Sanofi-Aventis v Alphapharm Pty Ltd

[2008] ATMO 56

TRADE MARKS ACT 1995

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

Re:Opposition by Sanofi-Aventis to registration of trade mark application 1107103(5) - SOMIDEM - filed in the name of Alphapharm Pty Ltd.

Delegate:

Iain Thompson

Representation:

Opponent Written submissions by Nathan Sinclair of Shelston IP

Applicant Carmen Champion, counsel, instructed by FB Rice & Co

Decision:

2008 ATMO 56

Section 52 proceedings – section 41, alleged similarity of trade mark to International Nonproprietory Name – signs are dissimilar, opposition not established.

Costs awarded against opponent

Background

1. In this matter, Alphapharm Pty Limited, of Glebe, New South Wales, (‘the applicant’) has applied to register a trade mark, under the Trade Marks Act 1995 (‘the Act’), current details of which appear below:

Application No: 1107103

Priority Date:  3 April 2006

Goods:  Class: 5 Human pharmaceuticals

Trade Mark:  SOMIDEM

1. After examination of the application, it was accepted and advertised for possible registration in the Australian Official Journal of Trade Marks on 3 August 2006.

2. On 3 November 2006, Sanofi-Aventis, of Paris, France, filed Notice of Opposition to the registration of the trade mark.  The Notice recites grounds which include:

   1.        (Section 41) The trade mark, which is the subject of trade mark application No. 1107103 is not a sign which is capable of distinguishing the goods/services specified in the application from the goods/services of other persons.

   8.        (Section 43) Use of the trade mark would be likely to deceive or cause confusion because of some connotation that the trade mark or a sign contained in the trade mark has.

3. The opponent relied on the above grounds at a hearing of the matter that I conducted, as a delegate of the Registrar of Trade Marks at a hearing in Sydney on 8 April 2008.  For the sake of completeness, I note that the other grounds in the Notice have not been established.  The opponent relied on written submissions by its attorney, Nathan Sinclair, of Shelston IP.  Carmen Champion, counsel, appeared for the applicant, instructed by FB Rice & Company.

4. A convenient start point is a discussion of the evidence in support of the opposition which is a statutory declaration by Andrew Lockhart who is a legal practitioner and principal of Shelston IP.

5. Mr Lockhart’s declaration is quite brief.  He says:

   On 7 December 2006, I used the IP Australia online “Search for International Nonproprietary Names for Pharmaceutical Substances” tool. A search for the name “zolpidem” returned one (1) result. A printout of the search result is annexed hereto at ASL-1.

   On 7 December 2006, I used the search facility on the World Health Organisation's website ( to search for the name “zolpidem”. Annexed hereto at ASL-2 is a printout of a document located by this search, which shows at Page 28 a reference to “zolpidem” as an “INN”, which I understand is the acronym for “international non-proprietary name”.

6. Annexure ASL-1 shows an exact match for the search term ‘zolpidem’.  Anexure ASL-2 shows a change in what is called an ‘ATC Code’ from NO5C GO1 to NO5C F02 for ‘zolpidem’ which is included under the tabular heading ‘INN/common name’ which is appended (or appears to be) to an article Global Partnerships for Health by Gro Harlem Brundtland, Director-General of the World Health Organization. 

7. There are many other names included under this tabular heading – for example, hydrocortisone, hydrocortisone combinations, hydroxocobalamin, hydroxocobalamin combinations, ibopamine, imiquimod, immunocyanin, interferon alfa-2a, interferon alfa-2b, interferon alfa-n1, interferon beta-1 a, and interferon beta-1b.

8. The evidence in answer is a declaration by Scott Jason Goodwin of Alphapharm Pty Limited.  Mr Goodwin says:

   The [trade mark] was launched in the Australian marketplace in November 2006. Pharmaceuticals bearing the SOMIDEM trade mark have been sold throughout all States and Territories of Australia since that time.

