Findings and observations in relation to the evidence
237 It is now necessary to say some things about the evidence described in these reasons.
238 I find as facts the matters set out at [2]-[7], [12]-[15] and [17]-[21] of these reasons.
239 As to the evidence of Mr Eastwood, he expressed some views about the conduct of Mr Goodman and Mr Latemore and others. He took the view that their conduct would be likely to lead to confusion. Those observations are contested by Mr Goodman and Mr Latemore. It is not necessary for me to decide questions about those matters. It seems to me unlikely that the conduct of either person, by reason of their former employment as they describe it, would bring about the confusion Mr Eastwood expresses. As to his other evidence, I accept his evidence generally and I accept the matters described at [22]-[26] of these reasons.
240 I also accept the evidence of Mr De Luca and, in particular, the matters described at [27]-[40] and [42]-[52].
241 I also accept the evidence of Mr Tancred and, in particular, the matters described at [53]-[69].
242 I also accept the evidence of Mr Tatt and, in particular, those matters described at [70]-[79].
243 I accept the evidence of Ms Jepson and Ms Murdoch.
244 Mr Braddock and Mr Black have both given evidence about their own experience in selling meat products to retailers on the one hand and buying meat as a butcher on the other hand. I accept their evidence described at [93]-[96] subject to one aspect of Mr Braddock's evidence, that is, I accept that in the context of telephone conversations about offers for the sale of meat products and acceptances of those offers in relation to export sales, the distractions which may occur in the domestic industry mentioned by Mr Latemore, are not likely to arise.
245 As to the evidence of the respondent, Mr Cabral is clearly a highly experienced industry participant. I accept the evidence he gave as described at [112] up to and including the first sentence of [121]. I will return to the remainder of the evidence described at [121]. I accept the evidence he gave as described at [122]-[125]. I accept that he holds the opinions described at [126] but, of course, I make no findings about the facts asserted. I note the matters Mr Cabral accepted in cross-examination described at [127]. I also accept that Mr Cabral holds the opinions described in the first two sentences of [128]. I accept that his experience is that customers from Japan, Korea and Taiwan either choose, or tell him that they choose, their meat for reasons of quality and that they associate a certain standard of quality with the establishment number of a processing plant. I accept the matters described in the fourth sentence of [128] and I accept that he holds the opinion described in the fifth sentence of [128]. I accept his evidence in relation to the remaining matters described in [128].
246 I accept the matters described in the first two sentences of [129] and I accept that Mr Cabral holds the opinion described in the third sentence of [129]. I accept Mr Cabral's evidence described at [130]-[135].
247 There are, however, two qualifications to be made to the acceptance of Mr Cabral's evidence. The first concerns an aspect of his own evidence and the second concerns observations which go to aspects of Mr Cabral's evidence but also views expressed by Mr Hurst (and to some extent at least, also the evidence of Mr Goodman and Mr Latemore, although less so).
248 As to Mr Cabral individually, the remaining matters described at [121] and his oral evidence to the same but more extensive effect, I do not accept that a person of the standing, knowledge, experience and commercial sophistication, so far as the dynamics in operation in the domestic and export markets for the supply of meat products at the various functional levels of the market is concerned, did not know that JBS was using the "AMH brand" in 2014 or in the period between 2008 and 2015. It seems to me highly likely that Mr Cabral understood, in substance, the size and scale of the "AMH" business of JBS (although, of course, not in any statistical detail for all the obvious reasons). Mr Cabral is a man with a clear degree of connectedness to the meat industry over a long period of time and his engagement in the supply-side of the industry must have made him astute to the presence of the AMH brand (having regard to its presence and reputation demonstrated by the enormity of the use of that mark) even though it may also have been used in conjunction with some other branding such as Swift Premium, Friboi and Royal, apart from very substantial use on its own. The data is compelling.
249 That is not to say that I do not accept that Mr Cabral was doing the best he could with his evidence. Although it was put to him in cross-examination that he seemed to be minimizing his knowledge of the AMH brand, I am certain that Mr Cabral is simply confused about his recollections about these matters. The opinion Mr Cabral holds on this issue is expressly inconsistent with the extent of the reputation in the AMH brand adopted and conceded by the respondent in these proceedings (T, p 333, lns 18-20) to the point where at the functional levels of the "wholesalers, export markets, and for supermarkets, and for independent butchers", there is a "strong reputation". Senior Counsel for the respondent, Mr Heerey, "embraces" what Senior Counsel for the applicant, Mr Shavin, "says about the endless thousands of millions of kilograms and cartons [and bags] flowing into wholesalers and distributors, and butchers, on a regular basis with the AMH brand blazoned all over it with its particular logo": T, p 333, lns 26-29. Mr Heerey says that a certain consequence flows from that (the Maltesers point) but as to reputation at those functional levels (which excludes the functional level of the retail consumer), the actual position adopted by the respondent is clear.
250 These observations are not designed to enter into a territory not pressed by the applicant concerning any contended intention to deceive. These observations go to the extent of the reputation subsisting in the AMH trade marks in JBS which is a matter relevant to deceptive similarity.
251 I will return to the second qualification in relation to Mr Cabral's evidence which also goes to the evidence of Mr Hurst (and to a lesser degree, the evidence of Mr Goodman and Mr Latemore).
