Sitmar Cruises Ltd v Carnival Cruise Lines Inc
[1986] FCA 350
•20 AUGUST 1986
Re: SITMAR CRUISES LIMITED
And: CARNIVAL CRUISE LINES INC; BRIDGE TRAVEL (AUSTRALIA) PTY. LIMITED
Re: CARINVAL CRUISE LINES INC. (First cross-claimant); BRIDGE TRAVEL
(AUSTRALIA) PTY. LIMITED (Second cross-claimant)
And: SITMAR CRUISES LIMITED (Cross-respondent)
No. G33 of 1986
Trade Practices (Consumer Protection) and Trade and Commerce
COURT
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Beaumont J.
CATCHWORDS
Trade Practices (Consumer Protection) - applicant using slogan "Funship" to describe its vessel - respondent using theme "Fun Ships" to describe its liners - whether either party contravened ss.52 and 53 Trade Practices Act 1974 - whether terms descriptive - conduct looked at as a whole - words not misleading when taken in context.
Trade and Commerce - passing-off - whether the use of similar slogans constituted passing-off.
Trade Practices Act 1974 ss.52, 53.
Taco Company of Australia Inc. v. Taco Bell Pty. Ltd. (1982) 42 A.L.R. 177.
Parkdale Custom Built Furniture Pty. Ltd. v. Puxu Pty. Ltd. (1982) 149 C.L.R. 191.
Cadbury Schweppes Pty. Ltd. v. Pub Squash Co. Pty. Ltd. (1980) 32 A.L.R. 387 (P.C.).
Hornsby Building Information Centre Pty. Ltd. v. Sydney Building Information Centre Pty. Ltd. (1978) 140 C.L.R. 216.
Moorgate Tobacco Co. Limited v. Phillip Morris Limited (No. 2) (1984) 156 C.L.R. 414.
HEARING
SYDNEY
#DATE 20:8:1986
Counsel and Solicitors for Applicant: Mr. S.J. Archer, Mr.T.J. Hancock and Mr. P. Gray instructed by Messrs Sly, Russell with Hall and Hall, Dare Reed.
Counsel and Solicitors for Respondent: Mr. R.B.S. Macfarlan and Miss H. Coonan instructed by Messrs Dawson Waldron.
ORDER
The application be dismissed.
The cross-claim be dismissed.
There be no order as to costs.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
JUDGE1
The applicant, Sitmar Cruises Limited (Sitmar), operates cruise ships for tourists. One of its ships, the "Fairstar", cruises out of Australian ports into the waters of the Pacific Ocean. Since May 1984, Sitmar has used the word "Funship" in its efforts to promote its cruises. The first respondent, Carnival Cruise Lines Inc (Carnival), also operates a number of cruise ships. They provide round trip voyages out of ports on the east and west coasts of the United States with destinations in the northern hemisphere which include the Caribbean and Mexico. Since 1974, Carnival has used the words "Fun Ship", or its plural, "Fun Ships", in promoting its cruises. Sitmar claims that Carnival now intends to introduce cruises in its ships into the southern Pacific region, and that Carnival will continue to use the term "Fun Ship" or "Fun Ships" in promoting its services. The second respondent, Bridge Travel (Australia) Pty. Limited (Bridge), is Carnival's exclusive general sales agent in Australia.
Sitmar's principal allegation is that, by using the words "Fun Ship" in their publicity, Carnival and Bridge have engaged in conduct which is misleading or deceptive or likely to mislead or deceive in contravention of s.52 of the Trade Practices Act 1974 (the Act). Sitmar's contentions are that since the Australian public has come to associate the word "Funship" with Sitmar and with the "Fairstar", Carnival's use of "Fun Ship", would induce Australian consumers to believe, contrary to the fact, that there was some connection between Carnival's cruises and those offered by Sitmar. Sitmar further claims, for similar reasons, that Carnival's conduct contravenes s.53 of the Act, alleging that Carnival is representing that its cruises have a sponsorship, approval or affiliation which they do not, in truth, have. Sitmar also contends, for comparable reasons, that Carnival has passed-off its business as that of Sitmar or, alternatively, that Carnival has falsely represented that there is a connection between the two. Sitmar seeks injunctions restraining Carnival from using the expression "Fun Ship" in carrying on its business in Australia.
