Taxback Pty Ltd v Skilled Accounting Pty Ltd [Sec=Unclassified]

[2009] ATMO 79

TRADE MARKS ACT 1995

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

Re:Opposition by TAXBACK PTY LTD to registration of trade mark application 1126209 (35) - TAXBACK TV - filed in the name of SKILLED ACCOUNTING PTY LTD.

Delegate:	Heath Wilson
Representation:	Opponent: John Hennessy of Counsel instructed by Allison Benson of Somerville & Co, Solicitors. Applicant: Sophie Goddard of Senior Counsel instructed by Simon Williams of Spruson and Ferguson, Patent & Trade mark Attorneys
Decision:	2009 ATMO 79 Section 52 Opposition- grounds under section 41, 43 and 60 of the Trade Marks Act 1995; Mark is inherently capable of distinguishing; No inherent connotation likely to mislead or deceive; Reputation of opponent’s trade mark unlikely to result in deception or confusion; Costs awarded against opponent.

Background  

1. On 26 July 2006, Skilled Accounting Pty Ltd (“the applicant”) applied to register the following trade mark:

   Trade mark application:      1126209
   Trade mark:  TAXBACK TV

   Services Specification:         Class: 35 Accounting services, taxation accounting services and, in particular, services associated with the preparation of tax returns, tax advice, tax marketing, tax refunds

2. The trade mark was advertised for possible registration in the Australian Official Journal of Trade Marks on 30 November 2006. On 27 February 2007, Taxback Pty Ltd (“the opponent”) filed a notice of opposition (“the notice”) to this trade mark application under section 52 of the Trade Marks Act 1995 (“the Act”).

   Evidence

3. The parties filed and served evidence as set out below:

   Evidence in Support

   ·     Statutory Declaration of Mircea Stoica dated 27 June 2007 (Exhibits “MS-1 to MS-39”)

   Evidence in Answer

   ·     Statutory Declaration of Timothy Dale Trumbull dated 8 May 2008 (Exhibits “A to L” and Exhibits “TDT-1 to TDT-9B”) including:

   Ø  Statutory Declaration of Timothy Dale Trumbull dated 21 January 2005 (Exhibits “TT-1 to TT-14”).

   Ø  Statutory Declaration of Paul Brady dated 23 March 2005 (Exhibits “PB1 to PB37”).

   Ø  Statutory Declaration of Timothy Dale Trumbull dated 23 June 2005 (Exhibits “TT-14A to TT-21C”).

   Evidence in Reply

   ·     Statutory Declaration of Jessica Lantry dated 12 December 2008 (Exhibits JL-1 to JL-31)

4. European Student Services Limited (“ESS”), of which the opponent is a wholly owned Australian subsidiary company, previously made application for registration of the following trade mark on 28 August 2003:

   Trade mark application:      967668
   Trade mark:  

   Services Specification:         Class: 35: Tax preparation, tax returns, tax advice, tax marketing, tax refunds, superannuation returns, accounting accounts

5. The above application (no. 967668) was opposed by Skilled Accounting Pty Ltd, evidence was submitted, and that trade mark application was withdrawn prior to the matter being heard by a delegate of the Registrar. Some of the evidence submitted by both parties in that opposition matter has been re-submitted by the applicant in the declaration of Timothy Trumbull and is, therefore, relevant to these proceedings. 

   Grounds of Opposition

6. The notice cites grounds of opposition under sections 41, 43 and 60 of the Act. The opponent pressed each of these grounds at the hearing, and I will therefore address them in the following decision. For an opposition to succeed, the opponent bears the onus of establishing at least one of the grounds cited in the notice on the balance of probabilities (Pfizer Products Inc v Karam (2006) 70 IPR 599, per Gyles J at [6] to [26]).

7. I heard this matter on 8 July 2009 in Sydney as a delegate of the Registrar of Trade Marks. At the hearing, John Hennessy of Counsel appeared on behalf of the opponent and Sophie Goddard of Senior Counsel appeared on behalf of the applicant.

   Reasons

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

   (1)For the purposes of this section, the use of a trade mark by a predecessor in title of an applicant for the registration of the trade mark is taken to be a use of the trade mark by the applicant.

   Note 1:For applicant and predecessor in title see section 6.

   Note 2:If a predecessor in title had authorised another person to use the trade mark, any authorised use of the trade mark by the other person is taken to be a use of the trade mark by the predecessor in title (see subsection 7(3) and section 8).

   (2)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 (designated goods or services) from the goods or services of other persons.