252 I accept the evidence of Mr J J Catalfamo.
253 As to Mr Hurst, I generally accept the matters described at [138]-[153]. I will address the qualification shortly. As to the matters described at [154], I accept that it may well be common, in Mr Hurst's experience, for some retailers to put their own label on meat products. However, I do not accept that it is common for retailers to put their own label "over" any "pre-existing supplier's brand". That proposition is far too general in its apparent ubiquity. It is not supported by the many images in evidence in the proceeding or the images at [6], [18], [68], [74] and [87]. If transactional visitations to sites on particular days resulted in inspections showing the results reflected in the photographs, I am not content to act on the basis that it is common that retailers place their own label over a pre-existing supplier's brand, so as to support the proposition that the pre-existing supplier's brand is obscured, obliterated or not otherwise able to be seen and inspected. Nor do I accept the generality of the statement that at IGA stores an IGA label is often placed over the pre-existing supplier's brand. I am, of course, willing to accept that Mr Hurst holds the view he has described. I accept that these things happen from time to time. I do not suggest for one moment that Mr Hurst is not doing the best he can in giving his evidence. It seems to me that his observations must be confined to an expression of his own views in his own experience. However, the broader overall evidence suggests to the contrary. As to one illustration in relation to IGA, it is perfectly plain at [18] that IGA has not placed its label over the version of the AMG device mark. The other photographs (not all of which can be included in these reasons for all the obvious reasons) illustrate primal cuts where, for example, the AMH device mark is transparently plain and is not covered over.
254 I also have reservations about the generality of the statement that all of the buyers of meat products from the respondent whether "wholesalers, manufacturers or export customers" are "highly sophisticated buyers". Again, I am willing to accept that Mr Hurst holds that opinion. No doubt some, perhaps most, of the buyers are sophisticated buyers. I am willing to apply the relevant principles on the footing that the buyers (wholesalers, manufacturers, supermarkets and export buyers) of the respondent's meat products, as the business has emerged to date, are discerning buyers in seeking out product, and are likely to bring an enquiring mind to the relevant transactions. I will return to that matter shortly.
255 The qualification I have concerning the evidence of Mr Hurst and aspects of the evidence of Mr Cabral is this. Each witness emphatically says that what matters in making transactional sales in the export and domestic market for beef products across the various functional levels from meat processing to wholesalers, distributors and retailers is the importance of the establishment number for the facility in which the processing has occurred. The establishment number is said to be the badge of quality. The seller is important as an entity but the quality is said to attach to the establishment number because the establishment number conveys standing in relation to cold chain management processes and other aspects of the processing of meat. Great emphasis is placed upon these things to illustrate the proposition that the brand is not the decisive thing which determines choice by a buyer. Choices are overwhelmingly informed, it is said, by the establishment number.
256 I have no doubt that rigorous, compliant, disciplined cold chain management and supervision of all of the processes undertaken in an accredited meat processing facility are very important matters in meat production and send a signal about quality. Because meat is a perishable commodity, its handling in terms of processing, chilling, freezing, transport and all steps associated with the processing of meat products are critical in ensuring that quality beef products are available for human consumption. I am sure that buyers want to know that the processing facilities are accredited and have a recognised establishment number.
257 However, I do not accept that these fundamental matters of physical meat production diminish the role that trade marks in the industry have in differentiating goods as a badge of origin of one trader as against another. A number of things make that perfectly plain. One of the first things that Mr Cabral and Mr Tarquinio did when they established their new company, was to engage Mr J J Catalfamo to design a new logo or device mark. They knew that their products would need to be differentiated in the market by a badge of origin. When they adopted the company name, they knew that the industry practice was to abbreviate a name such as Australian Meat Group to AMG. Mr Cabral was perfectly plain and frank about it: paras [122]-[125] of these reasons. When the respondent went to the Gulfood exhibition at Dubai, as earlier described, it displayed its device mark immediately next to its name in the brochure (not the establishment number). At its booth, it emblazoned the device mark all over the booth: [157]. When it displayed its meat in the cabinets at the exhibition it had its device mark on the packaging containing the beef products although it may have been the version of its device as depicted at [18]. Nevertheless, it is uncontested that the respondent placed its device mark on the products on display at the exhibition. It puts its device mark on the plastic packaging containing its primal cuts of meat for all to see: [18]. It puts its device mark on its boxes (cartons) in a prominent way: [92], [132]-[135]. It displays its boxes under the heading "Brands" on its website which display the device mark: [92]. It puts its trade marks on its PowerPoint presentations given to new customers and given to other customers who previously had relationships with one or more of the AMG principal actors: [146]. It uses "AMG" throughout the PowerPoint presentation: [146], [147] and "PJH-2". In essence, the respondent does everything in this regard that the applicant does in its trade except that the respondent's numbers are small, by comparison (yet nevertheless significant) with the applicant's numbers, as the respondent is a relatively new company.
258 The idea that the establishment number is the pivotal matter of differentiation to the point where the AMG trade marks are so significantly diminished that they do not operate as a badge of origin or that they are not important in transactions and thus, no real tangible danger of deception or confusion arises by reason of the respondent's use of its trade marks, in all the circumstances, is not correct (at least by reason of that factor alone). The establishment number is, no doubt, important because a seller of beef is supplying a product which has to be handled in facilities which have rigorous standards so that humans do not get sick when they consume the product. Of course, a buyer wants to know the establishment number, and buyers might well come to understand the high standards (or otherwise) deployed in particular facilities with a particular establishment number. However, there is no doubt, on the evidence before me, that the respondent is engaged in a field of rivalry with other suppliers at functional levels of the meat industry in which its trade marks are vigorously promoted as a badge of origin of its meat products in market contestable conduct in the domestic and export markets.
