Wolverine International, L.P. v Zijian Zhang

[2013] ATMO 38

TRADE MARKS ACT 1995

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

Re:Opposition by Wolverine International, L.P. to registration of trade mark application 1429105(25) - CHAKAH - filed in the name of Zijian Zhang

Delegate:	Debrett Lyons
Representation:	Opponent: Fiona Brittain of Davies, Collison, Cave Patent & Trade Mark Attorneys Applicant: No representation and no written submissions
Decision:	2013 ATMO 38 s52 opposition to registration: sections 42(b), 44 and 60 argued – trade marks not deceptively similar; reputation of Opponent’s trade mark not established by evidence; use not contrary to law. Opposition not established.

Background

1. This matter is an opposition under section 52 of the Trade Marks Act 1995 (‘the Act’) to the registration of the trade mark filed by Zijian Zhang (‘the Applicant’) details of which appear below:

Application No:                 1429105
Priority Date:  6 June 2011
Goods:  Class 25: Apparel (clothing, footwear, headgear)
Trade Mark:  CHAKAH      (‘the Trade Mark’)

1. The application was examined in compliance with section 31 of the Act and advertised as accepted for possible registration in the Australian Official Journal of Trade Marks on 20 October 2011.

2. On 19 January 2012, Wolverine International, L.P. (‘the Opponent’) filed Notice of Opposition (‘the Notice’) to the registration of the Trade Mark. The Notice is couched in broad terms and includes the grounds under sections 42(b), 44 and 60 of the Act which were relied upon by the Opponent at a hearing of the matter. For the sake of completeness I find that the grounds other than those relied upon by the Opponent at the hearing have not been established and note that any ground may be relied upon should my decision be appealed to the Court where the matter will be considered de novo.

3. The Opponent accepts that it bears the onus of establishing at least one of those grounds of opposition on the balance of probabilities.[1]

   [1] See Pfizer Products Inc v Karam [2006] FCA 1663; 237 ALR 787; (2006) 70 IPR 599; [2006] AIPC 92-146 per Gyles J at [6] to [26]; Chocolaterie Guylian N.V. v Registrar of Trade Marks [2009] FCA 891; (2009) 180 FCR 60; (2009) 258 ALR 545; (2009) 82 IPR 13; [2009] AIPC 92-355 per Sundberg J at [22] to [26]; Sports Warehouse, Inc v Fry Consulting Pty Ltd [2010] FCA 664; (2010) 87 IPR 300 per Kenny J at [30] to [40]; NV Sumatra Tobacco Trading Company v British American Tobacco Services Limited [2011] FCA 1051; (2011) 198 FCR 435; (2011) 283 ALR 743 per Greenwood J at [16] to 32]; Allergan, Inc v Di Giacomo [2011] FCA 1540; (2011) 199 FCR 126; 94 IPR 541 per Stone J at [11] to [12] and most recently Tricarico v Dunn Bay Holdings Pty Ltd [2012] FCA 271 per McKerracher J at [9] to [10] and Fry Consulting Pty Ltd v Sports Warehouse Inc (No 2) (2012) 94 IPR 551 per Dodds-Streeton J at [13].

4. The time at which the grounds of opposition must be established is the date of filing of the application for registration, 6 June 2011: see Southern Cross Refrigerating v Toowoomba Foundry Pty Ltd (1953) 91 CLR 592 at 595.

5. The hearing was before me as a delegate of the Registrar of Trade Marks in Melbourne on 27 May 2013.  The Opponent was represented by Fiona Brittain of Davies Collison Cave, Patent and Trade Mark Attorneys.  Although the Applicant is professionally represented it wrote to the Office prior to the hearing indicating that it would not to attend the hearing and would not be filing written representations.

6. The Trade Marks Regulations 1995 provide for the filing of evidence in support of an opposition under section 52 of the Act. In this case, the evidence comprises simply the Opponent’s Evidence in Support, being a Declaration of Kenneth A. Grady made 17 July 2012. No evidence has been filed on behalf of the Applicant.

Discussion

1. In outline, the Opponent’s submissions are that:

§ in terms of section 44, the Trade Mark is deceptively similar to the Opponent's trade mark CHACO which is the subject of earlier Trade Mark Registration Nos. 840425 and 915896;

§ in terms of section 60, the Trade Mark is similar to the CHACO trade mark which has a prior reputation in Australia and use of the Trade Mark would be likely to deceive or cause confusion; and

§ in terms of section 42(b), use of the Trade Mark would be contrary to law because (i) it would be in breach of section 18 of the Australian Consumer Law which prohibits misleading or deceptive conduct in the course of trade or commerce, and (ii) use of the Trade Mark would constitute the common law tort of passing off.

