The Privileges Card Pty Ltd v SPHC (IP) Pty Ltd

No judgment structure available for this case.

TRADE MARKS ACT 1995

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

Re:Opposition by THE PRIVILEGES CARD PTY LTD to registration of trade mark application 741375(16, 35, 42) - PACIFIC PRIVILEGE - filed in the name of SPHC (IP) PTY LTD.

Background

On 13 August 1997, SPHC (IP) Pty Ltd (‘the applicant’) filed application to register the trade mark PACIFIC PRIVILEGE in respect of goods and services that now read:

Class 16
Printed matter excluding printed matter relating to computer software and hardware; credit and debit cards in this class; brochures, advertising material and documents; office requisites excluding typewriters and excluding stationery and photographic paper and materials included in this class
Class 35
Advertising and promotional services in this class including those for the provision of accommodation, foods, beverages, liquor, entertainment, conferences, travel services and those for goods and services provided by travel agencies, hotels, motels, tourist homes and other establishments
Class 42
Discount services rendered to card holding members, particularly the provision of discounts, complimentary goods and complimentary services in hospitality, tourism and entertainment industries; services in procuring and reserving hotel, motel and tourist home accommodation for travellers
[‘the applicant’s goods and services’].

Before amendment, the specification of services in Class 42 read:

Class 42
Services rendered in connection with hotels, tourist-homes, hotel and/or motel operation and management; services rendered in the provision of accommodation and lodgings for travellers, room rental and/or leasing; services rendered in the provision of meals by hotels, motels, tourist-homes and other places of accommodation; restaurant services including services provided by self service restaurants and snack bars; services rendered in the provision of food, beverage and liquor prepared for consumption including catering services; provision of conference facilities by hotels, motels, tourist-homes and other establishments provided by travel agencies; services in procuring and reserving hotel and motel and tourist-home accommodation for travellers.

The amendment of the specification of services in Class 42 was an outcome of an objection by the examiner in terms of section 44 of the Trade Marks Act 1995 (‘the Act’). The present specification in Class 16 is the result of conflict with trade mark registrations unrelated to these proceedings. The examiner noted grounds for rejection because of, inter alia, registration 662423(42) THE PRIVILEGES CARD and subsections 44(1) and (2) and in terms of section 41.

Following the amendments to the application, the examiner applied the provisions of subsections 41(5) and 44(3)(a) and, as a delegate of the Registrar, accepted the application for registration. The application was advertised as accepted in the Australian Official Journal of Trade Marks on 16 July 1998.

On 16 October 1998, The Privileges Card Pty Ltd (‘The Privileges Card’) filed Notice of Opposition (‘the Notice’) to the registration of the trade mark.

The Notice cites several grounds, these being under:

i.section 44, relying on The Privileges Card’s registration 662423
ii.subparagraph 62(a) –that the application, or a document filed in support of the application, was amended contrary to this Act
iii.subparagraph 62(b) - that the Registrar accepted the application for registration on the basis of evidence or representations that were false in material particulars
iv.section 41 – that the trade mark is not capable of distinguishing the goods and services of the applicant from those of other traders
v.subparagraph 42(b) – that the use of the trade mark would be contrary to law
vi.section 43 – that, because of a connotation contained in the trade mark PACIFIC PRIVILEGE, the use of the trade mark would confuse or deceive

vii.subparagraph 44(3)(a) that the evidence of honest concurrent user of the applicant’s trade mark was, at the time of acceptance of the trade mark, insufficient to establish honest concurrent user of the trade mark by the applicant and remains so.

The grounds specified against items iv, v, and vi, above, would appear, from the opponent’s written submissions, to have been abandoned and I now dismiss the opposition in relation to those grounds.

Other

This application was the object of intensive efforts on the part of Mr John Christiansen, trade mark agent for The Privileges Card, to secure a revocation of acceptance in terms of section 38 of the Act. The reasons Mr Christiansen gave in his petitions for this revocation were that the evidence on which the application was accepted was manifestly inadequate; that the applicant must have been less than completely honest in its evidence; and, that the services in respect of which the application was accepted included services not included in the original specification, contrary to the provisions of section 65 of the Act.

Mr Christiansen was unsuccessful with these petitions but apparently continues to petition for revocation of the acceptance.

Hearing

The opposition matter was the subject of a hearing before me as a delegate of the Registrar of Trade Marks. Mr Christiansen submitted written submissions on behalf of The Privileges Card. Ms Baird, of Counsel, instructed by James Maxwell of Peter Maxwell and Associates appeared on behalf of the applicant. I provided copies of the written submissions to the applicant’s legal representatives.

The evidence

Evidence in support, evidence in answer and evidence in reply was served and filed as per Part 5 of the Trade Mark Regulations. The evidence comprises:

Declarant	Known as	Date Made	Exhibits
*Evidence in Support*
John Christiansen	Christiansen 1	7 January 1999	JC-1
Robert John Leticq	Leticq 1	11 January 1999
*Evidence in Answer*
Linda Gaye Townsend	Townsend	4 July 2000
Mark Justin Baker	Baker	11 July 2000	MJB1 – MJB22
Julie Van der Weegan	Van der Weegan	10 July 2000
Mark A Jamison	Jamison	28 July 2000
Craig Kelleher	Kelleher	9 August 2000
Rachel Stedman	Stedman	9 August 2000
Mark McCowan	McCowan	8 August 2000
Wendy Moala	Moala	9 August 2000
Kirsten Magan	Magan	9 August 2000
Danielle Summerfield	Summerfield	7 August 2000
Bonita Jones	Jones	7 August 2000
Philip Fowler	Fowler	7 August 2000
*Evidence in Reply*
John Christiansen	Christiansen 2	13 November 2000
Robert John Leticq	Leticq 2	9 February 2001	A – G
Sharon Mary Manthey	Manthey	7 February 2001

There are also two declarations by Justin Mark Baker made on 27 January 1998 and 6 April 1998, respectively, in support of the application prior to acceptance of the application. I will refer to these as the early Baker declarations. I will treat them as being material to these proceedings as The Privileges Card has had access to them via a Freedom of Information request and Mr Christiansen has addressed them both comprehensively in his declarations and submissions. It is clear, then, that it is procedurally fair to refer to them in these reasons.

Revocation

Much of Christiansen 1 and 2 appear to be a continuation of arguments for a revocation of acceptance of this application based on criticisms of the early Baker declarations rather than factual material to the opposition itself. While a statutory declaration is not an appropriate vehicle for what, essentially, constitutes submission, it is convenient for me to dispose of this aspect of submission at the outset.

Section 38 of the Act allows:

38 Revocation of acceptance
(1) If, before a trade mark is registered, the Registrar is satisfied:
(a)that the application for registration of the trade mark was accepted because of an error or omission in the course of the examination; or
(b)that, in the special circumstances of the case, the trade mark should not be registered, or should be registered subject to conditions or limitations, or to additional or different conditions or limitations;

the Registrar may revoke the acceptance of the application.

Revocation is regarded by the Registrar as an unusual step and will, in practice, occur where an error in examination, being an oversight, is obvious. It will occur, for example, where the examiner has not located an obviously conflicting registration or has failed to locate an obvious denotation of a word that would bring the trade mark within the operation of section 41 of the Act. The initiative that brings about a revocation is that of the Registrar; if information from a third party has brought circumstances to the Registrar’s attention, that third party is in the position of being a common informer and has no standing.

The wording of section 38 makes it plain that revocation is a matter for the Registrar and the use of the word ‘may’ within the section makes it clear that this is a discretionary power.

Procedural fairness to the applicant and the provisions of the Act dictate that revocation, if the Registrar believes it be appropriate, cannot proceed without the applicant being given:

·     Right and proper warning of the Registrar’s intention to revoke
·     The reasons for which the Registrar intends to revoke
·     A right of reply
·     A right to a hearing.