   Note:For goods of a person and services of a person see section 6.

   (3)In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.

   (4)Then, if the Registrar is still unable to decide the question, the following provisions apply.

   (5)If the Registrar finds 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 is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:

   (a)the Registrar is to consider whether, because of the combined effect of the following:

   (i)the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;

   (ii)the use, or intended use, of the trade mark by the applicant;

   (iii)any other circumstances;

   the trade mark does or will distinguish the designated goods or services as being those of the applicant; and

   (b)if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons; and

   (c)if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services—the trade mark is taken not to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons.

   Note 1:For goods of a person and services of a person see section 6.

   Note 2:Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).

8. The question of whether a trade mark is adapted to distinguish was considered by Kitto J in Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511 (at 514) as:

   … tested by 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.

9. The issue of whether the phrase “Tax Back” is capable of distinguishing the services of taxation accounting has been a contentious issue in the prolonged conflict between the applicant and the opponent. A cursory examination of the Trade Marks Register reveals various attempts by both parties to register slight variations on the phrase, with varying degrees of success. It is worth noting that other trade mark applications belonging to these parties featuring “Tax Back” with minimal or no getup, have attracted a ground for rejection under subsection 41(5) of the Act (i.e. it is an expression which is to some extent inherently adapted to distinguish the services). The applicant’s trade mark is TAXBACK TV, and it should be considered as a whole in relation to the relevant services.

10. The consideration of inherent adaptability is something which depends on the nature of the trade mark itself. It is not a test conducted with reference to specific traders who happen to have similar trade marks (such as the opponent), but a general question of whether “other traders are likely in the ordinary course of their business and without any improper motive, to desire to use upon or in connection with their goods” (per Justice Kitto in F. H. Faulding & Son Ltd v Imperial Chemical Industries of Australia and New Zealand Ltd. (1965) 112 CLR 537).

11. The most recent statutory declaration of Timothy Dale Trumbull, Managing Director of the applicant, indicates that the phrase “Tax Back” is used by a number of other traders in a descriptive sense. For example, the phrase “Tax back for Travellers” is used in relation to similar services on the Australian Customs Services website (Exhibit TDT 9A). In fact, both parties have used the phrase in this descriptive fashion at some stage, (in addition to their trade mark use) in order to encourage overseas workers to utilise their taxation services and receive their “tax back.”

12. In Burger King Corporation v Registrar of Trade Marks (1973) 128 CLR 417 (at 424) it was stated that:

    Inherent adaptability is something which depends on the nature of the trade mark itself - see Clark Equipment Co v Registrar of Trade Marks [(1964) 111 CLR 511 at 515] - and therefore is not something that can be acquired; the inherent nature of the trade mark itself cannot be changed by use or otherwise.

13. Accordingly, I am of the view that while the phrase “Tax Back” is descriptive by itself, it is not devoid of any capacity to distinguish the services claimed, and may function as a trade mark with a certain amount of “getup” or via evidence of use, intended use or other circumstances under section 41(5). However, the applicant’s trade mark in this matter consists of more than TAXBACK by itself and it is well established that the trade mark must be considered as a whole (Diamond T. Motor Co’s Appn (1921) 38 RPC 373).

14. The opponent has proposed that the addition of the letters “TV” to the applicant’s trade mark does not render “the descriptive words “tax back” distinctive” (paragraph 16, opponent’s submissions). This result is said to be due to the fact that “TV” is an Internet Domain code for the Island Nation of Tuvalu. While in general the inclusion of an internet address code (such as .com”, “.com.au” or “.uk”) does little to distinguish an applicant’s otherwise descriptive trade mark, in this instance the particular address code material does not appear be in as common usage as some other country address codes. I note though, that the applicant’s trade mark does not take on the appearance of an internet address, due to the lack of the ‘dot’ between the individual elements TAXBACK and TV. In addition, “TV” has another and more widely understood meaning, being a common abbreviation for “television”.

15. As a result, the trade mark as a whole has an overall meaning and significance which is different to that of an internet address. While this meaning may be allusory in respect of television production services relating to tax refunds, the same cannot be said for accounting services in Class 36. Accordingly, the suffix of the applicant’s trade mark cannot be ignored for the purposes of section 41. When considered as a whole, the trade mark does not directly describe the applicant’s services or their characteristics in the requisite sense and it is not a phrase that other traders are likely to need to use in their ordinary course of trade.