259 However, as to other aspects of Mr Hurst's evidence, I accept that in addition to the role played by the respondent's trade marks as badges of origin, the respondent engages in transactions, especially in the export market, which are characterised by very large orders: [144]. I also accept that customers placing orders at these levels are likely to be focused upon questions of quality and consistency and that such buyers would want to have confidence that the product supplied is reliable. I also accept that in respect of these sorts of transactions, the relationship between the buyers and the supplier is important and the buyer's confidence about the standards applied in the supplier's processing facilities is important. In other words, in a suite of particular transactional arrangements between the respondent and particular buyers, the nature of the relationship and the value and volume of the goods purchased would be likely to cause such a buyer to bring an enquiring mind to the transaction.
260 As to the evidence of Mr Goodman, I generally accept that he has taken significant steps to introduce the new company into the domestic market, the breeds of cattle the respondent prefers, the boning, processing and chilling processes and that many of the 15 domestic wholesalers with which AMG trades have been contacted in this way. I also accept that many of these wholesalers are known to Mr Cabral and Mr Catalfamo.
261 As to Mr Latemore, his evidence is to the same effect in substance as Mr Goodman. He says that when he makes phone calls to secure export sales he always uses the full name of the company, Australian Meat Group, and that he takes time to explain its operations. I accept that Mr Latemore adopts a practice along these lines although I am caused to wonder to what extent he would rapidly adopt use of the acronym AMG. Mr Latemore was involved in developing the PowerPoint presentation and in that presentation, from page 1 and thereafter, the presentation speaks of Australian Meat Group in terms of AMG throughout and gives prominence to the respondent's trade marks. Mr Latemore was not cross-examined.
262 As to the evidence of Mr Watson, he is an independent consultant to the meat industry and as described earlier, he was, for a time, the General Manager of Meat for Coles supermarkets ("Coles"). I generally accept his evidence subject to the following matters. I accept the matters described at [159] to [162] of these reasons. When speaking of his experience of engaging with processors described at [160] and the tolling arrangements described at [161], it needs to be remembered that Mr Watson is speaking about a very particular purchaser which stipulates specifications for the processing of meat. He speaks for a buyer which is particularly conscious of the "Coles brand" and the uniformity of providing consistent quality meat products under that brand throughout a whole network of supermarkets. In that sense, Coles is engaged in very particular bilateral transactions. It is not standing in the markets at large. Coles, apart from providing product for sale under the "Coles own brand" in its network of supermarkets, sells on the export market about 24% of the volume of meat it purchases through the particular arrangements with the four processing plants described at [160] or by reason of the tolling arrangements described at [161].
263 Mr Watson says that when Coles sells meat into the export market, the buyers are primarily interested in where the meat was processed and, particularly, the establishment number. That may be a result of Coles having acquired beef product for ultimate sale under the "Coles own brand", under the contractual arrangements with the four particular processing plants mentioned at [160] and under the tolling arrangements described at [161], rather than having acquired branded product per se. All product acquired by Coles would ultimately be sold under the Coles brand except for meat, surplus to domestic requirements, being sold on the export market and some sold to other distributors. Mr Watson says that wholesalers also make these enquiries of Coles should Coles be selling (as it sometimes does) meat surplus to its own requirements to a wholesaler. Again, in the context of the particular procurement arrangements adopted by Coles, those enquiries about the source of the processing might be very particular to the circumstances of Coles. However, as described at [164], Mr Watson puts the matter more broadly than I have just described it and I accept his evidence that there is a practice at the export level and in engaging with wholesalers, so far as he understands the position, to make enquiries about the particular facility in which the meat has been processed and its establishment number. In the remaining part of [164], I describe Mr Watson's evidence concerning the practice of the buyers for Coles. I accept that the buyers for Coles know the establishments, visit plants in the supply chain and are very familiar with all of the upstream activities specifically relevant to Coles and its specifications. I also accept that Coles would never purchase meat from a supplier it did not know extremely well. I also accept that in Mr Watson's experience, the wholesalers with whom he dealt, were sophisticated buyers who had knowledge of the facilities and the establishment numbers relevant to each facility.
264 Mr Watson gave some evidence which seems a little odd to me in the context of the evidence overall. He said that specifically branded meat is rare in the Australian market. He may well have that perspective because he says that, for Coles, there is a very clear imperative that no brand other than the Coles own brand appear on the meat. That may mean that Mr Watson is not really very conscious of branding because ultimately everything is subsumed to the "Coles own brand". He says he knows of the King Island Beef brand and David Blackmore's Wagyu Beef brand. However, the evidence is that wholesalers deal with a range of brands and in the plurality of market transactions characterising the field of rivalry at the various functional levels of the market (as opposed to the bilateral procurement arrangements particular to Coles), there are plainly a range of brands of beef. The respondent itself talks about its Premium Angus brand and its Southern Ranges Platinum brand apart from its boxes marked with the AMG device brand alone. There is the AMH brand, the Swift Premium brand, the Friboi brand, the Royal brand, the 1824 Premium Beef brand, the Darling Downs Wagyu brand, the Master Kobe brand, the Riverina Angus brand and a number of others. As Mr Watson says, the commercial interests of Coles have been best served by presenting meat products with only "Coles brand beef" to customers and this focus may have caused him to believe that there are very few brands on the market. He is plainly wrong about that matter. On the question of the rapid increase in the emergence of brands over the last six years or so, I accept the evidence of Mr De Luca at [48] in preference to the views of the respondent's witnesses.