   The trade mark is used in respect of a human pharmaceutical with the principal ingredient ZOLPIDEM TARTRATE.

   Attached and marked Annexure A are representations of packaging showing how the trade mark is used for the pharmaceutical product. [parenthetical material adjusted]

9. A copy of a part of this packaging appears below:

Submissions

1. In his submissions Mr Sinclair says of the ground under section 41:

   The basic inquiry under section 41 of the Act is:

   “... whether other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connection with their goods.”

   See: Kenman Kandy Australia Pty Ltd v Registrar of Trade Marks [2002] FCAFC 273; (2002) 122 FCR 494.

   The words “some mark nearly resembling it” from the above passage may be reformulated as meaning of “close similarity” or “confusingly similar”: Aventis Pharma SA v Alphapharm Pty Ltd (2005) 65 IPR 634 at [20].

   In the present circumstances, the trade mark is used in relation to a human pharmaceutical with the principal ingredient “Zolpidem Tartrate”: Goodwin, para 6.  “Zolpidem” is an International Nonproprietary Name (INN) assigned by the World. Health Organisation (WHO): see Lockhart, para 3.  

   It is clear, when compared side by side, that there are a number of visual and phonetic similarities between the word “Somidem” and the INN “Zolpidem”, being:

   •the four-letter suffix “-idem” is identical in both cases. It comprises a significant part of each word, and contributes greatly to the total visual and phonetic impression conveyed by the words;

   •the second letter “o”, which is pronounced in the same way in both cases;

   •the first letters “s” and “z” are both visually and phonetically similar;

   •the first two letters “so”, are phonetically virtually identical to the first two letters “zo”;

   •the letter “m”, which separates “so” from “idem”, and the letters “Ip”, which separate “zo” from “idem”, are both pronounced with a closed mouth. They are not stressed, and are phonetically similar; and

   •both consist of three syllables, with the second and third syllables being identical.

   The only differences between the trade mark and the INN are:

   •the first letters, with “z” being replaced by the visually and phonetically similar letter “s”; and

   •the middle letters “Ip” are replaced with the letter “m”, which for the reasons set out in paragraph 9 above is phonetically similar. The middle letters of a mark are ordinarily of less significance in assessing the impression conveyed by two marks: Kendall v Mulsyn Paint and Chemicals (1963) 109 CLR 300

   These differences are “very slight”, with “only one or two letters changed”: Glaxo Group Ltd v Pathstream Ltd (1987) 9 IPR 95 at 100.

   It has been held that “words of three syllables with a difference of one vowel in an unstressed position which has little, if any, effect on the pronunciation of the words”: Warner-Lambert Company v Harel, (1995) 32 1PR 189.

   There is therefore a “close similarity” between the word “Somidem” and the INN “Zolpidem”, such that traders are likely, in the ordinary course of their business, and without any improper purpose, to desire to use a mark that “so nearly resembles” the Opposed Mark, namely the INN “Zolpidem”.

2. Concerning the section 41 ground Mrs Champion, for the applicant, said:

   Part 22 s.23 of the Trade Marks Office Manual of Practice and Procedure under “Trade Marks Capable of Distinguishing” outlines the process for examination of trade marks for pharmaceutical substances, which involves a search against the INN List and rejection of an application under s.41(2) where a trade mark application and the INN Name are substantially identical.

   There is no definition in the Act of what is meant by the phrase “substantially identical” and it is necessary to consider the ordinary or usual meaning of these words as well as the practice of the Trade Marks Office and any official decisions on the question of substantial identity. It is submitted that the test for substantially identical marks and terms must be considered in light of Trade Marks Office practice and official decisions. Substantial identity means, in essence, in substance the same or essentially the same: Registrar of Trade Marks v Woolworths Limited (1999) 45 IPR 411 at page 470.

