Velcro Industries B.V. v SSS Pty Ltd

[2008] ATMO 19

TRADE MARKS ACT 1995

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

Re:Opposition by Velcro Industries B.V. to registration of 1057917(24)(26) VELOUR & Device, proceeding in the name of SSS Pty Ltd.

Delegate:

Iain Thompson

Representation:

Applicant:  Mark Vincent of Truman Hoyle, Lawyers.

Opponent:  Elspeth Strong, instructed by Sally Nicholson of Corrs,

Decision:

2008 ATMO xx

1. Section 52 proceedings – sections 42, 44, 58, 59, and 60. Tade marks not substantially identical or deceptively similar – grounds under sections 42, 44, and 60 cannot be established – no evidence of applicant’s alleged lack of intention to use – nothing from which such lack could be inferred – section 59 not established.

2.          Costs awarded against opponent.

Background

1. SSS Pty Ltd of King’s Park, NSW, filed an application to register a trade mark, current details of which appear below:

   App No:  1057917

   Priority Date:  31 May 2005

   Goods:Class: 24 Piece goods including synthetic velour and nylon hook material; bed and table covers; furnishing fabrics and other fabrics and materials not included in other classes

   Class: 26 Buttons, press studs and buttons, hooks and eyes, including separate fasteners, hook and loop type fasteners and their components

   Trade Mark:  

2. The application was advertised as accepted for possible registration on 29 September 2005 and, on 21 December 2005, Velcro Industries B.V. of Curacao, Netherlands Antilles, (‘the opponent’), filed Notice of Opposition to the registration of the trade mark. The Notice cites several grounds of which sections 42, 44, 58, 59, and 60 of the Trade Marks Act 1995 (‘the Act’) were argued at the hearing.

3. I heard this matter in Melbourne on 12 November 2007 as a delegate of the Registrar of Trade Marks.  Elspeth Strong, instructed by Sally Nicholson of Corrs appeared for the opponent.  Mark Vincent of Truman Hoyle, Lawyers, appeared for the applicant.

4. As mentioned, Ms Strong argued grounds under sections 42, 44, 58, 59, and 60. The grounds under sections 42, 44, 58, and 60 require the opponent to establish that the trade marks are substantially identical or at least similar enough to mislead or deceive, or to confuse or deceive, according to the relevant law. Accordingly, after a short discussion of the evidence, I will discuss the similarity of the trade marks. And then I will discuss section 59. First, I now record that the other grounds not addressed in evidence and argument have not been established.

   Evidence

5. The evidence in this matter is relatively comprehensive but only has incidental relevance to the issue of the similarity of the trade marks which is central to these proceedings.  Additionally, the relevant facts do not appear to be in much dispute so I will not dwell at length on the evidence.

6. The opponent makes and sells a ‘hook and loop’ fastener under the trade mark VELCRO.  The opponent’s trade mark has been in use in Australia since either the late 1950s or early 1960s (the evidence is silent on this) in relation to hook and loop products sold under the trade mark and is very well known.  Indeed, the opponent’s evidence contains copies of over one hundred dictionary entries which acknowledge the word VELCRO as being a trade mark of the opponent and as denoting a hook and loop fastener.

7. I note now that the Macquarie Dictionary gives the following definitions:

   velcro

   noun 1. a type of tape used as a fastening, comprising two strips of fabric, one with a dense arrangement of small nylon hooks and the other with a nylon pile, so that when the strips are pressed together one hooks into the other sufficiently firmly to hold the fastening together though still capable of being pulled apart without damage to either side, thus allowing for repeated attachment and disengagement.

   adjective 2. of or relating to velcro. Also, Velcro. [trademark; from velours-croché velvet-hook, the name given to the process invented in 1941 by Georges de Mestral, 1907--90, and produced commercially in Switzerland in 1957]

   velour

   noun any of various fabrics with a fine, raised finish. Also, velours. [French velours velvet, earlier velous, from Provençal velos, from Latin villus hair]

8. The applicant has used the opposed trade mark since February 2005 and, since then, at least one product, a heavy duty hook and loop product, bearing the opposed trade mark has been sold in blister packs through some 770 Woolworths supermarkets.

