3.2 Law regarding deceptive similarity
31 In Australian Woollen Mills Limited v FS Walton & Co Ltd [1937] HCA 51; (1937) 58 CLR 641 at 658, Dixon and McTiernan JJ described the test for deceptive similarity as follows:
But, in the end, it becomes a question of fact for the court to decide whether in fact there is such a reasonable probability of deception or confusion that the use of the new mark and title should be restrained.
In deciding this question, the marks ought not, of course, to be compared side by side. An attempt should be made to estimate the effect or impression produced on the mind of potential customers by the mark or device for which the protection of an injunction is sought. The impression or recollection which is carried away and retained is necessarily the basis of any mistaken belief that the challenged mark or device is the same. The effect of spoken description must be considered. If a mark is in fact or from its nature likely to be the source of some name or verbal description by which buyers will express their desire to have the goods, then similarities both of sound and of meaning play an important part. The usual manner in which ordinary people behave must be the test of what confusion or deception may be expected. Potential buyers of goods are not to be credited with any high perception or habitual caution. On the other hand, exceptional carelessness or stupidity may be disregarded. The course of business and the way in which the particular class of goods are sold gives, it may be said, the setting, and the habits and observation of men considered in the mass affords the standard. Evidence of actual cases of deception, if forthcoming, is of great weight.
32 Their Honours emphasised that the determination for the court is one of estimation and evaluation (at 659):
The main issue in the present case is a question never susceptible of much discussion. It depends on a combination of visual impression and judicial estimation of the effect likely to be produced in the course of the ordinary conduct of affairs.
33 The summary provided by Windeyer J in The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd [1963] HCA 66; (1963) 109 CLR 407 at 415 (Shell Oil) also encapsulates the approach required by s 120(1):
On the question of deceptive similarity a different comparison must be made from that which is necessary when substantial identity is in question. The marks are not now to be looked at side by side. The issue is not abstract similarity, but deceptive similarity. Therefore the comparison is the familiar one of trade mark law. It is between, on the one hand, the impression based on recollection of the plaintiff's mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant's television exhibitions.
34 In Hashtag Burgers Pty Ltd v In-N-Out Burgers, Inc [2020] FCAFC 235; (2020) 385 ALR 514 (Nicholas, Yates and Burley JJ), the Full Court noted at [64] that the distinction between consideration of whether one mark is deceptively similar to another, rather than substantially identical, lies in the point of emphasis on the impression or recollection which is carried away and retained of the registered mark, when conducting the comparison. In this context, the Full Court said:
…allowance must be made for the human frailty of imperfect recollection. In New South Wales Dairy Corporation v Murray Goulburn Co-operative Company Ltd [1989] FCA 124; 86 ALR 549, in a passage in his judgment not affected by the proceedings on appeal, Gummow J said at 589:
In determining whether MOO is deceptively similar to MOOVE, the impression based on recollection (which may be imperfect) of the mark MOOVE that persons of ordinary intelligence and memory would have, is compared with the impression such persons would get from MOO; the deceptiveness flows not only from the degree of similarity itself between the marks, but also from the effect of that similarity considered in relation to the circumstances of the goods, the prospective purchasers and the market covered by the monopoly attached to the registered trade mark: Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 414-15; Polaroid Corp v Sole N Pty Ltd [1981] 1 NSWLR 491 at 498. The latter case is also authority (at 497) for the proposition that the essential comparison in an infringement suit remains one between the marks involved, and that the court is not looking to the totality of the conduct of the defendant in the same way as in a passing off suit.
This passage was approved by the Full Court in C A Henschke & Co v Rosemount Estates Pty Ltd [2000] FCA 1539; 52 IPR 42 (Ryan, Branson, Lehane JJ) at [44].
