” took place using the Word Mark again[14], this time in collaboration with one of the big Australian banks.
[12]Wall, [15-28] and Confidential Ann. EW-5.
[13] Id., [27].
[14]Id., [33].
The present application for the Word Mark was filed on 21 February 2017. Section 41(3)(b) takes account only of the extent to which the Word Mark did in fact distinguish the Services at that date. The Opponent’s submission is that the Applicant's evidence is limited and defective, an assessment with which I am in agreement. I find that the Applicant would need to have provided far more compelling evidence (were it available) that the Word Mark had acquired distinctiveness through use in respect of the Services by the priority date. I find the evidence does not satisfy s 41(3)(b). It follows that the Opponent has established a ground of opposition against the Word Mark.
The Logo Mark
What follows of my decision is concerned only with the opposition against the Logo Mark. That said, much of what underpins my decision on the Word Mark has influence on the grounds of opposition, namely, ss 42(b), 44, 60, 62A, pressed in respect of the Logo Mark. With the exception of s 62A, which requires its own discussion, those grounds hinge at least in these proceedings on the question of the likelihood of confusion or deception and much of what has been said of the Word Mark has relevance to the Logo Mark when it comes to answering that question.
I have first compared the relevant trade marks since the Act requires that comparison for the purposes of determining ‘substantial identity’, ‘deceptive similarity’, or some other level of similarity. Set out below are the two marks which require attention. I note in passing here that the Opponent claims (unregistered) rights in a word mark and I will say something of that later.
(Logo Mark) (Opponent’s Mark)
It is when comparing these logo marks that the Opponent makes a series of statements upon which much of this opposition turns. The Opponent:
… recognises that the phrases REAL ESTATE and HOME LOANS are non-distinctive in relation to the … Services, and, in normal circumstances, could be discounted in the relevant analysis. However, in circumstances where descriptive elements form a significant feature of both parties' marks, the Opponent submits that these elements cannot simply be ignored, as to do so would not realistically reflect how consumers would perceive the marks in the marketplace. …
… the Applicant might seek to argue that as the 'essential elements' of the marks are non-distinctive, any confusion should be tolerated as being the consequence of adopting non-distinctive elements. … In respect of [that] argument, the Opponent responds [that] it is to be recalled that the Applicant itself is seeking to register marks the essential elements of which are also non-distinctive — to refuse to find that the marks are … similar for this reason therefore would both effectively ignore the Opponent's trade mark rights in [its] Logo Mark and, more concerning, have the perverse effect of granting the Applicant a monopoly in a descriptive mark.
It is plain for what has gone before that I am in agreement with the statement that the phrases ‘real estate’ and ‘home loans’ are non-distinctive. However, in my assessment there are no abnormal circumstances which should cause me not to completely discount the effect of those words when comparing the two trade marks. I will come very shortly to the relevance of how consumers might perceive the marks when I consider the specific grounds of opposition but, for now, the Opponent’s apprehension that I may accept the argument that confusion should be tolerated in consequence of the parties’ adoption of non-distinctive elements is well founded. In Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (‘Hornsby Building’) Stephen J. observed that:
There is a price to be paid for the advantages flowing from the possession of an eloquently descriptive trade name. Because it is descriptive it is equally applicable to any business of a like kind, its very descriptiveness ensures that it is not distinctive of any particular business and hence its application to other like businesses will not ordinarily mislead the public. In cases of passing off, where it is the wrongful appropriation of the reputation of another or that of his goods that is in question, a plaintiff which uses descriptive words in its trade name will find that quite small differences in a competitor’s trade name will render the latter immune from action (Office Cleaning Services Ltd. v. Westminster Window and General Cleaners Ltd. (1946) 63 RPC 39, at p 42, per Lord Simonds). As his Lordship said (1946) 63 RPC, at p 43, the possibility of blunders by members of the public will always be present when names consist of descriptive words - “So long as descriptive words are used by two traders as part of their respective trade names, it is possible that some members of the public will be confused whatever the differentiating words may be.” The risk of confusion must be accepted, to do otherwise is to give to one who appropriates to himself descriptive words an unfair monopoly in those words and might even deter others from pursuing the occupation which the words describe.