If the information has come from a common informer, that common informer has no standing whatsoever in the issue of the revocation. The issue of the revocation is strictly between the Registrar and the applicant. Thus, the common informer has no right to any detailed explanation of the Registrar’s decision to revoke or not to revoke. The Registrar will, of course, provide courtesy advice to the common informer, which will advise that the information has been received and considered, and is or is not being acted on. It is possible that a more detailed explanation will be on the official file and the common informer may access this via a Freedom of Information request.

If the common informer wishes to have standing before the Registrar to air their concerns about the acceptance of an application, the appropriate means is via the opposition process. The available grounds of opposition include all of those under which revocation might occur, procedural fairness is accorded to both parties and complex arguments may be made at a hearing where an applicant has an opportunity for response.

Opposition to registration is governed by Part 5 of the Act and the grounds of opposition are exhaustively listed. Revocation is not a ground. Nor, in terms of section 55 is it a possible outcome. Submissions bearing on revocation are not, therefore, a legitimate part of the opposition process. Revocation is merely a matter between the Registrar and the applicant.

In Re Remington Products, Inc: In the matter of Trade Mark Application No B460713 (1990) AIPC 90-680 (‘the Smooth and Silky case’), which concerned a revocation under the section 44 – the parallel provision of the Trade Marks Act 1955, Deputy Registrar Hardie said at 36,343-36,344:

I have found no other decisions dealing with the interpretation of [this section]. Section 160 of the Patents Act 1952 (Cth) however which provides for extensions of time in the circumstances of "errors or omissions" on the part of the applicant, has been considered. While interpretation of this section clearly cannot be directly adopted as an interpretation of what constitutes an error on the part of the Registrar, the following comments from the Deputy Commissioner's decision in the matter of an application for a patent by CSIRO provide some guidance: "I do not think that there has been any error or omission within the meaning of sub-s160(2). I do not think that that sub-section can be used to change a course of action deliberately chosen by an attorney to a different course of action providing a different application which, with hindsight, the attorney now believes to be more appropriate" (1978) 48 AOJP 3019.
By analogy it can be reasoned that the "error" specified in s44(3)(a) does not entitle the Registrar to apply the provisions of the section merely on the reconsideration of an acceptance and the conclusion that the judgment to accept ought to have been exercised in a different way.
This view is confirmed by the High Court's interpretation of the word "mistake". Isaacs and Gavin Duffy JJ, in finding that a mistake does not include ignorance, quote with approval these words from Fletcher Moulton LJ and Buckley LJ ex Roles v Pascall & Sons [1911] 1 KB 982 at 987: "A mistake exists when a person erroneously thinks that one state of facts exists when, in reality, another state of facts exists" Murray v Baxter (1914) 18 CLR 622 at 631. "Mistake", I note, is given by Websters Third New International Dictionary as a synonym for "error".
Applying the view of the Deputy Commissioner and the High Court to the interpretation of s44(3)(a), "accepted in error" must thus be restricted to mean acceptance of a trade mark where the acceptance officer is either mistaken as to the facts or in ignorance of the facts. It cannot be extended, however, to the reversal of a decision to accept when there is no more than a change of opinion as to the way the facts should be interpreted.
This interpretation is consistent with the view expressed by Mr D R Shanahan in Australian Trade Mark Law and Practice, p57 of the 1982 edition, where examples of "accepted in error" are confined to situations where it is found "that the examiner has missed a relevant dictionary meaning for the mark or an earlier registration that is clearly in conflict".'

Had this been a matter that was open to my determination, then, as per Remington, above, what Mr Christiansen seeks is a reappraisal and redetermination of a complex assessment and the development of a different conclusion. On the basis of such a complaint, the Registrar, or the delegate, would not, and could not, proceed with any revocation action.

The Opponent’s Evidence

Christiansen 1 and 2 consist only of argument, which debates the merits of the revocation, the opposition and the applicant’s evidence. Statutory declarations in this forum are not appropriate vehicles for argument – statutory declarations are served and filed in order to bring facts to the attention of the hearing officer and the other party: argument is not fact. The merits of this opposition and the weight accorded to evidence relating to it, are proper matters for submission either in person or in writing. These are issues for me to decide and, accordingly, I give these declarations no weight although I will look at the arguments they make where such arguments are relevant. At the hearing, Ms Baird characterised these declarations as intemperate. I agree with her – Christiansen 1 and 2 are, I believe, inappropriate and immoderate and I consider that they do no service to either Mr Christiansen or his client.

I will further observe that Mr Christiansen has not, in his declarations, led any evidence concerning his client’s use of the trade mark THE PRIVILEGES CARD but refers to the evidence filed in relation to 662423. Mr Christiansen has not exhibited this material to either of his declarations or to the other declarations served and filed by The Privileges Card. I agree with Ms Baird that I cannot refer to this material since the applicant has not had access to it and thus has not had any opportunity to consider it, receive advice from its legal advisors and respond to it. Hence, any reliance by me on this material would deny procedural fairness to the applicant.

The Leticq 1 declaration similarly refers to the evidence filed in relation to 662423. I cannot admit this evidence into proceedings for the reasons given above.

Mr Leticq then goes on, with reference to his declaration filed in relation to 662423, to state that The Privileges Card adopted the trade mark “in 1990” and a directory for the services offered in Canberra under the trade mark THE PRIVILEGES CARD was published “in early 1991”. Copies of this directory, or any of The Privileges Card’s subsequent directories to which Mr Leticq refers are not in evidence.

Mr Leticq states that the services offered by The Privileges Card under the trade mark have extended to Melbourne and Sydney and that selected SPHC properties in both of those cities are involved with The Privileges Card and it’s THE PRIVILEGES CARD program. However, Mr Leticq does not state when the services offered by The Privileges Card under its trade mark extended beyond Canberra nor does he provide any corroboration for this. Mr Leticq does not provide details of which SPHC properties in Melbourne and Sydney allegedly avail themselves of The Privileges Card’s services offered under the trade mark.

Mr Leticq asserts, without providing corroborating material, that his company has won Canberra’s ACT Tourism Awards for several years.

“In 1992”, Mr Leticq learnt that SPHC was promoting a discount card called PACIFIC PRIVILEGE. Mr Leticq reports a conversation with a Mr Stuart Jakins who was then “Executive Assistant General Manager”. It is not clear if Mr Jakins was employed specifically by the SPHC Group or the Capital Parkroyal which, I understand, is a hotel in Canberra in the SPHC Group which availed itself of services under The Privileges Card’s trade mark. Mr Jakins is alleged to have told Mr Leticq that “SPHC would be withdrawing from the The Privileges Card program, because of the similarity in names between the two products, and the potential for confusion to occur both with the public and with hotel staff”. Ms Baird, at the hearing, characterised this statement as hearsay, and I agree, so I weight it accordingly. More particularly, I believe that, in view of my doubt whether Mr Jakins was employed by the SPHC Group or by the Capital Parkroyal, it is not clear whether Mr Jakins was speaking for the Group or for one of its hotels – I believe that the latter is probable. Further, it would appear from the applicant’s evidence that the participation of the Capital Parkroyal Hotel in the program was restricted to its dining facility, Blundel’s Restaurant. It is apparent to me that Mr Leticq has elevated the participation of a restaurant in one hotel in a large group of hotels into a clear inference that the Group as a whole participated in the services that are offered under his company’s trade mark. I view this apparent obfuscation by Mr Leticq of the participation in his company’s program of a restaurant in one hotel in the SPHC Group into an inference of participation by the whole Group as being quite misleading – it is one which has caused the applicant a great deal of inconvenience in time and expense to demonstrate wrong.

However, Mr Leticq then goes on to aver that, in view of the reputation of his company’s trade mark, and the contact between his company and SPHC, he cannot understand how Mr Baker can state that the applicant was unaware of any use of The Privileges Card’s trade mark.