   The Opponent’s Registrations

9. The opponent has some 15 registrations on which it primarily relies in terms of section 44 of the Act. The opponent’s trade marks fall into two broad categories. These are:

   Category One

   Reg No:               306432

   Priority Date:  20 April 1977

   Goods:Class: 26 Buttons, press buttons, hooks and eyes, including separate fasteners, hook and loop type fasteners and components thereof

   Trade Mark:  

   Reg No:               727847

   Priority Date:  14 February 1997

   Goods:Class: 26 Hook and loop fasteners, namely, fasteners comprised of material having a surface of hooks mated with material having a surface of loops; lace and embroidery, ribbons and braid; buttons, hooks and eyes, pins and needles, artificial flowers

   Trade Mark:  

   
   

   Category Two

   Reg No:               171553

   Priority Date:  10 January 1962

   Goods:Class: 24 Piece goods; including hook-velvet fabric of synthetic material; bed and table covers, furnishing fabrics and all other articles of cotton, linen and man-made fibres, not included in other classes,

   Trade Mark:  VELCRO

   Reg No:               171555

   Priority Date:  10 January 1962

   Goods:Class: 26 Fasteners for clothing and for other articles made of a material resembling clothing materials; for sleeping bags and for other materials of a like nature to any of the foregoing materials; for boots, shoes, slippers and other footwear; for carpets, blankets, travelling bags, handbags; and for all other materials that may require joining,

   Trade Mark:  VELCRO

   Reg No:               516673

   Priority Date:  9 August 1989

   Goods:Class: 17 Molded and extruded plastic material having a surface of hooks or loops, for use in manufacture as components of hook and loop fastening systems; hook and loop fastening systems for use in manufacture; and all other class 17 goods

   Trade Mark:  VELCRO

   Reg No:               750256

   Priority Date:  4 December 1997

   Goods:Class: 10 Hook and loop fasteners and padding material having hook and loop fasteners, all for medical use, including those for use in or as medical splints, straps, cinching straps and belts; breathable liner padding incorporating such hook and loop fasteners intended for medical use, including those for use as a liner for medical splints, straps, cinching straps and belts including those for restraint of the limbs and/or the body in connection with operating tables, stretchers, wheelchairs, braces, splints, crutches and the like

   Trade Mark:  VELCRO

   Reg No:               717755

   Priority Date:  19 September 1996

   Goods:Class: 26 Separable fasteners, including hooks and loop type fasteners and components thereof

   Trade Mark:  VELCRO STICKY BACK

   Reg No:               598865

   Priority Date:  24 March 1993

   Goods:Class: 17 All goods in class 17; extruded or molded plastic material including extruded or molded plastic material covered with a surface of hooks to be used in manufacture as a component of a hook-and-loop fastening system

   Trade Mark:  VELSTUD

   Reg No:               598866

   Priority Date:  24 March 1993

   Goods:Class: 26 All goods in class 26; fastening components in this class including fastening components which include extruded or molded plastic material covered with a surface of hooks to be used as part of a hook-and-loop fastening system

   Trade Mark:  VELSTUD

   Reg No:               731833

   Priority Date:  10 April 1997

   Goods:Class: 24 Hook and loop fastener components in class 24; fabric for use in hook and loop fasteners including fabric having a woven or knitted surface of loops with a foam backing for use as a component of hook and loop fasteners

   Trade Mark:  VELTEX

   Reg No:               740647

   Priority Date:  4 August 1997

   Goods:Class: 24 Fabric including fabric having a woven or knitted surface, fabric for use in industry and product manufacture including hook and loop fasteners

   Trade Mark:  VELTEX

   Reg No:               635410

   Priority Date:  20 July 1994

   Goods:Class: 26 All goods in class 26; hook and loop fasteners, including fasteners comprised of material having a surface of hooks mated with material having a surface of loops

   Trade Mark:  VELCOIN

   Reg No:               635414

   Priority Date:  20 July 1994

   Goods:Class: 26 All goods in class 26; hook and loop fasteners, including fasteners comprised of material having a surface of hooks mated with material having a surface of loops