265 I generally accept Mr Watson's evidence as described at [169]-[171].
266 At [173], I note evidence given by Mr Watson to the effect that he has not seen AMH as a significant brand in the marketplace either as a buyer of meat or as a wholesaler of meat or as a brand for sale at a retail level. He says he has not had that experience since JBS acquired Australian Meat Holdings in 2007. Again, that evidence seems odd to me because the statistics demonstrate the enormity of the sales by JBS as a wholesaler of AMH meat products to the domestic market and the export market. The sheer volume of meat sold under the brand, packaged as it is in the plastic bags as described, and supplied in the cartons as described, generating the revenue as described, seems to make it difficult to conclude that AMH has not operated as, at the very least, a "significant brand" either in circumstances of being a buyer or a wholesaler or as a brand attached to meat available for sale at the retail level. Mr Watson accepts that AMH as a brand is "known" in the meat industry but he believes this to be "historical" and he says that JBS, in his opinion, has made a concerted effort to push its brands "over the top of the AMH brand".
267 There are three things to note about these observations.
268 First, Mr Watson comes at these matters from a very particular perspective as a person who has been engaged in operating the meat trading activities of a very particular buyer in the particular circumstances determined by that buyer with all of its upstream management.
269 Second, Mr Watson does not have the data concerning the trading activities in the AMH brand from 2008 to 2015. It would be objectively difficult to hold the views he holds in the face of that data. Moreover, the evidence is that trades have been occurring, offers made in pricelists, and emails exchanged, between relevant market participants for the purchase of meat products using the product description "AMH": [58], [59], [61], [62], [73], [77]-[79] and [184]-[187].
270 Third, moreover, the opinion Mr Watson holds on this issue is expressly inconsistent with the extent of the reputation in the "AMH brand" adopted and conceded by the respondent in these proceedings (T, p 333, lns 18-20; except at the level of the retail consumer), to the point where at the functional levels of the "wholesalers, export markets, and for supermarkets, and for independent butchers", there is said to be a "strong reputation". As mentioned earlier, Senior Counsel for the respondent, Mr Heerey, "embraces" what Senior Counsel for the applicant, Mr Shavin, "says about the endless thousands of millions of kilograms and cartons [and bags] flowing into wholesalers and distributors, and butchers on a regular basis with the AMH brand blazoned all over it with its particular logo": T, p 333, lns 26-29. Nevertheless, I certainly accept that Mr Watson holds those views.
271 As to the evidence of Associate Professor Cox, I have not found her evidence to be very helpful because her opinions operate at too high a level of abstraction. In making that observation, I do not wish to suggest any disrespect to Associate Professor Cox and I recognise and accept her expertise in phonetics and phonology, the two closely related scientific branches of linguistics.
272 I accept that acronyms pronounced as a "string of letter names" are sometimes differentiated as initialisms and that because the trade marks AMH and AMG do not satisfy the criteria for word-forms in English, readers or observers are likely to pronounce the acronym by using the "letter names". I accept that, plainly enough, the last syllable "H" and "G" differentiates each initialism by reason of the final "syllable". I also accept Associate Professor Cox's view that the pronunciation of the first two syllables "AM" would be the same but there would be a difference in the pronunciation of the final syllable. I also accept that as a matter of principle, the difference in the final syllable would be linguistically important in the pronunciation of the final syllable: [202].
273 The point of departure I have with the evidence of Associate Professor Cox is that it has no contextual application to the engaged field of common human endeavour in question in the case. It is entirely acontextual.
274 For example, Associate Professor Cox seeks to illustrate the differentiating phonetic feature of words by contrasting the words "dog" and "dot" observing that the difference in the last speech sound of each word leads to different meanings. Of course, in context, when a person makes a telephone call to a veterinary surgeon to enquire about a problem the person has with his or her dog, he or she would be unlikely to find that the receptionist or the veterinary surgeon hears, as a matter of pronunciation by the caller, a "speech sound", of "dot" for the word "dog", largely because, no doubt, the receptionist or the veterinary surgeon is cognitively expecting to hear a reference to "dog", rather than "dot" in the context of enquiries made to a veterinary practice about an animal taxonomically described by the word "dog" rather than "dot". Similarly, a person engaging with another in a field of activity or in a context which conditions the use of the word "dinosaur", would be unlikely to find that the person with whom they are engaging hears a "speech sound" consistent with "dynamite". Context is everything, especially in the hurly burly of oral commercial transactions in the purchase and sale of meat products as revealed in the evidence.
275 Associate Professor Cox then applies those concepts just described derived from principles governing words, to acronyms pronounced as initialisms and observes that AFI (an acronym for Australian Film Institute) and AFL (an acronym for Australian Football League) and AFP (an acronym for Australian Federal Police), are examples of acronyms which constitute initialisms which differ only in their final syllable and are differentiated in their pronunciation by the final syllable. However, in context, a person who is asked, in Melbourne, for example (as I have been asked many times as a non-resident but regular visitor to that great city), "which AFL team do you follow?", would be unlikely to hear the acronym "AFL" as "AFI" because the context would render it nonsensical. Similarly, two persons steeped in an interest in film and film genre, talking about which actors, directors or writers, might win awards at the Annual AFI Awards would be unlikely to hear, as a matter of speech sound or pronunciation, "AFI" as "AFL" or "AFP". References, by initialisms, to the Australian Football League or the Australian Federal Police would also be nonsensical in that context.
276 However, if two initialisms are in play in a common field of activity by participants in a field of rivalry engaged in the sale of the same or substantially the same meat products in a domestic and export market amongst many of the same market participants, the theoretical differentiation in pronunciation of the final syllable in AMH and AMG might well lose its structurally deconstructed abstracted integrity in the context of the cut and thrust of ordinary commercial arrangements by ordinary commercial people pronouncing AM something and AM something else in the sale and purchase of meat products, having regard to what is ordinary in that sense on the evidence.
277 Thus, I do not find the opinions expressed by Associate Professor Cox to be helpful in the context of the real questions that have to be asked about the use of the initialisms in an applied way.
