Wyndella Pty Ltd v C. Sparkes-Carroll, C. Baffsky

TRADE MARKS ACT 1995

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

Re:Opposition by Wyndella Pty Ltd to registration of trade mark application 1050693(35, 38, 44) - HEALTHEWAY - filed in the name of Cameron Sparkes-Carroll and Catherine Baffsky.

Delegate:

Terry Williams

Representation:

Opponent: Michael Houlihan, solicitor, of Houlihan²

Applicant: did not appear or make submissions

Decision:

2007 ATMO 79

S 52 opposition: S 58 not established, HEALTHEWAY not substantially identical to HEALTHWAYS - S 60 established in part – condition of registration required.

Background

On 14 April 2005 (“the critical date”) Cameron Sparkes-Carroll and Catherine Baffsky applied to register the trade mark HEALTHEWAY in respect of the following services:

(class 35): The retail of goods that seek to provide health and beauty benefits for both humans and animals; including retail of these goods via the Internet

(class 38): Telecommunications

(class 44): Services that seek to provide health and beauty benefits for both humans and animals; including the provision of these services over the Internet.

The application has been advertised as accepted for possible registration but this is opposed by Wyndella Pty Ltd (“the opponent”).
The parties have served evidence to support their respective positions, being evidence in support from the opponent and evidence in answer from the applicant. In due course the matter came to be heard. At the hearing, Mr Houlihan, solicitor, appeared for the opponent. The applicants simply indicated before the hearing that they did not believe that the evidence that they had submitted needed any explanation, and that they would thus not be attending. I am now to decide the opposition under delegation from the Registrar of Trade Marks.

Grounds

In brief, the opponent operates a facility that incorporates a gymnasium, swimming pool, bowling alley and squash courts. The opponent provides its services via these facilities and in the provision of various weight-reduction and (inter alia) fitness activities which I will illustrate in more detail below. At the hearing, Mr Houlihan relied on two grounds of opposition that, he said, were supported by the opponent’s evidence.

