FEDERAL COURT OF AUSTRALIA
Phone Directories Company Australia Pty Ltd v Telstra Corporation Limited [2014] FCA 373
FEDERAL COURT OF AUSTRALIA
Phone Directories Company Australia Pty Ltd v Telstra Corporation Limited [2014] FCA 373
CORRIGENDUM
1. In paragraph 3(b) the words “12 May 2011” should be replaced with the words “19 April 2011”.
2. In paragraph 9 after the word “that” the word “is” should be deleted.
3. In paragraph 21 the word “on” should be replaced with the word “of”.
4. In paragraph 183 before the words “categories of goods” the word “are” should be inserted.
5. In paragraph 353 after the words “the evidence shows Telstra” the word “application” should be deleted.
6. In paragraph 376 after the words “evidence of its in-house” the word “lawyers” should be replaced with the word “lawyer”.
7. In paragraph 418 the last word “it” should be replaced with the word “them”.
| I certify that the preceding seven (7) numbered paragraphs are a true copy of the Corrigendum to the Reasons for Judgment herein of the Honourable Justice Murphy. |
Associate:
Dated: 24 April 2014
| VICTORIA DISTRICT REGISTRY | |
| GENERAL DIVISION | VID 373 of 2011 |
| BETWEEN: | PHONE DIRECTORIES COMPANY AUSTRALIA PTY LTD Applicant |
| AND: | TELSTRA CORPORATION LIMITED Respondent |
| IN THE FEDERAL COURT OF AUSTRALIA | |
| queensland DISTRICT REGISTRY | |
| GENERAL DIVISION | QUD 220 of 2010 |
| BETWEEN: | YELLOWBOOK.COM.AU PTY LTD First Applicant |
| EMMANUEL KHOURY Second Applicant | |
| AND: | TELSTRA CORPORATION LIMITED Respondent |
| JUDGE: | MURPHY J |
| DATE: | 11 APRIL 2014 |
| PLACE: | MELBOURNE |
REASONS FOR JUDGMENT
introduction
1 Before the Court are two appeals against decisions of delegates of the Registrar of Trade Marks, made in relation to two separate trade mark applications.
2 In the first application, Telstra Corporation Limited (“Telstra”) applied on 25 July 2003 to register the word “yellow” as a trade mark (“the YELLOW Trade Mark”) in respect of broad classes of goods and services which include print and online telephone directories and related goods and services. In the second, Yellowbook.com.au Pty Ltd (“Yellowbook”) applied on 1 October 2006 to register the trade mark “Yellowbook.com.au” (“the YELLOWBOOK Trade Mark”) in respect of an online business directory and related goods and services.
3 Telstra’s application for the YELLOW Trade Mark was opposed in two separate proceedings before delegates of the Registrar of Trade Marks (“the Delegate(s)”), namely by:
(a) Emmanuel Khoury, the Managing Director of Yellowbook. On 21 May 2010 Delegate Kirov rejected this opposition proceeding: Khoury v Telstra Corporation [2010] ATMO 36 (“Khoury v Telstra”) at [1] to [68]; and
(b) Phone Directories Company Australia Pty Ltd (“PDCA”). On 19 April 2011 Delegate Williams rejected this opposition proceeding: Phone Directories Company Australia Pty Ltd v Telstra Corporation Limited (2011) 93 IPR 513 (“PDCA v Telstra”).
The Delegates separately ordered that the YELLOW Trade Mark proceed to registration.
4 The applicants commenced separate appeals to this Court opposing registration of the YELLOW Trade Mark, namely:
(a) proceeding QUD 220 of 2010 in which Yellowbook and Mr Khoury (collectively “Yellowbook”) appeal Delegate Kirov’s decision in Khoury v Telstra.
(b) proceeding VID 373 of 2011 in which PDCA appeals Delegate Williams’ decision in PDCA v Telstra.
Telstra is the respondent in both appeals. I describe these two appeals as the “YELLOW Appeals” and I deal with them together.
5 Yellowbook’s application for the YELLOWBOOK Trade Mark was opposed by Telstra in a proceeding before the Registrar. Telstra’s opposition was successful and Delegate Kirov refused registration of the mark: Khoury v Telstra at [69] to [84].
6 In proceeding QUD 220 of 2010 Yellowbook also appeals against the Delegate’s decision to refuse registration of the YELLOWBOOK mark. I describe this as the Yellowbook Appeal.
7 Through its predecessors, by itself and through its wholly owned subsidiary Sensis Pty Ltd (“Sensis”) (collectively “Telstra”), Telstra has been producing telephone directories since 1906. It had a statutory monopoly on telephone communications in Australia until the early 1990s, and it had a marked advantage over any competitors in relation to telephone directories as it held the information necessary to produce them.
8 Telstra switched from using pink coloured paper to using yellow coloured paper in its print business directories in 1975, and from that date it has branded its directories “Yellow Pages”. Over the years since then it has had a strong yellow-related theme in its branding including yellow coloured pages and yellow covers on its print business directories and yellow branding on its online directory website. In 1977 it registered the composite YELLOW PAGES trade mark associated with the Walking Fingers device, and in 1990 the words YELLOW PAGES. Since 1977 it has registered numerous YELLOW PAGES trade marks (collectively “YELLOW PAGES Trade Marks”) together with a number of others which have the word yellow as one of the elements.