For their part, by way of cross-claim, Carnival and Bridge have made like claims against Sitmar. They allege against Sitmar similar contraventions of ss.52 and 53 and passing-off arising out of Sitmar's use of the slogan "Funship". Carnival and Bridge seek injunctions restraining Sitmar from using "Funship" in its business in Australia.
Sitmar claims that the term "Funship" was suggested to it by a member of the staff of its advertising agent, John Clemenger Pty. Ltd. (Clemenger) in 1981 in ignorance of the use by Carnival of the expression "Fun Ships"; and that Sitmar decided to adopt the term "Funship" in early 1983 as part of a marketing strategy involving the promotion of the idea of "fun" on board the "Fairstar". It is accepted by Sitmar that, by 1983, some of its executives knew that Carnival used "Fun Ship" to describe its ships. However, Sitmar claims that such knowledge did not influence its decision to adopt the expression "Funship". Since 1984, Sitmar has used the expression as the central feature of a vigorous advertising campaign throughout Australia. Sitmar contends that the widespread dissemination of its advertising material containing references to "Funship" has had the desired result that a great number of Australians identify the "Fairstar" as "the Funship" and as a ship operated by Sitmar. Sitmar contrasts Carnival's publicity in Australia, branding it as insignificant. Consequently, Sitmar says, Carnival's cruises are known to few Australians. But, Sitmar claims, since Carnival now proposes to move into the south Pacific, its reference to "Fun Ships" will mislead Australian consumers: they will be led to believe that there is some connection between Carnival's cruises and those offered by Sitmar.
Carnival's case, on the other hand, is that the expression "Fun Ships" has been used extensively in the United States and in other parts of the world, to identify its liners, and that the use of this slogan or theme has been fundamental, in advertising jargon, to its marketing "strategy" and "execution". The result, Carnival says, is that it has acquired a reputation in the expression "Fun Ship" in the United States and elsewhere. According to Carnival, in the course of business activities conducted in Australia on its behalf, it has used its theme in this country on a significant scale from 1978 to the present time. Yet, Carnival says, Sitmar did not commence to use the expression "Funship" to describe its ship until May 1984 and, Carnival claims, Sitmar did so in the knowledge of the extensive and successful use of the expression "Fun Ships" by Carnival. Carnival further contends that the expression "Funship" was adopted by Sitmar with the specific object of hindering the legitimate exploitation by Carnival of its theme. Carnival then argues that, because the market for cruise berths is international, and since at least some Australians are prepared to travel overseas to join a cruise, confusion and deception will occur because Australian consumers will be misled into believing, contrary to the fact, that there is some connection or association between Sitmar's liners and those of Carnival.
There is little room for argument on the facts. The only areas of dispute as to factual matters are first, the suggestion by Carnival that Sitmar, in effect, stole from it the idea of using the term "Funship"; and secondly, the degree of circulation achieved by Carnival in its publicity of "the Fun Ships" within Australia.
The history of the use by Sitmar of the concept of "fun" commences well before the events now in question. As early as 1967, Sitmar promoted the idea of "fun" in its advertising. In a brochure published in July 1967 promoting the "Fairstar", consumers were invited to "(j)oin in all the fun....It's fun all the way...". In a pamphlet published at that time, Sitmar was said to be the "Fun way to U.K.....It's the way to meet....fun-loving people..." In a schedule of fares and sailings published in February 1968, Sitmar advertised the services provided by four of its ships, the "Fairsea", the "Fairsky", the "Castel Felice" and the "Fairstar" as "the fun way to Europe". A pamphlet published by Sitmar in April 1968 advertised cruises on the "Fairsea" by reference to "fun" aboard. Mention was also made of "the relaxed fun-atmosphere that all the big white Sitmar liners are famous for". A similar theme was later advanced by Sitmar in promoting cruises on the "Fairstar" in 1973 and 1974. Consumers were told in a brochure that they had the opportunity to cruise with "fun lovers". Reference was also made to "fun-filled" days.
One brochure, promoting a cruise departing Sydney in April 1974, actually referred to "the fun ship Fairstar". This appears to be the only occasion before 1984 that Sitmar used such a term. The evidence did not explain its origin.