16. In resolving this issue, if any doubt regarding the inherent capability of the applicant’s trade mark to distinguish the services claimed were to remain, it is well established that the section 41 ground is to be determined on the balance of probabilities. Justice Branson in Blount Inc v Registrar of Trade Marks (1998) 40 IPR 498 [at 508] commented:

    Each of ss33(1) and 41 involves the concept of the Registrar being 'satisfied'. Where the Act requires the Registrar to be 'satisfied' of any matter, it is to be understood as requiring that he or she be persuaded of the matter according to the balance of probabilities: Rejfek v McElroy (1965) 112 CLR 517; at 521. That is, that the Registrar be persuaded, having given proper consideration to those factors and circumstances that the Act requires him or her to give consideration to, that such matter is more probable than not.

17. In summary, the phrase “Tax Back” has limited inherent adaptation to distinguish these services, and the addition of the component TV creates a different meaning and renders the applicant’s trade mark capable of distinguishing as a whole. As a result, I find that the trade mark “TAXBACK TV” is, on the balance of probabilities, inherently capable of distinguishing the services applied for, and the ground of opposition under section 41 has not been established.

    Section 43: Trade mark likely to deceive or cause confusion

    An application for the registration of a trade mark in respect of particular goods or services must be rejected if, because of some connotation that the trade mark or a sign contained in the trade mark has, the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion.

18. In order for an opponent to establish the ground of opposition under section 43, there must be an inherent connotation within the trade mark likely to deceive or cause confusion, as addressed in Big Country Developments Pty Ltd v TGI Friday’s Inc [2000] FCA 720; 48 IPR 513 (at 521). A connotation inherent in the trade mark cannot be determined by external considerations, and sections 44 and 60 are the more suitable grounds for the comparison of potentially conflicting trade marks.

19. The likelihood of deception or confusion must derive from the mark itself. There are four main ways in which a mark may be deceptive under section 43. These are: (1) marks suggesting the nature or quality of the goods or services is of a particular kind (for example, Westchester Media Co LP v Australian Polo Magazine Pty Ltd [2001] AIPC 91-685); (2) marks falsely suggesting geographical origin (Verband Bayerischer Ausfuhrbrauereien Engetragener Verein v Bavaria NV (2006) 69 IPR 678); (3) marks falsely suggesting an affiliation or sponsorship (“Vitasafe” Trade marks [1963] RPC 256 (UK Reg); or, (4) confusion with other traders (e.g. Durkan v Twentieth Century Fox Film Corporation (2000) 47 IPR 651).

20. The trade mark TAXBACK TV does not falsely connote the nature of the services applied for, as it does not have a sufficiently tangible meaning as to be likely to deceive or confuse in the marketplace.  The connotation within the mark must be clear and result in a real and tangible danger of confusion. The trade mark as a whole does not contain a description of any services in particular, and consequently, it cannot be used falsely to mislead the Australian public.

21. The opponent has submitted that the opposed mark indicates a false association with the island of Tuvalu by virtue of the abbreviation “TV” at the end of the trade mark. Whether or not the trade mark connotes the sponsorship or approval of an entity or institution will depend on the surrounding circumstances. “In each case, it will be a question of fact and degree” (see McCorquodale v Masterton (2004) 63 IPR 582 [at 53]). Even if there were a connotation, it would only be to the extent that the applicant owns the web address with the identifier “.TV”. I am not convinced that the abbreviation “TV” falsely suggests any geographical origins. The trade mark is also an allusion as to the applicant’s form of presentation over the internet. However, this connotation does not amount to a false representation under section 43.

22. The submissions of counsel for the opponent rely predominately on the similarity of the applicant’s mark with the opponent’s trade marks TAXBACK.COM (and device) and TAXBACK.COM. However, in my view, this alleged similarity is not a “connotation” which is inherent within the applicant’s trade mark. The operation of section 43 does not depend on the existence of a conflicting trade mark, and a “connotation” is implied within the trade mark itself “in addition to its essential primary meaning.” (Durkan v Twentieth Century Fox (supra); Amalgamated Television Services Pty Ltd v Clissold (2000) 52 IPR 207). The consideration as to whether the use of the applicant’s trade mark would be likely to deceive or cause confusion because of the reputation of another similar trade mark is more appropriately dealt with under the section 60 ground of opposition.

23. For present purposes, I am satisfied that the trade mark does not contain a connotation that would be likely to deceive or cause confusion when used on those services. Accordingly, I find that the ground of opposition under section 43 of the Act has not been established.