   Trade Mark:  VELSTRETCH

   Reg No:               635415

   Priority Date:  20 July 1994

   Goods:Class: 26 All goods in class 26; hook and loop fasteners, including fasteners comprised of material having a surface of hooks mated with material having a surface of loops

   Trade Mark:  VELSTRAP

   Reg No:               635416

   Priority Date:  20 July 1994

   Goods:Class: 26 All goods in class 26; hook and loop fasteners, including fasteners comprised of material having a surface of hooks mated with material having a surface of loops

   Trade Mark:  VELSTRAP

   Similarity of Trade Marks

   Substantial identity

10. Under section 58 of the Act, which concerns the ownership of the trade marks, one of the three legs that an opponent is required to establish is that the trade marks in question are at least substantially identical to each other.[1] This ‘leg’ under section 58 is also potentially one under section 44.

    [1] Carnival  Cruise Lines Inc v Sitmar Cruises Limited [1994] FCA 936; (1994) AIPC 91-049 (1994) 120 ALR 495

11. The opponent here points to its perception of an identity between the trade mark which appears below and the ‘V’ portion of the word VELOUR within the opposed trade mark. 

12. There are problems with this argument :

    ·The evidence does not satisfy me that the opponent has used the above trade mark on its own, as a trade mark in Australia, without additions or alterations which do not substantially affect its identity,[2] before the priority date of the opposed application;

    ·The suggested approach would arbitrarily seize upon a feature in the opposed trade mark for comparison, to the exclusion of the balance, but it is not argued the balance of the material is subject to considerations of the type in, for example, PB Foods Ltd v Malanda  Dairy Foods Ltd [1999] FCA 1602. The V component of the opposed trade mark is not the essential feature of the opposed trade mark which draws its identity from the totality of its components: Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd [1961] HCA 75; (1963) 109 CLR 40 [Shell] and In re Diamond T  Motor Car Co. (1921) 2 Ch 583. The suggested approach thus would have me ignore material that contributes significantly to the identity of the opposed trade mark.

    ·If the stylised letters V within the relevant trade marks were to be impermissibly compared side by side, they are not, when allowance is made for the lack of inherent capacity to distinguish in the letter V per se, substantially identical: Shell, and see Colorado Group Limited v Strandbags Group Pty Limited [2006] FCA 160 at paragraph 23.

    [2]                   7  Use of trade mark

13. It follows, a fortiori, that were the trade marks of the parties to be compared as wholes, as I think here they should be, they are not substantially identical.

    Deceptive Similarity

14. In order to establish its opposition under sections 44 and 60, the opponent is (inter alia) required to establish to my satisfaction that the trade marks in question are deceptively similar.  I will note at the outset that the opponent here relies on allegations it has a family of trade marks and also that the previously discussed ‘V’ portions of the trade marks in Category One are deceptively similar to the allegedly corresponding portion of the opposed trade mark.

15. The ‘rules’ of comparison of trade marks are the familiar ones oft quoted from Dixon and McTiernan JJ in Australian Woollen Mills Limited v F S Walton and Company Limited [1937] HCA 51; (1937) 58 CLR 641:

    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. The effect of spoken description must be considered. If a mark is in fact or from its nature likely to be the source of some name or verbal description by which buyers will express their desire to have the goods, then similarities both of sound and of meaning may play an important part. The usual manner in which ordinary people behave must be the test of what confusion or deception may be expected. Potential buyers of goods are not to be credited with any high perception or habitual caution. On the other hand, exceptional carelessness or stupidity may be disregarded. The course of business and the way in which the particular class of goods are sold gives, it may be said, the setting, and the habits and observation of men considered in the mass affords the standard. Evidence of actual cases of deception, if forthcoming, is of great weight.

16. I must also consider the context of the particular marketplace in which the goods are traded; in In Re Application by the Pianotist Co Ltd (1906) 1A IPR 379 at 380; 23 RPC 774 at 777, above, where Parker J, as he then was, 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.