Further, the Opponent’s concern that if the marks were not found to be similar it would be because the Opponent's trade mark rights had been ignored and such a decision would allow the Applicant a monopoly in a descriptive mark, is unwarranted and something which I will address now.
The Opponent’s Mark sits on the register. Whatever tribulations the application for registration may have faced, one thing is clear: the graphic device element of the mark was a major reason for its acceptance. Prior to the Act, the statutory regulation of trade marks was controlled by the Trade Marks Act 1955 (Cth). The current Act brought with it widespread reform and major reshaping of the statute. One change was the abolition of so-called ‘disclaimers’, statements of monopoly that had attached to some registrations, mostly at the Registrar’s insistence. Disclaimers conditioned registrations of marks which included non-distinctive elements in a manner whereby those who inspected the Register might better understand the limitation of the exclusive rights of the owner. The reformers of the law foresaw that another generation of traders and jurisprudentialists would understand for themselves when and where a disclaimer might have once been applied and where the now invisible boundary lay when it came to understanding or enforcing a trade mark registration. In the years that have passed since the passage of the Act, that has not always been so.
The Opponent’s submission demonstrates the fallacy that the Logo Mark, were it registered, would grant the Applicant exclusive rights in the phrases, ‘real estate’ and ‘home loans’. Were registration 828907 for the Opponent’s Mark made under the former legislation it would inevitably have carried a disclaimer to the effect: “registration of this trade mark gives no exclusive rights in the words ‘real estate’ or the words ‘home loans’ other than as shown in the trade mark” - in other words, other than as shown in combination with the device element. The same disclaimer would have been applied to the Applicant’s Logo Mark had it been applied for and registered under the repealed legislation. The Act should be understood in the same way – no monopoly would be given in the, admittedly, non-distinctive features.
It will now be seen how these observations influence the grounds of opposition.
Section 44
Section 44 of the Act provides, relevantly:
44Identical etc. trade marks
(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.
The Opponent relies on its Registration in class 36 for “insurance; financial affairs; monetary affairs; real estate affairs” with a priority date of 23 March 2000. That date is earlier than the priority date of the Logo Mark and it only remains for me to decide whether the Services are similar to the services covered by the Registration, and if so, whether the Logo Mark is substantially identical or deceptively similar to the Opponent’s Mark.
The expression “similar services” is defined in s 14(2) of the Act as services that are the same as other services or of the same description as that of other services. Since the Registration covers “financial affairs” and the Logo Mark includes “financial services” the services are similar within the meaning of the Act.
In considering whether the marks are substantially identical they must be compared “side by side, their similarities and differences noted and the importance of these assessed having regard to the essential feature of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison.” (per Windeyer J. in The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd, (1963) 109 CLR 407 (‘Shell’) at 414).
The assessment of substantial identity has occupied the Federal Court’s attention in recent times and although it seemed that the identification of “dominant cognitive cues” may have momentarily replaced Shell’s search for “essential features”, matters have now settled to an appreciation of those terms as analogical. As it happens, these proceedings present me with a comparison where the expression “dominant cognitive cues” may be a more intuitive way to identify the similarities and differences of the marks. I find those cues to lie exclusively with the device component of each mark. Those devices are very different and I so find that the Logo Mark and the Opponent’s Mark are not substantially identical.
In Shell at [35] Windeyer J approved of what Lord Radcliffe had said[15] regarding ‘deceptive similarity’, to the effect that marks are remembered rather by general impressions or by some significant detail than by any photographic recollection of the whole. Here, that remembrance is what is left by the two, very different device elements. Allowance made for that familiar caveat of ‘imperfect recollection’ is, in my view, excessively counterbalanced by the care which a prospective seeker of any financial assistance, let alone the burden of a home mortgage, would take when comparing the signs used by competitive service providers.
[15] de Cordova v. Vick Chemical Co (1951) 68 RPC, at p 106.
Other mainstay tests, such as the spoken description of the compared marks, fail to assist the Opponent in any way since those same customers, astute to their financial needs, could barely be supposed to proceed on no more than naked, descriptive words.
In my assessment, there is nothing close to a real tangible danger of deception or confusion. Notwithstanding the facile attraction of the Opponent’s arguments that relevant consumers would be confused by the parties’ use of a collocation of phrases of natural interest to them, it is my conclusion that the public would not so easily be misled or deceived and that they would in fact be more than usually astute to the provenance of the services.