9 As I later explain, business directories around the world are often named Yellow Pages, and yellow coloured pages and yellow covers are commonly used on print business directories. The evidence is that in moving to Yellow Pages as a name and in adopting the colour yellow Telstra was following an international trend.
10 It appears that Telstra had no real competition in respect of the production and distribution of telephone directories until about 1987 when the BIG Directory commenced in Melbourne, and then capital cities and regional centres around Australia until it ceased in 2002. Since 1993 Telstra has also been in competition with PDCA which produces and distributes print business directories for regional markets in Queensland, Northern Territory and New South Wales, and operates an online directory covering the same areas. It did not (and because of Telstra’s trade marks could not) name its directories YELLOW PAGES but over the years it too had yellow coloured pages and yellow covers on its print business directories, yellow branding on its online directory, and yellow corporate branding. Other business directories around Australia have done the same. One directory was named YELLOW DIRECTORIES for about three years until made to cease by Telstra. Yellowbook has operated a small online directory at www.yellowbook.com.au since 2006, and applied to register yellowbook.com.au as a trade mark.
11 On 25 July 2003 (“the Lodgement Date”) Telstra applied to register the word YELLOW as a trade mark. By this date Telstra owned and had traded extensively under various YELLOW PAGES Trade Marks, and it had conducted extensive marketing campaigns around YELLOW PAGES and other trade marks including HELLO YELLOW.
12 Although following its lodgement of the yellow application Telstra initially did nothing with that mark, it registered and used other trade marks including FIND IT IN YELLOW, YELLOW with a Walking Fingers device, YELLOW 12456 with a Walking Fingers device, WELCOME TO THE WORLD OF YELLOW, and YELLOW WORLD. In February 2006 Telstra also applied to register the colour yellow as a trade mark.
13 Following lengthy deliberation, in May 2006 Telstra decided to refresh its brand by making YELLOW rather than YELLOW PAGES the overarching or “umbrella” trade mark of its designated goods and services. From September 2006 it conducted an extensive $20 million campaign to rebrand its print and online business directories as YELLOW, and it used the YELLOW Trade Mark as its principal brand for about the next three years. But Telstra then abandoned the YELLOW mark as its principal brand in 2009 and returned to using YELLOW PAGES.
The YELLOW Appeals
14 The YELLOW Appeals raise various questions under the Trade Marks Act 1995 (Cth) (“the Act”) which I set out below. I broadly summarise my decision as follows.
Section 41 – capacity to distinguish.
15 Under s 41 the following questions arise:
(a) Is the YELLOW Trade Mark inherently adapted to distinguish Telstra’s designated goods and services to any, and if so what, extent under section 41(3)? To what extent is the evidence of use of the colour and word yellow by persons in Australia and overseas (other than Telstra) relevant to determining this and the motives of other traders?
(b) If the YELLOW Trade Mark has no inherent capacity to distinguish, did it in fact distinguish the designated goods and services as at the Lodgement Date under section 41(6)?
(c) If the YELLOW Trade Mark has some inherent capacity to distinguish does or will it distinguish the designated goods and services as at the Lodgement Date under section 41(5)?
16 I consider that the applicants made out their opposition to the registration of the YELLOW Trade Mark under s 41 of the Act. In my view the YELLOW mark has no inherent adaptability to distinguish Telstra’s designated goods and services from the goods or services of other persons under s 41(3) of the Act. The word yellow is inherently descriptive of that colour, which is a colour commonly used in print and online business directories in Australia and overseas. In my view other traders are likely, without improper motive to, want to use the word yellow in a manner which would infringe the YELLOW Trade Mark if registered.
17 The onus therefore falls on Telstra under s 41(6) of the Act to establish that the extent of its use of the YELLOW Trade Mark prior to the Lodgement Date means that the mark in fact distinguished its goods and services. In my view Telstra’s evidence fell short of establishing any use of the YELLOW mark before the Lodgement Date and its application therefore fails.
18 This is not to say that Telstra did not use the word yellow pre-Lodgement Date as it plainly did. But in my view it did not use the word as a trade mark. If, contrary to my view, it is accepted that Telstra did use the word yellow as a trade mark, its use was light and insufficient to in fact distinguish Telstra’s designated goods and services. Accordingly, I refuse registration of the YELLOW Trade Mark.
19 While it is strictly unnecessary to decide, if contrary to my finding, the YELLOW Trade Mark is accepted as being to some extent inherently adapted to distinguish Telstra’s designated goods and services, then the onus falls on Telstra under s 41(5) of the Act. Under this provision Telstra must establish that the combined effect of:
(a) the extent of the mark’s inherent adaptability to distinguish;
(b) the use or intended use of the mark; and
(c) any other circumstances;
means that the mark does or will distinguish its designated goods and services.