I will state now that the answer to this question is obvious. The Privileges Card has been, until quite recently, (how recently is not clear from the evidence), a comparatively small company confined in operations, under the trade mark THE PRIVILEGES CARD, to the Australian Capital Territory and its immediate environs. It would appear that a restaurant in a hotel in the SPHC Group, within Canberra, has availed itself of the services offered by The Privileges Card under the trade mark but it does not logically follow from this that Mr Baker or any other corporate officer of the SPHC Group itself, (as distinct from one hotel within that Group), must have known of this. It is natural that individual hotels within a group, or restaurants within them, will avail themselves of local service supply without reference to head office. In addition, the tourism industry in Canberra is, from my personal observation, comparatively small and regional – it is not surprising, therefore, that a person who is divorced from this region may be unaware of any activity within it.

Mr Leticq alleges that there have been numerous instances of confusion between the trade marks THE PRIVILEGES CARD and PACIFIC PRIVILEGE. He reports one instance “on Sunday December 1998” where a person, whom he does not name, employed by Capital Parkroyal, phoned his company to complain that she had been issued with a card but had not received her directory. It transpired that this person had received a PACIFIC PRIVILEGE card. At the hearing, Ms Baird objected to the anecdotal natural of these claims – I note the lack of corroboration and detail in these claims and weight them accordingly.

Mr Leticq states that the Prime Minister, the Federal Cabinet and all Members of the House of Representatives and the Senate have The Privileges Card. It is not clear from the evidence whether Mr Leticq’s company supplies the card free to all of these Members for promotional purposes or whether any of these Members avail themselves of the services offered under the trade mark. As, to my mind, it is quite unlikely that all of these Members would decide to purchase these cards, the cards are probably either purchased on their behalf by the House or Joint House staff or they are provided free.

In Leticq 2, Mr Leticq reports three instances of confusion in more detail where he states the month and year of the complaint and the names and addresses of the complainants. These were each from within the Australian Capital Territory and made during the year 2000 – after the relevant date. However, although Mr Leticq has obviously kept some sort of record of these complaints, this is not exhibited to his declaration. Mr Leticq also reports a conversation he had with a person, who he names, who allegedly worked as ‘a telemarketer with Pacific Privilege’. This person is alleged to have told Mr Leticq that one or two people a week were confused between “Pacific Privilege and Privileges”. At the hearing, Ms Baird submitted that this reported instance of confusion is third hand and that the report is hearsay. I agree. It is not obvious, either, whether the alleged instances of confusion occurred in Canberra, as the others reportedly did; and, further, the basis of the comparison was not between the trade mark THE PRIVILEGES CARD, as registered, and PACIFIC PRIVILEGE. Neither is the context of the confusion obvious; for example, if the telemarketing company for who this person worked had contact with two or three hundred people a week, the degree of confusion in percentage terms is, in fact, very low. I weight this aspect of The Privileges Card’s evidence accordingly.

Appended to Leticq 2 are letters from various organizations stating that they use or promote The Privileges Card’s services offered under the trade mark THE PRIVILEGES CARD. One, written on 23 December 1992, is from the General Manager of New South Wales Tourism who supports the intention of The Privileges Card to extend the services offered under the trade mark to Sydney. It is not clear, however, when the services offered by The Privileges Card did extend to Sydney. It is also not clear within the other letters, which are not dated, whether they refer to The Privileges Card’s services offered under the trade mark in the Canberra region or elsewhere.

Ms Manthey works under contract to The Privileges Card as Renewals Manager. She has worked previously for the Group. In both positions, Ms Manthey worked, I gather, as a telemarketer, although she does not expressly state this. Ms Manthey attests to ‘several’ occasions when persons have phoned The Privileges Card to inquire why they have not received their cards and she has found that they are awaiting a PACIFIC PRIVILEGE card. Similarly, she has ‘often’ phoned people to renew their THE PRIVILEGES CARD card membership to find that the person believes that they have, because of the renewal of their PACIFIC PRIVILEGE membership. At the hearing, Ms Baird objected to the anecdotal nature of these statements. Ms Manthey’s declaration suggests to me that some confusion does occur, but the lack of precision in her declaration does not assist me in gauging how much confusion is, in fact, occurring.

Further, it is not apparent from this, or other, of The Privileges Card’s evidence what the exact nature of The Privileges Card’s services offered under the trade mark are – both Mr Christiansen and his client appear to have made assumptions that the trade mark is so well known that submission of an explanation or explanatory material in evidence is unnecessary. This is not so since I am unaware of the trade mark apart from these proceedings. I gather, from submissions of the applicant, that it believes The Privileges Card services offered under the trade mark involve purchase of THE PRIVILEGES CARD by the public which allows them to avail themselves of discount rates at participating restaurants, theatres, cinemas, hotels and tourist venues on presentation of the card – the ‘directory’ to which Mr Leticq refers, is, on this basis, likely to be a listing of the participating traders. The suggestion by Ms Baird appears to be consistent with the evidence led by The Privileges Card and I will approach my consideration of the issues on this basis.

In summary, The Privileges Card’s evidence is, considering the adversarial nature of this forum, vague, poorly supported and documented, and provides little in the way of fact which might have objectively supported its position. There are no details of, for example, how many persons avail themselves of the services offered under the trade mark THE PRIVILEGES CARD, where these people are, how many traders participate in the program or where these traders are, details of annual turnover under the trade mark, examples of advertising, promotion or figures relating to these activities. The directories to which I have been referred are not exhibited to the declarations. There are no supporting declarations from those in the trade who participate in the services. Consequently, I agree with Counsel that I cannot weight this evidence highly. I am left (due to the shortcomings in the evidence and not the weight I accord it) with very little direct knowledge of the nature of the services offered in relation to the trade mark, no knowledge of the scale of these services, no awareness of when the services were first offered outside Canberra, no basis for an assessment of the reputation of the THE PRIVILEGES CARD trade mark and I can only infer indirectly that the trade mark has, in fact, been used and that this use had, at the relevant date, been largely confined to Canberra. While there has obviously been some confusion between the trade marks, reports of this are largely anecdotal, and, it would appear from the reports that are more factual that this confusion has also been confined to Canberra.

Further, it is most unclear from the evidence when use of the trade mark THE PRIVILEGES CARD in its current form began. Registration 662423 claims a priority date of 29 November 1990 by its divisional status – it is divided out of 586709, which in turn was divided out of 546823, a representation of which appears below, which was filed on that date. However, although the words THE PRIVILEGES CARD do occur in the latter trade mark, they are a very minor part of it. I would be unwilling, on the evidence before me, to conclude that a use of the trade mark the subject of 546823 was a use of the words THE PRIVILEGES CARD as a trade mark.

Subsection 7(1) provides:

7 Use of trade mark

(1)If the Registrar or a prescribed court, having regard to the circumstances of a particular case, thinks fit, the Registrar or the court may decide that a person has used a trade mark if it is established that the person has used the trade mark with additions or alterations that do not substantially affect the identity of the trade mark.

The alterations and additions to the words THE PRIVILEGES CARD in 546823 do substantially affect their identity. The lack of supporting material, the lack of clarity and the obfuscation to which I have referred, in The Privileges Card evidence, leaves me with great concern in putting any reliance on The Privileges Card’s claims to have used its trade mark THE PRIVILEGES CARD in 1990.

The Applicant’s Evidence

Mr Baker is Senior Legal Counsel of Bass Hotel & Resorts. Before this, he was Company Secretary of SPHC (IP) Pty Limited and South Pacific Hotel Corporation Limited, these being members of the SPHC Group (‘the Group’) of companies. The corporate structure of these companies was somewhat complex and a schematic is appended to Baker 1 – the ultimate parent company of the SPHC Group was Hale International Limited. On 31 March 2000, Hale International Limited was acquired by Bass International Limited, a British company which is a subsidiary of Bass Plc. This included the purchase of the PACIFIC PRIVILEGE trade mark, the business conducted thereunder and all associated goodwill and reputation. Thus, the Group no longer exists. A schematic showing the corporate structure of Bass Hotels and resorts is exhibited to the Baker 1 declaration. The trade mark is now owned, says Mr Baker, by Bass Hotels & Resorts who are effectively the successors in title to the applicant. Bass Hotels & Resorts is a registered business name in New South Wales, which is owned by H I Holdings Inc, a subsidiary in turn of various companies, the ultimate parent of which is Bass Overseas Holdings Limited. It is not clear to me how the application may be now owned by a business name – a trade mark must be owned by a person whether corporate or otherwise. However, what I am required to assess is the situation at the filing date of application for registration of this trade mark: Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 at 594-95. At that date, the application was owned by the applicant.