35 In Self Care, the High Court summarised the position as follows (citations omitted):
[28] The question to be asked under s 120(1) is artificial - it is an objective question based on a construct. The focus is upon the effect or impression produced on the mind of potential customers. The buyer posited by the test is notional (or hypothetical), although having characteristics of an actual group of people. The notional buyer is understood by reference to the nature and kind of customer who would be likely to buy the goods covered by the registration. However, the notional buyer is a person with no knowledge about any actual use of the registered mark, the actual business of the owner of the registered mark, the goods the owner produces, any acquired distinctiveness arising from the use of the mark prior to filing or, as will be seen, any reputation associated with the registered mark.
[29] The issue is not abstract similarity, but deceptive similarity. The marks are not to be looked at side by side. Instead, the notional buyer's imperfect recollection of the registered mark lies at the centre of the test for deceptive similarity. The test assumes that the notional buyer has an imperfect recollection of the mark as registered. The notional buyer is assumed to have seen the registered mark used in relation to the full range of goods to which the registration extends. The correct approach is to compare the impression (allowing for imperfect recollection) that the notional buyer would have of the registered mark (as notionally used on all of the goods covered by the registration), with the impression that the notional buyer would have of the alleged infringer's mark (as actually used). As has been explained by the Full Federal Court, "[t]hat degree of artificiality can be justified on the ground that it is necessary in order to provide protection to the proprietor's statutory monopoly to its full extent".
(Emphasis added.)
36 Deceptive similarity must be assessed on the basis of whether there is a real, tangible danger of deception or confusion occurring. It is enough if the notional buyer would entertain a reasonable doubt as to whether, due to the resemblance between the marks, the two products come from the same source; Southern Cross Refrigerating Company v Toowoomba Foundry Pty Ltd [1954] HCA 82; (1953) 91 CLR 592 at 595; Registrar of Trade Marks v Woolworths Ltd [1999] FCA 1020; (1999) 93 FCR 365 at [50]; Campomar Sociedad Limitada v Nike International Ltd [2000] HCA 12; (2000) 202 CLR 45 at [83]. As the High Court noted in Self Care at [32], there must be "a real likelihood that some people will wonder or be left in doubt about whether the two sets of products… come from the same source".
37 The question of intention to deceive or cause confusion is material to the present case. In this regard, the leading authority is again the decision of Dixon and McTiernan JJ in Australian Woollen Mills at 657:
The rule that if a mark or get-up for goods is adopted for the purpose of appropriating part of the trade or reputation of a rival, it should be presumed to be fitted for the purpose and therefore likely to deceive or confuse, no doubt, is as just in principle as it is wholesome in tendency. In a question how possible or prospective buyers will be impressed by a given picture, word or appearance, the instinct and judgment of traders is not to be lightly rejected, and when a dishonest trader fashions an implement or weapon for the purpose of misleading potential customers he at least provides a reliable and expert opinion on the question whether what he has done is in fact likely to deceive.
38 As this passage makes clear, the question of whether or not an infringing use was intentional is but one factor for the court to take into account in determining whether there is a reasonable probability of deception or confusion; Self Care [30]; Hashtag Burgers at [67] - [68].
39 In resolving a long-standing controversy on the subject, the High Court determined in Self Care that reputation based on actual use of the registered trade mark should not be taken into account when assessing deceptive similarity under s 120(1); Self Care at [3], [36], [46], [47], [51]. That conclusion was explained by reference to the fact that it is the registration of a mark in respect of particular goods or services that confers monopoly rights on the registered owner, and the scope of that right is not to be varied by reference to inherently uncertain notions concerning whether or not the user of the mark has developed a reputation in it, which notions were antithetical to the type of certainty that the Register was designed to nurture; Self Care [37] - [40], [48]. For that reason, the Court explained at [49] that it is impermissible to attribute to the notional buyer any familiarity with the actual use of a registered trade mark:
…The inquiry under s 120(1) is directed to avoiding deception and confusion between trade marks, and protecting the registered owner's trade mark rights in relation to the particular goods covered by the registration. It is not concerned with and does not seek to protect "the commercial value or 'selling power' of a mark"
40 However, the reasoning in Self Care has ignited a further dispute between the parties concerning what the High Court meant in the passage at [29], as emphasised above at [35], (and elsewhere) by its reference to "actual use" on the part of the alleged infringer.