20 In my view Telstra failed to establish this. Taking Telstra’s case at its highest, the extent of the YELLOW mark’s inherent adaptability to distinguish must be low and its pre-Lodgement Date use of the mark was light. It used the YELLOW mark extensively post-Lodgement Date but this cannot be determinative. Telstra failed to establish that the combined effect of the matters under s 41(5) is such that the YELLOW Trade Mark does or will distinguish the designated goods and services. The lack of the mark’s capacity to distinguish is partly demonstrated by Telstra’s 2009 abandonment of its attempt to rebrand its goods and services as YELLOW, and its return to YELLOW PAGES as the umbrella brand. If it was necessary to decide the question I would refuse registration under s 41(5) of the Act.
Section 44 – Substantially identical and deceptively similar marks.
21 Should the registration of the YELLOW Trade Mark be refused under section 44 of the Act on the basis that the mark is deceptively similar to the THE YELLOW ENVELOPE, YELLOW DUCK, YELLOW ZONE, and YELLOW DOOR trade marks filed prior to the Lodgement Date in the specified classes?
22 It is strictly unnecessary to decide the opposition under s 44, but the applicants made out their opposition on the basis that the YELLOW Trade Mark is deceptively similar to four applications with earlier priority dates, namely THE YELLOW ENVELOPE, YELLOW DUCK, YELLOW ZONE, and YELLOW DOOR, in respect of directories and related goods and services.
Section 59 - no intention to use.
23 Should the registration of the YELLOW Trade Mark be refused under section 59 of the Act on the basis that, as at the Lodgement Date, Telstra did not intend to use or authorise the use of the mark?
24 It makes no difference to the result overall, but PDCA failed to establish its opposition to registration of the YELLOW Trade Mark under s 59. There is sufficient evidence of Telstra’s intention as at the Lodgement Date to use the mark.
The YELLOWBOOK Appeal
25 Telstra opposes registration of the YELLOWBOOK Trade Mark on the basis that it may deceive or cause confusion having regard to its YELLOW PAGES trade marks.
26 This appeal raises questions as to whether the mark should be refused registration:
(a) under s 43 of the Act on the basis that it would be likely to deceive or cause confusion;
(b) under s 44 of the Act on the basis that it is deceptively similar to the YELLOW PAGES trade marks in respect of similar services; and
(c) under s 60 of the Act on the basis that it is deceptively similar to the YELLOW PAGES trade marks, and covers the same goods and services as those in respect of which YELLOW PAGES has acquired a reputation in Australia, and is therefore likely to deceive or cause confusion.
27 In my view Telstra made out its opposition to registration of the YELLOWBOOK Trade Mark under each of ss 43, 44 and 60 of the Act. I consider that the mark is deceptively similar to the YELLOW PAGES trade marks and its registration is likely to deceive consumers or cause them confusion. Accordingly, I dismiss the appeal.
The nature of the appeals
Hearing de novo
28 It is uncontroversial that in hearing an appeal pursuant to s 56 of the Act, the Court exercises its original jurisdiction and conducts the hearing de novo. The Court must come to its own view on the merits and is not bound by any finding of fact or law made by the delegate of the Registrar. Even so, weight should be given to the delegate’s opinion as that of a “skilled and experienced person” and when a judgment is to be made “there is room for a degree of deference to the evaluative judgement made by the Registrar”: Eclipse Sleep Products Inc v Registrar of Trade Marks (1957) 99 CLR 300 (“Eclipse”) at 308 per Dixon CJ, Williams and Kitto JJ; Registrar of Trade Marks v Woolworths Ltd (1999) 93 FCR 365 (“Woolworths”) at [33] per French J.
29 The rights of the parties are to be determined as at the Lodgement Date: Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 (“Southern Cross”) at 595 per Kitto J. In the YELLOW application it is 25 July 2003 and in the YELLOWBOOK application it is 1 October 2006.
Onus and standard of proof
30 There is a general presumption of registrability in favour of the applicant: Sports Warehouse Inc v Fry Consulting Pty Ltd (2010) 186 FCR 519 (“Sports Warehouse”) at [26] to [27] and the authorities cited therein.
31 The onus of proof in an opposition hearing before a delegate of the Registrar and on appeal to the Court rests upon the opponent to registration: Food Channel Network Pty Ltd v Television Food Network GP (2010) 185 FCR 9 (“Food Channel”) at [32] per Keane CJ, Stone and Jagot JJ.
32 Accordingly, in the YELLOW Appeals as the opponents to registration, PDCA and Yellowbook must prove the grounds of opposition they rely upon. But where the enquiry proceeds to s 41(6) of the Act (as I have found) or s 41(5), then the onus shifts to Telstra as the applicant for the mark to persuade the Court of its entitlement to registration.
33 Under s 59 of the Act PDCA bears the onus of making out a prima facie lack of intention to use the mark, if it does so the onus then shifts to Telstra to establish its intention and persuade the Court of its entitlement to registration.
34 In the Yellowbook Appeal, as the opponent to registration Telstra has the onus.
35 There is a division of judicial opinion as to the relevant standard of proof. It has been suggested in some cases that rather than the ordinary civil standard of balance of probabilities applying, there is a special standard that requires an opponent to registration of a trade mark to show that the trade mark is “clearly” not to be registered. The division has not yet been resolved at the appellate level: Food Channel at [31] to [32]; Sports Warehouse at [26] to [39] and the authorities cited therein.