   A trade mark which is substantially identical to an INN Name is to be rejected on the grounds that it would not be capable of distinguishing the goods of the owner from similar substances also identified by that INN or, if the trade mark was to be used in respect of different constituents than that covered by the INN listing, the trade mark would be deceptive and the grounds for rejection under s.43, which are also relied upon by the Opponent, would then arise.

   It is submitted that the trade mark SOMIDEM and the INN Name ZOLPIDEM are not substantially identical, such that rejection under s.41 and s.43 does not arise. It is further submitted that SOMIDEM and ZOLPIDEM are so dissimilar that the words cannot be considered deceptively similar.

3. As I think it is apparent that if a single word trade mark does not lack inherent adaptation to distinguish the goods of a trader because it does not directly describe the nature of the goods, then neither can it be misdescriptive of the goods. Thus, if the opponent does not establish its section 41 ground relating to the description, the section 43 ground relating to the misdescription also falls away.

4. I will therefore discuss the opposition in terms of section 41 first, and then make a few brief remarks about section 43 if necessary.

Section 41

1. The nature and operation of section 41 were discussed by Branson J in Blount Inc v Registrar of Trade Marks [1998] FCA 440. Her Honour concluded that there are three options open to the Registrar after considering the trade mark in terms of section 41(3):

   a) that the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons and capable, on that basis alone, of so distinguishing the designated goods or services; or

   (b) that 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; or

   (c) that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, but there is uncertainty, on that basis alone, that the trade mark is actually capable of so distinguishing the designated goods or services.

   The structure of s 41 of the Act dictates that if the Registrar reaches conclusion (a) above, then he or she will decide the question whether or not the trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons by reaching the answer that it is so capable by reason of its inherent adaptability to distinguish (s 41(2) and (3)). The Registrar will, in such circumstances, be required, by reason of the terms of s 33(1) of the Act, to accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application.

   If the Registrar reaches conclusion (b) or (c) above, he or she is, within the meaning of s 41(4) “unable to decide the question”. That is, he or she is unable, simply by taking into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services, to answer the question whether or not the trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons.

   If the Registrar reaches conclusion (b) above, then the provisions of paragraphs (a) and (b) of s 41(6) are brought into operation. If the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date of the application, the trade mark does distinguish the designated goods or services as being those of the applicant, the Registrar will not reject the application pursuant to s 41(2). The Registrar will, in such circumstances, accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application (s 33(1)). If the applicant fails to establish that because of the extent to which the applicant has used the trade mark before the filing date of the application, the trade mark does distinguish the designated goods or services as being those of the applicant, the Registrar must reject the application pursuant to s 41(2).

   If the Registrar reaches conclusion (c) above, then the provisions of paragraphs (a), (b) and (c) of s 41(5) are brought into operation. If the Registrar, having considered the combined effect of the matters listed in subparagraphs (i), (ii) and (iii) of s 41(5)(a), is satisfied that the trade mark does or will distinguish the designated goods or services as being those of the applicant, he or she will not reject the application pursuant to s 41(2). The Registrar will, in such circumstances, accept the application unless he or she is satisfied that the application has not been made in accordance with the Act, or that there are grounds, independent of capacity to distinguish, for rejecting the application (s 33(1)). If the Registrar, having considered the combined effect of the matter listed in subparagraphs (i), (ii) and (iii) of s 41(5), is not satisfied that the trade mark does or will distinguish the designated goods as being those of the applicant, the Registrar must reject the application (s 41(2)).

2. Central to the positions of the parties is the section of the Trade Marks Office Manual of Practice and Procedure (‘the Manual’) which deals with applications in which the trade marks may be similar to International Nonproprietary Names (‘INNS’).  The Manual, of course, does not have the force of law and is a set of administrative guidelines that says:

   Section 41 Grounds for rejection in relation to INNs

   Grounds for rejection under section 41 exist where a trade mark to be used in relation to pharmaceutical preparations and substances, veterinary substances or pesticides is substantially identical to a notified INN. Such a trade mark would not be considered capable of distinguishing the applicant’s goods and objections would be very difficult to overcome – especially if the mark was identical to the INN. Since the INN is effectively the generic name for the substance it should be available for use by anyone in a descriptive context.

