Swatch AG v LG Electronics Inc

[2016] ATMO 121

TRADE MARKS ACT 1995

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

Re:Opposition by Swatch AG (Swatch SA) (Swatch Ltd) to registration of trade mark application 1618577 (9, 10, 14) - W WATCH - filed in the name of LG Electronics Inc.

Delegate:

Jock McDonagh

Representation:

Opponent: Written submissions by Watermark Patent and Trade Mark Attorneys

Applicant Written submissions by Davies Collison Cave Patent and Trade Mark Attorneys

Decision:

2016 ATMO 121

Trade Marks Act 1995 Section 52 opposition: sections 41, 42, 44 and 60 pressed – no grounds of opposition established – trade mark to proceed to registration.

Background

1. This matter relates to an opposition under section 52 of the Trade Marks Act 1995 (‘the Act’) to the registration of a trade mark filed by LG Electronics Inc (‘the Applicant’). Relevant details of the application are set out below.

Trade mark:  W WATCH (‘the Trade Mark’)

Trade mark application no:        1618577

Filing Date:  22 April 2014

Specifications:  Class 9: Smart phones; television receivers; monitors for computers; lap top computers; computers; digital versatile disc players; portable hard disc drives; apparatus for recording, transmission or reproduction of sound or images; computer application software for mobile phones; audio receivers; colour printers; tablet personal computers; settop boxes; mouses for computers; cameras; wearable computer; smart phone in glasses form; wristband for portable digital electronic media players; computer software for wireless data communications for receiving, processing, transmitting and displaying the information of exercise/body fat/bmi; portable terminals for personal use for recording/organizing/transmitting/controlling/reviewing the health and health care, and receiving the text, data, image, audio file; scanners; projectors; network monitoring cameras; digital signage; car speakers; universal serial bus drives; mpeg audio layer-3 players; telephone sets; wireless telephone sets; portable communications apparatus namely handsets, walkie-talkies, satellite telephones and personal digital assistants (PDA); television remote controllers; chips for improvement of television image quality; digital media broadcasting players (DMB); headsets for mobile phones; portable chargers for electric batteries; electronic albums; digital picture frames; apparatus for recording, transmission or reproduction of sound or images for use in telecommunications; electric audio and visual apparatus and instruments; computer application software for televisions; computer application software for personal monitors; computer application software for home appliances; computer application software for refrigerators; computer application software for clothes washing machines; computer application software for vacuum cleaners; computer application software for dish washers; computer application software for ovens; computer application software for microwave ovens; computer application software for clothes management machines; computer application software for air purifiers; computer application software for water purifiers; digital versatile disc players for home theaters; speakers for home theaters; audio-visual receivers for home theaters; projectors for home theaters; integrated circuits; electronic toll collection systems; electronic terminals equipped in vehicles for electronic commercial transactions; closed-circuit television cameras; thermal printers; laser printers; ink jet printers; recorded computer programmes; downloadable computer programs; personal computer cameras; digital voice recorders; videocassette recorders; network monitors; computer software for education; electronic notepads (E-Note); interactive white board; downloadable image files accessible via the internet; electronic downloadable publications; video conference system; monitors for video conference; cameras for video conference; speakers for video conference; three dimensional eyeglasses for television receivers; car broadcasting tuners; car cassette players

Class 10: Massage apparatus for medical purposes; bed vibrators; massage apparatus; electric massage apparatus for household use; diagnostic apparatus for medical purposes; medical apparatus and instruments; massage apparatus for human body; electric massage chairs for household use; pulse measuring devices; heartbeat measuring apparatus

Class 14: Watches with the function of wireless communications with electronic terminals such as smartphones, table computers, PDA, computers; Watch bands with the function of wireless communications with electronic terminals such as smartphones, tablet computers, PDA, computers; Wristwatches with the function of mobile communications; Clocks; Wristwatches; Electronic clocks and watches; Dials (clock and watch making); Watch crystals; Watch chains; Watch cases; Parts for watches; Watch pouches; Necklaces (jewelry); Bracelets (jewelry); Key rings (trinkets or fobs) of precious metal; Wire of precious metal (jewelry); Rings (jewelry)

1. Acceptance of the application for possible registration was published in the Australian Official Journal of Trade Marks dated 18 September 2014. Subsequently Omega SA (Omega AG) (Omega Ltd) – later amended to Swatch AG (Swatch SA) (Swatch Ltd) - (‘the Opponent’) filed a Notice of Intention to Oppose registration followed by a Statement of Grounds and Particulars (‘the Statement’).