References were made, in other Sitmar brochures published in 1974 to "the fun" on board the "Fairstar". Similar references were made in material published in Australia by Sitmar in 1974 through to 1983 to "fun" on Sitmar's vessels. For instance, in 1975, the "Fairsky" was described as a "fun-class resort-ship". One of its cruises was said to provide "(t)hree weeks of fun - meeting new people, making friends and having a ball." In a Sitmar brochure published in 1976, the captain of the "Fairstar" was said to be a man "who's made the Pacific his home. He knows its fun." In 1979, 1982 and 1983, Sitmar publicity emphasised "fun" for children on the "Fairstar". In 1984, Sitmar commenced the promotion of the "Fairstar" as the "Funship" in circumstances to be dealt with in some detail below.
Meanwhile, in late 1974, Carnival commenced the operation of its cruises out of Miami, Florida, employing the liner "Mardi Gras". In 1975, Carnival registered the trade mark "Fun Ships" under the laws of Florida. At about this time, Carnival commenced to use the mark "Fun Ships" to promote cruises on the "Mardi Gras". Later, the mark "Fun Ships" was used on other ships added to Carnival's fleet - the "Carnivale" and the "Festivale". To give a typical illustration, in a brochure published in the United States by Carnival in 1976, cruises on the "Carnivale" and the "Mardi Gras" were advertised as "Cruise 'the Fun Ships'". The concept of "fun" was there emphasised: consumers were invited to "experience the isles of the Caribbean the 'fun' way with Carnival cruise lines]....you are sure to enjoy your cruise on the 'Fun Ships." These themes were frequently repeated in Carnival's advertisement in the United States of its services from this time to the present. For example, an advertisement invited members of the public to "(h)ave more fun on a...'Fun Ship' Carnivale...featuring a fun day...We've Got The 'Fun'." Another publication spoke in the terms - "Where the fun begins...and never ends." Throughout this period, Carnival's advertising focussed attention on the concept of "fun". This was reinforced by Carnival's constant reference to its ships as the "Fun Ships".
In the United States at least, the message seems to have reached its intended destination. In Frommer's Dollarwise Guide to Cruises by Springer and Schultz (1985-86 edition) Carnival's operations were described as follows (at p.146):
"Carnival Cruise Lines vessels are the fun ships, folks. Nonstop activity is the watchword here, so if you're looking for action days - and nights - you'll want to see what's going on at Carnival.
Carnival's execs know exactly what market they're aiming at and they know just how to satisfy it: fun, fun, fun and sun, sun, sun. Carnival cruisers want to get away for a week or so, see a few ports, and play to the max.
Much of the success of Carnival's fleet must go to its sometimes controversial marketing executive Bob Dickinson. The Carnival marketing staff pursues potential passengers with enthusiasm, and with some very affordable prices that get even better when business is slow.
So intent is Carnival on marketing "fun" that it has made that somewhat nebulous concept part of its theme: the line's vessels call themselves "the Fun Ships," which says much to many. It should say something to you about the whoop-de-do atmosphere you'll find aboard the line's four craft, the Carnivale, Festivale, Mardi Gras, and Tropicale."
Carnival's promotion, in various ways, of "the Fun Ships" was conducted on a grand scale. In 1978, two million brochures were produced. In 1986, more than four million brochures have been distributed world-wide. The escalation of Carnival's advertising campaign was reflected in an increase in passenger numbers - from 198,647 in 1982 to 310,296 in 1985.
However well the "Fun Ships" were publicised in the United States, the extent of that publicity in this country, is, as has been noted, a controversial question in these proceedings. In 1977 or 1978, Carnival appointed, as its agent, an Adelaide travel agency, Bank Street Travel (Bank). The agency subsisted for about two years. During that period, about 200 brochures were received by Bank from Carnival. Bank distributed this material to the public and to other agents. In May 1980, Carnival appointed a suburban Sydney travel agent, Coulter Tours (Coulter), to act as a general sales agent on a non-exclusive basis. In the period up to 1984, Coulter sought to promote Carnival's cruises in Australia. For this purpose, Coulter distributed press releases and handed over brochures to members of the public who enquired about the cruises. Coulter also forwarded some copies of Carnival's brochures to some of the major Sydney travel agencies. In January 1982, Coulter was represented at the Sydney Travel Show held at the Sydney Show Ground. Carnival promotional material, including a film, was displayed.
