Sao Paulo Alpargatas S.A. v But Fashion Solutions Comercio E Industria de Artigos Em Pele LDA HC Wellington CIV 2010-485-2473
[2011] NZHC 661
•5 July 2011
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV 2010-485-2473
UNDER The Trade Marks Act 2002
IN THE MATTER OF an appeal from the decision of the Assistant
Commissioner of Trade Marks dated 12
November 2010
AND IN THE MATTER OF trade mark application no 798640
CUBANAS and logo
BETWEEN SAO PAULO ALPARGATAS S.A.
Appellant
ANDBUT FASHION SOLUTIONS COMERCIO E INDUSTRIA DE ARTIGOS EM PELE LDA Respondent
Hearing: 4 May 2011
Counsel: N J Robb for the Appellant
C A Warburton and M Warburton for the Respondent
Judgment: 5 July 2011
JUDGMENT OF MALLON J
SAO PAULO ALPARGATAS S.A. v BUT FASHION SOLUTIONS COMERCIO E INDUSTRIA DE ARTIGOS EM PELE LDA HC WN CIV 2010-485-2473 5 July 2011
Table of Contents
Introduction ....................................................................................................................................... [1] Factual Background .......................................................................................................................... [4] The Assistant Commissioner’s decision ........................................................................................... [9] Nature of the appeal .........................................................................................................................[11] Section 17(1)(a) ................................................................................................................................ [12] The section.................................................................................................................................... [12] The Assistant Commissioner’s analysis ........................................................................................ [13] First alleged error : failing to consider the brand ....................................................................... [19] Second alleged error : side-by-side comparison .......................................................................... [21] Third alleged error : failing to consider how the respective marks would appear in the market . [24] Fourth alleged error : requiring a similarity in the type of goods and services ........................... [26]
My assessment .............................................................................................................................. [29] Section 25(1)(b)................................................................................................................................ [41] The section.................................................................................................................................... [41] Alleged error : failing to recognise the distinction between s 17(1)(a) and s 25(1)(b) ................ [42] Section 25(1)(c) ................................................................................................................................ [46] The section.................................................................................................................................... [46] The Assistant Commissioner’s decision ........................................................................................ [47] First alleged error : issue of interpretation .................................................................................. [49] Second alleged error : mark is well known .................................................................................. [55] The remaining requirements of s 25(1)(c) .................................................................................... [61] Result ................................................................................................................................................ [65]
Introduction
[1] Sao Paulo (the appellant) makes beach sandals which are sold in New Zealand under its registered HAVAIANAS trade mark. Sao Paulo appeals against a decision of the Assistant Commissioner which found against Sao Paulo opposition to registration of the respondent’s CUBANAS trade mark.
[2] Sao Paulo submits that the Assistant Commissioner erred in concluding that the CUBANAS mark was not confusingly or deceptively similar to the HAVAIANAS mark. Particular issues are raised about the approach the Assistant Commissioner took to reach this conclusion on each of the statutory grounds on which the registration was opposed. Sao Paolo also submits that the Assistant
Commissioner erred in relation to one of those statutory grounds in finding that its mark was not well known in New Zealand.
[3] For the reasons which follow I dismiss Sao Paulo’s appeal.
Factual Background
[4] Sao Paulo is a Brazilian company which was established in 1907. It started making its HAVAIANAS sandals in 1962. They were inspired by the Zori Japanese style sandal. Over 200 styles have been made and over 2.2 million pairs have been sold throughout the world since 1962.
[5] Sao Paulo did not originally supply its sandals to New Zealand. However between 1994 and 2004 they were available in New Zealand via an Australian distributor. From May 2004 Sao Paulo had sold its sandals directly to distributors in New Zealand (the primary distributor being Bossa Nova Enterprises). In 2004,
93,300 pairs of HAVAIANAS were sent to New Zealand. In 2006 it was 145,900 and in 2007 it was 125,700. HAVAIANAS are sold through at least 180 retail outlets spread between Northland and Invercargill.