41 In its supplementary submissions, Hungry Jack's contends that the High Court made it clear that deceptive similarity for the purpose of s 120(1) infringement analysis is to be assessed in the context of the respondent's actual use of the accused mark, including usage of other aspects of packaging. It disputes the submission advanced by McDonald's to the effect that particular or idiosyncratic circumstances surrounding the alleged infringer's use are not relevant. By emphasizing "actual use", Hungry Jack's submits that the High Court conveyed that idiosyncratic circumstances of a particular respondent's use are to be taken into account. Hungry Jack's submits that the Court should now consider such matters as the presence of the Hungry Jack's trade marks and livery on its restaurants. In this regard, it submits that Self Care has the effect of expanding the inquiry beyond that envisaged in earlier authority, because not only are generalised trade circumstances to be taken into account, what were previously considered to be (and Hungry Jack's accepted were, prior to the decision in Self Care) extraneous and irrelevant matters such as the presence of other trade marks used on or in relation to the goods, are now to be taken into account. It relies in this respect on the High Court's treatment of the facts in Self Care to demonstrate how the comparison should be made.
42 For the following reasons, I am unable to accept that submission.
43 In Self Care at [29], [33] it is apparent that the Court was referring to the actual use of the impugned trade mark in the sense of the use of the impugned sign alone, rather than the broader context of use. The Court was contrasting that use in fact (of the impugned mark) with the notional use of the registered mark on goods within the class of registration. That is the comparison that has long been established by the authorities. Several matters lead me to this view.
44 First, the focal point of the High Court's consideration was on the relevance of reputation within the statutory test for deceptive similarity under s 120(1). In reaching its conclusions on that subject, the Court provided a succinct review of about a century of law on the subject of deceptive similarity, addressing briefly topics that have been the subject of detailed consideration by other Courts. It would be surprising if the Court intended to overrule or change well-established principle in the manner contended without addressing it squarely and in such short form. The better view is that it did not do so.
45 Secondly, the three cases cited in support of the proposition made in [29] were Shell Oil at 415, Wingate Marketing Pty Ltd v Levi Strauss & Co [1994] FCA 163; (1994) 49 FCR 89 at 128 and MID Sydney Pty Ltd v Australian Tourism Co Ltd [1998] FCA 1616; (1998) 90 FCR 236 at 245. Examination of those cases, and the passages cited, demonstrate the context of the reference to "actual use".
46 A passage from Shell Oil (Windeyer J) at 415 is set out above. That familiar case concerned a dispute between two well-known companies that sold petrol and oils about whether Shell had infringed Esso's trade mark for a "humanized oil drop" (described as the "Esso oil-drop man") in a television commercial. The novelty of the case at the time arose because before that date (1961), moving images in a film had not been found to constitute trade mark infringement. The two short commercials displayed an animated oil drop man. Windeyer J found the man not to be substantially identical with the Esso oil drop man mark but that he was deceptively similar to it, reciting the legal test at 415 which is set out above at [33]. Significantly, in both of the impugned animations it was clear from the voiceover and the word SHELL appearing on the animated oil drop that the oil drop man was associated with Shell, not Esso. Nevertheless, the comparison of the "actual use" of the mark led Windeyer J to the conclusion that the impugned Shell oil drop man was deceptively similar to Esso's trade mark. The presence of what might be said to amount to disclaimers of any connection with Esso was not relevant.
47 It is in this context that reference to the comparison of the impression based on recollection of the registered trade mark and "the impressions that such persons would get from the defendant's television exhibitions" must be understood. Windeyer J was not, in referring to use of the impugned mark, implicitly including the application by the defendant of the word "SHELL" in connection with the animated figure. The only "actual use" was the use of the impugned mark.