Ownership – Section 58

This ground of opposition is provided for by s 58 of the Trade Marks Act 1995. It is now well established law that in order to succeed under this ground of opposition the opponent must establish three factors. These are that:
- the respective trade marks of applicants and opponent be either identical or substantially identical (Carnival Cruise Lines Inc. v Sitmar Cruises Limited[1])
- the respective goods or services of the parties be ‘the same kind of thing’ (Re: Hicks' Trade Mark[2], and
- a person other than the applicants has the earlier claim to ownership based on use prior to both the present application to register and to the earliest actual use of the trade mark by the applicant (Settef SpA v Riv-Oland Marble Co (Vic.) Pty Limited[3] and Hicks' Trade Mark, supra, at 639).
With these three in mind, Mr Houlihan noted that the opponent’s trade mark consists of the word HEALTHWAYS. The applicants’ trade mark, HEALTHEWAY, he argued, was substantially identical.
Gummow J outlined the first of these necessary factors, concerning the possible conflicting trade marks themselves, in Carnival Cruise, supra, with the words:
When the decision is understood in this way, it does not supply any general authority for the proposition that in the case of disputed claims to proprietorship under the present statute anything less than substantial identity between the two marks will suffice.
The accepted test for substantial identity of competing trade marks is set out by Windeyer J in Shell Co. (Aust) Ltd v Esso Standard Oil (Aust) Ltd[4].
In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison.
[4] (1961) 109 CLR 407 at 414
Of the above, Mr Houlihan reminded me that, in Carnival Cruise, supra, Gummow J noted Windeyer J’s judgment, and then summarized the matter as follows: “It requires a total impression of similarity to emerge from a comparison between the two marks. In a real sense a claim to proprietorship of the one extends to the other.”
Mr Houlihan urged me to consider the totality of the similarities. The key difference, the letter “e” was, as he put it, “buried”. Here, Mr Houlihan drew support from the view expressed by the examiner of trade marks in relation to the opponent’s own application for registration, which was at one stage impeded by the presently-opposed application. The opponent in the present matter had filed an application to register a series of two trade marks, HEALTHWAY and HEALTHWAYS, under s 51. The examiner of that application accepted that those two trade marks could proceed as the subject of a single filing for the purposes of s 51. Since Mr Houlihan chose to rely on the view of the examiner who assessed his client’s own application, I will quote the relevant paragraph of the examiner’s report:
Your trade mark closely resembles the conflicting trade mark. Your mark is for HEALTHWAY and mark 1050693 is for HEALTHEWAY. The only difference in the marks is the E buried in the middle of HEALTHEWAY. The marks are euphonically and visually very similar and convey the same idea. In the marketplace, it is highly likely that consumers would become confused.
I agree with the examiner’s view, in that other matter, that the marks HEALTHEWAY and HEALTHWAY(S) are very similar, and closely resemble each other. However, the issues that concerned the examiner were the existence or otherwise of a series of trade marks for the purposes of s 51 and, subsequently, the issue of deceptive similarity, vis a vis the opponent’s trade mark for the purposes of s 44. The test to be applied under s 51 is less rigorous than substantial identity, the hurdle the opponent currently faces. Moreover, the evidence before me relates only to the trade mark HEALTHWAYS. For the purposes of s 58 in the present matter the opponent must base its claims entirely on rights arising from usage, not on those flowing from its own making of an application for registration. There is, under that heading, no evidence that the opponent has ever used the trade mark HEALTHWAY, in the singular form.
Thus, the view of the examiner goes to a different question, at a lesser standard than that which the opponent must now confront. The opponent can succeed now under s 58 only if I am satisfied that HEALTHWAYS and HEALTHEWAY are substantially identical. Clearly, the matter is a difficult one, approaching balance. In striking the balance, little weight should be given to the letter S as the conclusion of the applicants’ trade mark[5]. The S is likely to be perceived either as the plural or the possessive of HEALTHEWAY. Beyond this, it is obvious that the competing marks are deceptively similar, such that an error in typing may, and a failure of attention to detail in the side-by-side comparison inevitably must, produce a mistake. Mr Houlihan, moreover, is correct to say that the first six and the last three letters of the applicants’ trade mark occur in the opponent’s. However, the critical difference, the letter E, cannot be overlooked. The letter E in the applicants’ mark suggests a play on the word “healthy”, hence “healthy way”. Alternatively, it opens up a reading as “heal the way”, though perhaps this reading of the word is not one that would be immediately obvious. Either way, the letter E in the applicant’s mark introduces an ambiguity into the pronunciation and recall of the mark. Thus, no matter how Mr Houlihan might argue that the E is “buried”, its influence is felt, and is unavoidable in a side-by-side comparison. Because of this, the s 58 ground cannot be established.
[5] See the comments on this in Carnival Cruise Lines, supra, at 391.