[6] Sao Paulo’s trade mark was registered in New Zealand on 15 April 1999. It was registered with respect to ―footwear including shoes, sandals, boots and slippers.‖ It looks like this:
[7] The respondent applied to register its CUBANAS trademark on 7 November
2008. The application was accepted on 15 July 2009. The trade mark looks like this:
[8] Registration of the trade mark was sought in respect of:
Leather and imitations of leather, and goods made from these materials and not included in other classes; animal skins, hides; trunks and travelling bags; umbrellas, parasols and walking sticks; whips, harness and saddlery
Footwear, sporting footwear; beach footwear, slippers,; clothing, clothing of leather; headgear and belts
Advertising; business management; business administration; office functions; organization of exhibitions and trade fairs for commercial or advertising purposes; demonstration of goods; distribution of samples; presentation of goods on communication media, for retail purposes and marketing; marketing research, import-export agencies, sales promotion for others, commercial administration of the licensing of the goods and services of others, professional business consultancy; commercial information and advice for consumers (consumer advice shop); commercial or industrial management assistance; compilation of information into computer databases; layout services for advertising purposes.
The Assistant Commissioner’s decision
[9] Sao Paulo opposed the respondent’s registration under ss 17(1)(a), 25(1)(b)
and 25(1)(c) of the Trade Marks Act 2002 (the Act).
[10] The Assistant Commissioner considered the ground of opposition under s
17(1)(a) first. She said that while Sao Paulo had shown a sufficiently substantial awareness of its mark in the relevant market (the general public and businesses), there were strong visual and aural differences between the marks which would cause them to be perceived as conceptually different. This meant that the respondent’s
mark would not cause deception or confusion such that a registration should be declined under s 17(1)(a). She then turned to consider the opposition under s
25(1)(c). She found that the burden on Sao Paulo to show that its mark was ―well known‖ had not been discharged. She also said that, for the reasons given under the s 17(1)(a) argument, Sao Paulo’s mark and the respondent’s mark were not sufficiently similar to sustain an objection under s 25(1)(c). The ground of opposition under s 25(1)(b) was also rejected on the basis that the two marks were visually, orally and conceptually different.
Nature of the appeal
[11] This appeal is brought under s 170 of the Act. The appeal is a general one and is by way of rehearing.1
Section 17(1)(a)
The section
[12] Section 17(1)(a) provides:
(1) The Commissioner must not register as a trade mark or part of a trade mark any matter—
(a) the use of which would be likely to deceive or cause confusion; ...
The Assistant Commissioner’s analysis
[13] The Assistant Commissioner framed the issue under s 17(1)(a) as being:2
Having regard to the reputation acquired [for the opponent’s mark, which is HAVAIANAS ... ] is the Court satisfied that [the opposed mark...] if used in a normal and fair manner in connection with [the applicant’s goods and
1 Intellectual Reserve Inc v Robert Sintes [2009] NZCA 305 at [53] so the principles which apply are those set out in Austin, Nichols & Co Inc v Stitching Lodestar [2007] NZSC 103, [2008] 2
NZLR 141.
2 Relying on Smith Hayden & Co Ltd’s Application (1945) 63 RPC 97 at 101 as applied in Pioneer
Hi-Bred Corn Co v Hy-Line Chicks Pty Ltd [1978] 2 NZLR 50 at 57.
services], will not be reasonably likely to cause deception and confusion amongst a substantial number of person.
[14] The Assistant Commissioner said that the relevant market was the ―general public and businesses.‖ The question then was whether ―a substantial number of people‖ within the relevant market were likely to be deceived or confused. The Assistant Commissioner set out the distinction between deception and confusion:3
―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 (New Zealand Breweries Ltd v Heineken’s Bier Browerij Maatchappij NV [1964] NZLR 115,141). Where the deception or confusion alleged is as to the source of the [goods or services], deceived is equivalent to being misled into thinking that the [goods or services] bearing [the opposed] mark come from some other source and being confused to being caused to wonder whether that might not be the case.
[15] The Assistant Commissioner stated that while the burden lies on the respondent to prove that its trade mark does not offend s 17(1)(a), Sao Paulo has to first show that there was an awareness of its mark in the relevant market. The Assistant Commissioner found that Sao Paulo had discharged that burden.
[16] The Assistant Commissioner set out the test for comparing trade marks as follows:4
1. You must take the two words and judge of them both by their look and by their sound;
2. You must consider the [goods and services] to which they are to be applied and the nature and kind of customer who is likely to buy these [goods and services]; and
3. You must consider all the surrounding circumstances and what is likely to happen if each of the marks is used in a normal way as a trade mark for the [goods and service] of the respective owners of the mark...