The trade mark was first used by the Group, attests Mr Baker, in Australia in relation to the applicant’s goods and services in January 1992. The trade mark, says Mr Baker, was derived from a combination of the suggestive word ‘privilege’ along with the word ‘Pacific’ - the latter word both provides a geographical indication of where the Group operates and uses a word from the name of the Group. At the time the trade mark was adopted, the Group was unaware of any use by The Privileges Card of the THE PRIVILEGES CARD trade mark. Mr Baker states that he remains personally unaware of any activity of The Privileges Card in the hotel and tourism industries apart from what has been stated in correspondence relating to these proceedings.

Mr Baker avers that since the Group commenced use of the trade mark PACIFIC PRIVILEGE, no instances of confusion between the trade marks have been reported to him or other officers of the Group by managers or employees of the Groups hotels and he is not aware of such instances occurring.

Mr Baker describes the services offered by the Group under the trade mark as what I would characterise as a hotel loyalty program – such as those services offered in relation to similar cards by airlines. Users, or members, of the PACIFIC PRIVILEGE program, accumulate benefits and are given discount rates at hotels within the Group. They are entitled to free meals, discount rates at a certain car-hire firm, a credit card firm, provision of a free magazine and so on. The list of possible benefits is quite extensive.

The loyalty program is promoted by brochures, which are displayed within the Group’s hotels, and by a telemarketing program.

The program gained some 24,000 members in its first year of operation and this number had grown to well over 300,000 members in the year 2000. A detailed breakdown of memberships, by State, on an annual basis, is exhibited to the Baker declaration. Mr Baker also provides details of occupation in ‘room nights’ for the Australian hotels operated by the Group and details of amounts spent advertising and promoting the goods and services provided under the trade mark. Confidentiality is claimed for these figures, but I would state that the ‘room night’ figures are significant. Obviously, many of the ‘room nights’ will be repeats – that is, many people will stay in the Group’s hotels for more than one night a year. However, even when making allowance for this, the figure was significant at the relevant date.

It is apparent from the evidence that most people who have stayed in one of the Group’s hotels will be aware of the loyalty program and that a great many of these people actually avail themselves of it.

To address The Privileges Card’s allegations that persons employed by the Group must have known of the trade mark The PRIVILEGES CARD, Mr Baker wrote a memorandum to a Mr Patrick Imbardelli who is Marketing and Sales Manager of the Group – he attached a copy of Mr Leticq’s declaration. A copy of Mr Baker’s memorandum, which is dated 4 February 1999, is exhibited to his declaration. Mr Baker expresses his surprise in the memo, in light of Mr Leticq’s declaration, that the issue of confusion between the trade marks had not been raised with him (Mr Baker) earlier. He asks Mr Imbardelli to make certain inquiries throughout the Group to ascertain whether there has been any confusion of which Corporate Office staff was aware and the scope of the Group’s interaction with The Privileges Card services offered under the trade mark THE PRIVILEGES CARD. Mr Imbardelli forwarded Mr Baker’s memo to eight senior managers within the Group. The handwritten response of a Mr Howard Kemball is Exhibit MJB15 to the Baker declaration. Mr Kemball was the General Manager of Capital Parkroyal in Canberra from January 1992 (when the applicant first used its trade mark) until November 1996 - in summary, he says that there was never any confusion whilst he was in Canberra – Mr Kemball is now Director of Operations of the Group in Australia.

There are also responses from the other seven addressees exhibited to the Baker declaration. These are:

Respondent	Position within Group	Response
Greg Cox	Area General Manager	Does not know of THE PRIVILEGES CARD
John Farrell	Marketing Manager New Zealand	Does not know of THE PRIVILEGES CARD
Greg Lee	Area General Manager	Does not know of THE PRIVILEGES CARD
Jonathon Ray	Director of Worldwide Sales	Does not know of THE PRIVILEGES CARD
Anja Smith	Marketing Manager	Does not know of THE PRIVILEGES CARD
David Travers	Area General Manager	Does not know of THE PRIVILEGES CARD
Ken Harris	General Manager - Le Lagon Parkroyal	Does not know of THE PRIVILEGES CARD

Mr Christensen sharply criticises the probity of this evidence. However, the material submitted is, I believe, obviously copies of the originals, the one which is most relevant is in handwriting, and the answers are obviously freely made. Most remarkably, Mr Christiansen says “A party to an opposition cannot” [stress in original] “avoid the hard work of preparing evidence by circumventing the established procedures. …Third hand material is presented here as evidence.” I feel obliged to note that the applicant has documented its evidence and that I find it most surprising, in view of Mr Christiansen’s criticisms, that his own client has not done the same in respect of its own third hand and anecdotal reports of confusion. Mr Christiansen appears to have failed to appreciate that instances of confusion, and evidence of use and reputation, may also be supported by statutory declarations from those who were allegedly confused, or by, for instance, copies of diary or journal entries, which document these instances. Put bluntly, I must give the Baker evidence higher weight than that of Leticq since it is better supported.

Since Mr Christiansen uses the vehicle of his declarations to accuse Mr Baker of making statements that are not true, I will state now that I am impressed by the veracity and fullness of Mr Baker’s declaration which is well supported. I will return to the theme, pursued by Mr Christiansen, more fully under the headings Honesty and Section 62, below.

The declarations made by Linda Gaye Townsend, Julie Van der Weegan, Mark A Jamison, Craig Kelleher, Rachel Stedman, Mark McCowan, Wendy Moala, Kirsten Magan, Danielle Summerfield, Bonita Jones and Philip Fowler go to the knowledge of these people as to the use of the trade marks. Of the foregoing declarations, those with an asterisk against the name of the declarant, below, are ‘pro forma’. I summarise the content of these declarations as follows:

Declarant	Position	Knows of both trade marks?
Townsend	Non-Airline Partner Manager Air New Zealand Limited	No – knows of applicant’s trade mark
Van der Weegan	Operations Manager of Hotel Dynamics Group	No – knows of applicant’s trade mark
Jamison*	General Manager of Ausprint	No – knows of applicant’s trade mark
Kelleher	Co-director of Pulse Graphic Design	No – knows of applicant’s trade mark
Stedman	Rewards Manager NRMA VISA Credit Card	No – knows of applicant’s trade mark
McCowan	Director, Syncro Marketing Australia Pty Ltd	No – knows of applicant’s trade mark
Moala*	Consultant, Jetset Travel	Yes – has client who is member of THE PRIVILEGES CARD
Magan*	Consultant, Jetset Travel	No – knows of applicant’s trade mark
Summerfield*	Consultant, Jetset Travel	No – knows of applicant’s trade mark
Jones*	Corporate Domestic Supervisor, Jetset Travel	No – knows of applicant’s trade mark
Fowler*	Manager, Jetset Corporate	No – knows of applicant’s trade mark

Mr Christiansen criticised the pro forma nature of some of the above declarations (‘the supporting declarations’). He referred me to Brakes Plus Pty Ltd v Midas International Corporation [1997] ATMO 20 (5 May 1997). In these reasons, the Registrar’s delegate, after reviewing the authorities[i], excluded from proceedings evidence which was led as to whether the declarants, if they saw two trade marks, which were enlisted on the declarations, would be confused or deceived. The authorities the delegate reviewed in Midas are concerned with the question of whether judicial notice can be taken of affidavits or declarations where the declarants aver their belief that there would be no confusion. However, here the declarants say nothing as to whether they would be confused or deceived and this question was not asked of them. The declarants attest only to their knowledge, or lack of it, of the two trade marks. The principle Mr Christiansen would have me rely on applies to the question of potential confusion and not the pro forma nature of the declarations. Accordingly, there is no basis for Mr Christiansen’s criticism.