278 As to the evidence, I simply add this observation. I have read the transcript of the proceedings closely and have taken all the evidence into account. I have attempted to deal with all of the evidence comprehensively. To the extent that I have not mentioned or set out in these reasons aspects of the evidence, I should not be taken as not having considered all of the relevant matters.
279 It is now necessary to apply the governing principles to the evidence I have accepted. In doing so, I make these observations:
(1) The AMG device mark was lodged for registration on 8 April 2014. The AMG trade marks depicted at [15] were lodged for registration on 3 March 2016. The respondent commenced trading in beef products in cartons (boxes) in January 2015: Exhibits 20, 21, 22 and 23. The boxes were designed between September and December 2014.
(2) As the image at [2] reveals, the AMH device mark consists of a stylised map of Australia enclosing a white field with the letters AMH across the centre of the map, with the map and enclosed letters, sitting on a ribbon feature. The word mark consists of the letters AMH.
(3) The AMG device mark consists of a stylised map of Australia in more free-flowing form enclosing a white field with the letters AMG in something akin to cursive text sitting in the centre of the map with the words Australian Meat Group in small but capital text as depicted at [13]. There is a version of the device mark described and depicted at [18].
(4) As to the two trade marks depicted at [15], they too incorporate the AMG device mark. The applicant says that they are also characterised by a ribbon device. Minds might legitimately differ about whether that is an accurate description. However, what is clear is that each of the trade marks depicted at [15] (and, of course, [134] and [135]) contain the AMG map device with the three letter acronym in the middle. I accept that the impression on the mind's eye when looking at those trade marks is that the dominant feature is the AMG device mark. It is true that the image at [134] contains the additional words forming part of the branding for the box of "Southern Ranges" and underneath it the word "PLATINUM". It is also true that the image at [135] contains the additional words forming part of the branding for the box of "PREMIUM" and underneath that word in apparent handwriting Angus Beef. Those words are essentially descriptive and laudatory of the quality of the meat contained within the box. Notwithstanding the addition of those words in each case, I am satisfied that an essential feature of the branding or badging for each box is the AMG device mark as described.
(5) For all the reasons mentioned in the evidence which I have accepted, some of which is summarised at [257], it is perfectly plain that the respondent uses the AMG device mark as a badge of identification and uses the acronym AMG as a badge of identification.
(6) The industry practice is that acronyms are used to identify the source of product, that is to say, as a bridge or link or badge of origin. Mr Cabral was very much influenced to select the name Australian Meat Group because he understood that industry participants would quickly abbreviate the name to the three letter acronym AMG. I mention that matter not because of any question going to intention to deceive but simply because Mr Cabral recognised the industry practice in this regard, and that practice influenced his selection of the company name. The acronym AMG would, he thought, prove to be "easy to remember" and have a "zing to it".
(7) The evidence makes plain that industry participants order meat products by reference to the acronyms AMH and AMG.
(8) As to the reputation subsisting in AMH and the AMH device mark, there can simply be no doubt that there is a very significant and substantial reputation subsisting in those two trade marks. The respondent does not contest that proposition insofar as the reputation is recognised in cohorts operating at functional levels of the market which involve buying and selling activity by wholesalers, those acquiring meat products for sale for export, direct export by processors, supermarkets and independent butchers. The respondent describes the character or quality of that reputation as a "strong reputation". The respondent contends that, at the level of the retail consumer as a buyer of meat products, AMH does not enjoy a "strong reputation" or, for all relevant present purposes, a reputation at all.
(9) As to the question of scale, the statistics in evidence which I have accepted, speak for themselves. As to the export market, AMH, is the largest meat processing company in Australia. It exports to 80 countries. Plainly, the applicant enjoys a strong reputation at the various functional levels of the supply chain in the sale and supply of meat products in the domestic market and it enjoys a strong reputation for its products in the export market. So much is accepted. However, notwithstanding the "strong reputation" at all functional levels of the market except at the functional level of retail sales (a matter to which I will return later in these reasons), I am not satisfied that that reputation is so pronounced in the Maltesers sense that no "imperfect recollection" of the AMH device mark and AMH word mark would be brought to any engagement with the AMG device mark and AMG word mark by members of the cohorts operating at those functional levels of the market. In other words, the reputation is not so pronounced that somebody seeing the AMG trade marks and especially the AMG device mark would, analogically speaking, say: "That's not a Maltesers box". The recollection would be imperfect and thus the conduct of the respondent is susceptible of deception and confusion.
(10) The supply chain for the sale of meat products into the domestic market is explained in the evidence which I have accepted. However, the supply chain activities involve these steps. Livestock is purchased by the applicant either at saleyards or from the "farm gate" under contracts with farmers. Livestock are transported to an abattoir where each animal is killed and boned. Some abattoirs (processors) conduct kill and bone operations on a tolling basis for buyers such as Coles and Woolworths. The processing activity results in the meat being reduced to whole primal cuts which are then placed in bags as described in the evidence and chilled, or the meat is frozen. The supply chain involves the supply of meat products in whole primal form to a range of wholesalers, and also supply by the applicant to D.R. Johnston, as described in the evidence. Wholesalers and DRJ on-sell meat to others as described in the evidence. The wholesale entities supply distributors, manufacturers and/or retail entities. The whole primal cuts are then normally cut into portions by retailers (butchers) for consumers to buy. Sometimes, whole primal cuts are placed on display in cabinets where consumers can cast their eyes upon them in that form: [18], [68], [74] and [87]. Sometimes, retailers acquire portion-cut meat from intermediate processors.