2. The Applicant then filed its Notice of Intention to Defend. Thereafter the Opponent has filed evidence in support of the opposition in accordance with the provisions of the Trade Mark Regulations 1995 (‘the Regulations’), and the Applicant filed evidence in answer. The Opponent subsequently requested to be heard.

3. I was appointed to hear the opposition in Canberra as a delegate of the Registrar of Trade Marks at a hearing on 18 July 2016. The Opponent, represented by Watermark Patent and Trade Mark Attorneys, elected to rely on written submissions. The Applicant, represented by Davies Collison Cave patent and trade mark attorneys, also elected to rely on written submissions.

Grounds of Opposition

1. The Statement nominated four grounds of opposition under the Act, being under ss 41, 42, 44 and 60. In these proceedings, the Opponent elected to rely on all of those grounds. The onus is upon the Opponent to establish one or more of its grounds of opposition. The standard of proof required in these matters is the ordinary civil standard based on the balance of probabilities.[1]

   [1] Telstra Corporation Limited v Phone Directories Company Pty Ltd [2015] FCAFC 156, [133] affirming the approach of Gyles J in Pfizer Products Inc. v Karam [2006] FCA 1663, [26].

Evidence

1. The evidence in these proceedings consists of the following declarations:

Declarant	Position	Date Made	Exhibits
Evidence in Support
Leopoldo Emsenhuber (‘Emsenhuber’)	Vice President Logistics and Proxy of Opponent	8.05.15	LE-1 to LE-9 (no LE-3)
Evidence in Answer
Rick Cho (‘Cho’)	Trade Mark Manager of Applicant	8.09.15	1 to 3
Madeleine Chan (‘Chan’)	Trade mark lawyer for Applicant’s attorneys	10.09.15	MC-1 to MC-5

1. Emsenhuber establishes that the Opponent is an internationally well-known watch manufacturer. It was founded in 1983 and employs over 35,600 people in 50 countries, and its world famous brands include SWATCH, OMEGA, LONGINES, RADO and TISSOT.

Discussion

Section 41- 41    Trade mark not distinguishing applicant’s goods or services

1. As a preliminary matter I should mention that my role here is not to review the original examiner’s decision and arguments, but rather to consider afresh the grounds of opposition that have been raised.

2. Section 41 of the Act relevantly provides:

   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…

1. Pursuant to s 33 of the Act, the Registrar must accept an application for registration unless satisfied that there is a ground for rejecting it.

2. The inherent adaptation of a trade mark is to be tested:

   [B]y reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives – in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess – will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it. [2]

   [2] Clark Equipment Company v Registrar of Trade Marks (1964) 111 CLR 511, 515.

3. The signification which the words ordinarily possess (ordinary signification) is the ordinary meaning of the words to people in Australia who purchase, consume and trade in the designated services.[3]

   [3] Cantarella Bros Pty Ltd v Modena Trading Pty Ltd [2014] HCA 48 [70] (‘Cantarella’). 

4. Referring to the High Court’s test in Cantarella, Beach J of the Federal Court of Australia has recently held[4] that in considering a trade mark’s inherent adaptation to distinguish, it is the mark as a whole which must be assessed:

   “It is necessary to consider the trade mark as a whole, rather than its constituent parts, and then assess whether there is a direct reference to the character or quality of the goods.”  (emphasis added).

   [4] Flexopack S.A. Plastics Industry v Flexopack Australia Pty Ltd [2016] FCA 235 [220] (11 March 2016) (“Flexopack”).

5. Importantly, Beach J rejected an “atomistic approach” to considering a trade mark’s inherent adaptation to distinguish, describing such a “disassembled explication” as “artificial”: see paragraph 244

6. In the Opponent’s Submissions, the Opponent argues that the W Watch mark is not capable of distinguishing the relevant goods because it is “a simple combination of entirely non-distinctive elements which have no inherent capacity to distinguish the relevant goods” (at paragraph 6). In arguing so, the Opponent refers to:

• the term WATCH being “generic and non-distinctive in the context of the vast majority of the goods the subject of the application, including watches, smart watches and associated products” (at paragraph 7);

• the letter W being a “simple repetition of the first letter of the word WATCH” and that “it is common for words to be represented in printed materials in a manner that highlights or isolates the first letter, for example for decorative or ornamental reasons” (at paragraph 8);