Deception and Confusion - Section 60

In simple terms, a s 60 ground must be based on the existence of a prior reputation in a deceptively similar trade mark - in this case, the opponent’s - such that the ordinary fair use, for goods or services within the scope of the application, would result in deception or confusion. The critical date, at which this is to be tested, is the date of the opposed application, 14 April 2005.
At the outset, and despite the protestations of the applicants to the contrary by way of argument in their evidence in answer to the opposition, I am satisfied that the competing trade marks, HEALTHWAYS and HEALTHEWAY, are deceptively similar. While I have found them not to be substantially identical when examined side-by-side, proper allowance for what the courts have described as imperfect recollection must inevitably find that the marks are close enough to cause outright mistake. Without delving into case law to illustrate my point, the appropriate allowance for this requires me to ask what will happen if an ordinary consumer encounters one trade mark in use, in the absence of the other. The arguments that Mr Houlihan urged to support substantial identity are more than sufficient in such a context.
Given that I find the trade marks to be deceptively similar, it still does not necessarily follow that there will be confusion. That would ultimately depend on both the extent and character of the opponent’s reputation and on the nexus, or otherwise, of the various goods and services for which the applicants seek registration with the services in respect of which the opponent’s reputation is manifest.
As to the character and extent of the opponent’s reputation, Mr Houlihan argued strongly that health and, to a lesser extent, the beauty benefits that flow from this are inseparable from the opponent’s trade in fitness services as variously manifested by the opponent’s business. He argued, in effect, that the opponent’s services were aimed, and were known to be aimed, at the wellbeing of the entire person. He sought, in other words, to convince me that the character of the opponent’s reputation was more than just that of an assemblage of a gymnasium, a pool, a bowling alley and squash courts.
The evidence does not support him in this to any great degree. This evidence is in two declarations made by Mr Simcocks, a director of the opponent[6]. The high-point of the opponent’s case is a brochure dated 2001. This attests to the opponent’s winning a Business Award sponsored by Leader Newspapers. Mr Simcocks, in the evidence in support, declares that these newspapers circulate throughout Greater Melbourne. However, I infer from this somewhat ambiguous claim that Mr Simcocks is attempting to avoid acknowledging that Leader Newspapers is a group of local newspapers. In other words, the most likely import of the award is that it was a local award, bestowed by a local paper. Thus, as some of the un-dateable internet material puts it, the opponent is “a genuine, local community focused, family owned business”. Other pages indicate that, at some stage, the facility offered Ju-jitsu, but the general picture remains consistent with what follows, a page from what I assume is the 2001 brochure. The wide variety of services offered is obvious:

[6] These are the opponent’s evidence in support and evidence in reply. I note, but give little weight to, a second declaration by the owner of the company that hosts the opponent’s website. The declarant, Mr Clark, essentially sets out reasons why he himself would confuse the competing trade marks in various contexts. That is precisely the matter for my own decision, and I will decide it accordingly.