3. The applicant states that the above test is the correct one and that it is only trade marks which are substantially identical to INNs which should be rejected.  The opponent states that the test is, in fact, a lesser one – that, in effect, the test to be applied is whether the trade mark is of “close similarity” or is “confusingly similar” to the INN.

4. I think that there is room for the view that both parties have some merit in their arguments but that, in this forum it is the test proposed by the opponent which should apply.

5. Section 33 of the Act requires Registrar, after the examination, to accept an application unless he or she is satisfied that there are grounds under this Act for rejecting it; and, see the words of French J in Registrar of Trade Marks v Woolworths [1999] FCA 1020 at paragraphs 24 and 47:

   The mandatory language of s 33 gives effect to the intention, expressed in the Second Reading Speech, that there is to be a presumption of registrability when the application is examined by the Registrar of Trade Marks. This is a shift from the position under the previous law whereby the onus was on the applicant to establish registrability - Jafferjee v Scarlett [1937] HCA 36; (1937) 57 CLR 115 at 119 and 126. In respect of the 1955 Act see Advanced Hair Studio of America Pty Ltd v Registrar of Trade Marks (1988) 10 IPR 583 at 587 (King J). This shift reflects recommendation 4A of the Working Party's 1992 Report that “[t]he legislation should be expressed in terms which make it clear that there is to be a presumption of registrability when examining an application for registration”. It brings the Australian law into line with the approach taken internationally as expressed in the European Communities' Directive on Trade Mark Laws (December 1988), the TRIPS agreement and developments in the United Kingdom and New Zealand.

   […]

   The decision to reject an application regularly made must now be based upon positive satisfaction that a ground for rejecting it is made out. This may have implications for the Registrar's administrative practice. There will no doubt be cases in which the requisite state of satisfaction can be reached by consideration of the visual and aural features of the marks in question against the description of the goods and/or services to which they relate. But there will also be cases in which such materials will be of themselves inadequate to support a proper judgment. In some circumstances market or survey evidence might be necessary to form a concluded view. Unless the Registrar is to undertake inquiries of that kind going beyond the content of the application and the existing Register and prior applications, then the application will have to be accepted and determination of such questions as deceptive similarity left to opposition or expungment proceedings. Given the preliminary character of the acceptance decision and the availability of the later adversarial processes, it may be consistent with the policy of the 1995 Act that only in clear cases of deceptive similarity will the Registrar reject upon that ground. The policy of the 1995 Act can be said to some extent to have shifted the balance of the objectives of trade mark law more towards the identification and protection of commercial products and services than the protection of consumers, although the latter remains an objective. In respect of deceptive trade marks the interests of consumers are also protected by comprehensive Federal and State laws relating to conduct which is misleading or deceptive or likely to mislead or deceive. The trade mark law concept of confusion in the sense of mere wonderment as to common origin or connection has little part to play in the consumer protection statutes. That, no doubt, is because “confusion” used in that sense, does not of itself lead into error or affect choices at the point of sale. It is perhaps best described in trade mark law as effecting a prophylactic support for commercial distinctiveness.

6. Thus, from an administrative stand-point, it may make sense to set the bar slightly high (at substantial identity) in relation to INNS in the knowledge that the onus has shifted from that under the 1955 Act and traders such as the opponent are willingly to protect ‘the great common’[1] so that all might freely ramble upon its paths.

   [1] Joseph Crosfield and Sons’ Application (1909) 26 RPC 837 at 854.

7. However, I also agree with the opponent that the case law on which it relies indicates that, in opposition proceedings where the onus is on the opponent to establish to my satisfaction that it has, on the balance of probabilities, made out its grounds of opposition, the test becomes whether the whether the trade mark is of “close similarity” or “confusingly similar” to the INN.