I find that the compared marks are not deceptively similar. With that finding I do not need to consider the Applicant’s further argument of entitlement to registration under either ss 44(3)(a) or 44(4) of the Act. Those submissions, however, lead me on to how the marks might be compared under s 60.
Section 60
Section 60 of the Act is reproduced below:
Trade mark similar to trade mark that has acquired a reputation in Australia
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.
In order to establish s 60 the Opponent must demonstrate that at the priority date, 19 June 2017, another trade mark had acquired a reputation amongst a significant number of persons in Australia such that use of the Logo Mark would be likely to deceive or cause confusion.
The Opponent is based in Ballarat, Victoria, from where it has operated a mortgage brokerage providing home loans, mortgage refinancing services and associated financial and insurance services.[16] The business started in March 2000[17] and either directly, or through independent contractors, has at one time or another provided those services in Melbourne, Bendigo, Colac, Albury, Tasmania and Queensland.[18] Due to personal circumstances affecting the principal of the business, Mr Ballinger, between 2011 and 2013, the Opponent’s clients were referred to other brokers[19]. Thereafter it seems business has been concentrated in Victoria and at the priority date the Opponent claims to have established a reputation in Ballarat and Western Victoria which, for the purposes of s 60, it says is enough for a reputation in Australia[20].
[16] Ballinger 1, [7].
[17]Id., [12].
[18]Id., [14, 15].
[19]Id., [17 - 19].
[20]Following Pham Global (2017) 251 FCR 379, [61], [81].
In support of these claims there are confidential sales and promotional figures, together with examples of local radio advertising[21], newspaper advertisements[22], a website[23] and printed business material and paraphernalia[24]. The Opponent submits that these materials and this promotion reached a catchment audience of 200,000 people in one way or another.
[21]Ballinger 1, [43 - 50] and Exs. PB-17 to PB-24.
[22]Id., [12], [52 - 57] and Exs. PB-2 and PB-25
[23]Ballinger 1, [35]–[38] and Exs. PB-10 to PB-13.
[24]Id., [25]–[26] and Exs. PB-6 and PB-7.
The Opponent’s SGP in relation to the Logo Mark states that:
The Opponent has, and as at the Priority Date had, a substantial reputation in its REHL Trade Marks as a result of the use and promotion of these marks by the Opponent in relation to the Opponent’s Services [defined previously as ‘mortgage broking and finance broking generally, including in relation to home loans and insurance’]. The Opponent’s reputation derives from the continuous use and promotion of the REHL Trade Marks in Australia since at least as [early as] 2000 in relation to the Opponent’s Services.
As a result, the use of the Applicant’s Mark [] for the Applicant’s Services would be likely to cause confusion (including initial interest confusion). The possibility of consumers being misled or deceived is heightened in this case given that the Applicant’s Mark consists of a combination of REAL ESTATE, HOME LOANS and a house device, thereby replicating the features of the REHL Logo Mark.
Something must first be said of the term, ‘REHL Trade Marks’, which the Opponent has defined and used throughout its submissions. It includes the Opponent’s Mark and also what is claimed to be a common law word mark, REAL ESTATE HOME LOANS. I have alluded to it before and now the time has come for me to find that the scant evidence of its use, coupled with – to say it again – the absolute lack of inherent capacity of that expression to operate as a badge of origin, lays waste to any claim to trade mark rights. For the purposes of s 60, and anywhere else in this decision where some ambiguity might possibly exist, I find that the only mark for comparison purposes is the Opponent’s Mark.
That said, I am on the evidence prepared to find that at the priority date, the Opponent’s Mark had a modest reputation in respect of mortgage brokering services for residential properties. Were it not plain already, where I take issue with the SGP is in relation to the assertion that “the [Logo] Mark consists of a combination of REAL ESTATE, HOME LOANS and a house device, thereby replicating the features of the [Opponent’s] Mark” in a way likely to cause confusion or deception.