36 It is unnecessary to descend into the differing views to explain my conclusion on this issue as that terrain is already well trodden. For the reasons stated in Pfizer Products Inc v Karam (2006) 237 ALR 787 (“Pfizer Products”) at [18] per Gyles J, Chocolaterie Guylian NV v Registrar of Trade Marks (2009) 180 FCR 60 (“Chocolaterie Guylian”) at [26] per Sundberg J, Sports Warehouse at [39] per Kenny J, and Allergan, Inc v Di Giacomo [2011] FCA 1540 at [11] to [12] per Stone J, I respectfully prefer the view that the Act does not impose a requirement on an opponent to a trade mark to show that it is “clearly” not to be registered. The onus is to be discharged to the ordinary civil standard.
37 In any event, the division in judicial opinion is of no significance in the present case. Firstly, the division of opinion relates to the standard of proof to be met by an opponent to registration of a trade mark. In the YELLOW Appeals my decision to refuse registration turns on s 41(6) of the Act, or alternatively s 41(5), both of which place the onus on the applicant for registration. I agree with Kenny J in Sports Warehouse at [40] where her Honour said:
In any case…there can be no place for any special standard in respect of s 41(5) or s 41(6), because these provisions place the onus on the applicant for registration, Sports Warehouse, rather than on the opponent. That is…these provisions require the applicant for registration to “satisfy” the Registrar (s 41(5)), or “establish” (s 41(6)), that the relevant criteria are met: compare Chocolaterie Guylian 180 FCR 60 at [21]. As Branson J said in Blount 83 FCR at 56, referring to Rejfek v McElroy (1965) 112 CLR 517 at 521:
Where the Act requires the Registrar to be “satisfied” of any matter, it is to be understood as requiring that he or she be persuaded of the matter according to the balance of probabilities… That is, that the Registrar be persuaded, having given proper consideration to those factors and circumstances that the Act requires him or her to give consideration to, that such matter is more probable than not.
Under s 41(5), the Registrar must be persuaded by the applicant on the balance of probabilities that the trade mark does or will distinguish, having regard to the considerations in s 41(5)(a). The standard is the same under s 41(6), where the applicant must establish on the balance of probabilities that the mark does distinguish “because of the extent to which the applicant has used the trade mark before the filing date”.
38 Secondly, the opposition to the YELLOW Trade Mark under s 59 fails to satisfy even the ordinary balance of probabilities test.
39 Thirdly:
(a) the applicant’s opposition to the YELLOW Trade Mark under s 44; and
(b) Telstra’s grounds of opposition to registration of the YELLOWBOOK Trade Mark under ss 43, 44 and 60;
are made out even if the higher standard applies. That is, both marks are “clearly” likely to deceive or confuse consumers.
The facts
40 I thank the parties for their cooperative approach to the Agreed Issues for determination and the Agreed List of Use of Yellow by Third Parties, and for the quality of their submissions. These have all been of real assistance and I have directly drawn upon them at a number of points in these reasons.
The parties
41 PDCA was incorporated on 14 April 1993 and carries on the business of publishing, selling advertising space in, marketing and promoting print and online telephone directories. Its distribution of printed directories commenced in 1993 in the Northern Territory, then expanded into Queensland, and in 2004 into regional New South Wales. It operates an online directory covering the same geographical areas at www.localdirectories.com.au.
42 Yellowbook was incorporated on 29 September 2006 and operates online directories at www.yellowbook.com.au and www.yellowbook.net.au. Mr Khoury is the Managing Director of Yellowbook and he also operates online directories at www.yellowdirectory.com.au, www.yellowcoupons.com.au, and www.ozaussie.com.au.
43 Telstra has produced directories across Australia since 1906. It compiles, produces and distributes print business directories throughout Australia under the Yellow Pages Trade Marks, and it operates an online business directory at www.yellowpages.com.au carrying the YELLOW PAGES brand.
The witnesses
44 The evidence largely goes to the use of the colour and word yellow as trade indicia by Telstra and other traders before and after the Lodgement Date, and includes voluminous folders providing examples of such use. In setting out the facts I have sought to summarise the voluminous evidence, which will inevitably mean some loss of nuance. I have though sought to capture the salient facts.
45 The witnesses for PDCA and Yellowbook are:
(a) Geoffrey Moule, former credit manager Business Marketing Australia Pty Ltd (“BMA”) as to its publication of the print BIG Directory in capital cities and regional centres from 1987 until 2002;
(b) Catherine Rose McGarry, General Manager of Local Directories Pty Ltd (a related company of PDCA), as to the PDCA group’s publication of print and online directories for various parts of Northern Territory, Queensland and New South Wales from 1994 to the present. Her evidence also goes to the use of the colour and word yellow in Australia and overseas in respect of directories;
(c) Dale Kerferd, Managing Director of Sound International Pty Ltd (trading as RMK Directories), as to its publication of print and online directories, covering the communities of Rockingham, Kwinana and Mandurah, Western Australia from 1985 to the present;
(d) Darren Andrew Lee, Managing Director of Market Creations Pty Ltd, as to its publication of regional and community directories in various regions in Western Australia from 1997 to the present;
(e) Thomas James Greene, Chairman of Horizon Media Pty Ltd (“Horizon”), as to its distribution of a direct mail advertising package named The Yellow Envelope throughout Australia from 1997 to the present;
(f) Robert George Coles, in relation to his online business directory at www.yellowduck.com.au (“YELLOW DUCK”) until 2011;
(g) Lisa Maree Egan and Caroline Anemieke Cossio, solicitors for PDCA, as to various relevant trade marks which pre-date the YELLOW application, and as to the registration date of various relevant domain names; and
(h) Mr Khoury, Managing Director of Yellowbook as to the online directories published by his company since September 2006, and the use of the colour and word yellow in Australia and overseas in respect of directories.