Of the abovementioned supporting declarations, I consider that it is not obvious that Jamison and Kelleher, in their occupations, could or should know of both trade marks. These declarants are not directly employed in the travel, tourism, hotel or hospitality industries and I regard their declarations as being of low weight. Otherwise, the applicant’s supporting declarations might be viewed as suggesting that The Privileges Card’s trade mark, THE PRIVILEGES CARD, is little known outside Canberra and that the trade mark PACIFIC PRIVILEGE is quite well known.

Submissions

I will address the submissions of the parties as is necessary in my reasons, below. The Privileges Card relies on its registration, details of which are:

Reg Number:   662423
Owner:  The Privileges Card
Filing Date:     31 May 1995 – divisional of 586709 etc filed 29 November 1990

Services:Discount services rendered to cardholding members, particularly the provision of discounts, complimentary goods and complimentary services in the hospitality, tourism, transport and entertainment industries

Trade Mark: THE PRIVILEGES CARD

Reasons

The first step in the assessment of the opposition as regards honest concurrent user of the trade marks lies in a comparison of the trade marks in terms of subsections 44(1) and (2). I note Ms Baird argued, albeit sotto voce, at the hearing, that the trade marks are not deceptively similar.

Section 44

Section 44 of the Act provides:

44 Identical etc. trade marks

(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)the applicant’s trade mark 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 similar see section 10.
Note 2:For similar goods see subsection 14(1).
Note 3:For priority date see section 12.

(2)Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant’s trade mark) in respect of services (applicant’s services) must be rejected if:
(a)it is substantially identical with, or deceptively similar to:
(i)a trade mark registered by another person in respect of similar services or closely related goods; or
(ii)a trade mark whose registration in respect of similar services or closely related goods is being sought by another person; and
(b)the priority date for the registration of the applicant’s trade mark in respect of the applicant’s services is not earlier than the priority date for the registration of the other trade mark in respect of the similar services or closely related goods.
Note 1:For deceptively similar see section 10.
Note 2:For similar services see subsection 14(2).
Note 3:For priority date see section 12.

(3)If the Registrar in either case is satisfied:
(a)that there has been honest concurrent use of the 2 trade marks; or
(b)that, because of other circumstances, it is proper to do so;
the Registrar may accept the application for the registration of the applicant’s trade mark subject to any conditions or limitations that the Registrar thinks fit to impose. If the applicant’s trade mark has been used only in a particular area, the limitations may include that the use of the trade mark is to be restricted to that particular area.
Note:For limitations see section 6.

(4)If the Registrar in either case is satisfied that the applicant, or the applicant and the predecessor in title of the applicant, have continuously used the applicant’s trade mark for a period:
(a)beginning before the priority date for the registration of the other trade mark in respect of:
(i)the similar goods or closely related services; or
(ii)the similar services or closely related goods; and
(b)ending on the priority date for the registration of the applicant’s trade mark;
the Registrar may not reject the application because of the existence of the other trade mark.
Note 1:An authorised use of the trade mark by a person is taken to be a use of the trade mark by the owner of the trade mark (see subsection 7(3)).
Note 2:For predecessor in title see section 6.
Note 3:For priority date see section 12.

In terms of subsections 44(1) and (2), the initial issues for me to determine are if:

·     the goods and services in question are, respectively, closely related or similar
·     the trade marks at issue are substantially identical, or deceptively similar
·     the priority date for the registration of the applicant’s trade mark in respect of the applicant’s services is not earlier than the priority date for the registration of the other trade mark in respect of the similar services or closely related goods.

There is no dispute that The Privileges Card’s registered trade mark has an earlier priority date than that of the opposed application.

Goods and Services

In Registrar of Trade Marks v Woolworths Ltd (1999) 45 IPR 411 at 425, French J said:

The logic of subs 44(2) suggests that the determination whether goods are closely related to the services in question is logically antecedent to the determination whether the trade mark in respect of the services is deceptively similar to that in respect of the goods.

I note here that the assessment is, in addition, as to whether services are similar, but the principle remains the same. As the services specified in both the applicant’s and The Privileges Card’s Class 42 specifications of services, above, are in large part parallel, the services must be similar. As this similarity in services is the greatest hurdle that the applicant must get over in order to establish its honest concurrent user of the trade mark, I will limit the scope of my considerations to the parallel portions of the specifications.

The Trade Marks

I do not think that it could be seriously contended that the trade marks are substantially identical. When objectively compared, side by side, there are many differences between the trade marks.

The tests for deceptive similarity lie in the words of Windeyer J in Shell Company Of Australia Ltd v Esso Standard Oil (Australia) Ltd 1B IPR 523:

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 (de Cordova v Vick Chemical Co (1951) 68 RPC 103; at 106; 1B IPR 496; at 499):
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.

And in Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641; at 658, 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.

Further, the commercial and other surrounding contexts of the comparison must be considered and some rules of the comparison of trade marks apply: Lord Parker (then Parker J) in Re Application by the Pianotist Co Ltd 1A IPR 379 at 380; (1906) 23 RPC 774 at 777), 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. If, considering all those circumstances, you come to the conclusion that there will be a confusion — that is to say, not necessarily that one man will be injured and the other will gain illicit benefit, but that there will be a confusion in the mind of the public which will lead to confusion in the goods — then you may refuse the registration, or, rather, you must refuse the registration in that case.

At the hearing, Ms Baird drew my attention to the fact that the word PRIVILEGE(S) is used differently in both trade marks. In the one, it is used adjectivally to describe, or qualify, the word CARD. In the other, the trade mark is used as a noun, which is qualified by the word PACIFIC. However, it would be rare for a member of the public to engage in this type of analysis and it depends on having both trade marks at hand for a detailed side by side comparison. While such a distinction might be of relevance elsewhere, I do not believe it is so here. I agree with Mr Christiansen that the word PRIVILEGE(S) is effectively the focus in the applicant’s trade mark and is most likely to be the element which is remembered and carried away.

I consider that it is probable that, in the context of the comparison, that of the card services of The Privileges Card and the applicant, the public is likely to discount, to some extent, the word CARD in The Privileges Card’s trade mark and imperfectly remember the trade mark when seeing the applicant's trade mark: Williams J in Shell Co. of Australia Ltd. v. Rohm and Haas Co. (1949) 78 CLR 601 at paragraph 6:

A person who is familiar with both words will neither be deceived nor confused. It is the person who only knows the one word, and has perhaps an imperfect recollection of it who is likely to be deceived or confused (Aristoc Ltd. v. Rysta Ltd. (1945) AC 68, at p 86).

Concerning deceptive similarity, in Woolworths, supra at paragraph 50, French J said:

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) 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."

I believe that 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. Both of the parties may, and in fact do, use telemarketers to promote their services to the public. Under these circumstances, the public does not have either trade mark before them for any sort of comparison: it is in these conditions where the trade mark may be imperfectly remembered. There is some evidence on behalf of The Privileges Card that this activity has led to a degree of confusion in Canberra. Although I do not weigh this evidence highly as regards the magnitude of the confusion, I accept that it establishes that some confusion has occurred.

I therefore find that the trade marks are deceptively similar and are caught by the provisions of subsection 44(1) and 44(2).

Honest Concurrent User

In McCormick & Company Inc v McCormick [2000] FCA 1335, Kenny J affirmed that the applicability of the criteria pertinent to the Trade Marks Act 1955 and its predecessors are of equal applicability to the Trade Marks Act 1995. At paragraph 30, she said:

Section 44(3) gives the Registrar a discretion to accept an application that would otherwise be rejected under s 44(1) in the case of honest concurrent use or other circumstances making it proper to do so. The authorities establish that the principal criteria for determining whether registration should be permitted pursuant to s 44(3) include:
(1) the honesty of the concurrent use;
(2)the extent of the use in terms of time, geographic area and volume of sales;
(3)the degree of confusion likely to ensue between the marks in question;

(4) whether any instances of confusion have been proved; and
(5)the relevant inconvenience that would ensue to the parties if registration were to be permitted.