• the letter W being a single letter which the Opponent argues has no inherent capacity to distinguish, citing a paragraph from the Trade Marks Office Manual of Practice and Procedure (“the Manual”) (at paragraph 9);

• the letter W being “commonly used as an abbreviation for many terms that are used to describe watches or feature of watches – such as weight, width, watts, water and women’s” (at paragraph 11); and

• the Applicant’s actual use of its related G Watch mark. The Opponent argues that the Applicant’s use of the G Watch mark in conjunction with the LG mark “highlights the non-distinctive nature of G WATCH (and by analogy W WATCH)” (at paragraph 12).

1. The Applicant submitted that the approach taken by the Opponent is “atomistic” and a “disassembled explication” of the kind Beach J strongly rejected in Flexopack. Instead, when the W Watch mark is appropriately considered as a whole, the mark does not have an ordinary signification that another trader would have a genuine need to use. The Applicant submitted that this is because the mark does not impart an obvious or known meaning in the context of the goods claimed by the Trade Mark. When a consumer is faced with the mark W Watch, it is not in a better position to understand the goods as the mark says nothing tangible about the goods.

2. Instead, according to the Applicant’s submissions, a consumer would understand the term to function as a badge of origin denoting the goods of a trader.

3. Having considered the submissions and the authorities relevant to this ground, I consider that the Applicant has better characterised the issues applicable.

4. I am not satisfied that other traders are likely, in the ordinary course of their businesses and without any improper motive, to desire to use the Trade Mark, or some mark nearly resembling it, upon or in connexion with their own goods. This ground of opposition has not been established.

Section 44 – Identical etc. trade marks

1. Section 44 of the Act relevantly states:

(1)   Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant’s trade mark) in respect of goods (applicant’s goods) 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 goods or closely related services; or

   (ii)  a trade mark whose registration in respect of similar goods or closely related services 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 goods is not earlier than the priority date for the registration of the other trade mark in respect of the similar goods or closely related services.

Note 1:       For deceptively similarsee section 10.

Note 2:       For similar goodssee subsection 14(1).

Note 3:       For priority datesee section 12.

Note 4:       The regulations may provide that an application must also be rejected if the trade mark is substantially identical with, or deceptively similar to, a protected international trade mark or a trade mark for which there is a request to extend international registration to Australia: see Part 17A.

1. To found the ground under section 44, an opponent has to establish the existence of at least one trade mark registration or application for registration of a trade mark that is owned by a person other than the Applicant and which:

   ·        has a priority date earlier than that of the Trade Mark; and

   ·is registered or made in respect of the same or similar goods or closely related services; and

   ·is a trade mark substantially identical or deceptively similar to the Trade Mark.

1. The Opponent relied upon the following trade marks:

Trade Mark No.	Trade mark	Goods/Services
447978 Priority date 4.7.86	Class 14: Precious metals and their alloys and goods in precious metals or coated therewith, not included in other classes; jewellery, precious stones; horological and chronometric instruments
503443 Priority date 23.1.89	Class 9: Telephones, radios, tapes and records and all other goods included in class 9
907618 (International Registration 506123) Priority date 14.2.02	Class 14: Precious metals and their alloys and goods in precious metals or coated therewith (excluding cutlery); jewellery, precious stones; clocks and watches and other chronometric instruments
909976 Priority date 18.4.02	Class 9: Televisions, video cameras, transistors, fire alarms, anti-theft warning apparatus, theftproof alarms, indicators (electricity), telecontrol instruments, television monitors of closed circuit, theftproof television video cameras of on-line access
1223949 Priority date 12.2.08 Removed for non use 17.11.15	IWATCH	Class 9: Cellular phones; mobile phones
1244524  (International Registration 962366) Priority date 7.4.08	Class 14: Precious metals and their alloys and goods in precious metals or coated therewith not included in other classes, jewellery, precious stones; horological and chronometric instruments Class 35: Retail trading of horological products and jewellery; retail trading via global networks of computers (Internet) of horological products and jewellery Class 37: Repair and maintenance of horological products and jewellery

1. All of the cited marks have earlier priority dates than the Trade Mark. Registration 1223949 has been removed from the Register and I shall not consider it any further.

2. The remaining cited registrations are for similar goods to those of the Trade Mark; therefore the remaining issue is that of similarity and/or substantial identity of the trade marks.