17. Deceptive similarity is defined within section 10 of the Act which provides:

    10  Definition of deceptively similar

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

18. Concerning deceptive similarity, and the expression ‘deceive or cause confusion’, in  Registrar of Trade Marks v Woolworths [1999] FCA 1020, French J explained, at paragraph 50:

    In Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd [1953] HCA 73; (1954) 91 CLR 592 at 594-5, which concerned the 1905 Act, Kitto J set out a number of propositions which have frequently been quoted and applied to the 1955 Act. The essential elements of those propositions continue to apply to the issue of deceptive similarity under the 1995 Act. Applied also to service marks and absent the imposition of an onus upon the applicant they may be restated as follows:

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

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

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

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

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

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

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

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

19. That said, I am hard pressed to see any similarity between the trade marks of the parties, let alone one which even remotely has the potential to confuse or deceive.  The words VELOUR and VELCRO are each dictionary words with different meanings.  The words are very obviously going to be remembered and recalled in quite different ways – the likelihood of the one being mistaken or misremembered for the other in the marketplace thus appears to me to be vanishingly small.  Further, the stylised letter V in the opponent’s trade mark is not a part of the word VELCRO but under it and it bears scant resemblance to the letter V within the word VELOUR in the opposed trade mark.  The highly stylised letter V in the opponent’s trade mark and the letter V in the opposed trade mark thus appear to me to be quite different and perform different functions in the trade marks.  The one serves to stress the word VELOUR and the other, in which the letter V can only just be discerned, functions to underline the word VELCRO.  If the trade marks of the parties were ever mistaken for each other I could only conclude that it was as a result of some exceptional carelessness or stupidity as per Woollen Mills, above.

20. It is quite possible that a person might set out to purchase a Velcro product, thinking that all hook and loop fasteners are Velcro, see the applicant’s goods and purchase them, but this would happen even if the trade mark appearing on the other product was ACME or WOMBAT.

21. It is also, I consider, improbable that the broad mass of Australian consumers would be aware of the fact that a part of the opponent’s trade mark and the whole of the word within the opponent’s trade mark are similarly etymologically derived or reflect for a moment on this when shopping for hook and loop products.  The word ‘Velcro’ is, in essence, an invented word[3] and has, as such, not gained any meaning that it may have derived from its antecedents.  The words ‘Velcro’ and ‘Velour’ are both now dictionary words which mean different things and it is improbable that people would look beyond that if they reflected upon it at all.

    [3] Compare Mark  Foy's Ltd v Davies Coop and Co Ltd [1956] HCA 41; (1956) 95 CLR 190 and Howard Auto-Cultivators Limited v Webb Industries Pty Ltd [1946] HCA 15; (1946) 72 CLR 175.

22. The opponent has not, on the evidence before me, established to my satisfaction that it has used any trade marks in Australia apart from the trade mark VELCRO (word) and logo-form which is the subject of registration 306432, such that the public would make an assumption that any word with the ‘prefix’ VEL- would be or could be likely to be, a member of that family.  There is no evidence of a public appreciation or recognition of a family of the opponent’s VEL- trade marks at all – nor any evidence broken down by revenues under the different trade marks from which this might be inferred.

1. Additionally, since the word VELOUR is a dictionary word, parallels could not here exist with what I might term ‘The McFamily of Trade Mark Cases’ such as McDonald's Corporation v Macri Fruit Distributors Pty Ltd [2000] ATMO 37 or McDonald's Inc v Future Enterprises Pte Ltd [2007] ATMO 22. In those cases there was strong and well-supported evidence that the opponent’s ongoing coinage of ‘McFamily’ trade marks was notorious and very widely recognised – such evidence is absent here. And, anyway, the ‘rule’ (and I use that word very loosely) falters when the ‘Mac-’ stem is compared with dictionary words such as MACE, MACRAMI, or MACULAR or even surnames such as McNiece or McHendry.  Similarly, if the stem ‘VEL-’ hypothetically indicates the opponent’s goods, what then of words such as VELLUM, VELVET, VELDTS, or VELLICATE if used on the same goods, or the more extreme examples of the surnames Vellios or Veltman?  The word VELOUR would be in likewise position to those other dictionary examples, I consider, had the opponent been able to satisfactorily establish a public recognition of its postulated family of trade marks.  There is no reason for the public to see them as being related or connected in any way.