8. The assessment as to whether a trade mark is inherently adapted to distinguish is to be tested according to the classic test set out in Clark Equipment Co v Registrar of Trade Marks [1964] HCA 55; (1964) 111 CLR 511 where Kitto J said at paragraph 5:

   That 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. In Registrar of Trade Marks v. W. & G. Du Cros Ltd. (1913) AC 624, at pp 634, 635 Lord Parker of Waddington, having remarked upon the difficulty of finding the right criterion by which to determine whether a proposed mark is or is not “adapted to distinguish” the applicant's goods, defined the crucial question practically as I have stated it, and added two sentences which have often been quoted but to which it is well to return for an understanding of the problem in a case such as the present. His Lordship said: “The applicant's chance of success in this respect (i.e. in distinguishing his goods by means of the mark, apart from the effects of registration) must, I think, largely depend upon whether other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connexion with their own goods. It is apparent from the history of trade marks in this country that both the Legislature and the Courts have always shown a natural disinclination to allow any person to obtain by registration under the Trade Marks Acts a monopoly in what others may legitimately desire to use.”

   [stress added]

1. According, the question which I am to answer is whether the trade mark “nearly resembles”, or has “close similarity” and is “confusingly similar” to the INN ZOLPIDEM such that in lacks inherent adaptation to distinguish the goods of the applicant.

2. To my mind, however, the opponent here has fallen into the trap of insisting that a standard of comparison very close to that of ‘deceptive similarity’ applies and then discussing the similarities in terms of ‘substantial identity’.  The opponent engages in an analysis of the similarities and differences between the INN and the trade mark which is dependant on having the signs in question side by side.  In any comparison akin to that of ‘deceptive similarity’ this approach is inappropriate. In Australian Woollen Mills Limited v F S Walton and Company Limited [1937] HCA 51; (1937) 58 CLR 641, Dixon and McTeirnan, JJ said, concerning comparison (albeit of trade marks):

   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, then 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.

3. Subsequently, in the same case, they said:

   It depends on a combination of visual impression and judicial estimation of the effect likely to be produced in the course of the ordinary conduct of affairs.

4. Given that the signs involved are used in respect of pharmaceuticals and those involved in prescribing and selling pharmaceuticals are of great experience and habitual caution, I think that the differences in how the signs present to the eye and ear easily outweigh any similarities that they might have.  It is most difficult to understand how, in the context that these signs are used, that either might be mistaken for the other.

5. To my eye and ear, the initial letters and the central structure of the signs in question are quite different from each other such that it is unlikely (for example) that most people on seeing the trade mark would even apprehend that it might have been coined out of the INN.

6. Thus, to my mind, there is no visual or phonetic similarity of the trade mark to the INN so that trade mark “nearly resembles”, or has “close similarity”, or is “confusingly similar” to the INN ZOLPIDEM such that in lacks inherent adaptation to distinguish the goods of the applicant from other traders who might also require to use the INN.

7. It also follows, naturally, that if the stricter test of ‘substantial identity’ were to apply, the signs in question are not substantially identical.

8. Accordingly, the opponent has not established its ground under section 41 of the Act.

9. It also follows, as I have observed above, that the trade mark cannot be misdescriptive of the goods in the opposed application which are not ‘zolpidem’.

Decision

1. Section 55 of the Act provides:

   Decision

   55. Unless the proceedings are discontinued or dismissed, the Registrar must, at the end, decide:

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

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

   Note:  For limitations see section 6.

2. The trade mark application 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 the disposition of the application should be in accordance with the Court’s order or direction.

Costs

1. Both parties sought their costs should they be successful in these proceedings.  I see no reason why costs should not follow the event and I order costs against the opponent at the scale set out in the regulations.

Iain Thompson

Hearing Officer

Trade Marks Hearings

2 July 2008