46 Telstra’s evidence largely goes to its use of the yellow Trade Mark pre and post-Lodgement Date. Its witnesses are its employees, namely:
(a) Nadine Maree Courmadias, an in-house lawyer at Sensis, as to the use of the YELLOW Trade Mark and as to Telstra’s defence of its intellectual property rights;
(b) Michelle Kay Sherwood, Executive General Manager – Strategic Marketing, at Sensis, as to the evolution of Telstra’s trade marks and its use of the YELLOW mark;
(c) Stephen Thomas Harvy, Group Manager of Distribution, at Sensis, as to the evolution of Telstra’s trade marks, its use of the YELLOW mark, and marketing campaigns in support of its trade marks;
(d) Lucinda Kate Sedgwick, an in-house lawyer at Sensis, in relation to Telstra’s opposition to YELLOW DUCK, its exclusive rights to the word yellow, and its intention to use the YELLOW Trade Mark.
47 I note at this point that some of Telstra’s evidence was adduced with a request that it be treated by the Court as confidential, particularly its evidence relating to advertising expenditure. While I respect Telstra’s desire for commercial privacy I have not always treated its evidence as confidential. It has sometimes been necessary to set it out.
48 The evidence in each YELLOW Appeal is evidence in the other YELLOW Appeal. Much of the evidence of the use of the colour and word yellow by Telstra and other traders was not contested.
49 My view of the evidence is as I now set out. Much of it is not in contest.
Telstra’s pre-Lodgement Date use of the word yellow
50 In 1975 Telstra stopped using pink coloured paper in its printed telephone business directories, which up to that point had been named the “Pink Pages”. It began publishing its classified telephone directories on yellow paper and renamed its directories the YELLOW PAGES. In 1977 Telstra registered a composite trade mark featuring its Walking Fingers logo and the words YELLOW PAGES, as follows.
51 It registered YELLOW PAGES Trade Marks over the period from 1977 to the Lodgement Date which are as follows.
| Trade Mark No. | Mark | Status |
| 304264 |
| Registered from 1977 |
| 387413 |
| Registered from 1983 |
| 478792 |
| Registered from 1987 |
| 478793 |
| Registered from 1987 |
| 478794 |
| Registered from 1987 |
| 507905 | TALKING YELLOW PAGES | Registered from 1989 |
| 507906 | TALKING YELLOW PAGES | Registered from 1989 |
| 507907 | TALKING YELLOW PAGES | Registered from 1989 |
| 545667 | YELLOW PAGES | Registered from 1990 |
| 545668 | YELLOW PAGES | Registered from 1990 |
| 545669 | YELLOW PAGES | Registered from 1990 |
| 558728 |
| Registered from 1991 |
| 558729 |
| Registered from 1991 |
| 558730 |
| Registered from 1991 |
| 705463 |
| Registered from 1996 |
| 704079 | YELLOW PAGES | Registered from 1996 |
| 710697 |
| Registered from 1996 |
| 820729 |
| Registered from 2000 |
| 820731 |
| Registered from 2000 |
52 Telstra’s directories were initially only produced for capital cities, then in 1986 they were extended to regional areas, and in 1994 to local areas within major capital cities.
53 The evidence is that from 1975 to 1996 Telstra distributed approximately 231 million YELLOW PAGES directories to Australian businesses and households and it spent more than $200 million in the same period promoting the YELLOW PAGES brand. These marketing campaigns were very successful. In 2003 the Superbrands Council, an independent body of marketing, communications and business experts, described the YELLOW PAGES as “one of Australia’s most loved and memorable brands”. I accept this.
The Hello Yellow campaign
54 In the early 1980s, Telstra began using the slogan “Hello Yellow” in an extensive marketing campaign for its YELLOW PAGES directories. It screened over 450 commercials on Australian television between November 1982 and June 1983 and it ran over 1200 30 second radio advertisements in Sydney alone from 1982 to 1984. It mailed out about 100,000 letters and brochures to Australian businesses and consumers which featured the appearance of a YELLOW PAGES print directory and a YELLOW PAGES Trade Mark. The brochures made it clear that the campaign was aimed at increasing usage of the Yellow pages print directory.
55 Mr Harvy gives evidence that the HELLO YELLOW advertisements “referred to yellow on its own”. Five television advertisements are in evidence.
56 By way of example, one of the television advertisements depicts a scene where preparations are being made for a wedding. Interspersed with footage of a wedding celebration is footage of a person thumbing the YELLOW PAGES print directory to arrange a wedding cake, balloons and musicians. The advertisement concludes with a still picture of a YELLOW PAGES directory and a telephone, accompanied by the words “Telcom Yellow Pages” and the following trade mark.