3. The Opponent did not make submissions on substantial identity and I take it that the Opponent does not consider the marks to be substantially identical, nor am I satisfied that they are substantially identical.

4. The term deceptively similar is defined in section 10 of the Act as follows:

   10. For the purposes of this Act, a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.

5. Deceptive similarity is to be assessed according to the tests set out in Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd[5]  per Windeyer J:

   On the question of deceptive similarity a different comparison must be made from that which is necessary when substantial identity is in question. The marks are not now to be looked at side by side. The issue is not abstract similarity, but deceptive similarity. Therefore the comparison is the familiar one of trade mark law. It is between, on the one hand, the impression based on recollection of the plaintiff's mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant's television exhibitions. To quote Lord Radcliffe again: "The likelihood of confusion or deception in such cases is not disproved by placing the two  marks  side by side and demonstrating how small is the chance of error in any customer who places his order for goods with both the  marks  clearly before him . . . . It is more useful to observe that in most persons the eye is not an accurate recorder of visual detail, and that marks are remembered rather by general impressions or by some significant detail than by any photographic recollection of the whole": de Cordova v. Vick Chemical Co (1951) 68 RPC, at p 106. And in Australian Woollen Mills Ltd v. F.S. Walton & Co. Ltd. (1937) 58 CLR 641 Dixon and McTiernan JJ. said: "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" (1937) 58 CLR, at p 658.

   [5] (1963) 109 CLR 407 at paragraph 13

1. I am to estimate the effect of the trade marks on the minds of potential customers – in other words, the assessment is to take place in the context of the marketplace for the goods.  This contextual comparison was stressed in Re Application by the Pianotist Co Ltd[6], where Parker J said: 

   You must take the two words. You must judge of them, both by their look and by their sound. You must consider the goods to which they are to be applied. You must consider the nature and kind of customer who would be likely to buy those goods. In fact, you must consider all the surrounding circumstances; and you must further consider what is likely to happen if each of those trade marks is used in a normal way as a trade mark for the goods of the respective owners of the marks.

   [6] (1906) 1A IPR 379 at 380

2. The standard which is applied to the assessment of whether the trade marks are deceptively similar was stated by French J in Registrar of Trade Marks v Woolworths[7]:

   [7] [1999] FCA 1020; (1999) 45 IPR 411 at paragraph 50

   In Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 at 594-5, which concerned the 1905 Act, Kitto J set out a number of propositions which have frequently been quoted and applied to the 1955 Act. The essential elements of those propositions continue to apply to the issue of deceptive similarity under the 1995 Act. Applied also to service marks and absent the imposition of an onus upon the applicant they may be restated as follows:

   (i) To show that a trade mark is deceptively similar to another it is necessary to show a real tangible danger of deception or confusion occurring. A mere possibility is not sufficient.

   (ii) A trade mark is likely to cause confusion if the result of its use will be that a number of persons are caused to wonder whether it might not be the case that the two products or closely related products and services come from the same source. It is enough if the ordinary person entertains a reasonable doubt.

   It may be interpolated that this is another way of expressing the proposition that the trade mark is likely to cause confusion if there is a real likelihood that some people will wonder or be left in doubt about whether the two sets of products or the products and services in question come from the same source.

   (iii) In considering whether there is a likelihood of deception or confusion all surrounding circumstances have to be taken into consideration. These include the circumstances in which the marks will be used, the circumstances in which the goods or services will be bought and sold and the character of the probable acquirers of the goods and services.

   (iv) The rights of the parties are to be determined as at the date of the application.

   (v) The question of deceptive similarity must be considered in respect of all goods or services coming within the specification in the application and in respect of which registration is desired, not only in respect of those goods or services on which it is proposed to immediately use the mark. The question is not limited to whether a particular use will give rise to deception or confusion. It must be based upon what the applicant can do if registration is obtained.

   In respect of the last proposition, Mason J observed in Berlei Hestia Industries Ltd v The Bali Company Inc [1973] HCA 43; (1973) 129 CLR 353 at 362:

   “...the question whether there is a likelihood of confusion is to be answered, not by reference to the manner in which the respondent has used its mark in the past, but by reference to the use to which it can properly put the mark. The issue is whether that use would give rise to a real danger of confusion."

3. Having regard to consumers’ imperfect recollection, I consider that there are significant visual differences between the Trade Mark and the cited marks, and in particular the clear separation of the elements of the Trade Mark.