[17] The Assistant Commissioner then recognised that she was required to consider the whole of each mark, that a side by side comparison was not appropriate
and that she must allow for imperfect recollection. She then said:
3 At [12] from Pioneer Hi-Bred at 62.
4 At [15], from New Zealand Breweries Ltd v Heineken’s Bier Browerij Maatschappij NV [1964] NZLR 115 at 139.
My immediate overall impression of the whole of the [Appellant’s] mark and the whole of the [respondent’s] mark is that the marks are visually and aurally different even though the word in each of the marks appears to have in common the last four letters ―ANAS‖. I also note that the [respondent’s] mark contains a distinctive stylised logo of a person (almost as if it were a cameo), which appears to be predominant. I consider that the word in each mark is likely to be perceived as an invented word or as a foreign word. In either case, I consider that there is no obvious meaning. It is possible that the relevant market may perceive an underlying tropical theme to each mark (bearing in mind the actual use of HAVAIANAS in trade). However, I consider that this tropical theme would not be enough to overwhelm the strong visual and aural differences between the whole of each mark, which I consider would cause the marks to also be perceived as conceptually different.
[18] The Assistant Commissioner also said that, while Sao Paulo’s rubber sandals were the same or similar to some of the goods and services listed in the respondent’s application, they were different from the others. Overall, she concluded that Sao Paulo’s opposition under s 17(1)(a) did not succeed.
First alleged error : failing to consider the brand
[19] Sao Paulo submits that the Assistant Commissioner erred by considering only the word used in its mark instead of the whole identity of Sao Paulo’s brand. Sao Paulo submits that there is more to their HAVAIANAS brand than simply the word Havaianas. Sao Paulo submits that the identity of the brand has the following features:
(a) The unusual word HAVAIANAS;
(b)The theme of a sun loving beach lifestyle, a tropical island, a holiday destination;
(c) The theme is represented in the promotion and advertising for the products and is part of the identity of the products;
(d) The uniqueness of the word;
(e) The associated flowers, palm trees and vegetation in promotional material;
(f) A dynamic and changing product; and
(g)That the HAVAIANAS trade mark appears on the thong or strap of the sandal.
[20] I consider that the Assistant Commissioner did take into account the whole of the mark including its theme, and the similar theme that applied to the respondent mark, in the passage cited above at [17]. She did not specifically refer to the
―uniqueness‖ of the word but she did refer to it as an invented word with no obvious meaning. She did not specifically refer to the associated flowers, palm trees and vegetation in the promotional material, the dynamic and changing product or that the mark appeared on the strap of the sandal but she did refer generally to the tropical theme ―bearing in mind the actual use of HAVAIANAS in trade.‖ She did not place much weight on factors in light of her conclusions or the visual and aural difference between the marks. I consider that issue below (at [29] to [40]).
Second alleged error : side-by-side comparison
[21] The next submission is that the Assistant Commissioner engaged in a side-by- side comparison of the marks, contrary to established principles. Sao Paulo cites the following passage from Re Sandow in support:5
The question is whether the person who sees the proposed mark in the absence of the other mark, and in view only of his general recollection of what the nature of the trade mark was, would be liable to be deceived and to think that the trade mark before him is the same as the other, of which he has a general recollection.
[22] A similar statement was quoted by the Assistant Commissioner in this case. She cited the following passage from De Cordova v Vick Chemical Coy:6
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, for orders are not placed, or are often not placed, under such conditions. It is more useful to observe that in most persons the eye is not an accurate recorder of visual detail, and that marks are
5 Re Sandow (1914) 31 RPC 196 at 205.
6 De Cordova v Vick Chemical Coy (1951) 63 RPC 103 at 106.
remembered rather by general impressions or by some significant detail than by an photographic recollection of the whole. (the Assistant Commissioner’s emphasis).
[23] The Assistant Commissioner therefore recognised the principle that a side-by- side comparison is not appropriate and that imperfect recollection is required to be taken into account. Her analysis, as set out above at [17], takes this approach. I consider there was no error by the Assistant Commissioner in this respect.