There are, I note, some difficulties with the detail of the opponent’s evidence. The 2001 brochure has been unhelpfully conjoined with, apparently, a 2003 brochure. Similarly, Mr Simcocks does not attempt to date any parts of the opponent’s internet material that he appends to his declaration, other than to say that, on one hand, his company has operated the site since 2000 while noting, on the other, that one photograph on the site is dated October 2004. This date is unhelpful since it simply begs the question of what the site itself showed at times up to the critical date, in April the next year. Mr Simcocks notes that the website details he appends were not captured until February 2006[7].
[7] Mr Houlihan, at the hearing, argued from exhibit MWS2 that the website was “last modified” in April 2004. I find it puzzling, if so, that it would incorporate a photograph bearing a date in October of that year.
I will, however, put these difficulties aside and give the opponent the benefit of the doubt here. Even when I take the opponent’s evidence at its highest, the outcome remains the same. My characterization of the extent and nature of the opponent’s reputation would not change even if I am, through the opponent’s inadvertence, putting more weight than I should on things that are, in fact, part of the later, 2003, brochure.
Mr Houlihan noted the references to “personalized fitness assessments and training” in the brochure. It is quite clear that, were a customer to make good use of the available facilities, the end result would be that one would be “feeling good, looking great and getting more out of life”, as the website puts it. Again, I note the opponent’s evidence in reply, which tends to show that the public is familiar with health magazines, such as Australian Men’s Health and Women’s Health & Fitness Australia wherein there is a close interleaving of articles on a divergent range of topics including sex, fitness, health, nutrition, weight loss, stress, appearance and so forth. As Mr Simcocks puts it “for some people, beauty is held in such high importance that health and fitness is really only a means to a more attractive end”. Those things are no doubt so and, as Mr Simcocks argues, they act to precondition the market, including his own customers, towards being confused by the use of a similar trade mark in relation to health and beauty services of various sorts. None the less, if I turn to the substance of the brochure produced by the opponent for the school holidays of September/October 2001, or 2003 as the case may be, it is very clear that the reputation of the opponent lies in little more than the sum total of its facilities, though these are themselves quite considerable. It is simply not correct to assert, as Mr Simcocks does, that the evidence shows that the opponent has traded, “as a consequence” in beauty services.
The opponent has included in its evidence in reply material that might perhaps show that, in 2006, there existed health and fitness centres that were part of a “popular trend” to “develop a ‘one stop shop’ for health and wellbeing”. Mr Simcocks supports this by annexing material from the 2006 Yellow Pages, and by a detailed analysis of two establishments, the King Club and Hunts Fitness Club. However, the question posed by s 60 looks at the extent and character of the reputation of the opponent’s trade mark, not the nature of the business of other players in its field, and has a focus on the reputation of the opponent in April 2005. The generalities of the market would guide consumer expectations, but they will not supply a case where one does not otherwise exist and the main driver of this ground of opposition must be the reputation of the opponent’s trade mark.
It is of very little relevance to this reputation that the opponent had employed a qualified dietician/nutritionist since “about” December 2004 to work with the opponent’s customers on weight reduction. There is no evidence that this facet of the opponent’s activities had had any material impact on the nature of its reputation as at the critical date, “about” four months later.
It might well be said, moreover, that the reputation of the opponent is localized. I have no evidence before me to suggest that any significant number of people beyond what I will loosely define as the opponent’s part of Melbourne would have been aware of the opponent or its activities at the priority date of the opposed application.
What, then, is the likelihood of deception or confusion? To answer this, it is necessary to turn to a detailed consideration of the potential usages of the applied-for mark that would fall within the scope of the opposed application. The test in this regard is quite clear: it is not “how might the applicants safely avoid confusion?”. Rather, as Kitto J put it in Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd[8]:
…the onus is not discharged by proof only that a particular method of user will not give rise to confusion. The test is, what can the applicant do if he obtains registration?
[8] (1954) 91 CLR 592 at 595
In this, I am not at all assisted by the attitude of the applicants. To judge from the tenor of the evidence, the applicants are perhaps not proposing to trade in telecommunications services, but their application is broadly cast in the remaining classes. They did not attend the hearing and Mr Sparkes-Carroll has put nothing into his evidence in answer that would allow me to understand the nature of the services within the vague descriptions set out in the application as filed, particularly class 44. Mr Spares-Carroll does, however, acknowledge that the lack of a launch of “our goods and/or services” is attributable to a number of things, “not least of which is the resolution of various IP issues such as the opposed application”.
I find nothing about the nature and extent of the opponent’s reputation that would lead to deception or confusion if the applicants conduct an ordinary trade in telecommunications services. The opponent has not satisfied me that there is even a bare bone of a prospect of deception or confusion in that market.
As to class 35, however, the position is by no means so obvious. The opponent had, by the priority date, established a reputation within parts of Melbourne. The extent of this is unclear, as customer numbers in the years leading up to the critical date have not been clearly stated[9]. Were the reputation more extensive, and were the marks in question either identical or, perhaps, more striking and unusual, it would be possible to envisage deception or confusion arising in the sale of, perhaps, exercise equipment. However, the opponent’s case is lacking the quantum and essence that might have given it success in this field. A theoretical possibility of confusion is not enough; I would need to be satisfied that there is a real or tangible risk[10]. With respect to the retail of goods, the opponent’s case falls short of the mark.
[9] Mr Simcocks declares that, even in 2006, there were only 1000 members, 2,500 permanent casual members and an unstated amount of usage by non-members.
[10] See Southern Cross, supra. This remains entirely applicable to the 1995 legislation, under which the opponent bears the onus in relation to s 60.
The generality of the applicants’ specification brings them closer to danger in respect of class 44, “Services that seek to provide health and beauty benefits for both humans and animals; including the provision of these services over the Internet”. Those services, as I have said, are broad. They would include everything from veterinary services, at one extreme, through hairdressing salons to psychological counselling services. The scope of the application in class 44 cannot be entirely separated from the scope of the class itself, the definitive text for that purpose being the International Classification of Goods and Services, 8th edition, effective from January 2002. To assist readers of this decision I have appended a copy of page 161 thereof. In addition, there is an overlay of services that fall into class 44 by determination of the Registrar of Trade Marks.