It cannot be disputed, however, that the scale of Carnival's business in this country was limited. In the years 1980 to 1985 inclusive, only 180 Australian passengers undertook a "Carnival" cruise. Some brochures were provided by Carnival to Australian travel agents but it is not possible to say how many were distributed to members of the Australian public. The evidence on the point is unsatisfactory. The best estimate permitted by the evidence of the number of brochures sent out here is that, in the period 1981 to 1985 inclusive, about 12,000 brochures were made available by Carnival for distribution to the Australian public.
In the period from 1977 to the present time, publication of references to Carnival's "Fun Ships" occurred in several international travel industry journals which were used by Australian travel agents. For instance, OAG Worldwide Cruise and Shipline Guide July-August 1981, published for the international travel trade, included a full page advertisement for "The 'Fun Ships' of Carnival Cruise Lines," and was used by local agents. In the ordinary course of events, such trade journals would not be seen by the general public. Other American publications such as "Esquire" and "Brides" Magazines, having only a small circulation here, carried similar advertising during this period.
In September 1983, Bridge, trading as Cruise World, a Sydney travel agency, was appointed Carnival's general sales agent on a non-exclusive basis. (In August 1985, Bridge's appointment was made exclusive). Bridge received from Carnival 1,200 of its brochures for the 1984/5 seasons and 1,500 brochures for the 1985 season. It seems that most of these brochures were distributed by Bridge to other travel agents and to interested members of the Australian public.
The form in which Carnival has chosen to advertise its services is, of course, a crucial aspect of the present dispute. It is clear that Carnival's advertising makes significant use of the "Fun Ships" slogan and of the general theme of "fun". However, this slogan has appeared in a context which distinguishes Carnival's services from those of its competitors: the publicity emphasises both Carnival's corporate name and the identity of its fleet; prominent references are made to "Carnival Cruise Lines" and to the names of Carnival's liners.
To revert now to the circumstances surrounding Sitmar's decision to adopt "Funship" as a theme or slogan, it appears that, late in 1981, Mr. J.A.M.H. Hulsbosch, a designer employed by Clemenger, suggested to Mr. P.B. Young, Sitmar's marketing manager, that in the light of Sitmar's successful use of the "fun" theme in its advertisements, it might be a good idea to adopt the expression "Fairstar" the "Funship". Mr. Hulsbosch, whose evidence I accept, said that this was an idea which occurred to him during a "free-wheeling, brainstorming" discussion. Mr. Young's response was enthusiastic and Mr. Hulsbosch drew some preliminary sketches using the name "Funship". However, the suggestion then lapsed.
The proposal that Sitmar utilise a "Funship" slogan was not, in fact, revived until 1983. In order to place that decision in its context, it is necessary to trace the development of the ideas held by Sitmar's executives in this period with respect to the image of the "Fairstar" sought to be projected by Sitmar to the Australian public. Early in 1983, one of its executives, Mr. P.S. Green, in a memorandum to Mr. Young on the subject of a "Fairstar" video, referred to Sitmar's "product proposition" for 1983/84 as -
"offering unbeatable value for money on a fun-filled South Pacific holiday....Sitmar is perceived by the trade as a fun ship....Since our product launch a strategy has evolved through our customer and trade advertising, point-of-sale and PR in positioning our ship, FAIRSTAR, as the fun ship in the Pacific. The all-important message we wish to communicate being fun-filled, value holidays. Our objective being to re-brand our fun, value imagine with FAIRSTAR, the product, rather than Sitmar cruises, the company...For the 1984 launch...the objective (is) to continue our strategy of positioning FAIRSTAR, as the fun ship of the South Pacific."
According to Mr. Green's memorandum, one of Sitmar's objectives was:
"- To engender a "fun in the sun" image for
Sitmar's FAIRSTAR that would appeal to our major target markets - the young (18 - 35 years) and families"
On the topic of "Creative Direction", Mr. Green said:
"Overall it is vital that the video presents Sitmar's unique benefits and identifies FAIRSTAR strongly as the fun ship of the Pacific.