Third alleged error : failing to consider how the respective marks would appear in the market
[24] The next ground of appeal is that the Assistant Commissioner failed to consider how the respective marks would appear in the market. Sao Paulo did not elaborate on the error that is alleged to have occurred in this respect. However I infer Sao Paulo’s concern to be an alleged failure to take into account how HAVAIANAS are advertised (ie beach etc theme, dynamic and changing product and other features of the brand as discussed above) together with the nature of the market in which they are sold (ie sold through retail shops to the general public who are not likely to spend much time considering their purchase).
[25] The Assistant Commissioner was aware that she needed to consider all the surrounding circumstances (she referred to authority about the requirement to consider all the surrounding circumstances – refer [16]). The issue is whether she reached an erroneous conclusion in light of the surrounding circumstances.
Fourth alleged error : requiring a similarity in the type of goods and services
[26] Sao Paulo’s final specific ground of appeal under this head of opposition is that the Assistant Commissioner failed to recognise that s 17(1)(a) does not require any similarity in the type of goods and services that Sao Paulo and the respondent supply. That submission relates to the following passage in the Assistant
Commissioner’s decision:7
7 At [18] of the Assistant Commissioner’s decision.
I consider that the opponent’s rubber sandals are identical to ―beach footwear‖ and are a category of ―footwear‖ that may be considered to be similar or related to ―sporting footwear‖ and ―slippers‖. However, applying the relevant factors, I consider that rubber sandals are different to the rest of the applicant’s class 25 goods and are also different to the applicant’s class
18 goods and class 35 services. (Emphasis added.)
[27] In ―applying the relevant factors‖, the Assistant Commissioner cites the factors set out in British Sugar PLC v Joames Robertson & Sons Ltd8 on the basis that those were accepted by the High Court in Intellectual Reserve Inc v Robert Sintes as relevant.9 However the High Court’s approval of those factors was in relation to the High Court’s analysis under s 25(1)(b), a provision which uses the words ―in respect of the same goods or services or goods or services that are similar to those goods or services...‖
[28] Therefore, in considering the s 17(1)(a) ground of opposition, the Assistant Commissioner relied upon authorities under s 25(1)(b). The two sections have different tests. Section 25(1)(b) specifically requires that the mark be in respect of the same or similar goods or services whereas s 17 does not. That said, the similarity of the goods or services is likely to be a relevant factor in considering whether the use of the proposed mark would be likely to deceive or cause confusion.
My assessment
[29] The starting point is to identify the relevant consumers. As Sao Paulo submits, its consumers are the general public and its products are not big ticket items. Consumers of the respondent’s goods are also likely to include the general public and its goods are also likely to include goods that are not big ticket items.
[30] Having identified the relevant consumers I turn to consider what the general public, purchasing goods under these marks, would make of any connection between the two words. The respondent emphasises that Sao Paulo’s mark is the Portuguese word for Hawaiians. It submits that Sao Paulo’s mark is focussed on the ―sun-loving
beach lifestyle of Hawaii.‖ It submits that, in contrast, CUBANAS refers to Cuba
8 British Sugar Plc v Joames Robertson & Sons Ltd [1996] RPC 281 at 296-292.
9 Intellectual Reserve Inc v Robert Sintes HC Auckland CIV 2007-404-2610, 13 December 2007 at [25].
and ―represents a modest Cuban culture.‖ I consider that New Zealand consumers (purchasing HAVAIANAS sandals or goods sold with CUBANAS mark) are unlikely to be that discerning as to whether there is this different cultural theme underlying the brand.
[31] As to the meaning of each word, I agree with Sao Paulo that New Zealand consumers (purchasing HAVAIANAS sandals or goods sold with the CUBANAS mark) are unlikely to know that HAVAIANAS means Hawaiians. I also agree with Sao Paulo that many New Zealand consumers might assume that CUBANAS has something to do with Cuba (the connection with the word Cuba being more obvious to the English speaking public). It is possible, as Sao Paulo submits, that some New Zealand consumers may think that HAVAIANAS has something to do with Havana (the capital of Cuba).
[32] Others may think that HAVAIANAS has some connection to Brazil rather than Cuba (or Hawaii). Bossa Nova is (and sounds like) a Brazilian company and its name appears on some of the advertising. Some of the advertising refers to Brazil by saying ―Brazil invented the perfect bikini. Invented the Bossa Nova. Invented the Caipirinha. They then invented Havaianas to relax.‖ I also understand that some versions of HAVAIANAS have a Brazilian theme to them. Both marks end with
―anas‖. That ending is not common in either the English or Maori languages. The words of both marks look and sound foreign. Overall it is likely that members of the public will view both marks as either foreign or made up words with some sort of tropical or beach theme.