See In Re Alex Pirie & Sons Ltd's Application (1932) 49 RPC 195; (1933) 50 RPC 147 at 159-160; In Re John Fitton & Co Ltd's Application (1949) 66 RPC 110 at 112; and Stingray Surf Co Pty Ltd v Lister (1997) 37 IPR 306 at 310-311. These factors are not necessarily exhaustive of the matters to be considered, but they are a useful guide: see In Re Electrix Ltd's Application [1957] RPC 369 at 379.

The Honesty of the Use

In McCormick, above, at paragraph 31, Kenny J said:

The rights of the parties are to be determined as at the date of the application for registration - in this case, 9 March 1992: Southern Cross at 594-95; In Re Simac SpA Macchine Alimentari's Application (1987) 10 IPR 81 ("Simac") at 90-91; Aromas Pty Ltd v Aroma Coffee & Tea Co Pty Ltd (1997) 40 IPR 75 ("Aromas") at 86; and Trepper v Miss Selfridge Ltd (1991) 23 IPR 335 at 346.
The honesty of concurrent use refers to "commercial honesty, which differs not from common honesty": see In Re Parkington & Co Ltd's Application (1946) 63 RPC 171 at 182. In that case, Romer J said at 181-182:
[T]he circumstances which attend the adoption of a trade mark in the first instance are of considerable importance when one comes to consider whether the use of that mark has or has not been a honest user.

The date of application for registration here is 13 August 1997. Mr Christiansen argues that the applicant has not, in fact, shown that the applicant has used the trade mark and therefore cannot have used it honestly and concurrently. The advertising and promotional material supplied by the applicant in Mr Baker’s declarations show use of the trade mark PACIFIC PRIVILEGE by the Parkroyal, Centra and Travelodge hotels and resorts that operate as a group. There were at the priority date some twenty-nine hotels in this group in Australia and a further thirty-two throughout the South-East Pacific region. The material identifies this group as being the SPHC Group (‘the Group’). The applicant is SPHC (IP) Pty Ltd. The similarity between the names of the Group and the applicant should, I consider, lead to a conclusion that the trade mark has been used under the control of the applicant whether by the Group or by the hotels individually. To my mind, it is inconceivable that the applicant has put in evidence of use of the trade mark by a person who is not using the trade mark under its control as Mr Christiansen suggests. I gather that Mr Christiansen’s submissions are directed also towards the formalities that the applicant has observed and he believes that a trade mark cannot be used by a group. In these regards I direct his attention to Note 1 to section 44 which states “An authorised use of the trade mark by a person is taken to be a use of the trade mark by the owner of the trade mark (see subsection 7(3))”; [stress added] and, to the words of Burchett J in Re: Polo Textile Industries Pty Limited And Keith Gamble Pty Limited And: Domestic Textile Corporation Pty Limited And Polo Textile Industries Pty Limited (1993) 114 ALR 157; (1993) AIPC 91-007; (1993) 42 FCR 227, at para 23:

My summary statement cannot, of course, do justice to Aickin's J extended analysis, but I think it fairly indicates the background against which he went on to conclude (at 683):
"These cases demonstrate that the essential requirement for the maintenance of the validity of a trade mark is that it must indicate a connexion in the course of trade with the registered proprietor, even though the connexion may be slight, such as selection or quality control or control of the user in the sense in which a parent company controls a subsidiary. Use by either the registered proprietor or a licensee (whether registered or otherwise) will protect the mark from attack on the ground of non-user, but it is essential both that the user maintains the connexion of the registered proprietor with the goods and that the use of the mark does not become otherwise deceptive. Conversely registration of a registered user will not save the mark if there ceases to be the relevant connexion in the course of trade with the proprietor or the mark otherwise becomes deceptive."

This passage draws together the threads of three pages of discussion, dealing with the effect of the use of a trade mark by someone other than the registered proprietor. I accept the point made by counsel for the cross-claimant that the discussion is not concerned with s. 23(1)(b). However, it is clear that Aickin J was setting out to make a fairly comprehensive statement, not indeed in detail, but of the principles relevant to the registered user provisions of the Act. It was of the essence of the view he was expounding, in rejecting the approach taken by the Registrar, that the registered user provisions did not fill a yawning gap in the previous law of trade marks, but rather facilitated and partly codified an always permissible practice. In that context, in the passage I have quoted, he pointed out that "(u)se by either the registered proprietor or a licensee (whether registered or otherwise) will protect the mark from attack on the ground of non-user", and he added what was essential to enable the benefits of the user to be reaped. (cf the apparent acceptance by Dixon CJ, Taylor and Windeyer JJ in G.F. Heublein and Bro. Incorporated v. Continental Liqueurs Proprietary Limited (1962) 109 CLR 153 at 159 that some uses of a trade mark by a licensee can in some sense be regarded as use by the registered proprietor.)
I cannot see any escape from the conclusion that Aickin J meant to say exactly what his language conveys. It was not essential to the decision for him to do so, and his statement is accordingly an obiter dictum. But it is the considered view of a judge of the High Court whose views on matters of intellectual property law have always been treated with particular respect. And it is supported by the weight of the logic of the preceding discussion. I accept that dictum of Aickin J as establishing that use by an unregistered licensee may be relied on in answer to an attack on the ground of non-user. Subsequent decisions in England have supported the endorsement by Aickin J of Bostitch, and have affirmed the idea that a trade mark may be used as a house mark for a group: Revlon Inc v. Cripps and Lee Ltd (1980) FSR 85; Chanel Ltd v. F.W. Woolworth and Co Ltd (1981) 1 WLR 485. I discussed these and other cases in Fender Australia Pty Ltd v. Bevk (trading as Guitar Crazy) (1989) 25 FCR 161, citing (at 171) a passage from the judgment of Buckley LJ in Chanel where his Lordship summarized the holding in Revlon as involving "that every company in the group must be taken to have consented to the mark's being used by every other company of the group to designate the products so marked as products of the group as a whole". While there will be factual contexts in which such a conclusion cannot be drawn in relation to a group (cf Ritz Hotel Ltd v. Charles of the Ritz Ltd (1988) 15 NSWLR 158 at 199-201), I think, as between the applicants, a similar conclusion is to be drawn here. [Stress added]

Mr Christiansen submits that it is not apparent that the applicant has used the trade mark and that a trade mark cannot be used by a group. In this, he is wrong. He submits that there is no evidence that the use of the trade mark by the Group was an authorised use – however, he does not argue that the use of the trade mark by the Group was unauthorised or provide any evidence of unauthorised use. There is a very clear inference to be drawn from the evidence that the use by the Group was an authorised use.

I accept that it is quite clear from the evidence that neither Mr Baker nor the other corporate officers of the applicant knew of The Privileges Card’s trade mark when the trade mark was coined, adopted and first used by the Group and that this persisted until The Privileges Card filed Notice of Opposition. Indeed, as I inferred in my analysis of the evidence, it is difficult to comprehend how they could then have known of it. The existence of The Privileges Card’s trade mark appears not to have been known to the corporate officers of the Group until 16 October 1998 when The Privileges Card filed Notice of Opposition in these proceedings. The relevant officers of the applicant, with the exception of Mr Kemball, did not work in Canberra where The Privileges Card has its base of operations and to which city the use of The Privileges Card’s trade mark was for some time confined. Since Mr Kemball commenced duties in Canberra at the same time that the applicant first used its trade mark PACIFIC PRIVILEGE, he either cannot have been involved in its coinage, or, if he was involved, have known of The Privileges Card’s trade mark prior to him taking up his duties in Canberra. Further, it is apparent that the extent of the Capital Parkroyal Hotel’s involvement in the THE PRIVILEGES CARD program was limited to one of its restaurants. It is not clear from the evidence when The Privileges Card’s operations spread beyond Canberra. And, as Mr Leticq puts the publication of the first directory published by The Privileges Card in relation to the trade mark “in early 1991” it appears probable that the THE PRIVILEGES CARD trade mark only existed in Canberra before the broader public for up to a year before the adoption of the opposed trade mark by the applicant.

