Top Heavy Pty Ltd v Killin

[1996] FCA 295

CATCHWORDS

Trade Marks - alleged trade mark infringement - whether use of sign is use as a trade mark - whether sign substantially identical with, or deceptively similar to, the trade mark - use of phrase "Chill Out" - whether phrase has a meaning - whether purely emotive - whether use as a badge of trade origin - whether use to distinguish goods dealt with in the course of trade - whether capable of being read as descriptive of a characteristic, quality or function of the goods in relation to which it is used - whether phrase has acquired any secondary meaning - relevance thereof

Trade Marks - whether letter constitutes a groundless threat - whether a declaration to that effect should be granted

Words and phrases - "use as a trade mark" - "Chill Out"

Trade Marks Act 1995 (Cth) s 6, s 17, s 120(1)
Trade Marks Act 1955 (Cth) s 6(1), s 62(1)

Shell Co. of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 422, 423, 425 considered
Johnson & Johnson Australia Pty Ltd v Sterling Pharmaceuticals Pty Ltd (1991) 30 FCR 326 at 335, 347 consdered
Mark Foys Ltd  v Davies Coop & Co Ltd (1956) 95 CLR 190 at 194, 205 considered
Pepsico Australia Pty Ltd v The Kettle Chip Co Pty Ltd unreported, Federal Court of Australia, Full Court, 15 February 1996 considered
Wrigley's (A/asia) Ltd v Life Savers A/asia Ltd (1936) 37 SR (NSW) 9 considered
Kodiak Trade Mark (1990) 17 FSR 49 referred
Unidoor Ltd v Marks & Spencer PLC [1988] RPC 275 considered

TOP HEAVY PTY LIMITED v PAUL JOSEPH KILLIN
NG 137 of 1996

CORAM:Lehane J

PLACE:Sydney

DATE:18 April 1996

IN THE FEDERAL COURT OF AUSTRALIA              )
NEW SOUTH WALES DISTRICT REGISTRY             )
GENERAL DIVISION  )     No. NG 137 of 1996

BETWEEN:TOP HEAVY PTY LIMITED

Applicant

AND:PAUL JOSEPH KILLIN

Respondent

PAUL JOSEPH KILLIN

Cross‑claimant

TOP HEAVY PTY LIMITED

Cross‑respondent

CORAM:Lehane J

PLACE:Sydney

DATE:18 April 1996

REASONS FOR JUDGMENT

LEHANE J:

Facts

The applicant is a manufacturer of T‑shirts.  It claims to be the largest licensed T‑shirt manufacturer in Australia: by "licensed" the applicant means that it is licensed to display, on its T‑shirts, marks or insignia belonging to other parties.  The applicant's counsel described the T‑shirt as a modern day form of canvas; certainly  such garments are commonly decorated with graphic designs and messages of various sorts.  Two T‑shirts designed and manufactured by the applicant under a licence agreement which it has with the Coca-Cola Company are the subject of these
proceedings; a sample of each is in evidence and copies of the designs which they bear are attached to these reasons.  The originals, of course, are in colour.  A prominent feature of each design - and the relevant feature for the purposes of these proceedings - is what might be described as a somewhat stylised representation of the phrase "Chill Out" in which a slightly tilted Coca-Cola bottle appears as the letter "I".  No doubt it is taking a literal approach too far to suggest that the liquid in the bottle, which otherwise seems to defy gravity, is apparently chilled to the point of being frozen.

The respondent is registered under the Trade Marks Act 1995 (Cth) (the 1995 Act) as the owner of a trade mark registered as No 536401 (the Mark), a representation of which appears below:

The Mark is registered in Class 25 for goods included in that class: clothing, footwear and head gear including board‑shorts, swim‑suits, sweaters, sweat‑shirts, t‑shirts, wet‑suits for water skiing.

The evidence is that the applicant's two "Chill Out" designs were devised, in ignorance of the respondent's mark, by an employee of the applicant with assistance, in the case
of the more elaborate design, from a design consultant.

The discovery by the respondent that T‑shirts bearing the words "Chill Out" were being manufactured and sold without the respondent's authority led to a letter of demand from the respondent's trade mark and patent attorneys addressed to a retailer which stocked and sold the garments, demanding that the retailer undertake to "immediately cease using the trade mark Chill Out & device or marks substantially identical or deceptively similar thereto" in connection with goods of a relevant kind, and a series of ancillary undertakings.  That led to correspondence between representatives of the parties and, in turn, to the commencement of these proceedings.  In them, the applicant claims a declaration that the letter from the patent and trade mark attorneys to the retailer constitutes a groundless threat; final and interlocutory injunctions restraining the respondent from representing to customers of the applicant that offering for sale or selling the T‑shirts concerned constitutes an infringement of the Mark; and orders for the cancellation of the Mark and its removal from the Register.  There is also a claim for damages.  The respondent cross‑claims for an injunction restraining the applicant from infringing the Mark and ancillary relief.