4. Further, there are significant differences in the likely pronunciation of the marks. SWATCH would be pronounced as the known English word, while I-WATCH and ISWATCH are likely to pronounced ‘eye-watch’ and ‘eye-swatch’ respectively. The Trade Mark would be pronounced ‘double-you-watch’.

5. The marks can be distinguished conceptually. As demonstrated in Chan in MC-1, SWATCH is an English word with known meanings, including small samples of fabric, paint, or makeup.

6. In Emsenhuber Appendix LE-2, it is shown that SWATCH can be taken to mean ‘Swiss watch’ or ‘second watch’. These meanings are derived from the concept of the SWATCH being an inexpensive but well-crafted Swiss watch. Neither of these meaning are likely to be applied to the Trade Mark.

7. Chan, in Exhibit MC-3, suggests that the ‘I’ prefix in I-WATCH and ISWATCH could be interpreted to stand for ‘internet’ or ‘individual’, possibly suggesting an internet version of the watch or Swatch. The letter ‘w’ has no such connotation, nor is it likely to be taken as a prefix.

8. Chan states that the Applicant has marketed ‘smart watches’ under the G WATCH trade mark since July 2014 in the United States, Canada, the United Kingdom, Australia, France, Germany, Ireland, Italy, Japan, South Korea, and Spain. There is no evidence in these procedings of any instances of confusion in any of the markets mentioned.

9. I note that the common element WATCH has a low level of distinctiveness in the context of the relevant goods, and must therefore be discounted.

10. I also note the absence of any evidence of actual confusion resulting from the use of the Trade Mark, the Applicant’s G WATCH mark, and the cited marks.

11. I am not satisfied that the Opponent has established this ground of opposition.

Section 60

1. Section 60 of the Act provides:

   60Trade 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

2. Concerning a trade mark’s reputation, in McCormick & Co Inc v McCormick[8] (‘McCormick’) Kenny J said at [81]:

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

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

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

and Heerey J in Le Cordon Bleu B.V. v Cordon Bleu International Ltd[9]  said that the reputation required to be demonstrated was:

one of which a significant number of persons were aware…What is ‘significant’ or ‘substantial’ will depend on the nature of the goods or services in question. For some highly specialised products, awareness among a few thousand persons, or even less, might be sufficient.

[8] [2000] FCA 1335; (2000) 51 IPR 102; [2000] AIPC 38-192

[9] [2000] FCA 1587; (2000) 50 IPR 1

1. The reputation may be assessed by evidence of sales revenue and advertising expenditure provided by an Opponent.  In McCormick, Kenny J said at [86]:

   In practice, it is commonplace to infer reputation from a high volume of sales, together with substantial advertising expenditures and other promotions, without any direct evidence of consumer appreciation of the mark, as opposed to the product: see, e.g., Isuzu-General Motors Australia Ltd v Jackeroo World Pty Ltd (1999) 47 IPR 198; Marks & Spencer plc v Effem Foods Pty Ltd (2000) AIPC 91-560; Photo Disc Inc v Gibson (1998) 42 IPR 473; and RS Components Ltd v Holophane Corp (1999) 46 IPR 451. This Court has followed this approach as well, acknowledging that public awareness of and regard for a mark tends to correlate with appreciation of the products with which that mark is associated, as evidenced by sales volume, amongst other things. Thus, in Toddler Kindy Gymbaroo Pty Ltd v Gymboree Pty Ltd [2000] FCA 618 (“Gymboree”), Moore J accepted at [94] that the applicant had established a reputation for the purposes of s 60 solely on the basis of use and promotion of the relevant mark. Another example of this approach is Nettlefold Advertising Pty Ltd v Nettlefold Signs Pty Ltd (1997) 38 IPR 495 (“Nettlefold”), in which Heerey J relied upon the public visibility of the applicant’s marks over approximately two decades as well as a $100,000 promotional campaign in finding that a reputation for the purposes of s 28 of the 1955 Act existed.

2. Emsehuber establishes that the Opponent produces the world’s best-selling plastic watch, being the Swatch. Although the Applicant pointed out matters that it considered diminished the weight of the reputation evidence, I am satisfied that the Opponent has established the required reputation in watches.

3. The real issue for this ground is whether or not the use of the Trade Mark is likely to cause confusion. I am not satisfied that this issue has been established by the Opponent.