[33] As to that theme, Sao Paul emphasises that its products and promotion ―has generated a beach or island identity.‖ It submits that the respondent’s device of a person with leaves or a wreath on the head creates a similar impression of beach or island life. The respondent submits that the person depicted is obviously an indigenous person reminiscent of the indigenous inhabitants of Cuba. The respondent submits that this contrasts with the inhabitants of the American state of Hawaii. I do not agree with this point. The person depicted could just as easily be intended to represent a Hawaiian (or an indigenous person of some other beach destination) as an inhabitant of Cuba. The depiction of an indigenous person in the
CUBANAS mark is consistent with the general tropical holiday and beach theme that HAVAIANAS promotes.
[34] The respondent submits that Sao Paulo has no claim to a monopoly on a beach or island life theme, especially in relation to beach goods. Sao Paulo does not claim to have such a monopoly, but submits that the similar theme is a factor which goes to the likelihood of confusion. I agree that it is a relevant factor to take into account. However, because a tropical holiday or beach theme is not a unique or unusual brand feature, the similar theme of the two marks is not a factor which weighs heavily in the assessment of likely confusion.
[35] As to how the two marks look, there are some similarities. Both marks are one word. Both have a similar ending. Both use lower case letters. In both the predominant vowel is the letter ―a‖ and the scripts used for that letter in each case have some similarities. Both marks incorporate a circle around them.
[36] There are, however, a number of differences in how the words look. The words begin differently HAVAIANAS is a longer word than CUBANAS and has more syllables. The script for HAVAIANAS uses a font which has thicker and thinner parts to it. The script for CUBANAS is more usual and even. The ―h‖ in HAVAIANAS is taller than the other letters in the word whereas all the letters in CUBANAS finish at the same height (the ―b‖ being in a smaller font to achieve this). One of the ―a‖s in the HAVAIANAS mark has an extended loop which the ―a‖s in CUBANAS do not. The circle around HAVAIANAS is in fact an oval and is very prominent. In contrast, the circle around CUBANAS is not oval and is not the predominant feature of the device. The predominant feature of the CUBANAS mark is the image of the man with the wreath.
[37] Bearing in mind that the marks must be compared from the point of view of a person who has seen one mark, and may imperfectly remember that mark when they see the second mark, I consider that the above differences in how the words look are in the main quite subtle. One exception to this is the distinctive picture of the man with the wreath. However it is conceivable that a person who had seen the HAVAIANAS mark on rubber sandals and who then saw the CUBANAS mark on
rubber sandals might think that the image of the person was something added to this particular model of the rubber sandals (given the dynamic styles of the HAVAIANAS rubber sandals). That possibility would be more likely if the words looked (and sounded) very similar. Apart from that image the main difference in how the marks look is their beginnings. ―HAVAI‖ does not look like ―CUB‖.
[38] As to how the words sound, there is again a similarity because of the
―ANAS‖ ending. The main difference is how each word begins. The ―HAVAI‖ beginning does not sound like ―CUB‖. The former is longer and softer sounding, whereas the latter is shorter and harder sounding.
[39] If there was a risk of confusion it is more likely to occur in relation to rubber sandals than goods which the respondent may sell which are not similar. Sao Paulo sells its sandals through retail shops. CUBANAS may also be sold through retail shops. The general public who have heard about HAVAIANAS through advertising or through seeing them on friends or the like may wish to purchase that brand of rubber sandal. It is possible that some members of the public on seeing CUBANAS in a retail shop may think that that was the brand of rubber sandal they wished to purchase. However I consider it unlikely that a significant number of those wanting to buy HAVAIANAS would do so. The look and sound of the two marks, even imperfectly recalled, are sufficiently distinct. Overall it is the different look and sound of the beginning of the work that makes it unlikely that the use of the respondent’s mark will cause confusion.
[40] I therefore consider that Sao Paulo has not shown that the respondent’s use of
the mark will cause confusion.
Section 25(1)(b)
The section
[41] Section 25(1)(b) provides:
The Commissioner must not register a trade mark (trade mark A) in respect of any goods or services if ...