It is, of course, not fatal to a determination of honesty if the applicant did know of the The Privileges Card’s card mark when the trade mark was devised[ii]. However, on the evidence before me, it did not.

The Extent of the Use

The applicant first used its trade mark in January 1992. The Privileges Card claims to have first used its trade mark in 1990 and its first directory appeared in early 1991. The application was filed on 13 August 1997. The duration of the relevant concurrent user of the trade marks thus extends over at least five and a half years up to the priority date. The use of the applicant’s trade mark is quite extensive and is throughout Australia where it has its hotels. At the date of application, there were some 29 major hotels throughout Australia at, and through which, the applicant used its trade mark and its program had a large number of members. Although Mr Christiansen in his submissions observes that this says nothing of the use of the opposed trade mark, the growth in the number of users of the loyalty program confirms, in my mind, the wide extent of the user of the opposed trade mark.

Mr Christiansen also submitted that the duration of the concurrent user is too low to qualify the opposed trade mark for registration. However, it is apparent from the cases that one cannot point to any specific duration and conclude with any certitude which periods do and do not qualify a trade mark for registration under these provisions. In Pirie’s case, above, the duration of the concurrent user was five years. In Re Buler [1975] RPC 275, the duration was three and a half years. In PB Foods Ltd v Malanda Dairy Foods Ltd [1999] FCA 1602 (17 November 1999), where the period of concurrent use was five weeks, Carr J observed, at paragraph 59:

It is true, as the respondent pointed out, that there does not appear to have been a decided case in which five weeks has been held to be of sufficient duration to support a finding of honest concurrent use. However, as Lord Hanworth MR observed in Pirie at 212:
"It would be impossible to say that in all cases a particular span of time must be accomplished before it can be treated as justifying a user within section 21" (the then equivalent in the United Kingdom of s 34(1) of the 1955 Act).

I think that this period of five weeks must be seen in the context of the use by the respondent which was itself only some ten weeks. In terms of area, the evidence is that the applicant's sales were conducted during the relevant period throughout Western Australia.

It would appear, then, what I am to consider is the relative extent and duration of the concurrent user having regard to the length and extent of user of the trade marks of both parties and the geographical scope of the user.

While The Privileges Card has not detailed the extent of its claimed use of the trade mark THE PRIVILEGES CARD, the use that I can infer is, I consider, obviously dwarfed, as to both extent and geographic scope, by the user of the trade mark PACIFIC PRIVILEGE by the applicant.

The degree of confusion

The instances of confusion brought to my attention by The Privileges Card are not well documented and are of low probative value. However, if these instances of confusion had been better documented, I consider they would not have shown that the degree of confusion is unacceptably high – I would assess the degree of confusion as being moderate. The trade marks are not identical and the markets within which the parties operate have some overlap but have differences. The one market is those people who might repeatedly stay in hotels and thus participate in the loyalty program run by the Group. The other market is tourists and residents who might go to the cinema, restaurants, tourist venues and so forth who wish to avail themselves of discounts offered on presentation of the THE PRIVILEGES CARD. The services offered by the parties, although falling within parallel specifications, are thus not identical.

In New South Wales Dairy Corp. v Murray Goulburn Co-Op Co. Ltd. (1990) 171 CLR 363, at paragraph 12 of his judgment, Deane J observed:

The doctrine of honest concurrent user meant that a degree of confusion had to be tolerated within the system. The mere fact that the use of a mark would be likely to deceive or cause confusion was not necessarily sufficient to support an injunction restraining that use. That, Lord Diplock explained, at pp 745, 748; pp 521, 524 of All ER, was how s.11 and its predecessors came to be interpreted in such a way that something more than mere deception or confusion was required to disentitle a trade mark to protection in a court of justice.

In Buler, above, at page 289, Graham J said:

In my judgment, however, as seems clear from Pirie’s case and other cases, the degree of confusion is relatively unimportant under section 12(2) provided the honesty of the applicant is established and it is otherwise just in all of the circumstances that his mark should be registered.

In PB Foods Ltd v Malanda Dairy Foods Ltd [1999] FCA 1602 (17 November 1999), Carr J, despite finding the likelihood of confusion was high (albeit, apparently, confined to Western Australia) allowed the registration to proceed[iii].

Actual Confusion

As I have indicated, the reports of confusion between the trade marks occur only on the part of The Privileges Card. These reports are largely anecdotal and are not well documented – it is difficult to assess, therefore, whether these instances are of actual confusion or are the result of mistake on the part of the complainants. For example, it is not obvious, because of the indirect nature of these accounts, whether the occurrences might have arisen because the people involved had located the wrong entry or only entry in the Canberra phone book when endeavouring to call the applicant. If this is the explanation of the complaints, it might not be good evidence of actual confusion in trade. There are, for example, no reported instances of confusion from the traders who participate in the The Privileges Card’s program of the public mistakenly attempting to avail themselves of their services with reference to the applicant’s card; there are no complaints from the public on this basis either.

Other anecdotal accounts of confusion involve the alleged existence of a common-law trade mark, PRIVILEGES, that is not in evidence or at issue.

Mr Baker is senior legal counsel of the applicant and might be expected to know, in his position, of any confusion. The applicant has discovered no instances of confusion at all after making inquiries of senior managers in the Group.

The relevant inconvenience

It is not suggested by The Privileges Card that it will suffer on-going inconvenience if the opposed trade mark is registered. Rather, Mr Leticq, in Leticq 1, says, “My company has managed to convince a number of SPHC hotels to re-join the The Privileges Card program. Those hotels have recognised that the The Privileges Card program complements, rather than competes with their own THE PRIVILEGES CARD product, and is a very effective promotional tool for attracting short-term visitors”. It appears to logically follow that, if The Privileges Card’s program does not compete with the applicant’s product, it must also be that, in reality, competition between the trade marks does not exist.

The inconvenience to the applicant if it failed to achieve registration is obvious. It, at the application date, had expended six years building a considerable reputation in its trade mark throughout Australia and it is appropriate that this be reflected on the register of trade marks in order to reveal its rights and that it might readily enforce its own rights against third parties. As observed by Carr J in Malanda, above, at paragraph 78, “the scheme of the Act is not proprietorship by registration but rather registration of proprietorship.”

In the exercise of my discretion under section 44(3), having weighed the above factors, I find that the applicant has established honest concurrent user of its trade mark with that of The Privileges Card. I therefore dismiss the opposition in relation to this ground.

Section 62

Section 62 of the Act provides:

62 Application etc. defective etc.

The registration of a trade mark may be opposed on any of the following grounds:
(a)that the application, or a document filed in support of the application, was amended contrary to this Act;
(b)that the Registrar accepted the application for registration on the basis of evidence or representations that were false in material particulars.
Note:For file see section 6.

For convenience, I will first discuss the opposition in terms of subparagraph 62(b). Mr Christiansen points to the early declaration of Mr Baker that the applicant is using its trade mark in relation to:

Services rendered in connection with hotels, tourist-homes, hotel and/or motel operation and management; services rendered in the provision of accommodation and lodgings for travellers, room rental and/or leasing; services rendered in the provision of meals by hotels, motels, tourist-homes and other places of accommodation; restaurant services including services provided by self service restaurants and snack bars; services rendered in the provision of food, beverage and liquor prepared for consumption including catering services; provision of conference facilities by hotels, motels, tourist-homes and other establishments provided by travel agencies; services in procuring and reserving hotel and motel and tourist-home accommodation for travellers.