As the product direction for 1983/84 is to move to a more simplified product proposition rather than a more complex one as in previous years, we believe the thrust then should move much more from an informative, product learning experience to an emotionally involving fun and entertaining Pacific FAIRSTAR experience, which includes the essential communication of our product strategy direction."
On 18 March 1983, Mr. Young and Sitmar's Australian general manager, Mr. T.E. Blamey, met with Mr. G. Love, a Clemenger executive, to discuss Sitmar's company slogan. According to a memorandum written by Mr. Love dated 23 March 1983, that topic was dealt with as follows:
"Company Slogan
After much discussion, a few mmm's, it was decided (by Phil) (Mr. Young) that the line 'Sitmar Cruises ... funny, sunny and not much money', is not where they see the company positioned to the trade or the consumer. It actually is where they want to be, but the word 'funny' doesn't sit well with Phil or Ted (Mr. Blamey).
We will use 'Sitmar Cruises - fun filled, value holidays' until the agency produces a better line which says fun and value but is more emotive than this line.
The other area they want us to look at creatively (again) is that of a personality for TSS Fairstar. A personality in terms of a word, a slogan, similar to P&O's line for Oriana - 'The spaceship' or Minghua's 'Friendship'.
Ted raised the word (used by the Carnival Line in the US) 'Funship' and suggested that it could be used in copy or as a logo - 'Fairstar the Funship/Funship Fairstar/Fairstar Funship'...." (Emphasis added)
The evidence does not clearly establish when Mr. Blamey first became aware of Carnival's use of the slogan "Fun Ship". It is likely that this happened in October 1982 during a visit to Sitmar's head office in Los Angeles by Messrs. Blamey and Young and another Australian Sitmar executive, Mr. G.A. Starkie. The three Sitmar executives visited Carnival's ship, the "Tropicale", then in port in Los Angeles. Since all of Carnival's ships carry prominent references to "Fun Ship", it is probable that Mr. Blamey then noticed this use of the expression. In any event, there is no reason to doubt the accuracy of Mr. Love's memorandum.
A written review of Sitmar's marketing efforts in 1983 was prepared by its staff towards the end of 1983. According to that review, Sitmar's:
"1983 marketing stratgety has focused on filling the FAIRSTAR through tactical press advertising communicating fun and unbeatable value for money".
Part of the advertising compaign was there described as:
""Funny, sunny and not much money..."
In evaluating the 1983 results, the review said:
"The trade are playing back to our sales team, our fun, value and unspoilt island propositions more frequently than they were a year ago."
The review then dealt with the 1984 marketing campaign by including in its objectives the following:
"To create a perception that Sitmar really is a fun holiday by injecting a fun theme to the functions.
To communicate the continuing features of Sitmar's fun-filled, value positioning as well as introducing the new features of the 1984 program."
In 1984, Sitmar adopted the slogan "Funship" to describe the "Fairstar". In May 1984, the company initiated an advertising campaign in which the "Fairstar" was referred to, in terms, as the "Funship". From October 1984, Sitmar's national advertising campaign escalated. It has continued on a massive scale to the present time.
In its advertisements in the media and elsewhere, Sitmar has used the "Funship" theme in various ways. There are references to "the Funship Fairstar"; to "Fairstar the Funship" and to "Sitmar's Fairstar the Funship". But, since the advertising emphasises that the source of the services offered is Sitmar and that the cruise advertised will be taken on board the "Fairstar", even an unsophisticated reader would realise that the cruise offered has no connection with any of Sitmar's actual or potential competitors. In particular, the prominent references, in Sitmar's publicity, to Sitmar and to the "Fairstar" are a clear indication to any reader that the cruise in question is in no way connected with Carnival.