It is similar to a trade mark (trade mark C) that belongs to a different owner and that is registered, or has priority under s 34 or section 36 in respect of the same goods or services or goods or services that are similar to those goods or services, and its use is likely to deceive or confuse.
Alleged error : failing to recognise the distinction between s 17(1)(a) and s 25(1)(b)
[42] Sao Paulo submits that the Assistant Commissioner failed to recognise the difference in approach under ss 25(1)(b) and 17(1)(a). The distinction is that under s 25(1)(b) the test of likely deception or confusion is applied to any fair use of the existing mark and the mark for which registration is sought, whereas under s 17(1) the comparison is between the opponent’s actual use of their mark and any fair use of
the applicant’s mark.10 Any ―fair use‖ considered under s 25(1)(b) will encompass
the actual use under s 17(1)). The enquiry under s 25(1)(b) is therefore broader than that under s 17(1)(a).
[43] While the Assistant Commissioner did not explicitly state that the s 25(1)(b)
test was wider than the s 17(1)(b) test, she did state in relation to s 25(1)(b):11
The context of the section 25(1)(b) enquiry is broad because it requires the fair and notional use of the trade marks on any of the applicant’s goods or services or the goods covered by the opponent’s registered mark to be considered...
[44] She referred to there being an overlap in the relevant markets and simply concluded, without further elaboration, that for the reasons given under s 17(1)(b), the whole of each mark were visually, aurally, and conceptually different and therefore the opposition under s 25(1)(b) failed.
[45] Sao Paulo submits that the Assistant Commissioner failed to address the fair notional use of its HAVAIANAS mark. Having said that, Sao Paulo has not identified any potential notional use that would actually differ from the current use of its mark. Sao Paulo submits only that s 25(1)(b) goes beyond a simple side by side comparison of the marks and the goods and services and all the surrounding circumstances regarding the notional use of the mark must be considered. Sao Paulo
does not refer to any particular and separate considerations that have not been
10 Anheuser Busch Inc v Budweiser Budvar National Corporation [2003] 1 NZLR 472.
11 At [29].
addressed in my discussion under s 17(1)(a). As nothing additional has been referred to, my conclusion is the same.
Section 25(1)(c)
The section
[46] Section 25(1)(c) provides:
The Commissioner must not register a trade mark (trade mark A) in respect of any goods or services if...
...
It is, or an essential element is, identical or similar to, or a translation of, a trade mark that is well known in New Zealand (trade mark D), whether through advertising or otherwise, in respect of those goods or services or similar goods or services or any other goods or services if the use of trade mark A would be taken as indicating a connection in the course of trade between those other goods or services and the owner of trade mark D, and would be likely to prejudice the interests of the owner.
The Assistant Commissioner’s decision
[47] The Assistant Commissioner set out the issues under s 25(1)(c) as follows:12
[Is the opponent’s mark: HAVAIANAS, identical, or similar to [the opposed mark Cubanas...] which is well known, or is an essential element of [the opposed mark] identical or similar to that which is well known?
Are [the applicant’s goods and services] the same as or similar to the
[opponent’s rubber sandals]? If not,
Would use of [the opposed mark] be taken as indicating a connection in the course of trade with [the opponent]?
If the answer to issue 2 or 3 is yes, would use of the opposed mark be likely to prejudice the interests of [the opponent]?
[48] She turned to consider part of the first issue, namely whether Sao Paulo’s
mark was well known in New Zealand at the relevant date. She said that the threshold for establishing that the mark was well known was similar to that which
12 At [21], the test being taken from New Zealand Milk Brands Ltd v NV Sumatra Tobacco Trading
Co HC Wellington CIV 2007-485-2485, 28 November 2008 at [46].
applies in the law of passing off. She said that although she had found that Sao Paulo had a sufficient reputation at the relevant date for the purposes of s 17(1)(a), she did not consider that the evidence established that Sao Paulo’s mark was well known at that date. She then said:
In any event, for the reasons that I have given [in relation to s 17(1)(a)] the whole of the opposed mark is visually, aurally, and conceptually different to the whole of the opponent’s mark.