(11) The evidence demonstrates that whole primal cuts packaged in plastic bags marked with the AMH device mark are available for purchase by retail consumers in that form at some retail sites. The evidence also shows that whole primal cuts in bags marked with the version of the AMG device mark depicted at [18] are available for purchase by retail consumers at some sites. In each case, in the images in evidence, the device mark can readily be seen. Sometimes, the AMH mark will be on a bag which also contains an insert exhibiting another mark as well, such as Swift Premium: [68]. Sometimes, the device mark endorsed on the plastic bag might be overlayed with another trade mark by a retailer such as IGA. Sometimes, butchers as retail traders, might place their own brands on the meat. Generally, butchers will remove whole primal cuts from the processor's packaging and cut the meat into portion controlled segments. Nevertheless, the evidence shows that in a number of retail sites, whole primal cuts can be purchased, packaged in the processor's plastic packaging bearing the device marks.
(12) 80% of the applicant's processed beef is sold into the export market into 80 countries as previously mentioned. 70% of the respondent's meat products are sold on the export market.
(13) The evidence is that 2.2% of all beef consumed in Australia is displayed to retail consumers in whole primal form in a retail environment. So far as AMH is concerned, that means that approximately 2.2% of the 20% of its processed beef sold into the domestic market is displayed to retail consumers in whole primal form in a retail environment. It also means that 2.2% of the 30% of the AMG processed meat sold into the domestic market is displayed to retail consumers in whole primal form in a retail environment.
(14) That being so, although 2.2% appears to be a small percentage, it means that in the period 2008 to 2015 in the case of AMH, there were 972,701 bags marked with the AMH device mark available for retail sale as primal cuts representing 3,776,417 kilograms of meat product, according to Mr De Luca's Annexure "BJDL-4", apart from the evidence of Mr Tancred and his schedule.
(15) In the domestic market, there is a strong reputation for the AMH brand in all functional aspects of the supply chain amongst those cohorts participating as wholesalers, distributors, manufacturers, supermarkets, butchers and retailers. I am also satisfied that the AMH trade marks enjoy recognition and reputation at the functional level of interactions between a retail seller of whole primal cuts and a consumer. The reputation in the AMH device mark and AMH word mark is, obviously enough, less pronounced than the reputation those marks enjoy at other functional levels of the market. Nevertheless, the marks enjoy recognition and reputation at the retail level. I am not satisfied that the so-called Maltesers principle has any role to play at the retail level.
(16) The export cuts produced by AMH are either cryovaced in bags marked with the AMH device, by and large, or frozen. The primal cuts tend to be in AMH marked bags. The bags containing meat supplied in boxes marked with the brands Swift or Swift Premium or Friboi or Royal bear the AMH device mark on the bag. It is true that the AMH brand might be on the "bottom" of the bag in the sense that the bag is inverted or turned over, with an inset on the "top" section of the plastic bag. Nevertheless, each bag is endorsed with the AMH device mark at [29].
(17) As to the so-called north/south divide, I accept that AMG procures livestock for slaughter and processing predominantly in southern Australia and that AMH predominantly procures livestock in northern catchments. However, two things should be noted. First, the applicant's registrations of its trade marks are national and unqualified. Second, there is some evidence that cattle are acquired by the applicant in Victoria and southern New South Wales and taken to Dinmore for slaughter. Moreover, the evidence demonstrates that at least to some extent the respondent is supplying its primal cuts for sale in Queensland.
(18) Purchase and sales transactions occur as between wholesalers and retailers by telephone and thus orally and by email. DRJ has 6,000 customers who buy meat products. Mr Tatt says that there are about 10 major meat distributors which represent 80% of the market demand and the remaining 20% is comprised of a significant number of smaller distributors. The total would be about 100: [75].
(19) Without wishing to unduly constrain the balancing of all the relevant circumstances, it seems to me that the question (subject to the consideration discussed at (28) and following), ultimately comes down to this, so far as the domestic market is concerned, leaving aside for the moment the cohort represented by the retail consumer: that is, having regard to:
(a) the circumstance that AMH is a trade mark that has been used for decades;
(b) its reputation is strong at all functional levels of the market amongst the cohorts engaged in market activity at these levels;
(c) the AMH device mark and the AMH mark have been used in connection with a vast number of bags and cartons containing meat products the subject of the registrations;
(d) the goods of the applicant and the respondent are traded in markets substantially in common areas among the same cohorts of buyers although particular sectors of those cohorts may tend to engage with the applicant on the one hand, or tend to engage with the respondent on the other hand;
(e) the essential feature of the AMH device mark is a stylised map of Australia enclosing a white field with the letters AMH across the centre of the map with the map and enclosed letters sitting on a ribbon feature;
(f) the essential feature of the AMG device mark is a stylised map of Australia enclosing a white field with the letters AMG across the centre of the map without the map being located on a ribbon feature albeit with the words Australian Meat Group across the bottom of the map;
(g) the visual impression and imperfect recollection of the essential features of the AMH device mark carried away by those traders having engaged with it over time; and
(h) the characteristics of the supply chain and the methods of sale and purchase of meat products in that supply chain and thus the ordinary conduct of buyers and sellers engaging in steps in the supply chain,
is there a finite and non-trivial ([230]) real tangible danger, that is to say, a real non-trivial likelihood (231), that use of the AMG device mark will result in a number of people being caused to wonder, or left in doubt (231) whether it might not be the case that the meat products of AMG are those of, or associated with, AMH (JBS)?
(20) I am satisfied that the answer to that question is "yes".