57 The advertisement features a jingle which, although indistinct, appears to have the following lyrics:
Hello Yellow, it’s for you. Let your fingers do the walking, help you do the things you do.
Hello Yellow, make more time on your own with a Hello YELLOW PAGES and a hello on the phone.
Hello Yellow, save your cash.
Hello Yellow, find it fast.
There’s nothing you can’t find.
Hello Yellow, with a Hello YELLOW PAGES every time.
Hello Yellow.
58 Another of the advertisements depicts two women thumbing the YELLOW PAGES directory and reaching for the telephone. It then shows footage of a young man sitting in a chair that breaks and a young woman sitting on a bicycle that loses its rear wheel. One of the women then uses the YELLOW PAGES to order a lounge suite which is delivered to her house. The advertisement concludes with a series of short clips depicting an antique dealer and a fabric salesman, before again cutting to a still picture of the YELLOW PAGES directory and the same Walking Fingers device trade mark as in the other advertisement.
59 It is accompanied by a jingle which, although again indistinct, appears to have the following lyrics:
If it’s not the YELLOW PAGES, it’s somehow not all there.
Like a kiss without a squeeze or a crumbling, buckling chair.
If it’s not the YELLOW PAGES, it’s really not complete.
Say “Hello YELLOW PAGES, call me when you need.”
Feel fine. Hello Yellow. Save your time.
Hello Yellow. Lounge suite.
Hello Yellow. Save your feet.
Hello Yellow. Cut. Around the corner.
Hello Yellow. Across the town.
Hello Yellow. Australia’s only buying guide you need to have around.
60 Having reviewed each of these commercials, contrary to Mr Harvy’s evidence I am satisfied that they do not use the word yellow standing alone. The word yellow is only used in the jingle as part of the phrases “Hello Yellow” or “Hello YELLOW PAGES”. This illustrates that yellow is merely a shorthand reference to YELLOW PAGES. Mr Harvy conceded that the reference to yellow in the trade mark HELLO YELLOW is “clearly and obviously a reference to the YELLOW PAGES directories.”
61 Mr Harvy gives evidence of other television advertisements in the HELLO YELLOW campaign, including advertisements named “Yellowmania”, “Goggomobil”, “Train Set”, “Lamp”, and “Leak”. Having also reviewed these advertisements I am satisfied that they too do not use the word yellow standing alone, using it only as part of the phrase HELLO YELLOW.
62 By way of example, the “Goggomobil” advertisement depicts a man working on his Goggomobil car and then phoning a mechanic to assist him. He has a thick accent and has difficulty communicating the make and model of the car to the mechanic, eventually spelling out the word “Goggomobil”. The scene then cuts to a still picture of the YELLOW PAGES composite trade mark with the Walking Fingers logo. I consider that this advertisement and the others in the HELLO YELLOW campaign refer to the YELLOW PAGES Trade Marks rather than to YELLOW as a badge of origin.
63 The evidence shows that the print advertising in the HELLO YELLOW campaign also featured a YELLOW PAGES composite mark including the Walking Fingers logo.
64 Following the use of this slogan in the HELLO YELLOW campaign, Telstra registered HELLO YELLOW as a trade mark in 1990.
65 By this time Telstra was facing competition in the market for directories. The BIG Directory published by BMA commenced in Melbourne in 1987 and from 1991 rapidly expanded to other capital cities and regional areas throughout Australia. In 1993 PDCA launched its first directory and then also rapidly expanded through Northern Territory, Queensland and into New South Wales.
The Hello Yellow operator assisted directory service
66 In 1993 to 1994 Telstra launched an operator assisted directory service named HELLO YELLOW, which allowed consumers to obtain information about businesses advertising in the YELLOW PAGES directories and to be connected directly through to the chosen business. The operator would welcome customers who telephoned the service with the words “Hello Yellow, how can I help you?”
67 Importantly, the operator assisted directory service changed its name to YELLOW PAGES Direct from 1997 and to YELLOW PAGES Connect from 2001 to 2002. I infer that the HELLO YELLOW operator assisted directory service only ran for three or four years and the use of “Hello Yellow” in the greeting by the operator ceased with the change of name in 1997.
The practice of referring to the online directory business as Yellow
68 Ms Sherwood joined Telstra in 2002. Her evidence is that when she joined Telstra the print directory and online directory businesses were separate. It was commonplace for employees in the online directory marketing and sales teams to refer to the online business as “Yellow” and she did so herself. Although the internet address of the online directory was www.yellowpages.com.au, Ms Sherwood says, and I accept, that it was common practice for employees in the online business to introduce themselves as being from “Yellow” when calling customers and potential customers.
Continued use of YELLOW PAGES Trade Marks on print and online directories
69 Telstra established an online directory under the YELLOW PAGES Trade Marks in 1994, at the domain name www.yellowpages.com.au. The evidence shows that Telstra operated an online directory at this internet address under the YELLOW PAGES brand for 19 years from 1994 to the Lodgement Date.
70 From 1994 to the Lodgement Date Telstra distributed between about 11 and 14 million YELLOW PAGES directories per year to Australian businesses and households.