Separate question

On 21 February 1996 I ordered, by consent, that the question whether the applicant is using a mark identical with, or deceptively similar to, the Mark as a trade mark be
separately determined prior to all other issues.  Obviously, such a determination can be made only on the basis of the evidence relevant to use which is before me: that is, the manufacture and sale by the applicant of T‑shirts bearing either of the two designs which I have described.  It is agreed that if I answer the question for separate determination favourably to the applicant it will follow that the respondent's cross‑claim should be dismissed.

Statutory provisions: trade mark use

The question for separate determination refers to two elements of the kind of infringement with which s 120(1) of the 1995 Act deals. That sub‑section provides:

120(1)A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered.

Plainly the applicant's stylised "Chill Out" is a "sign" as defined in s 6 of the 1995 Act; T‑shirts are, of course, goods in respect of which the Mark is registered. The kind of use referred to in s 120(1) is, no doubt, use of the kind contemplated by s 17 of the 1995 Act, the provision which tells us what a trade mark is. That section provides:

17A "trade mark" is a sign used, or intended to be used, to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person.

Those provisions of the 1995 Act differ somewhat from those of the Trade Marks Act 1955 (Cth) (the 1955 Act). Particularly, the relevant provision of the 1955 Act concerning infringement was to be found in s 62(1), which was as follows:

62(1)A registered trade mark is infringed by a person who, not being the registered proprietor of the trade mark or the registered user of the trade mark using by way of permitted use, uses a mark which is substantially identical with, or deceptively similar to, the trade mark, in the course of trade, in relation to goods or services in respect of which the trade mark is registered.

The relevant part of the definition of "trade mark" in s 6(1) of the 1955 Act was:

... a mark used or proposed to be used in relation to goods or services for the purpose of indicating, or so as to indicate, a connection in the course of trade between the goods or services and a person who has the right, either as proprietor or as registered user, to use the mark, whether with or without an indication of the identity of that person ...

It was put to me that the new provisions are wider than the old, and that may be true in some respects though not, I think, in any respect that matters for present purposes. It was clear, in relation to s 62(1) of the 1955 Act, "that the use which is there referred to is limited to use of a mark as a trade mark": Shell Co. of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 422 per Kitto J (his Honour discusses the legislation and the authorities at 422, 423). Section 120(1) of the 1995 Act expressly provides that the relevant use is "use as a trade mark". What was meant by use as a trade mark for the purposes of the 1955 Act was clear enough. Phrases such as "badge of origin" were used to summarise what was meant: Johnson
& Johnson Australia Pty Ltd v Sterling Pharmaceuticals Pty Ltd (1991) 30 FCR 326 at 335 (Lockhart J) and 347 (Gummow J). The concept thus summarised was described by Williams J in Mark Foys Ltd  v Davies Coop & Co Ltd (1956) 95 CLR 190 at 205 in connection with the use by the defendants, in relation to their "Exacto" garments, of the plaintiff's mark "Tub Happy". His Honour said:

The public are not being invited to compare the "Exacto" goods of the defendants with the "Tub Happy" goods of the plaintiff.  They are being invited to purchase goods of the defendants which are to be distinguished from the goods of other traders partly because they are described as "Tub Happy" goods.

The same "badge of origin" notion is plainly to be seen in the definition of "trade mark" in s 17 of the 1995 Act.

"Chill Out": use as trade mark

It is common ground that, in contemporary usage, the phrase "Chill Out" has a well understood meaning, similar to the perhaps more dated "Cool It" or the rather more evergreen "Relax".  Two dictionary definitions were brought to my attention.  The Concise Oxford Dictionary of Current English, 1995, says that the phrase is especially in North American colloquial use as meaning "relax; become less tense".  The New Shorter Oxford English Dictionary, 1993, tells us that the phrase is slang, "chiefly US", meaning "calm down, relax".  Both deponents for the applicant asserted that they understood the phrase in that sense.  It was put to me that "Chill Out" is a phrase of
the same nature as "Tub Happy".  This related, I think, not to a suggestion that "Chill Out", like - as the majority held - "Tub Happy", was substantially meaningless, but to an argument that the phrase, as used on the T‑shirts, was to be regarded as "purely emotive" and "employed for no purpose but to evoke in the reader or hearer some feeling, some mood, some mental attitude" (at 194 per Dixon CJ).  The difference, however, is that whereas the majority held that "Tub Happy" had no particular meaning, it is clear that "Chill Out" has a meaning and the question is whether, used in the way the applicant has used it, it indicates the trade origin of the T‑shirts rather than (or at least as well as) conveying some other message to the reader.