(21) I am also satisfied that when the same question is asked having regard to the same considerations except that the focus of the enquiry is upon the respondent's use of "AMG", in the context of the longstanding reputation of "AMH" (conditioned by use of the AMH device mark containing the acronym) coupled with the volume of trade by reference to the acronym, the answer is also "yes".
(22) As to the AMG device mark, I do not regard the addition of the words "Australian Meat Group" placed across the bottom of the continent on the map as a sufficiently distinguishing feature so as to cause the answer to the questions to be "no".
(23) Further, the circumstance that "H" is the final syllable in the acronym "AMH" and that "G" is the final syllable in the acronym "AMG", is not a sufficiently distinguishing feature of the two marks when AMH has been used in the same market for so long.
(24) I accept that in oral communications in the hurly burly of oral trading transactions between retailers and wholesalers the emphasis is likely to be upon the "AM" component of the letter acronyms and that the last syllable is not sufficiently differentiating. As I indicated earlier, I am not assisted by Associate Professor Cox when the question is examined, as it must be, in a relevantly applied context.
(25) I accept that at the level of engagement between a retailer and a consumer when it comes to potential sales of whole primal cuts, there is at least a reputation subsisting in the AMH device mark and word mark. I accept that a consumer is likely to bring to the presentation of whole primal cuts bearing the AMG device mark and the letter acronym "AMG" an imperfect recollection of the AMH device mark and the AMH word mark. I accept that there is in those engagements a finite and non-trivial real tangible danger of confusion. Such confusion might be dispelled at the point of a purchase transaction or it might not. Whether it is or is not, is not the relevant question. There is, in my view, a real non-trivial likelihood that consumers exposed to whole primal cuts in the way depicted at [18] will be caused to wonder or left in doubt whether it might not be the case that the meat products of AMG are those of AMH.
(26) I also accept that an element of a likelihood of such a consumer being caused to wonder or being left in doubt is whether a consumer might think, as a matter of imperfect recollection, that whole primal cuts in a bag marked with a stylised map of Australia enclosing a white field with "AMG" in the middle of the map is, somehow or other, a version, or a more modern version, or some form of variant upon, the AMH device mark.
(27) In the export market, the applicant exports to 80 countries and again has a very substantial volume of meat product supplied through export channels. Sales occur directly into the export market and to entities within Australia which supply meat products into the export market. I also accept that there is a real non-trivial risk or tangible danger or a real non-trivial likelihood, that export customers having a recollection of the AMH device mark and the AMH word mark, might be caused to wonder or left in doubt about whether meat products marked with the AMG device mark and the AMG letter mark are products of the applicant or products associated in some way with the applicant. This is especially so having regard to the many different languages in the various export destinations in which importers of meat products operate.
(28) The consideration mentioned at (19) is this. I accept that in the domestic market many of the wholesalers acquiring meat products from processors and resupplying meat to distributors, manufacturers, retailers, supermarkets etc are participants in the market who bring an enquiring mind to purchase transactions having regard to the consideration that the orders placed are normally orders for significant quantities of meat. The average purchase order into the domestic market placed with wholesalers is mentioned in the evidence. Some of those wholesalers may not be as "sophisticated" as others. There may be as many as 100 or so buyers operating at greater or lesser degrees of market engagement exhibiting a greater or lesser degree of enquiry. However, on balance, many of the wholesalers (but not all) are likely to be discerning and in that sense they are "sophisticated". I proceed on the basis that this is a consideration which characterises ordinary transactions at this functional level of the domestic market. I suspect that in the course of transactions, over time, some wholesalers are likely to ultimately come to recognise that notwithstanding the reputation of AMH and the understanding such wholesalers have of the word mark and the device mark (and their imperfect recollection of it), the trade marks adopted by the respondent in the form of the AMG device mark and the AMG letter mark convey a notion that those marks are a badge or source of origin of goods supplied or offered to be supplied by a new or different company, not associated or connected with JBS but one which is a contestable rival of JBS.
(29) Nevertheless, I am entirely satisfied that the use by the respondent of its trade marks at this functional level of the market engages a finite and non-trivial danger or real and non-trivial likelihood that a number of participants at the wholesale level of the market will necessarily be caused to wonder or left in doubt about whether it might not be the case that the meat products of AMG are those of the owner of the AMH trade marks. That finite and non-trivial danger or real and non-trivial likelihood might well, over time, come to be dispelled in the minds of some wholesalers (but not necessarily all), but that is not an answer to the question of whether use by the respondent of its trade marks involves deception or confusion. It plainly does so and, no doubt, a respondent engaging in that conduct would try very hard to bootstrap itself into a position where it seeks to dispel the deception or confusion once it has engaged the market participant and, from its perspective, hopefully, captured it as a buyer. However, it is not necessary for the applicant to show passing off or that transactions have actually been lost. There is a very good reason for this in the trade mark law of this country. It is very difficult, often, to show the extent to which transactions have been lost. The trade marks of an owner are sufficiently prejudiced and compromised and their integrity diminished when rivals seek to use a sign in connection with the relevant goods, which is deceptively similar. A respondent engaging in conduct which gives rise to deception and confusion in the sense discussed in the authorities, is the very essence of the infringement right.
(30) On this issue of the sophistication of wholesalers or buyers at particular functional levels (leaving aside the retail consumer level), I am not aided by Mr Watson's evidence. His evidence operates at a very particular level as earlier described. The respondent says that Mr Watson's evidence is absolutely emblematic of the extent to which wholesalers generally bring discrimination and sophistication to the purchase transactions, in the markets. For the reasons I have already identified, I do not agree that Mr Watson's evidence is decisive of that question or even necessarily influential in an assessment of the position relating to behaviour in a multilateral field of rivalry as opposed to the very particular features characterising the "arrangements" under which Coles operates.
