SECTION 44
20 Section 44 of the TMA provides:
Identical etc. trade marks
(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.
(2) Subject to subsections (3) and (4), an application for the registration of a trade mark (applicant's trade mark) in respect of services (applicant's services) must be rejected if:
(a) it is substantially identical with, or deceptively similar to:
(i) a trade mark registered by another person in respect of similar services or closely related goods; or
(ii) a trade mark whose registration in respect of similar services or closely related goods 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 services is not earlier than the priority date for the registration of the other trade mark in respect of the similar services or closely related goods.
(3) If the Registrar in either case is satisfied:
(a) that there has been honest concurrent use of the 2 trade marks; or
(b) that, because of other circumstances, it is proper to do so;
the Registrar may accept the application for the registration of the applicant's trade mark subject to any conditions or limitations that the Registrar thinks fit to impose. If the applicant's trade mark has been used only in a particular area, the limitations may include that the use of the trade mark is to be restricted to that particular area.
(4) If the Registrar in either case is satisfied that the applicant, or the applicant and the predecessor in title of the applicant, have continuously used the applicant's trade mark for a period:
(a) beginning before the priority date for the registration of the other trade mark in respect of:
(i) the similar goods or closely related services; or
(ii) the similar services or closely related goods; and
(b) ending on the priority date for the registration of the applicant's trade mark;
the Registrar may not reject the application because of the existence of the other trade mark.
21 Enagic is the registered proprietor of the mark "KANGEN WATER" (Trade Mark 1756433) in respect of goods in class 11, which has the heading "Apparatus for lighting, heating, steam generating, cooking, refrigerating, drying, ventilating, water supply and sanitary purposes": Regulations, Sch 1, Pt 1, item 11. The specified goods are:
Class 11: Electrolytic water generators for electrically decomposing tap water to generate electrolytic water and for removing chlorine odor [sic] from tap water
22 I will refer to that mark as Enagic's Goods Mark, and to the specified goods as the Class 11 Goods.
23 The Enagic Goods Mark has an earlier priority date of 11 February 2016, thus fulfilling s 44(2)(b) of the TMA.
24 Horizons sought registration of the Opposed Mark in respect of services in class 35, which has the heading "Advertising; business management; business administration; office functions": Regulations, Sch 1, Pt 2, item 35. The specified services are.
Class 35: Distribution of goods (not being transport services) (agent, wholesale, representative services, by any means); wholesale; retail; sales by any means; advertising, marketing, promotion and public relations; operation, supervision and management of loyalty programs, sales and promotional incentive schemes; discount services (retail, wholesale, or sales promotion services); customer support services; compilation and maintenance of directories, mailing lists including such lists compiled and maintained via the global computer network; conferences and exhibitions for commercial purposes; business administration; business development; dissemination of commercial information; distribution of prospectus; importing services; exporting services; providing information, advisory and consultancy services, including by electronic means, for all of the aforesaid services
25 I will refer to those services as the Class 35 Services.
26 For the purposes of the TMA, "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": TMA, s 10. As Nicholas J said in Vivo International Corporation Pty Ltd v Tivo Inc [2012] FCAFC 159; 294 ALR 661 (at [114], Dowsett J agreeing):
… it is the statutory rights of use that are to be compared rather than any actual use, and in considering whether an application for a mark should be rejected under s 44(1) because it is deceptively similar to an existing registered trade mark, it is necessary to have regard to all legitimate uses to which each mark might be put by its owner: see Re Application by Smith Hayden & Coy Ld (1946) 63 RPC 97 at 101; Berlei Hestia at CLR 362; ALR 449 and Polo Textile Industries Pty Ltd v Domestic Textile Corporation Pty Ltd (1993) 42 FCR 227 at 230-1; 114 ALR 157 at 161-2; 26 IPR 246 at 249-50.
27 The delegate concluded that Enagic's Goods Mark (KANGEN WATER) and the Opposed Mark (KANGEN) are deceptively similar. I agree with that conclusion. Whilst Enagic's Goods Mark includes the word "WATER", the word "KANGEN" is a memorable feature of the mark that is likely to have the greater impression on consumers. The two marks are such that it is likely that consumers will be caused to wonder whether the goods or services in respect of which the marks are used come from the same source: Coca-Cola Company v All-Fect Distributors Ltd (1999) 96 FCR 107 (at [39]); Southern Cross Refrigerating Co (at 595). I have arrived at that conclusion by a textual comparison of the marks, having regard to the trade context in which each mark might legitimately be used.
28 It is necessary to determine whether the Class 35 Services specified for the Opposed Mark are "closely related to" the Class 11 Goods specified for the Enagic Goods Mark within the meaning of s 44(2)(ii).