I have found that the compared marks are neither substantially identical nor deceptively similar. The claimed ‘replication’ does not interest me when I come to the critical issue of whether or not there is a likelihood of confusion or deception for the reason expressed in the Hornsby Building case. Not only will the Opponent find the public astute to “quite small differences in a competitor’s trade name”, but as Stephen J discerned, so long as descriptive words are used by two traders some members of public will always be confused and that cause of that confusion cannot be placed elsewhere. In my assessment, the Opponent’s evidence of actual confusion exemplifies this point[25].
[25]See also Pottle Productions Inc v Rute Ithalat Ve Ihracat Anonim Sirketi [2012] ATMO 12, [40] where it was held that s 60 required consideration of “the strength of the reputation of the Opponent’s trade mark(s), the inherent distinctiveness thereof, the degree of similarity between the trade marks”.
Section 60(b) requires that because of the reputation of the Opponent’s Mark, the use of the Logo Mark would be likely to deceive or cause confusion. What I have found is that any confusion or deception – likely or actual – would not be the result of that reputation. For these reasons, the Opponent has not established a ground of opposition under s 60.
Section 42(b)
Section 42(b) of the Act is reproduced below:
42 Trade mark scandalous or its use contrary to law
An application for the registration of a trade mark must be rejected if:
(a) …
(b) its use would be contrary to law.
As with all grounds of opposition, the onus of proof rests with the Opponent and in that regard the case law on s 42(b) requires it to show that use of the Logo Mark would be, rather than could or might be, contrary to law.[26]
[26] Advantage Rent-a-Car Inc v Advantage Car Rental Pty Ltd [2001] FCA 683.
The SGP states, so far as relevant, that:
Given the goodwill and reputation accrued by the Opponent in the REHL Trade Marks in relation to the Opponent's Services, the use of the Applicant’s Logo Mark … would be likely to cause consumers to be misled or deceived, as, amongst other things, it would wrongly suggest:
·a connection in trade between the Applicant and the Opponent;
·that the Applicant and the Opponent have entered into an arrangement or understanding regarding the provision of the Applicant's Services to third parties; and/or
·that the Applicant's Services are being provided with the licence, permission, sponsorship or approval of the Opponent.
As a result, use by the Applicant of the Applicant's Mark in relation to the Applicant's Services would constitute:
·misleading and deceptive conduct contrary to s 18 of the Australian Consumer Law (being Schedule 2 to the Competition and Consumer Act 2010 (Cth) (‘ACL’);
·the making of false statements contrary to s 29 of the ACL; and/or
·the tort of passing off.
Little more need be said in relation to this ground of opposition. The passage from the Hornsby Building case to which I have referred twice already expressly contemplated the law of passing off. There is no relevant misrepresentation that would support that claim. Section 18 of the Australian Consumer Law[27] (‘ACL’) is concerned with misleading or deceptive conduct. I have found that the Opponent failed to establish a ground of opposition under s 60 of the Act and the case law relevant to the ACL has made plain that s 18 imposes a more stringent test than that for deception or confusion under s 60.[28] Further, the alleged breaches of ss 29(1)(g) and (h) of the ACL can also be dismissed since it has been held that where a trade mark does not offend s 18 of the ACL, neither will it offend s 29 of the ACL[29].
[27] Schedule 2 to the Competition and Consumer Act 2010 (Cth).
[28] See, for example, Ownit Homes Pty Ltd v Ownit Conveyancing Pty Ltd [2005] ATMO 47, [36]; Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191, 198 (Gibbs CJ).
[29] In Pacific Publications Pty Ltd v IPC Media Pty Ltd, Beaumont J considered - in connection with the superseded Trade Practices Act1974 (‘TPA’)—that ‘the Court’s conclusion on s 52 would necessarily carry with it a conclusion on s 53(c) and (d)’. Sections 53(c) and 53(d) of the TPA are the equivalent provisions to ss 29(1)(g) and 29(1)(h) of the ACL.
I am not satisfied that use of the Logo Mark would be contrary to law and accordingly the Opponent has failed to establish this ground of opposition.
Section 62A
Section 62A of the Act is reproduced below:
62A Application made in bad faith
The registration of a trade mark may be opposed on the ground that the application was made in bad faith.
The Opponent particularised this ground of opposition as follows:
In or around 2004, when the Applicant applied to register a similar mark to the [Word] Mark for the …Services, the Opponent put the Applicant on notice of its prior rights in the REHL Trade Marks… .