The evidence does not clearly indicate the processes of reasoning used by Sitmar's executives in deciding, in 1983 or 1984, to adopt the slogan "Funship". It is likely that such an important matter was discussed with Mr. J.P. Bland, the president of Sitmar International and also a director of Sitmar. Mr. Bland was not called to give evidence. Although he resides in Los Angeles, Mr. Bland visits Australia periodically to review Sitmar's operations. He came here in February 1983, and included on the agenda for that visit was Sitmar's "1984 Product Release Strategy". Mr. Blamey said that he cannot recall any discussion in 1983 or 1984 with Mr. Bland concerning Sitmar's decision to use the expression "Funship" or "Fun Ship". Mr. Bland would not ordinarily be concerned with the details of Sitmar's advertising campaigns in Australia. Nonetheless, it is reasonable to assume that Mr. Bland would be informed of a major marketing proposal such as the adoption of the term "Funship" to identify the "Fairstar". It is probable that such a matter was discussed with Mr. Bland in 1983 or 1984. Whether, in any such discussion, mention was made of the use by Carnival of the expression the "Fun Ships" is a more difficult question. Given Mr. Blamey's earlier reference to Carnival's theme, it is quite possible that Carnival's experience was there mentioned but I am unable to make a specific finding on this point.
However doubtful the evidence as to the actual position in 1983 and 1984, there can be no doubt that in 1985, Sitmar's executives did turn their minds specifically to Carnival's position vis-a-vis that of Sitmar. By a memorandum dated 24 April 1985, Mr. Young wrote to Mr. Starkie on the subject "Protection of 'The Funship' Usage in Australasia" as follows:
"Sometime ago, I wrote to you requesting that we register 'The Funship' for exclusive use by Sitmar Cruises in the Australiasian (sic) market. Your reply indicated that we should simply use the description which, over time, would give us certain rights to it.
We now understand that Carnival Lines have an intention to base a vessel in our market. As you are aware, they use the 'Funship' description in the American market and will probably wish to use the description in our market.
Indeed Ray Stevenson (a Director of Bridge) is already circulating literature which describes their vessel as the 'Funship'.
Could you please develop a plan which will prevent Carnival Cruise Lines from current and future use of the description 'Funship'. This will not only help us position our product as a fun oriented product, but will also hamper Carnival Lines marketing efforts in Australia."
I will deal first with Sitmar's claim that, by using the name the "Fun Ships", Carnival has contravened s.52 of the Act.
In order to establish a contravention of this provision, it must be shown that the conduct in question "contains or conveys, in all the circumstances of the case, a misrepresentation" (see Taco Company of Australia Inc. v. Taco Bell Pty. Ltd. (1982) 42 ALR 177 per Deane and Fitzgerald JJ. at p 202). It is not enough that the conduct damages a rival trader: it must mislead or deceive or be likely to mislead or deceive "members of the public in their capacity as consumers" (Parkdale Custom Built Furniture Pty. Ltd. v. Puxu Pty. Ltd. (1982) 149 CLR 191 per Mason J. at p 203). In considering these questions, the respondent's conduct must be viewed as a whole (see Puxu, supra, per Gibbs C.J. at p.199).
It is possible for an applicant to make out a case under s.52, as in passing-off, that by adopting a slogan which has become distinctive of the services offered by another trader, the respondent has, by a false implication, misrepresented the existence of some connection or association between them (see Cadbury Schweppes Pty. Ltd. v. Pub Squash Co. Pty. Ltd. (1980) 32 ALR 387 (PC) per Lord Scarman at p 392; Bannon, Passing Off Trade Deception Trade Marks (1985) at p 10). But the circumstances of the present case demonstrate there is no real likelihood of members of the Australian public being mislead or deceived in this way merely because of Carnival's use of the term "the Fun Ships". A number of considerations work against any real likelihood of confusion or deception.
In the first place, as has been seen, the references by Sitmar to "Funship" and by Carnival to "Fun Ships" in their respective advertisements do not occur in isolation. In each case, the slogan or theme used by Sitmar and by Carnival is placed in a context which sufficiently distinguishes the sources of the cruise services as those of Sitmar and Carnival respectively. This is achieved in a number of ways. In the case of Sitmar, as has been noted, various methods of expression are adopted: "The Funship Fairstar"; "Fairstar The Funship"; "Sitmar's Funship"; "Sitmar's Fairstar The Funship". Sitmar's advertising material thus sufficiently brings to the attention of consumers the fact that the services are being offered by Sitmar on its ship the "Fairstar".