48 In MID Sydney, Burchett, Sackville and Lehane JJ similarly observed at 245 that it is irrelevant that the respondent may "by means other than its use of the mark, make it clear that there is no connection between its business and that of MID", citing the established position set out in Mark Foy's v Davies Co-op Ltd [1956] HCA 41; (1956) 95 CLR 190 at 205 where Williams J (Dixon CJ agreeing) adopted the following statement of Lord Greene MR in Saville Perfumery Ltd v June Perfect Ltd (1939) 58 RPC 141 at 161:
In an infringement action, once it is found that the defendants mark is used as a trade mark, the fact that he makes it clear that the commercial origin of the goods indicated by the trade mark is some business other than that of the plaintiff avails him nothing, since infringement consists in using the mark as a trade mark, that is, as indicating origin.
49 In Wingate Marketing at 128, Gummow J addressed the comparison for the purposes of deceptive similarity, noting that it must be between the mark registered on the one hand "and the mark as used by the defendant on the other". However, this cannot be taken to refer to aspects of the defendant's use beyond the impugned mark itself. The reason for this was explained by his Honour in the passage that followed at pages 128 - 129:
(i) The comparison is between any normal use of the plaintiff's mark comprised within the registration and that which the defendant actually does in the advertisements or on the goods in respect of which there is the alleged infringement, but ignoring any matter added to the allegedly infringing trade mark; for this reason disclaimers are to be disregarded,…(ii) However, evidence of trade usage in the sense discussed above, is admissible but not so as to cut across the central importance of proposition (i)…
(Emphasis added.)
50 Thirdly, the approach taken by Hungry Jack's, in my view, is contrary to a correct reading of Self Care, where the Court said at [33] (footnotes included):
In considering the likelihood of confusion or deception, "the court is not looking to the totality of the conduct of the defendant in the same way as in a passing off suit"81. In addition to the degree of similarity between the marks, the assessment takes account of the effect of that similarity considered in relation to the alleged infringer's actual use of the mark82, as well as the circumstances of the goods, the character of the likely customers, and the market covered by the monopoly attached to the registered trade mark83. Consideration of the context of those surrounding circumstances does not "open the door" for examination of the actual use of the registered mark, or, as will be explained, any consideration of the reputation associated with the mark84.
(Italics in original. Emboldening added.)
51 The reference in the second sentence to "actual use of the mark" is again a limited reference to the impugned mark itself, not surrounding marks or disclaimers. This is apparent from the first sentence which in footnote 81 refers to the passage in New South Wales Dairy Corporation v Murray Goulburn Co-operative Company Ltd [1989] FCA 124; (1989) 86 ALR 549 at 589, which I have set out above at [34]. It is clear that the Court is here reciting long-established authority that the whole of the conduct of the respondent is not taken into account when considering deceptive similarity. Footnote 82 repeats the citations identified in [29] which I have reviewed in relation to the second point above. It is plain that the High Court continues to focus on the "actual use" only of the respondent's mark, not on the actual surrounding circumstances, which may include disclaimers or other marks. The relevant "surrounding circumstances" are confined to consideration of the way in which goods of the relevant kind are typically bought and sold.
52 Fourthly, Hungry Jack's relies on passages in the High Court's reasoning where it applies the facts. In that case the relevant question was whether PROTOX was deceptively similar to the registered trade mark BOTOX.
53 The Court said:
[69] Allergan was correct to submit that, as the Full Court accepted, there are visual and aural similarities between the two marks. The word PROTOX uses two short consonants, "p" and "r", to make the syllable "pro", which is visually and aurally similar to "bo"; both "pro" and "bo" are "sounded through the lips together"; and the word "otox" is "distinctive and identical" between PROTOX and BOTOX and is an "identical rhyme". But, as the Full Court correctly said, "[c]onsumers would not have confused PROTOX for BOTOX". The words are sufficiently different that the notional buyer, allowing for an imperfect recollection of BOTOX, would not confuse the marks or the products they denote. The visual and aural similarities were just one part of the inquiry.