1. For the reasons which follow I find that none of those grounds is established.

Section 44

1. Subsection 44(1) of the Act provides:

   (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.

1. In order to establish this ground the Opponent must show that there is an earlier application or registration in the name of someone other than the Applicant which is for the same or similar goods, where the trade mark of that application or registration is substantially identical with, or deceptively similar to, the Trade Mark.  For that purpose the Opponent relies on two of its own registrations, details of which appear below:

Regn. No.	Trade Mark	Goods
840425	CHACO	Class: 25 Footwear including sandals, shoes, boots, thongs, insoles, outsoles, footbeds
915896	CHACO	Class: 25 Clothing including T-shirts, jackets, belts, shorts, vests, shirts, pants; hosiery including socks; headgear including hats, visors

1. Registration 915896 arose from a divisional application from what is now registration 840425. Both registrations have a priority date of 27 June 2000, earlier than that of the opposed application. Section 14(1) of the Act defines "similar goods" as goods which are the same, or of the same description, as other goods. The goods of the application - clothing, footwear, headgear – are the same as goods covered by the Opponent’s registrations.

2. The only remaining issue for the purposes of section 44(1) is whether CHAKAH is deceptively similar to CHACO, there being no submission that they are substantially identical.

3. Section 10 of the Act defines a ‘deceptively similar’ trade mark as follows:

   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.

4. Justice French in Registrar of Trade Marks v Woolworths Ltd[2] observed in relation to the expression “likely to deceive or cause confusion”:

   … The use of the word “likely” in this context does not import a requirement that it be more probable than not that the mark has that effect. The probability of deception or confusion must be finite and non-trivial. There must be a “real tangible danger of its occurring” …

   [2] (1999) 45 IPR 411 at 426

5. The difference between ‘deceive’ and ‘cause confusion’ was considered in Pioneer Hi-Bred  Corn  Co v Hy-Line Chicks Pty Ltd[3] where it was stated:

   ‘Deceived’ implies the creation of an incorrect belief or mental impression and ‘causing confusion’ may go no further than perplexing or mixing up the minds of the purchasing public.... Where the deception or confusion alleged is as to the source of the goods, deceived is equivalent to being misled into thinking that the goods bearing the applicant's mark come from some other source and confused to being caused to wonder whether that might not be the case.

   [3] (1979) RPC 410 at 423

6. The Opponent submitted that the prefix of each mark is "CHA".  The middle letter of each mark is "K" and "C" respectively.  Relevantly, the "C" in CHACO will be pronounced as a hard "C" as in "chocolate" and not a soft "C" as in "mice".  The end of each mark is "O" and "A" respectively, being an open vowel sound.  It was also put to me that “the marks CHAKAH and CHACO both comprise a made up word. … The fact that the marks comprise made up words with no descriptive significance in relation to the designated goods in class 25 increases the likelihood of confusion (Quintessence Inc v. Jovani Enterprises Pty Ltd (1994) 28 IPR 365).”

7. The Opponent recited a number of cases where trade marks which shared a common prefix or first element were held by either the Registrar or the Courts to be deceptively similar and concluded that the only exceptional cases which held otherwise could “be categorised as (a) situations where the goods were highly specialised and expensive (ie. pharmaceuticals, cars, etc); (b) situations where the prefix of the trade marks under comparison was shown to be common or lacking distinctiveness; and (c) situations where the idea between the trade marks was completely different.  None of the following apply (at all or to a sufficient degree) in the present circumstances.  The goods are class 25 goods, which are not highly specialised or expensive.  The prefix "CHA" is not common or non-distinctive.  The marks do not convey different ideas as they are both made up words.”

8. I find that the Opponent’s own précis of the case law works against it.  As a preliminary matter I asked Ms Brittain why the Opponent’s registrations had been accepted subject to an endorsement on the Register which reads in each case: “Provisions of subsection 41(5) applied.”  Ms Brittain had no knowledge as her firm had not prosecuted either application to registration.  She appeared not to have delved further into the matter for the purposes of this opposition. 

9. After the hearing I soon learned that the word “Chaco” has a geographical significance.  Office records show this was something which had not escaped the attention of the examiner of those applications.  In a report, the examiner wrote:

   Your trade mark is not capable of distinguishing your goods because CHACO is the name of a region in Paraguay and Argentina.  As this region is rather expansive in size and is famous for their cotton production, a fibre that is directly linked to your statement of goods for clothing, other traders are likely to need to use this name to indicate an obvious or potential connection with their goods.

   However, I may be able to reconsider this matter if you provide evidence of use of your trade mark under sub-section 41(5). 

10. Evidence of use was filed, resulting in acceptance of the Opponent’s trade mark. 

11. My own limited research showed that “Chaco” is the name of what was a well established American culture and that hiking and exploration of that culture is a popular pastime in the Chaco National Park.