29 As French J said in Woolworths, the term "closely related" recognises the obvious circumstance that goods and services are not the same thing: at [37]. His Honour said that the expression "closely related" is of wider import than the word "similar", and observed:
… There will be classes of goods which are similar to each other. There will also be classes of services which are similar to each other. But the word 'similar' does not apply as between goods and services. So there must be some other form of relationship between the services covered by one mark and the goods covered by another to enable the goods or services in question to be described as 'closely related'. …
30 The meaning of the word "services" in the TMA was considered by Lockhart J in Caterpillar Loader Hire (Holdings) Pty Ltd v Caterpillar Tractor Co (1983) 48 ALR 511 (at 522) at a time when service marks were in their infancy in Australia. His Honour predicted that they may give rise to confusion between goods and service marks "of greater difficulty and subtlety than has previously been experienced in the case of goods marks alone". His Honour gave the following examples of cases where there the potential for confusion in the minds of consumers might arise:
… the sale of goods such as data processing equipment and the sale of programs for their operation; the sale of curtains and furnishing materials on the one hand, and the sewing of curtains on the other, as interior decorators often sell curtains and perform the service of sewing; the sale of clothes on the one hand and tailoring on the other because the service of custom tailoring is frequently provided in addition to the sale of ready-made clothes; and the sale of educational material on the one hand and educational services (language courses, home study programmes) on the other.
31 A further example was identified by French J in Woolworths (at [38]):
… Services which provide for the installation, operation, maintenance or repair of goods are likely to be treated as closely related to them. Television repair services in this sense are clearly related to television sets as a class of goods. A trade mark used by a television repair services which resembles (to use the language of s 10) the trade mark used on a prominent brand of television sets would be deceptively similar for suggesting an association between the provider of the services and the manufacturer of the sets. …
32 As these examples illustrate, it is relevant to consider the nature of the goods or services, the use or purpose of the goods or services, and the channels of trade: Southern Cross Refrigerating Co at 606 - 607.
33 The phrase "closely related" is to be interpreted having regard to the objects of the TMA, which can be discerned in part in the definition of a trade mark as an indicia of the origin of goods or services. Section 44(2) is plainly intended to address the mischief that may be created where two marks are the same or deceptively similar. It recognises the potential for confusion in the minds of consumers as to the origin of goods in respect of which a mark is registered or sought to be registered and the origin of services in which an identical or a deceptively similar mark is registered, or sought to be registered as the case may be. The more closely related the goods on the one hand and the services on the other, the greater the potential for confusion as to whether they originate from the same person. Whether the relevant services and the relevant goods are "closely related" is to be assessed in that context and in a commercially sensible way, having regard to all legitimate uses of the Opposed Mark.
34 In its closing submissions in support of this ground of opposition, Enagic submitted:
Enagic's water filtration products are a bespoke, high end product, retailing for several thousands of dollars, sold through a direct selling model where its customers in turn become prospective distributors. There is synergy in the Appellant's business model between the product and the Relevant Services, whereby its distributors have a certain level of expertise common to the provision of goods and services.
35 In my view, that submission introduces an irrelevant consideration for the purposes of s 44(2), namely the services said to be provided in fact by Enagic. Whether Enagic has used any relevant mark in respect of any services is relevant to other grounds of opposition. However, the Court is not presently concerned with a comparison between the services allegedly provided by Enagic on the one hand and the services in respect of which the Opposed Mark is sought to be registered on the other. For the purposes of s 44(2)(a)(ii) of the TMA, the relevant inquiry is whether the narrowly described Class 11 Goods referred to in Enagic's Goods Mark registration are closely related to the broadly described Class 35 Services referred to in the Opposed Mark registration.
36 On their face, the headings used in the Regulations for the goods classification 11 and the services classification 35 appear to be disparate. By reference to the headings alone, it is not immediately apparent how goods in the nature of "Class 11 Apparatus for lighting, heating, steam generating, cooking, refrigerating, drying, ventilating, water supply and sanitary purposes" could be closely related to services in the nature of "Class 35 Advertising; business management; business administration; office functions".
37 Horizons referred the Court to the Trade Marks Office Manual of Practice and Procedure and a "Cross Class Search List" contained within it. The list identifies goods or services which the Trade Marks Office considers "are most likely to be goods or services that are similar or closely related". I consider the list to be of limited assistance to the Court in performing its task under s 44(2), and indeed liable to detract from it. The Court must interpret the particular words chosen by the trade mark applicant to describe the services so as to identify the nature and scope of the trading activities in respect of which trade mark protection is sought. In the present case, the descriptions in the specification are of very broad import. As discussed below, it is significant that most of the specified services are either inherently concerned with or expressly connected to the marketing, sale and distribution of goods. As explained in Southern Cross Refrigerating Co, it is relevant to consider their purpose. For the most part, the purpose of the broadly described services is to facilitate the promotion of goods for sale, as well as their actual sale.
38 It is open to a trade mark applicant to describe services in the widest of terms so as to achieve the greatest possible protection provided that the services are specified in accordance with the Regulations: TMA, ss 27(3)(b), (4) and (5); 33(1)(a); 57. Enagic has not advanced any argument to the effect that the Class 35 Services did not in fact fall within the parameters of the relevant class, nor any argument that the services described are impermissibly broad or vague so as to require the application to be rejected in accordance with the provisions just cited. That is not surprising, given that most of the specification was copied by Horizons from an earlier trade mark registration obtained by Enagic in 2014 (as discussed later in these reasons).