First alleged error : issue of interpretation
[49] Sao Paulo submits that the section should be read as follows:
–the Commissioner should not register a trade mark (trade mark A) in respect of any goods or services if –
It is, or an essential element of it is, identical or similar to, or a translation of, a trade mark that is well known in New Zealand (trade mark D), whether through advertising or otherwise
In respect of those goods or services or similar goods or services
Or any other goods or services if the use of trade mark A would be taken as indicating a connection in the course of trade between those other goods or services and the owner of trade mark D, and would be likely to prejudice the interests of the owner.
[50] That interpretation means that where the goods or services are the same or similar in respect of the two marks, there is no need to show that use of the new mark would be likely to prejudice the interests of the owner of the old mark. That is a different interpretation than that adopted by the Assistant Commissioner.
[51] The Assistant Commissioner’s approach (set out above at [47]) came from the High Court decision in Intellectual Reserve Inc v Robert Sintes.13 That decision was appealed to the Court of Appeal, and the High Court’s decision was upheld, but the test under s 25(1)(c) was not specifically discussed. The High Court Judge in New Zealand Milk Brands Ltd v NV Sumatra Trading Co applied the same approach as had been taken by the High Court Judge in Intellectual Reserve Inc v Robert Sintes. The approach taken by the High Court in these two cases is contrary to the
interpretation put forward by Sao Paulo.
13 At [40].
[52] In my view, the interpretation Sao Paulo puts forward is contrary to the natural reading of s 25(1)(c). In particular, the comma that precedes ―and would be likely to prejudice the interests of the owner‖ separates that clause out from the preceding clause. That preceding clause sets out the possibilities as to the nature of the goods or services to which the section applies. One possibility is that the marks relate to the same or similar goods or services. Another possibility is that the marks relate to any other goods or services ―if the use of the opposed mark would be taken as indicating a connection in the course of trade between those other goods or services and the owner of trade mark D.‖ As the prejudice requirement is not part of that preceding clause, it applies to all marks which satisfy the other requirements of the section.
[53] Sao Paulo’s submission accepted that the placement of the comma was a difficulty for its interpretation. Sao Paulo submits, however, that s 25(1)(c) was intended to provide greater protection for well-known marks than the protection available under the other statutory grounds on which marks may be opposed. That may be so, but Parliament has decided to provide that protection by a statutory test which requires there to be ―likely prejudice to the interests of owner‖ whether the mark applies to the same or similar goods or services or not.
[54] I therefore reject Sao Paolo’s submission that the Assistant Commissioner erred in her interpretation of s 25(1)(c).
Second alleged error : mark is well known
[55] The Assistant Commissioner concluded that on the evidence before her it had not been established that the trade mark was well known in New Zealand at the relevant date. Sao Paulo submits that the Assistant Commissioner erred in this respect. Sao Paulo accepts that there is a higher threshold under s 25(1)(c) than under s 17(1)(a) as to the reputation that the opponent of the registration must show.
It accepts that the threshold is similar to that used in the law of passing off.14 Sao
Paulo submits that it meets that higher threshold. It submits that its brand is well
14 Intellectual Reserve Inc v Robert Sintes in the High Court at [41].
known and that the evidence, of sales and also of its reputation in the fashion industry, established that.
[56] Some cases have queried whether evidence of advertising and money spent on promotion can be sufficient to establish that the mark is well known, or whether some survey evidence is required to establish that.15 In other cases courts have been prepared to accept that a trade mark is well known without recourse to affidavit evidence16 or where sale volumes are low.17
[57] The respondent emphasised the small volumes of HAVAIANAS that have been distributed to New Zealand and the small percentage of the New Zealand population that this represented. However volumes are just one potentially relevant factor. Here there are a number of relevant factors. Other relevant factors include that the trademark HAVAIANAS has been registered in New Zealand since 1998. Export figures, while representing a small proportion of the New Zealand population, are not insignificant (2005: 93,300; 2006: 145,900; and 2007: 125,700). The sandals are available throughout New Zealand (180 retail stores spread throughout New Zealand from Northland to Invercargill).
[58] Sao Paulo also refers to and has provided a number of advertisements for HAVAIANAS run in both overseas magazines that are available in New Zealand and in New Zealand magazines. These advertisements are noticeable for their colour, their background of a tropical holiday beach setting, the use of the word ―Original‖, and the picture of the rubber sandal on which the HAVAIANAS mark is clearly seen. The advertisements promote the rubber sandals not as beach footwear, sandals, thongs or jandals, but as original ―HAVAIANAS‖.