(31) I take the view that the same conclusion reflected at (29) and (30) applies in relation to conduct in the export market. It is clear that the respondent vigorously promotes its trade marks in connection with the export sale of its goods. It vigorously promotes its trade marks to potential new clients. It uses the device mark in its PowerPoint presentations and it emblazons its device mark on stands at international trade fairs. Again, international importers of meat products might, ultimately, come to understand that the trade marks used by the respondent in connection with trade in its meat products, operate as a badge of origin of a new company unrelated to JBS. However, that is not the test. I accept that the respondent has embarked upon a relationship-based campaign to attract buyers of its export meat products and I accept that it has pressed many of the pre-existing relationships enjoyed by Mr Cabral and Mr Catalfamo with buyers from an earlier time. I accept that in respect of a number of these bilateral relationships, AMG's relationship partner would not be in any doubt that the person he or she is dealing with is a representative of a new company brought into existence by Mr Cabral and Mr Catalfamo and one not associated with the owner of the AMH trade marks. However, these engagements simply reflect the course of conduct to date by the respondent. In any event, the respondent is not simply dealing with relationship partners. It is promoting itself and its meat products to the export market at large under and by reference to its trade marks. Its use of those trade marks in that way involves a finite non-trivial real tangible danger that some participants in the export market will be caused to wonder in the relevant sense I have described.
(32) It should also be recalled that Mr Cabral was very direct about the utility of a three letter acronym like AMG and although the respondent says that in dealing with new customers great emphasis is placed upon the name Australian Meat Group, it seems to me having regard to the PowerPoint presentation that "AMG" is very likely to be the acronym used to describe the respondent and its products together with the badge of identification emblazoned on its meat products in the form of the AMG device mark.
(33) It follows from all of this that I am satisfied that at each functional level of the domestic market and the export market, the conduct of the respondent engages infringement of s 120(1) of the TM Act on the footing that the respondent has used as a trade mark two signs consisting of the AMG device mark and AMG word mark that are deceptively similar to the AMH trade marks in relation to goods in respect of which the trade mark is registered having regard to the tests to be applied to the facts in the context of s 10 of the TM Act.
(34) I am also satisfied that the use by the respondent of the two trade marks depicted at [15], [134] and [135] also engages an infringement on the footing that these trade marks constitute use, as trade marks, of signs deceptively similar to the AMH device mark and the AMH word mark in relation to goods in respect of which both AMH trade marks are registered.
(35) Without restating the totality of the evidence on infringement, I am satisfied that the evidence I have accepted makes good the causes of action.
280 At [112] to [125], I describe the evidence in relation to the evolution of the name Australian Meat Group and the various company names which were investigated as possibilities for use. There were a number of company names that were considered and were available. However, for the reasons identified by Mr Cabral, a name reflecting a three letter acronym was to be preferred. At [117], I note an email sent by Mr Tarquinio to Mr Zervos on 21 February 2014 in which Mr Tarquinio says that the decision-making group had exercised a preference for Australian Meat Group. However, he added the qualification that "but our concern is that someone is already using AMG Pty Ltd and [there] could [be] brand issue implications in the future".
281 It is not clear what Mr Tarquinio meant by that observation but he seems to have reflected an opinion that there could be brand issues in the future in relation to the use of the name Australian Meat Group recognising, of course, that which Mr Cabral recognised, which is that industry practice is to abbreviate a name to, in this case, an "easy to remember" acronym "AMG" which has a "zing to it".
282 Having regard to those matters, the applicant says that Mr Tarquinio's unexplained failure to give evidence, gives rise to a Jones v Dunkel inference that Mr Tarquinio's evidence on the nature of the "brand implications for the future" would not have been helpful to the respondent.
283 I am not willing to draw that inference because it is equally open to conclude that Mr Tarquinio's reservation was in relation to the very specific entity AMG Pty Ltd rather than anything else.
284 The applicant also says that the evidence demonstrates that nothing was done by the respondent to investigate the possible consequences of adopting the name Australian Meat Group in circumstances where it was expected from the outset, as a matter of industry practice, that that name would rapidly be abbreviated to AMG in relevant market behaviour. The applicant says that no enquiry was made about the consequences of associating its products with the acronym "AMG" or the AMG device mark. The applicant says that no legal advice was taken about these matters and that, in effect, the respondent pushed on in disregard, perhaps reckless disregard, of the consequences of using the trade marks to be adopted. This is said to give rise to a proper foundation for a finding that the respondent's conduct warrants the imposition of additional damages which are to be calculated in the later separate hearing.
285 I do not propose to recite the content of the factual matters going to that question, in these reasons. I have examined the evidence and the submissions carefully. I am not satisfied that there is a proper foundation for an award of additional damages. The respondent, by its officers, engaged in conduct. The applicant has made good the proposition that that conduct, in the way I have described, engages infringement of its trade marks. However, there is no basis for additional damages.
286 As I indicated earlier, I am also satisfied that the use by the respondent of the trade marks reflected at [15], [134] and [135] engage infringements of the applicant's trade marks. The addition of other words and titles on the boxes and in conjunction with the AMG device mark does not have the effect of distinguishing or differentiating the branding which adopt as an essential feature, the AMH device mark which suffers from the difficulties earlier described in the sense that it reflects the essential features of the AMH device mark. Use of these marks is infringing conduct.
287 I propose to make directions that the applicant submits proposed orders to be made arising out of these reasons within seven days. The costs of and incidental to this stage of the proceedings will be reserved for later determination upon the making of orders arising out of this part of the proceedings.
I certify that the preceding two hundred and eighty-seven (287) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Greenwood.