Despite being in full awareness of the Opponent's rights (including the reputation that the Opponent possessed in the REHL Trade Marks and its prior use of those marks for services the same or similar to those proposed to be offered by the Applicant), the Applicant nevertheless proceeded to file the Application.
The Applicant's conduct in filing the Application:
(a) in the knowledge of, and without adequate regard to, the Opponent's prior rights; and
(b) without conducting adequate or appropriate searches (including to determine whether the similar REHL Trade Marks remained in use by the Opponent);
is conduct that falls short of the standard of reasonable commercial behaviour.
It is said that the allegation of bad faith is a serious matter[30]. Determination of bad faith involves both a subjective and objective assessment of the Applicant’s state of mind[31]; what did the Applicant know at the filing date of its application and, in view of that knowledge, did the Applicant’s decision to apply for the Logo Mark display behaviour falling short of acceptable commercial standards.[32] Here the complaint is that there was correspondence, albeit inconclusive, between the parties’ then legal representatives concerning rightful use of trade marks long before the present application for the Logo Mark and, with knowledge of that unresolves dispute, the Applicant made the application in bad faith indifferent to the Opponent’s registered and reputational rights.
[30] Hard Coffee Pty Ltd v Hard Coffee Main Beach Pty Ltd [2009] ATMO 26, [12].
[31]Fry Consulting Pty Ltd v Sports Warehouse Inc (No. 2) [2012] FCA 81, [45] (‘Fry Consulting’); DC Comics v Cheqout Pty Ltd [2013] FCA 478, [62].
[32]Fry Consulting [2012] FCA 81, [145].
Very few of the facts are in dispute and it is for me only to characterise the Applicant’s behaviour. The Explanatory Memorandum to the Trade Marks Amendment Bill 2006 gave examples of opportunistic behaviour borrowed from older cases[33], none of any real guidance to me here. The generalisation from the Courts has been that “the concept of bad faith imports conduct which, irrespective of the form it takes, is of an unscrupulous, underhand or unconscientious character”[34]. Examples of bad faith conduct are not finite. They may be as simple as breach of a contractual promise not to apply to register a certain mark, or a ‘spoiler’ application filed only to frustrate a competitor’s passage to registration[35]. However, expectation has met experience since it has been more common to see claims based on an inference that the use of the impugned trade mark was intended to gain some unfair benefit or advantage, usually but not necessarily, over an opponent.
[33]- persons who monitor new property developments, register the names of new developments as trade marks for a number of services and then threaten the property developers with trade mark infringement proceedings unless the developers licence or buy the trade marks;
- persons who have a history of applying for trade marks that are deliberate misspellings of other registered trade marks;
- persons who identify trade marks used overseas but with no Australian use as yet who then apply to register the trade marks in Australia for the express purpose of selling them to the overseas owners.
[34] Fry Consulting, [165]-[166].
[35] Although s 59 might dispose of that as well.
What I have already decided determines the issue of bad faith in this case. Even if the parties were squarely competitors in business in the same space for mortgage lending services, neither could exert a monopoly over “real estate” or “home loans”, either used separately or together. I cannot conclude that the decision of the Applicant to adopt and seek to register the Logo Mark, containing the phrases “real estate” or “home loans”, was a decision made to take advantage of the Opponent in some way, rather than a decision to use those phrases (as part of the Logo Mark) for their normal and natural meanings in respect of the Services. I am not satisfied that the Applicant’s conduct in filing the application for the Logo Mark was unscrupulous, underhanded or unconscientious in character. Consequently, I find that the Opponent has failed to establish the ground of opposition under s 62A.
Decision
Section 55 (1) of the Act provides:
(1) Unless subsection (3) applies to the proceedings, 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.
The Opponent has established a ground of opposition under the Act with respect to trade mark application 1827083 and so registration is refused.
The Opponent has not established a ground of opposition with respect to trade mark application 1852809 which may 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 either the appeal is withdrawn or a court so orders.
Costs
Both parties sought their costs in respect of each opposition. Each party has been successful in one opposition and unsuccessful in the other. The matters proceeded on essentially the same evidence and so in these cases I make no award of costs.
Debrett Lyons
Hearings Officer
Trade Marks Hearings
28 August 2019
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