What is at issue for present purposes is this: are there any services within the scope of the ambiguous wording adopted by the applicants that would reasonably give rise to deception or confusion if the applicants made any normal and fair use of their mark in the provision of the services in question? Once it is noted that the scope of services in class 44 is broadly defined as per the class heading “Medical services; veterinary services; hygienic and beauty care for human beings or animals; agriculture, horticulture and forestry services”, some clarity begins to emerge. Whatever the scope of the applicant’s rights would be, they would extend to services that are health services or beauty services per se. They would not, within the scope of the application, extend to services that operate by way of education or exercise. Those services fall in class 41. The closest that the applicants would come to obtaining rights for usage that could, perhaps, cause deception or confusion because of the opponent’s reputation is in the operation of health spas (which fall into class 44 by dint of a classification determination made by the Registrar) or “public baths for hygiene purposes”, and the more familiar description “Turkish baths”.
I have already noted that the opponent’s reputation is localized. I have noted that the character of that reputation is, moreover, essentially that of the total of the facilities that the opponent provides. The quantum of the evidence is not such as to show that the opponent is a major player in its field, or necessarily to be seen as potentially diversifying into the operation of a health spa. Mr Houlihan, at the hearing, sought to portray the opponent as a health and beauty facility in order to, in effect, paint the opponent’s case as being bigger, better, and marginally different to what it really is. This will not do. When the opponent’s business is seen for what it is, the substance, character and nature of the reputation will arguably tend to mitigate, rather than contribute to, the likelihood of deception or confusion. And, while the trade marks are deceptively similar, they are not the same. This factor too must be added to the balance, though its weight is but slight.
None the less, the possibility of confusion is established to the necessary degree as regards some parts of Melbourne. By way of illustration, it would be a perverse exercise in optimism to expect that, in some parts of Melbourne, the applicants could conduct either a public bath facility, or a health spa, of the sorts that would fall in class 44, without causing a significant risk of confusion vis a vis the opponent’s trade mark. When I note too that the applicant’s services will, most clearly and explicitly, be rendered in ways that involve the internet, the risk of deception or confusion, and the area wherein deception or confusion will be manifest, both increase.
This confronts me with a difficulty. The applicants have been less than fulsome about the services that they actually intend to provide. That in turn means that I am left to assess what scope of registration I could properly authorize while being completely in the dark about the applicant’s actual intentions. As can be seen from the attachment to this decision, the scope of class 44 can be difficult to anticipate. Once an opponent has established a ground of opposition to at least some extent, it is not my proper role, to give the applicant the benefit of the doubt where that doubt is created, in the first instance, by the broad and ambiguous scope of the application. The applicants have, moreover, been served with the opponent’s evidence but have adopted a dismissive attitude, casting the opponent’s case as “irrelevant” despite acknowledging that the outcome of the present opposition may influence their future use. I am required to decide the opposition and it would be inappropriate for me, in the present circumstances, to delay the resolution by conducting any further investigation into what amendments of the statement of services or conditions of registration might have otherwise been allowable at the margins.

Conclusion

The trade mark application may proceed to registration one month from the date of this decision, subject to the condition that it be endorsed as follows:
Registration of this trade mark in class 44 does not extend, in Victoria, to any services to be provided to humans.
If the Registrar has been served with a notice of appeal before the date of registration, I direct that registration shall not occur until either the appeal has been discontinued or registration, in whatever terms, is ordered by the Court.
I direct that the applicants pay the costs of the opponent to the limits provided in the scale in the regulations.

Terry Williams

Hearing Officer

28 November 2007

Appendix: Class 44, from the International Classification of Goods and Services, 8th edition.

[2007] ATMO 79

28 November 2007

Key Legal Topics

Areas of Law

Civil Procedure

Administrative Law

Legal Concepts

Judicial Review

Procedural Fairness

Natural Justice

Standing

Abuse of Process

Costs