    Section 60: Trade mark similar to trade mark that has acquired a reputation in Australia

24. The opponent’s counsel, Mr. Hennessy submitted that the reputation of both TAXBACK.COM (“the word mark”) and (“the composite mark”) would be relied upon for section 60. I will therefore consider whether either of those these trade marks had a reputation (as at 26 July 2006) amongst a significant section of the Australian public, such that the use of the applicant’s trade mark TAXBACK TV would be likely to deceive or cause confusion in the marketplace.

    Reputation of the Opponent’s Trade marks

25. In ConAgra Inc v McCain Foods (Aust) Pty Ltd (1992) 33 FCR 302 [at 343]; 23 IPR 193 [at 343], Lockhart J commented that:

    [R]eputation within the jurisdiction may be proved by a variety of means including advertisements on television or radio, or in magazines and newspapers within the forum. It may be established by showing constant travel of people between other countries and the forum and that people within the forum (whether residents there or persons simply visiting there from other countries) are exposed to the goods of the overseas owner.

26. Ms Goddard, counsel for the applicant, argued that the trade mark TAXBACK.COM is unable to establish a reputation likely to deceive or cause confusion, due to the descriptive nature of the “Tax Back” element. I cannot agree. However, while I am of the view that the expression “Tax Back” (and TAXBACK.COM) by itself is capable of distinguishing the claimed services through use or intended use, in this instance the requisite reputation in the opponent’s mark must therefore be greater in order to create a likelihood of confusion under section 60.

27. While the opponent registered the expression TAXBACK.COM as an internet domain name in 2000, this fact alone does little to establish use of, or a reputation in a trade mark (Ward Group Pty. Limited v Brodie & Stone plc (2005) 64 IPR 1; Deutsche Telekom AG v E! Entertainment Television Inc. [2006] ATMO 33). In November 2002, the opponent’s overseas business was re-branded from ESS Refunds to TAXBACK.COM. However, the letter from 2002 featuring the trade mark (Exhibit MS-3) does not establish its use in Australia, as it was addressed from the overseas office.

28. Within the opponent’s promotional “Build up” period (from August 2003 to March 2004), the main emphasis on featuring the word mark TAXBACK.COM in advertising was to direct consumers to the opponent’s website. I am not satisfied that appearances of the trade mark as part of the web address for the opponent’s contact details constitutes trade mark use. A descriptive expression used as a web address is unlikely to be viewed by the relevant consumer as the opponent’s badge of origin. In addition, the evidence which indicates that the opponent has used its trade mark descriptively will not assist (Kamyr Inc’s Application (1996) 34 IPR 432 (Reg)) in the establishment of a reputation. It is likely that the average Australian would view the words as a description of the services offered by the opponent rather than as its badge of origin. I find that the word mark TAXBACK.COM by itself does not have a reputation likely to result in the use of the applicant’s trade mark deceiving or causing confusion in the marketplace.

1. On the strength of the evidence, the expression TAXBACK.COM as a word mark is unable to distinguish the relevant services or to function as a trade mark, and the opponent’s reputation therefore lies predominately in the composite mark TAXBACK.COM (incorporating the globe device). Due to the addition of the device, the opponent’s composite trade mark is inherently capable of distinguishing its services from those of other traders. Despite this factor, the device is not particularly unique or memorable and the principal or dominant element remains the words “Tax Back”.

2. With a few exceptions, in actual use the opponent’s word trade mark rarely appears on promotional material without being accompanied by the TAXBACK.COM composite trade mark. The earliest use of the composite trade mark in Australia is in 2003, and sustained advertising and marketing occurred in the “Build up” period as described in the statutory declaration of Mircea Stoica, Director of Taxback Pty Limited (paragraph 18). It is clear that the number of customers registered for tax (from 2000-2006) and marketing figures for the trade mark (2004-2007) have risen substantially, but they do not indicate whether the figures relate to Australian or overseas marketing (Paragraph 30). In addition, the public awareness of the opponent’s composite trade mark in Australia spanned a relatively short period of time (approximately three years) before the applicant’s priority date in 2006.

3. The evidence featuring the composite mark includes posters, flyers, backpacker magazine articles, advertisements in train stations, exhibition stands, website links, Frisbees, promotional condoms and clothing for staff members. The posters feature the composite mark, the word “Tax Back” by itself and the web address TAXBACK.COM (usually in the form of contact details). Use on employee t-shirts (Exhibits MS-13), indicates that the opponent was also using the sole phrase “Tax Back” to describe a service, as it appears along with the words “Jobs” and “Visas”. However, the composite mark TAXBACK.COM is still evident at the opponent’s exhibitions and on the promotional material.