Discussions to refresh the YELLOW PAGES brand
71 Mr Harvy and Ms Sherwood were involved in discussions to refresh Telstra’s YELLOW PAGES brand in the early 2000s, noting that Ms Sherwood did not commence with Telstra until 2002. The thrust of their evidence is that refreshment of the brand was necessary for Telstra to transfer its considerable reputation in printed directories to its online directories, and to ensure that Telstra’s online products were seen as synonymous with its more well-known printed directories. I accept this.
72 As well as its YELLOW PAGES Trade Marks, by the Lodgement Date Telstra had registered further trade marks which used the word yellow as an element, namely:
| Trade Mark No. | Mark | Status | |
| 545658, 545659, 545660 | HELLO YELLOW | Registered from 1990 | |
| 545664, 545665, 545666 | YELLOWMANIA | Registered from 1990 | |
| 710701 | HELLO YELLOW | Registered from 1996 | |
| 796436 |
| Registered from 1999 | |
The application for the registration of the YELLOW Trade Mark
73 On 25 July 2003 Telstra applied to register the YELLOW Trade Mark in Application No. 963492 in relation to the goods in classes 9 and 16 and the services in classes 35, 38, 41 and 42, as set out in the table below.
| Class 9 | Computer software including computer programs; publications in electronic form including publications supplied online from database or from facilities provided on the Internet (including web sites) |
| Class 16 | Telephone books; telephone directories; and business directories |
| Class 35 | Retail and wholesale services including retail and wholesale services in relation to directories, publications, printed matter, telecommunications equipment, computer hardware and software, recording discs and CD ROMs; marketing, merchandising, retail and wholesale distribution services (excluding transport); directory services; business advisory services; business planning and analysis services; business management and business administration services; business surveys, appraisals and research; collection, preparation, compilation, storage, processing, retrieval and provision of business information; conduct of business studies and preparation of business reports; economic forecasting and analysis for business purposes; market analysis, research and monitoring services for business purposes; advertising services; advertising survey services, including telephonic and electronic surveys; electronic commerce services; business information services; agency services in respect of such directories and business supplements; advertising services promoting the services and goods of advertisers in such directories and business supplements in any medium; co-operative advertising with those who advertise in telephone and telephone directory business supplements; online business information services relating to e-commerce |
| Class 38 | Telecommunication and communication services including telecommunication of information (including web pages), computer programs and any other data; directory services including provision of online directories; electronic mail services; provision of telecommunication access and links to computer databases and the Internet; transmission of information on a wide range of topics, including online transmission; arranging and providing electronic, digital and computerised communications services and facilities between wholesalers, retailers, customers, transport service providers; computer aided transmission of messages, data and images; online telecommunications information services relating to e-commerce |
| Class 41 | Electronic publication of information on a wide range of topics, including online publication; publication in multiple mediums; education and training services relating to advertising; organising and staging sporting, cultural and entertainment events and competitions; publication of books, business directories and newsletters; arranging and conducting conferences and seminars |
| Class 42 | Computer programming services; computer rental services; computer software design services; installation, maintenance and construction of computer software programs; research and development of technology, including research and development in relation to telecommunications goods and services, including directory goods and services in both electronic and non-electronic form; online computer services; provision of access to electronic databases including electronic directory databases; hosting of websites for others; designing of websites; drawing and commission writing for webpages; compilation of webpages and data for websites; consultancy in relation to all of the aforesaid services |
74 The YELLOW Trade Mark was accepted for registration on 21 December 2007 under s 41(5) of the Act and was advertised on 10 January 2008. As I have said, it was then opposed in separate proceedings by Yellowbook and by PDCA.
Telstra’s post-Lodgement Date use of YELLOW
75 Telstra registered the following relevant trade marks after the 25 July 2003 Lodgement Date:
| Trade Mark No. | Mark | Status |
| 1042570 | FIND IT IN YELLOW | Registered from 2005 |
| 1120486 |
| Registered from 2006 |
| 1222378 |
| Registered from 2008 |
| 1268043 |
| Registered from 2008 |
| 1275292 | Welcome to the World of Yellow | Registered from 2008 |
| 1275301 | Yellow World | Registered from 2008 |
| 1277458 |
| Registered from 2008 |
The FIND IT IN YELLOW campaign
76 In 2003 Telstra began planning a marketing campaign to promote its directories via television, print and online media centred around the slogan FIND IT IN YELLOW. This campaign was intended to encourage consumers to use Telstra’s various YELLOW PAGES products and to reinforce the message that there was an online equivalent to the printed directory. It was launched in February 2005 and it ran until June 2006 supported by a marketing campaign costing about $9 million. Telstra registered FIND IT IN YELLOW as a trade mark in 2005.
77 Both Mr Harvy and Ms Sherwood say that the FIND IT IN YELLOW campaign involved use of the word yellow, standing alone. In effect their evidence is that the campaign focused on just the word yellow rather than on YELLOW PAGES, and showed confidence that consumers would recognise the YELLOW PAGES directories simply by using the first word of that trade mark. Telstra contends that the use of the word YELLOW rather than YELLOW PAGES in the phrase FIND IT IN YELLOW was intended to encapsulate the portfolio of products offered and to focus the marketing on a theme that had been common to preceding advertising campaigns.