Questions of this sort commonly arise where a word or phrase, claimed to be used as a trade mark, is capable of being read as descriptive of a characteristic, quality or  function of the goods in relation to which it is used.  Mark Foys itself was such a case.  So too were Johnson & Johnson ("Caplets") and Pepsico Australia Pty Ltd v The Kettle Chip Co Pty Ltd unreported, Federal Court of Australia, Full Court, 15 February 1996 ("Kettle Cooked" in relation to potato chips).  The same question can, however, and does arise in other contexts.  In Shell Co of Australia, for example, the question was whether an "oil drop man" was used in television advertisements so as to distinguish Shell petrol from other petrol or merely (as the Court held) for the purpose of uniting "the quickly moving series of pictures as a whole, namely the purpose of conveying by a combination of pictures and words a particular message about the qualities of Shell petrol" (at 425 per Kitto J).  The oil drop man himself, of course, was not descriptive of character or quality.  Similarly, in the much earlier case
of Wrigley's (A/asia) Ltd v Life Savers A/asia Ltd (1936) 37 SR (NSW) 9 the use of a new device, claimed and held to be trade mark use and an infringement, was not in any sense descriptive of the goods or their character or quality. The English case Kodiak Trade Mark (1990) 17 FSR 49 is an example of yet another way in which questions of this sort may arise.

In the end, the question here is whether the applicant's use of the designs incorporating the phrase "Chill Out" is use as a badge of the trade origin of its T‑shirts or, in the statutory language, use to distinguish goods dealt with or provided in the course of trade by a person from goods so dealt with or provided by another person.  In my view it is not.  It is relevant that there was no evidence that "Chill Out" has acquired a secondary meaning of a kind which the Full Court had recently to consider in Pepsico.  In my view the designs are not indications of the provenance of the T‑shirts.  The message which they convey may, not surprisingly, be one of less than complete clarity; but in general terms the message is, I think, an exhortation to the reader, reinforced by the slightly tilted picture of the drink in each case and, in the case of the more elaborate design, by the image of enjoyable winter sport, to relax; and this is combined with an advertising message that Coca Cola is a suitable medium or accompaniment of relaxation.

I doubt that further analysis would be profitable.  I should perhaps mention only that there were tendered on behalf of the respondent three other T‑shirts, two of the applicant's manufacture, one not, which were said to be evidence of a practice of
embellishing the fronts of T‑shirts with designs incorporating trade marks.  That may in a sense be right, though it is not by any means clear that the specimens tendered do so in a way that is relevant for present purposes: that is, it is not clear to me that the matter emblazoned on them is indicative of the trade origins of the T‑shirts themselves.  Whether that is so or not, however, the question here is, what is the message conveyed by the two T‑shirts carrying designs including the phrase "Chill Out"?  As I have said, I do not think it is a message about trade origin.

Since I wrote the foregoing, counsel for the applicant, with the consent of counsel for the respondent, has referred me to the decision of Whitford J in Unidoor Ltd v Marks & Spencer PLC [1988] RPC 275. That decision, in a case the facts of which were somewhat similar to those of this case, supports the conclusion to which I have come: see especially his Lordship's judgment at 280.

Deceptive similarity - conclusion

Given that conclusion, it is not necessary for me to take the further step of deciding whether, if the use were trade mark use, the matter on the T‑shirts should be held to be substantially identical with, or deceptively similar to, the Mark.  The Mark comprises the words "Chill Out" represented in a particular way.  Plainly, in my view, what appears on the front of the T‑shirts is not substantially identical with it.  The question whether it is deceptively similar would have to be answered on the footing that the use of the matter on the T‑shirts, including as a prominent feature the words
"Chill Out", was use as a trade mark, i.e. use indicating origin.  Once that is appreciated, I think it can be seen that it would be difficult to conclude that the matter on the T‑shirts, in which the phrase "Chill Out" so prominently appears, is not deceptively similar to the registered mark.

I need say no more about that, however, as my conclusion about the character of the applicant's use of the phrase "Chill Out" requires that the question reserved for separate determination, understood as mentioned at the commencement of these reasons, be answered "no".  It follows that the respondent's cross‑claim should be dismissed.  Counsel for the applicant indicated that if I came to that conclusion he would seek a declaration, presumably to the effect of that claimed in the amended application filed on 28 February 1996; that is, that the letter to the retailer from the respondent's trade mark and patent attorneys constitutes a groundless threat.  I think the applicant probably is entitled to a declaration of that kind, but the issue was not canvassed in argument and I shall hear counsel as to the precise orders which should be made to give effect to these reasons.

The respondent should pay the applicant's costs of the question for separate determination.

I certify that this and the preceding 9 pages are a true copy of the Reasons for Judgment of the Honourable Justice Lehane.

Associate:

Dated:  18 April 1996

Heard:  2 April 1996

Place:  Sydney

Decision:  18 April 1996

Appearances:  Mr J V Nicholas of counsel instructed by David Jenkins & Co appeared for the applicant/cross‑respondent.

Ms J R Baird of counsel instructed by Hall & Co appeared for the respondent/cross‑claimant.