4. Some of the evidence before me constitutes advertising in Australia; though there are also overseas promotions for people looking to work in Australia. This evidence includes advertisements in British Balls Magazine (Exhibit MS-34) and TNT Magazine (Exhibit MS-36) which are primarily British backpacker magazines. Given the international nature of the opponent’s services, this evidence is relevant, but it does not carry the weight of a well-known Australian publication.

5. On the strength of the evidence, the composite mark does have a reputation in the marketplace, as it is present on most of the opponent’s promotions prior to 26 July 2006. However, the assessment of the likelihood that reputation existing in the opponent’s trade mark is sufficient to cause confusion involves a number of determinative factors. The reputation existing amongst a significant number of consumers is dependant on the size of the relevant market. Heerey J commented in Le Cordon Bleu BV v Cordon Bleu International Ltee (2001) 50 IPR 1 (at 20); that:

   What is “significant” or “substantial” will depend on the nature of the goods or services in question. For highly specialised products, awareness among a few thousand persons, or even less might be sufficient … We are here concerned with foodstuffs sold in supermarkets, delicatessens, milk bars and other retail outlets. The relevant market is virtually the entire Australian population from early teenage years onwards.

6. Section 60 involves a consideration of a notional use of the applicant’s trade mark on all the claimed goods in the application, across the whole of Australia. It is worth noting that both parties are clearly in the same business field, and the services are generally aimed at a narrow market, being international students/backpackers working in Australia. The reputation required for a “substantial” number of consumers would consequently be less than it would be if the trade mark was in use for general accounting services for the Australian public.

7. While both parties operate in the same geographic area (i.e. Sydney), the majority of the High Court in Sym Choon & Co Ltd v Gordon Choon Nuts Ltd (1949) 80 CLR 65 [at 72]) considered the proximity of the parties businesses to be irrelevant for determining reputation, and that the “proximity of businesses does no more that demonstrate beyond question that such a possibility is real and not imaginary.” The main issue must be the various uses to which the applicant can properly put the trade mark TAXBACK TV (as applied for), and whether that use would cause confusion.

8. Actual instances of confusion between the trade marks are also relevant for a determination under section 60 (Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641 at 658). Exhibit MS-28 of the Mircea Stoica declaration highlights a client’s uncertainty between the opponent’s and the applicant’s services via e-mail dated 3 August 2004. However, this instance is not one of confusion between the trade marks TAXBACK.COM and TAXBACK TV per se, but appears to be as a result of incorrect information which that person was given regarding a relationship between Skilled Accounting Pty Ltd and Taxback Pty Ltd, and therefore has little value. Given the history of other similar “Taxback” trade marks used by the applicant and opponent, and the descriptive use of the expression “Tax Back” by third parties (referred to earlier), it is not surprising that such uncertainties in this narrow marketplace have arisen.

9. While there has been use of the opponent’s composite trade mark TAXBACK.COM both overseas and in Australia in the “build-up” period, I do not consider that the activity of the opponent has translated into an “awareness, cognisance or knowledge of the mark” (Pioneer Hi-Bred Corn Co v Hy-Line Chicks Pty Ltd [1979] RPC 410 at 424) such that use by the applicant of the trade mark TAXBACK TV is likely to deceive or cause confusion in Australia.

10. Taking into account the overall level of reputation of the opponent’s trade mark balanced with the various factors affecting the likelihood of confusion, I find that on the balance of probabilities, the danger of confusion between the two trade marks is not a real and tangible one. The probability of confusion must be finite and non-trivial (Registrar of Trade Marks v Woolworths (1999) 45 IPR 411 per French J [at 428]). The reputation of both of the opponent’s trade marks is insufficient, when taking into consideration the factors affecting the likelihood of confusion in the marketplace, to create a situation of that order. Accordingly, I find that the ground of opposition under section 60 has not been established.

    Decision

    Section 55: Decision

    (1) 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.

11. No grounds of opposition under the Act have been established, and 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 registration shall not occur until the appeal has been discontinued or, in the event of a decision from the Court that the application be subject to that order.

    Costs

12. Both parties have requested an award of costs in this matter. As the opposition is unsuccessful, the applicant is entitled to costs. Accordingly, I award costs against the opponent to the extent allowed under the Official Scale contained in Schedule 8 of the Trade Marks Regulations 1995.

    Heath Wilson
    Hearing Officer
    Trade Marks Hearings
    8 October 2009