Mr Christiansen then draws my attention to the subsequent declaration of Mr Baker that the applicant is using its trade mark in relation to:

Discount services rendered to card holding members, particularly the provision of discounts, complimentary goods and complimentary services in hospitality, tourism and entertainment industries; services in procuring and reserving hotel, motel and tourist home accommodation for travellers.

Mr Christiansen then states that, as both of these statements cannot be true, Mr Baker must have made a representation or put in evidence that brings the application within the scope of subparagraph 62(b).

However, Mr Christiansen does not properly explain why both statements cannot be true. I do not follow the logic of his proposition. It is apparent that any particular services can be truthfully described in various different ways; for example, a person might describe their particular services as either ‘suit making’ or ‘tailoring’ or ‘men’s fashion realisation’ with equal veracity. I have noted, above, that the applicant’s services are in the way of being a hotel loyalty program – it is of the same ilk as those loyalty programs offered by airlines. As such, the applicant’s services are capable of being described by either specification with equal facility and veracity and neither is untrue. It is correct that the differing specifications have differing precisions, but lack of precision is not untruth.

I therefore dismiss this ground of opposition.

In relation to subparagraph 62(a), section 65 provides:

65 Amendment after particulars of application have been published

(1)If the particulars of the application have been published under section 30, the application may be amended as provided in this section.
(2)An amendment may be made to the representation of the trade mark if the amendment does not substantially affect the identity of the trade mark as at the time when the particulars of the application were published.
(3)An amendment may be made to correct a mistake of fact or an error in the classification of any goods or services specified in the application.
(4)An amendment may be made to change the type of registration sought in the application (for example, an application for the registration of a trade mark as a certification trade mark may be amended to an application for registration as a collective trade mark).
(5)An amendment may be made to any other particular specified in the application unless the amendment would have the effect of extending the rights that (apart from the amendment) the applicant would have under the registration if it were granted.

Thus, the expression “contrary to this Act” in subparagraph 62(b), in the circumstances of this opposition, has reference to subsection 65(5).

I agree with Mr Christiansen that the current specification of services in Class 42 represents an extension on those that were specified on the application as filed. The extension to the applicant’s rights is not immediately obvious but may be thought of in the following way.

The expression in the original specification of services, “Services rendered in connection with hotels, tourist-homes, hotel and/or motel operation and management;” is all embracing and card services are included in the expression. Therefore, the specification of services as filed includes discount card services as they relate to hotels and other facilities nominated in the specification, but the discount card services are accordingly limited to those nominated hotels and facilities. The discount card services as amended, however, could because of the use of the word ‘particularly’ (which imparts a claim of a general nature to all of the words preceding it) be held to also include (for example) discount card services (in Class 42) rendered by motoring organizations to their members; or, discount card services (in Class 42) rendered by airlines to travellers. These services were not included in the original specification. Hence, the second specification must be an extension on the first.

Such an amendment has the effect of extending the rights that (apart from the amendment) the applicant would have under the registration if the amendment had not been granted – the applicant would have the right, for example, to an action for infringement in terms of section 120(1) in respect of the previously mentioned ‘discount card services to motoring organizations’ that it would not otherwise have had.

The opposition therefore succeeds on this ground and I, subject to any appeal against my decision, will refuse to register the applicant’s trade mark on this ground so long as the offending specification of services remains in the application. However, the application is capable of simple amendment to rectify the problem and may, if the applicant files a request for the amendment within twenty-one days from this decision, proceed to registration. The amended specification should read:

Discount services rendered to card holding members, namely the provision of discounts, complimentary goods and complimentary services in hospitality, tourism and entertainment industries; services in procuring and reserving hotel, motel and tourist home accommodation for travellers.

The proposed specification is one that is narrower than the current specification and narrower than the original specification – it must, therefore, be one allowable under section 65(5). The expression “the provision of discounts, complimentary goods and complimentary services in hospitality, tourism and entertainment industries” is encompassed within the generality of the expression “Services rendered in connection with hotels, tourist-homes, hotel and/or motel operation and management”.

Decision

The opposition fails under section 44 and subparagraph 62(b) and succeeds in relation to 62(a). I therefore refuse to register the application. The application may, however, on the elapse of the period allowed for appeal against these reasons, payment of registration fees, and amendment on the terms outlined above, proceed to registration.

Costs

Sections 202 and 221 of the Act provide:

202 Registrar’s powers

The Registrar may, for the purposes of this Act:
(a)summon witnesses; and
(b)receive written or oral evidence on oath or affirmation; and
(c)require the production of documents or articles; and
(d)award costs against a party to proceedings brought before the Registrar; and
(e)notify, as he or she considers fit, any person of any matter that, in his or her opinion, should be brought to the person’s notice.
Note:For the awarding of costs see section 221.

221 Costs awarded by Registrar

(1)The Registrar may award costs in respect of the matters, and in the amounts, provided for in the regulations against any party to proceedings brought before him or her.
(2)A party desiring to obtain costs must apply to the Registrar in accordance with the regulations.
(3)If a party is ordered to pay the costs of another party, the costs may be recovered in a court of competent jurisdiction as a debt due by the first party to the other party.

The award of costs against a party is a discretionary power of the Registrar. I have decided not to exercise my discretion to award all costs against the applicant in this matter for the reasons given below. I award costs against the applicant only for the Notice of Opposition and for one of The Privileges Card’s written submissions.

The two declarations of John Christiansen are irrelevant and consist solely of argument that is duplicated in submission. The declarations of Leticq and Manthey go to an issue on which The Privileges Card was unsuccessful. The opponent has only been successful to the extent that it has succeeded in changing one word in the applicant’s Class 42 specification.

Ian Thompson
Hearing Officer

3 September 2001

[i] Payton & Co Ld v Snelling, Lampard, & Co Ltd 17 RPC 628, at 635 per Lord Macnaghten; North Cheshire and Manchester Brewery Company v Manchester Brewery Company [1889] AC 83 per Lord Halsbury; Addley Bourne v Swan and Edgar, Ltd 20 RPC 105 at 118; and (1903) 1 Ch 211 at 224 per Farwell J; Claudius Ash, Sons & Co Ltd v Invicta Manufacturing Company Ltd (1911) 28 RPC 597 at 608 per Buckley LJ; Don v Burley (1916) 22 CLR 136 per Barton J; Thomas Bear & Sons (India) Ld v Prayag Narain & Jaggennath (1941) 58 RPC 25, a decision of the Privy Council, per Viscount Maugham; Mothercare UK Ltd v Penguin Books Ltd [1988] RPC 113 at 116 per Dillon LJ; George Ballantine & Son v Ballantyne Stewart & Co [1959] RPC 273 at 280 per Lord Evershed.

[ii] Baume & Co Ltd v Moore (A H) Ltd [1958] RPC 226 at 235; [1958] Ch 907 at 921 and Joseph Rodgers & Sons Ltd v W N Rodgers & Co (1924) 41 RPC 277 at 291.

[iii] see also No Name Restaurants Pty Ltd v No Name Restaurants (Cesare) Pty Ltd (1996) 36 IPR 488 at 497.

Key Legal Topics

Areas of Law

Commercial Law
Intellectual Property

Legal Concepts

Injunction
Breach
Damages
Privilege

Actions

Download as PDF Download as Word Document

Citations

The Privileges Card Pty Ltd v SPHC (IP) Pty Ltd [2001] ATMO 81

Most Recent Citation

Tricarico v Dunn Bay Holdings Pty Ltd [2012] FCA 271

Cases Citing This Decision

2

Tricarico v Dunn Bay Holdings Pty Ltd [2012] FCA 271

Cases Cited

16

Statutory Material Cited

0

Murray v Baxter [1914] HCA 78

Registrar of Trade Marks v Woolworths [1999] FCA 1020

[2001] ATMO 81

3 September 2001

Key Legal Topics

Areas of Law

Commercial Law

Intellectual Property

Legal Concepts

Injunction

Breach

Damages

Privilege