[70] The question, then, was whether these similarities "imply an association" so that the notional buyer would be caused to wonder whether it might not be the case that the products come from the same source. The alleged deceptiveness was said to flow not only from the degree of similarity itself, but also from its effect considered in relation to the circumstances of the goods and the prospective purchaser and the market covered by the monopoly - anti-wrinkle creams in class 3. It is to be assumed that the products would be sold in similar trade outlets, including pharmacies, as well as through websites. The notional buyer has a recollection of the BOTOX mark being used on anti-wrinkle creams in class 3 in that context. The notional buyer sees the PROTOX mark used on a similar product - a serum which is advertised on its packaging and website to "prolong the look of Botox®". While the reputation of BOTOX cannot be considered, the relevant context includes the circumstances of the actual use of PROTOX by Self Care. "[P]rolong the look of Botox®" may suggest that Protox is a complementary product. However, as was observed by the primary judge, "it will be the common experience of consumers that one trader's product can be used to enhance another trader's product without there being any suggestion of affiliation".136 In this case, the back of the packaging stated in small font that "Botox is a registered trademark of Allergan Inc" and, although the assumption is that Botox is an anti-wrinkle cream, the website stated that "PROTOX has no association with any anti-wrinkle injection brand".
[71] Applying the applicable principles,137 there is no real risk of confusion or deception such that the notional buyer will be caused to wonder whether it might be that the products come from the same source. What is required is a "real, tangible danger" of confusion or deception occurring.138 As explained, the marks are sufficiently distinctive such that there is no real danger that the notional buyer would confuse the marks or products. The similarities between the marks, considered in the circumstances, are not such that the notional buyer nevertheless is likely to wonder whether the products come from the same trade source. That conclusion is reinforced by the fact that the PROTOX mark was "almost always used in proximity to the FREEZEFRAME mark" and that there was "no evidence of actual confusion".
54 Hungry Jacks relies on these paragraphs to support the contention that Self Care should be read to endorse the concept that in considering deceptive similarity under s 120(1) it is relevant to take into account disclaimers and other features of the packaging of the defendant's use. I do not consider that, taken in the context of the whole of the judgment, this is the correct conclusion.
55 The analysis at [69] is consistent with the statements of principle to which the Court earlier referred and adopted, the Court noting that the correct approach was to consider the notional use of BOTOX against the actual use of the PROTOX mark. Paragraph [70] includes parts that might suggest that the Court took into account factors that went beyond a comparison of the marks and had regard to extraneous features of the packaging. However, [71] commences with the statement that the Court is applying the "applicable principles", cross-referencing (as footnote 137 identifies) to [26] - [33] which endorse the long-established principles identified above. In those circumstances, it appears to me that the relevant reasoning on the facts is to be found in third and fourth sentences of [71] as follows:
…As explained, the marks are sufficiently distinctive such that there is no real danger that the notional buyer would confuse the marks or products. The similarities between the marks, considered in the circumstances, are not such that the notional buyer nevertheless is likely to wonder whether the products come from the same trade source….
56 That conclusion picks up the comparison of the marks identified in [69]. Having reached that conclusion, the statement that the conclusion is "reinforced" by the proximity of the impugned use to the FREEZEFRAME mark may be regarded as obiter dicta, the legal conclusion having already been provided to the effect that regardless of the presence of the FREEZEFRAME mark, the impugned mark was not deceptively similar to BOTOX. To take a different view would render significant parts of the earlier reasoning in Self Care otiose in circumstances where it is apparent that no argument before the High Court involved the contention that any of the prior cases referring to the subject were incorrectly decided, and the High Court expressly adopted those authorities.
57 To the extent that passages in [70] might be taken to indicate a broader view of context as part of the ratio decidendi, the aspects of packaging on the Self Care product that were emphasised in that paragraph are concerned with the proximity of the impugned PROTOX mark to the registered BOTOX® mark. That is not the situation in the present case, which may be distinguished from the conclusions reached in Self Care for that reason.
58 Accordingly, I do not consider that the decision of the High Court in Self Care leads to the conclusion for which Hungry Jack's contends.
59 I note that in The Agency Group Australia Limited v H.A.S. Real Estate Pty Ltd [2023] FCA 482, Jackman J addressed the interpretation of Self Care. For the reasons set out above, I respectfully agree with his Honour's observations at [56] - [59].