4. The theoretical lack of likelihood of confusion has been canvassed in the section 44 ground; however, the principles have some applicability here in relation to the aural, visual, and conceptual differences in the competing marks.

5. The aural, visual, and conceptual differences in the Trade Mark are applicable to the Applicant’s G WATCH trade mark, although here the ‘G’ has no reference to ‘watch’. No evidence has been provided to support any actual confusion in any marketplace. If confusion has not arisen through concurrent use of the G Watch and SWATCH marks in any jurisdiction, it seems to me that the Applicant’s use of the W Watch mark is also not likely to confuse or deceive.

6. Furthermore, the Opponent’s reputation in the SWATCH trade mark is limited to watches. The application covers a wide range of goods beyond watches. Such goods are very different to watches and, accordingly, in addition to the significant differences between the marks as discussed above, use of the Trade Mark on those goods are not likely to deceive or cause confusion.

7. This ground of opposition has not been established.

Section 42(b): Trade mark’s use contrary to law

1. Section 42 of the Act relevantly provides:

   42 Trade mark scandalous or its use contrary to law

   An application for the registration of a trade mark must be rejected if:

   (b)         its use would be contrary to law.

2. The Opponent nominated section 18 of the Australian Consumer Law (‘ACL’), which is contravened when a party engages in conduct in trade or commerce that is misleading or deceptive, or is likely to mislead or deceive customers. There must be a ‘real but not remote chance or possibility’ of misleading or deceiving regardless of whether it is less or more than 50 percent.[10]

   [10] Global Sportsman Pty Ltd v Mirror Newspapers Ltd (1984) 55 ALR 25 at 34, per Bowen CJ, Lockhart and Fitzgerald JJ.

3. The Opponent also nominated a breach of section 29(1)(g), that the Applicant’s use of the Trade Mark would be a contravention of the ACL and amount to passing off at common law.

4. However, in the circumstances of this matter, where the Opponent has not established that the use of the trade mark would be likely to deceive or cause confusion in terms of section 60, it follows that neither can it establish that the use of the trade mark would ‘mislead or deceive’ under the ACL (or its common law equivalent), which is a higher standard. In Parkdale Custom Built Furniture Pty. Limited v Puxu Pty Limited[11], Gibbs C.J. said at [8]:

   The words of s. 52 require the court to consider the nature of the conduct of the corporation against which proceedings are brought and to decide whether that conduct was, within the meaning of that section, misleading or deceptive or likely to mislead or deceive . . . . . The words “likely to mislead or deceive”, which were inserted by amendment in 1977, add little to the section; at most they make it clear that it is unnecessary to prove that the conduct in question actually deceived or misled anyone. In McWilliams v. McDonalds [1980] FCA 159; (1980) 33 A.L.R. 394 it was rightly held by Smithers J. and by Fisher J. that to prove a breach of s. 52 it is not enough to establish that the conduct complained of was confusing or caused people to wonder whether two products may have come from the same source, and that Southern Cross Refrigerating Co. v. Toowoomba Foundry Pty Ltd (1954) 91 C.L.R. 592, a decision on the Trade Marks  Act 1905 (Cth) as amended, is distinguishable: I need not add to what their Honours said on this subject (33 A.L.R.) at 397-8 and 412-3. I agree too with those learned judges that the court must decide objectively whether the conduct is misleading or deceptive or likely to mislead or deceive, and that evidence that members of the public have actually been misled is not conclusive: see at 399-400 and 413-4. I would add that evidence that members of the public were misled, not by any conduct of the defendant, but by other circumstances for which the defendant was not responsible, would be quite irrelevant.”

   [11] [1982] HCA 44; (1982) 149 CLR 191.

5. In the same case Mason J. said at [30]:

   “. . . the onus is on the plaintiff to show that the conduct is likely to mislead or deceive. Therefore conduct which merely causes some uncertainty in the minds of relevant members of the public does not breach s. 52.”

6. I am not satisfied that this ground of opposition, under section 42(b) of the Act, has been established.

Decision & Costs

1. Subsection 55(1) of the Act requires me to decide either to refuse to register the trade mark, or 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.

2. The Opponent has not established any of its grounds of opposition.

3. The trade mark application may then 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 the appeal has been decided or discontinued.

4. Both parties sought their costs. Costs may follow the event and I award costs against the Opponent at the scale set out in the Regulations.

Jock McDonagh

Hearing Officer

Trade Marks Hearings

22 December 2016