12. So, the word “Chaco” has in fact two meanings.

13. Moreover, it appears from my own limited research that the word “Chakah” is the name of a sizeable place in Pakistan[4].

    [4] Also a common word in Hebrew.

14. In the result, one of the exceptions which the Opponent sought to draw out from the general rules of law it outlined is, as it happens, applicable to the comparison of the trade marks before me.

15. I do not find the words deceptively similar in terms of their visual character.  Phonetically, it is true they differ by only a syllable change.  However these are not “made up” words as the Opponent has tried to argue.  Both have geographical significance and one (at least) is likely to be recognised for its geographical significance, especially amongst its target audience of purchasers who buy the goods in outdoor shops and who, in my estimation, are educated to see places and placenames like Kathmandu and Patagonia used as trade marks for similar goods.

16. I do not find the trade marks under comparison to be deceptively similar. In terms of section 10 of the Act I do not find that the Trade Mark so nearly resembles the Opponent’s trade mark that it is likely to deceive or cause confusion.

17. The Opponent has failed to establish its ground of opposition under section 44.

Section 60

1. Section 60 of the Act provides that the registration of a trade mark in respect of particular goods may be opposed on the ground that (a) other trade mark had, before the priority date for registration of the first mentioned trade mark in respect of those goods, acquired a reputation in Australia; and (b) because of the reputation of that other trade mark, the use of the first mentioned trade mark would be likely to deceive or cause confusion.

2. Accordingly, in order to establish the ground of opposition under Section 60, the Opponent must show that as at 6 June 2011, the CHACO trade mark on which it continues to rely, had acquired a reputation in Australia such that use of the CHAKAH mark would be likely to deceive or cause confusion.

3. Since 2006 section 60 has no longer required that the compared trade marks be at least deceptively similar and operation of the section may still be triggered if, taking account of the degree of similarity of the trade marks in combination with the level of repute of the Opponent’s trade mark, use of the Trade Mark is likely to deceive or cause confusion.

4. The Opponent states that “by virtue of the extensive reputation which has built up in connection with the CHACO mark in Australia …, use of the CHAKAH mark would be likely to deceive or cause confusion for the purposes of Section 60 of the Act.”

5. That claim is more than the evidence can support.  The evidence is that since 1994 sales of class 25 goods bearing the trade mark CHACO have been made in Australia through distributors[5] in this country.  The sales figures are confidential and at the commencement of the hearing I questioned Ms Brittain as to how she thought I was to treat that claim to confidentiality when it came to a written decision.  In response, I was authorised to make qualitative statements about the level of sales.  That being so, and bearing in mind that I am privy only to wholesale figures, I would nonetheless characterise the Australian sales as very modest.  When coupled with the finding I have already made that the trade marks are not deceptively similar, those sales do not underpin the degree of reputation which would be required to elevate the compared trade marks to a point where there would be a likelihood of confusion or deception.

   [5] Patagonia Pty Ltd, Paddle Sports Pty Ltd and RCG Corporation Limited

Section 42(b)

1. Section 42(b) of the Act provides that an application for the registration of a trade mark must be rejected if its use would be contrary to law.

2. In Advantage Rent-a-Car Inc v Advantage Car Rental Pty Ltd (2001) FCA 683 the Court held that, in assessing whether use would be contrary to law the Registrar was obliged to take into account the operation of law and legislation other than the Act. It was held that the test to be satisfied was that the use of the opposed mark would, rather than could, be contrary to law on the balance of probabilities.

3. The Opponent relies in part on section 18 of the Australian Consumer Law ("ACL") which prohibits misleading or deceptive conduct in the course of trade or commerce. For reasons already explained I do not consider that the evidence supports finding that use of the Trade Mark would offend section 18 of the ACL.

4. The Opponent also claimed that use of the Trade Mark would constitute the common law tort of passing off.  That tort has three central elements which must be shown in order for a claimant to succeed – a reputation, a misrepresentation and resultant damage.  Again, for reasons already explained, I would not consider the level of reputation in the Opponent’s trade mark based on the evidence to be enough that there would be a relevant misrepresentation were the Trade Mark to be used taking into meaning of the Opponent’s trade mark and the audience for the goods.

Decision

1. Subsection 55(1) of the Act provides:

   55Decision

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

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

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

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

   Note:For limitations see section 6.

2. The Opponent has not to any extent established a ground of opposition.

3. The Trade Mark may then proceed to registration one month from the date of this decision.  If the Registrar has been served with a notice of appeal before that time, I direct that registration shall not occur until the appeal has been decided or discontinued and the disposition of the application be in accordance with the Court’s order or direction.

Debrett Lyons
Hearing Officer
Trade Marks Hearings
7 June 2013