39 By their nature, any or all of the listed "services" are services in relation to which the Opposed Mark may legitimately be used in the course of Horizons' trade. The focus is on the use of the Opposed Mark as an indicia of the origin of the services by Horizons in the course of trade with other persons. It is in the nature of services that they are provided by one entity to another. They are not to be understood as incorporating inherent business activities internal to Horizons.
40 The services expressly include "distribution of goods", which must be understood as a service for the distribution of goods. There is no limitation on the goods that are to be the subject of the distribution services. Notionally, registration of the Opposed Mark would permit its use in connection with the provision of distribution services where the subject of the distribution includes goods of an infinite variety. More importantly for present purposes, the legitimate use of the mark also includes its use as an indicia of the origin of distribution services in connection with goods of a singular description or specialised nature. The services described as "sales by any means" must also be taken to include services for the sale of goods of all descriptions or a singular description, and so on. The services also include advertising, marketing, promotion and public relations, which must be understood to include services for the advertising and marketing of goods of a specific kind or all kinds. Moreover, the phrase "providing information, advisory and consultancy services, including by electronic means, for all of the aforesaid services" is not limiting. It is expressed as a discrete service in addition to all other services preceding it and so significantly expands the field of services in respect of which the Opposed Mark may be used exclusively by Horizons as a trade mark.
41 On the topic of whether the relevant services and goods were closely related, the delegate said:
The Opponent's Goods relate to a very specific type of water generator and purifier. The Applicant's Services are distribution and business administration services that have no specific connection to the Opponent's Goods. The mere fact that an entity could engage in distribution and business administration services incidental to the course of selling the Opponent's Goods is not a basis to find that they are closely related. There is no particular relationship between the Applicant's Services and the Opponent's Goods and hence no basis to conclude that these services are closely related to the Opponent's Goods. I find that the Opponent has failed to establish the ground of opposition under s 44 of the Act.
42 I respectfully disagree with the delegate's reasoning. I do not consider the sale of particular goods (for example) as being merely incidental to the provision of the services described. The phrase "sales by any means" as listed in the specification must be understood as "service" in its own right. That aspect of the specification necessarily encompasses services for the sale of goods.
43 Moreover, Horizons has chosen to draft the list of services commencing with the phrase "distribution of goods". Read in its proper context, the phrase "distribution of goods" must be understood to refer to a service offered or provided in the course of trade between Horizons and other persons. The activity of "distributing" the goods is not merely incidental to such a service, it is the very essence of it.
44 As I have said above, that drafting encompasses services for the distribution of goods either of a confined kind or of infinite variety. Absent words of limitation, the specification must be understood to encompass both, as if both were separately described in the text. In respect of the former, the specification encompasses any or all goods falling within classes 1 to 34, which necessarily encapsulates all goods in class 11, including "Electrolytic water generators for electrically decomposing tap water to generate electrolytic water and for removing chlorine odor [sic] from tap water". The distribution services referred to in the registration may be provided (and promoted) in respect of only those goods.
45 I have no difficulty concluding that services for the distribution of goods "X" are closely related to goods "X" within the meaning of s 44(2)(ii) of the TMA. To illustrate the point, the words "electrolytic water generators" may be inserted in Horizon's Class 35 Services specification so as to illuminate the protection afforded by the registration of the word KANGEN. The word may be used as an indicia of the trade origin of the following services: distribution services in connection with electrolytic water generators (not being transport services); services for the sale of electrolytic water generators by any means; services for the advertising, marketing, promotion and public relations in connection with electrolytic water generators; services involving operation, supervision and management of loyalty programs in respect of electrolytic water generators; services involving the sales and promotional incentive schemes in respect of electrolytic water generators; customer support services in respect of electrolytic water generators; services for compilation and maintenance of directories in respect of electrolytic water generators; services for the provision of conferences and exhibitions for commercial purposes in connection with electrolytic water generators; import and export services in connection with electrolytic water generators; services for the provision of information and advisory and consultancy services for all of the aforesaid.
46 Once the permitted use of the Opposed Mark is understood in that way, it is readily apparent how the Class 11 Goods are closely related to the Class 35 Services. That consequence follows from Horizons' choice to capture within the services description all goods without exception or qualification, so capturing the goods the subject of Enagic's Goods Mark. It follows that the requirements for the successful opposition of the mark under s 44(2) are fulfilled.
47 It is of course open to the Registrar to consider whether to accept the registration subject to a condition or limitation, so as to confine the use of the mark to exclude services that are closely related to goods in the same class in respect of which the Enagic Goods Mark is registered: TMA, s 33(2). A discretion of the same kind applies in opposition proceedings and may also be exercised by this Court on appeal: TMA, s 55(1)(b).
48 However, I have determined not to embark upon that exercise or to hear further from Horizons in respect of it. That is because I am satisfied that the appeal should be allowed on multiple grounds such that registration should not proceed on a more limited specification, as it might otherwise have done had the ground of opposition under s 44 of the TMA been the only successful ground.