2. The opponent has not established that its trade marks are (individually or collectively) substantially identical or deceptively similar to the opposed trade mark and thus cannot establish its opposition in terms of sections 58, 44 and 60 of the Act.

   Section 42

3. Subsection 42 of the Act provides:

   42  Trade mark scandalous or its use contrary to law

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

   […]

   (b)         its use would be contrary to law.

4. The laws here relied on by the opponent are that of passing off and sections 52 and 53 of the Trade Practices Act 1974 (’the TPA’). The words ‘mislead or deceive’ within section 52 of the TPA are narrower in scope than are the words ‘confuse and deceive’ in terms of sections 44 and 60 of the Act. Thus, as I have found that the opposition under section 60 has not been established, it follows that the opposition here which is also based on the reputation of the VELCRO trade mark(s), and an alleged similarity of one or more of the opponent’s trade marks to the opposed trade mark, cannot be established. In this regard, see the judgment of Gibbs CJ in Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; (1982) 149 CLR 191 at paragraph 8:

   In McWilliam's Wines Pty. Ltd. v. McDonalds System of Australia Pty. Ltd (1980) 49 FLR 455; 33 ALR 394 it was rightly held by Smithers J. and by Fisher J. that to prove a breach of s. 52 it is not enough to establish that the conduct complained of was confusing or caused people to wonder whether two products may have come from the same source, and that Southern Cross Refrigerating Co. v. Toowoomba Foundry Pty. Ltd. [1953] HCA 73; (1954) 91 CLR 592, a decision on the Trade Marks Act 1905 (Cth), as amended, is distinguishable.

5. It follows that if I am not satisfied in the present circumstances that the opposed trade mark would be likely to confuse (as a minimum) in terms of sections 44 and 60, neither can I be satisfied it would mislead or deceive.

6. As to section 53 of the TPA or the passing off claim, I can see no misrepresentation inherent in the opposed trade mark.

7. The opposition under section 42 of the Act is not established.

   Section 59

8. Section 59 of the Act provides:

   59  Applicant not intending to use trade mark

   The registration of a trade mark may be opposed on the ground that the applicant does not intend:

   (a)         to use, or authorise the use of, the trade mark in Australia; or

   (b)         to assign the trade mark to a body corporate for use by the body corporate in Australia;

   in relation to the goods and/or services specified in the application.

   Note: For applicant see section 6.

9. I will initially note that the basis for this ground is that the specification of goods of the opposed application contains many goods other than hook and loop fasteners.  It can be fairly observed that several of the opponent’s registrations suffer from the defect the opponent complains of, if it be such.

10. Be that as it may, there is nothing in the opponent’s evidence, or in correspondence leading up to the hearing, which would have put the opponent on notice that section 59 was a ground to be addressed in its evidence and at the hearing. An applicant’s evidence in answer is just that – if a ground is not addressed in the opponent’s evidence, and the applicant is not put on notice, there is nothing to answer. As it is for the opponent to establish the grounds of opposition, the absence of evidence of the applicant’s intention to use the trade mark on all of the goods in respect of which registration is sought is entirely unsurprising and may be simply explained as resulting from the dearth of the opponent’s evidence in this regard.

11. The opponent has not established the ground of opposition under section 59.

    Decision

12. Section 55 of the Act provides:

    55  Decision

    Unless the proceedings are discontinued or dismissed, the Registrar must, at the end, decide:

    (a)to refuse to register the trade mark; or

    (b)       to register the trade mark (with or without conditions or limitations) in respect of the goods and/or services then specified in the application;

    having regard to the extent (if any) to which any ground on which the application was opposed has been established.

    Note:For limitations see section 6.

13. No ground of opposition has been established to any extent.  I therefore direct that the application may be registered one month from the date of this decision.  If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until the appeal has been decided or discontinued and that the disposition of the application be in accordance with the Court’s order or direction.

    Costs

14. As the applicant has been successful in these proceedings, I award costs against the opponent at the scale set out in the regulations.

    Iain Thompson

    Hearing Officer

    Trade Marks Hearings

    27 February 2008

    
    

(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.

Note:For prescribed court see section 190.