[59] The HAVAIANAS brand has also received some publicity in New Zealand. Sao Paulo has referred to:
15 Zespri Group Ltd v ENZA Ltd HC Wellington CIV 2008-485-1072, 18 September 2008 at [64];
and LG Corporation Ltd v Atspec Ltd HC Wellington CIV 2008-485-1792, 23 April 2009 at [37].
16 New Zealand Milk Brands v NV Sumatra Tobacco Trading Coat [48] where it was found that
ANCHOR was well known.
17 Prada SA v The Farmers Trading Company Ltd HC Auckland CIV 2010-485-58, 21 September
2010 where the Court accepted that MIU MIU was well known in New Zealand despite low volumes and only two retail stores.
(a) A story on the New Zealand Herald website concerning fashion week, stating ―we couldn’t help but notice the colourful Havaianas stand, where customers can create their own personalised jandal.‖
(b)Another NZ Herald story stating ―Brazilian jewellers H. Stern have teamed up with Havaianas, Brazil’s most popular jandal brand, to make a range of luxury jandals with a top price of 58,500 reais ($NZ31,000)‖
(c) An NZ Herald story setting out some ―Summer Essentials‖ including
―Havaianas men’s jandals‖
(d) An NZ Herald article setting out wardrobe essentials including ―a
cashmere sweater, Havaianas, a striped shirt...‖
(e) An NZ Herald ―Retail therapy‖ article saying ―Summer is the perfect opportunity to flash a sexy pedicure and Havaianas and OPI are teaming up to help get your feet ready.‖
(f) An NZ Herald article ―What I Pack‖ saying ―my faithful black
Havaianas‖
(g)A Stuff.co.nz article ―How to look good on $100‖ saying ―shift dresses will also look sweet with a pair of sandals or Havaianas on a warmer day.‖
(h)An nzgirl.co.nz article entitled ―Summer Trend Setters‖ picturing a HAVAIANAS jandal and saying ―the ubiquitous Havaianas return this summer, now in slim line with many colour choices.‖
(i) A One News article on fashion week listing as one of the designers
Claudine Paiva from HAVAIANAS.
(j) An nzlifeandleisure article entitled ―Gift Guide: Tracey Strange‖
saying:
It might seem almost anti-fashion to recommend ordinary old flipflops over a pair of perfectly formed (if vertiginous) high heels. But Havaianas are anything by run-of-the-mill. Fashionable and colourful, they are so comfortable you will never go back to wearing traditional rubber on your feet.
[60] The Assistant Commissioner did not go into any more detail than to say that she did not consider that on the evidence before her Sao Paulo had established that its mark was well known in New Zealand. I consider that the evidence establishes Sao Paulo’s mark was well known in New Zealand at the relevant date just as, for example, MIU MIU was accepted as being well-known in another case. I consider that all of the above factors show this, but I consider it is particularly demonstrated by examples in the media where ―HAVAIANAS‖ were mentioned without it being linked to what the product actually was, indicating that the audience for that article at least would understand what was meant by HAVAIANAS without any further information.
The remaining requirements of s 25(1)(c)
[61] Sao Paulo submits that the other requirements under s 25(1)(c) are also satisfied.
[62] While the marks are similar (as discussed above) they also have important differences aurally and visually. To the extent that the goods or services are different, the differences in the marks’ appearance and sound in my view make it unlikely that the respondent’s goods or services would indicate a connection in the course of trade between the goods or services.
[63] Sao Paulo submits that confusion is likely in respect of some or all of the respondent’s goods or services and that this will cause prejudice to it. I have already rejected the submission that confusion is likely. Sao Paulo submits that the expansion of its product range (for example to shoes) or means of sale will be limited by the presence of the respondent’s mark. Sao Paulo does not elaborate on this submission and I do not see why it would be so. Sao Paulo submits that the respondent’s mark will dilute or blur the distinctiveness of the HAVAIANAS brand.
Again this submission is not expanded upon. I do not accept it. The differences in the respective marks will enable Sao Paulo to preserve its identity.
[64] Therefore I conclude that Sao Paulo’s opposition under s 25(1)(c) fails.
Result
[65] The appeal is dismissed.
Mallon J
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