In particular it could not be suggested that Sitmar has highlighted the reference to the "Funship" in some prominent fashion but buried in fine print any reference to Sitmar or to the "Fairstar" (see Puxu, supra, per Mason J. at pp.210-11). On the contrary, Sitmar has gone to considerable lengths to ensure that even a casual reader of its promotional material would appreciate that it is Sitmar which is advertising its services and that it is on board the "Fairstar" that the cruise being offered will take place.
On the other hand, Carnival, in its advertising, makes it clear beyond any reasonable doubt that the services offered on its "Fun Ships" will be provided by Carnival on one of its nominated ships for, in its publicity, Carnival has emphasised its name and the identity of its liners.
Thus, the parties' methods of distinguishing their "products" from those of other competitors are likely to dispel any confusion or uncertainty which might otherwise have been caused in the minds of consumers by the use of the similar themes, "Funship" and "Fun Ships".
Next, there are, in any event, difficulties confronting both Sitmar and Carnival in their attempts to establish that merely descriptive words such as "Funship" or "Fun Ship" have become distinctive of Sitmar's or Carnival's services so that the public is likely to be misled if a similar slogan is adopted by a competitor. As Stephen J. said in Hornsby Building Information Centre Pty. Ltd. v. Sydney Building Information Centre Pty. Ltd. (1978) 140 CLR 216 (at p 229):
"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."
Further, if any likelihood of deception might otherwise have arisen from the parties' use of similar slogans, it would be eliminated by the considerable distance separating the locations from which Sitmar and Carnival carry on their respective operations. Although Carnival has expressed interest in moving into the southern Pacific region, no final decision to do so has yet been made. Even if Carnival were to position a ship in this region, it seems likely that the respective operations of Sitmar and Carnival will continue to be sufficiently remote in physical location to enable Australian consumers to distinguish sufficiently between the two lines.
Sitmar was able to adduce evidence that some Australians had become aware of Sitmar's use of the theme "Funship", but did not know of Carnival or of its use of "Fun Ship"; and Carnival was able to show that some Australians knew of Carnival's "Fun Ship" slogan, but were unaware of Sitmar's use of "Funship". Such evidence does not, however, demonstrate a contravention of s.52. It merely shows that, from their individual experiences, some members of the Australian community have formed certain impressions on the matter. The question here, an objective one for the Court to determine, is whether Carnival or Sitmar has by its overall conduct, misrepresented the true position. It is the conduct of the parties, not the impressions of these witnesses, which is decisive for present purposes.
To summarise the position, when the conduct of the parties is looked at as a whole, it is apparent that there is no real possibility of confusion on the part of consumers as to any association or connection between Sitmar's cruises and those of Carnival arising from the use of the similar themes "Funship" and "Fun Ships". Accordingly, Sitmar's claim under s.52 of the Act must be rejected.
It follows that Carnival has not contravened s.53 of the Act and has not passed-off its services as those of Sitmar: it was correctly acknowledged by counsel for Sitmar that, if Sitmar's case under s.52 were to fail, its other claims must also be dismissed.
Carnival's cross-claim under s.52 must also fail for the reasons given for rejecting Sitmar's claims under that provision. For this purpose, it may be accepted that, when Sitmar decided to adopt the slogan "Funship", it was well aware of Carnival's successful use in the United States of the theme "Fun Ships". But however unfair misappropriation of the efforts of another party may appear to be, it does not follow that consumers are likely to be misled or deceived in that respect (see Pub Squash, supra). For the purposes of s.52 and in passing-off, it is the making of a misrepresentation to consumers, not damage to a rival trader, which is the critical consideration (see Puxu, supra, per Mason J. at p 203; cf. Moorgate Tobacco Co. Limited v. Phillip Morris Limited (No. 2) (1984) 156 CLR 414 per Deane J. at pp 439-446).
Since Sitmar has made no representation, express or implied, of any connection between its business and that of Carnival, it has not contravened s.52. Nor has it passed-off its services as having some connection with those offered by Carnival.
For similar reasons, I would also reject Carnival's subsidiary claims so far as they assert contraventions by Sitmar of s.53 of the Act and passing-off.
Since each party has failed in its claims, it is appropriate that there be no order as to costs.
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