78 The evidence is that the FIND IT IN YELLOW campaign consisted of five separate phases and used a range of media. Phase 1 ran from February to June 2005 at a cost of $2.7 million. From February 2005 until May 2005 Telstra published press advertisements in high circulation Australian newspapers and magazines in capital cities and major regional centres. During the same period it aired television commercials, including advertisements named “Delicate”, “Handy” and “Hyena”.
79 In my view it is significant that the print and television advertisements featured the composite YELLOW PAGES Trade Mark below, and the domain name www.yellowpages.com.au.
80 In May 2005 the campaign involved delivering advertising material into residential letter boxes and handing it out at CBD train stations and shopping malls. The material distributed included leaflets, bookmarks and note pads bearing FIND IT IN YELLOW and featuring extensive yellow colouring. This was a high volume campaign and 1.6 million note pads alone were distributed by June 2005.
81 Corresponding to the press, television and mail out advertising Telstra also conducted an online advertising campaign involving banner and pop up advertisements on popular websites such as NineMSN and Fairfax Digital. Telstra’s evidence is that there were 200,000 additional visitors to its website www.yellowpages.com.au as a result of these advertisements. Again, I consider it significant that the online FIND IT IN YELLOW campaign directed internet traffic to the YELLOW PAGES website rather than to a YELLOW website.
82 Phase 2 of the campaign ran from August 2005 to January 2006 using similar media to that adopted in Phase 1, with the addition of an extensive outdoor campaign on billboards and public transport. The allocated budget was $3 million.
83 The marketing brief provided by Sensis set out the campaign objectives as follows:
Marketing Objectives
- Defend yellowpages.com.au usage
- Defend Yellow Pages directory usage
- Grow yellowpages.com.au usage
The brief also stated that the campaign “will use Find It In Yellow branding. This will remain consistent with previous campaigns and will make way for branding changes later in 2006.”
84 Contrary to Mr Harvy’s evidence that Phase 2 of the campaign was intended to “maintain and further increase the usage of the Yellow products” the marketing objectives make it clear that the campaign was in support of directories branded as YELLOW PAGES. The campaign did not refer to YELLOW goods and services at all, and I do not accept Mr Harvy’s evidence in this regard.
85 Phase 3 ran from January to March of 2006 at a cost of $800,000. It used the slogan Paint thE Town Yellow in a range of media campaigns. It achieved considerable exposure for Telstra’s directory products and the audience included about:
(a) 1.1 million consumers of the press advertising;
(b) 1.67 million consumers of the large billboard outdoor advertising;
(c) 2.15 million consumers of the outdoor advertising (metrolites, superlites etc); and
(d) 5 million consumers of the online advertising.
86 Telstra conducted market research into the Find it in Yellow campaign at the end of Phase 3, through market research company TNS. TNS’s report titled “Ad/Comms Monitor - Yellow Pages February 2006 campaign” (“February 2006 TNS Report”) again makes the objectives of the campaign clear. The report confirms that the campaign strategy was directed at placing YELLOW PAGES products as a top of mind consideration by consumers at key times.
87 The February 2006 TNS Report included consumer surveys conducted over the course of the campaign which reported that:
(a) 79 per cent of respondents would consider using YELLOW PAGES products in the future;
(b) 54 per cent of respondents would consider using YELLOW PAGES online in the future; and
(c) 67 per cent of respondents would consider using the print YELLOW PAGES directory in the future.
It is significant that the surveys recorded the recognition by consumers of YELLOW PAGES print and online directories, and did not record consumer recognition of YELLOW directories.
88 Phase 4 of the Find it in Yellow campaign ran during April and May of 2006 as a competition in which consumers were encouraged to visit the YELLOW PAGES website for a chance to win one of three yellow coloured Volkswagen Beetles and cash prizes. Although it also featured press and outdoor advertising, this phase was heavily dependent on online advertising. Internet “pop up” advertisements featuring the FIND IT IN YELLOW Trade Mark made 143.4 million “impressions” during this two month period.
89 At the end of Phase 4, Telstra conducted an internal review of the FIND IT IN YELLOW campaign and produced a report titled “Consumer Post Implementation Review - ‘Find your way around Yellow’ promotion”. This internal review emphasised that the business objective of the campaign had been to defend and increase Telstra’s existing YELLOW PAGES Online usage, by giving consumers a reason to visit the YELLOW PAGES website to win a prize. The review found that the campaign had been successful in its objectives in increasing consumer recognition of YELLOW PAGES Online.
90 In addition to this report, Telstra commissioned market research companies Zenith Optimedia and TNS to conduct external reviews in May and June 2006 into the success of Phase 4. Their reports showed results consistent with those of the internal review, in broad terms showing increased consumer use and consideration of YELLOW PAGES, particularly the online products. Key findings were:
(a) 68% of respondents would consider using YELLOW PAGES Online (compared with an objective of 65%);
(b) 47% of respondents would consider using YELLOW PAGES directories (compared with an objective of 53%); and
(c) an increase in visitation to YELLOW PAGES Online of 150,000 unique users.
The internal review and external reports showed Phase 4 to have been successful in promoting the YELLOW PAGES products, but said nothing about consumer recognition of YELLOW products.
91 Phase 5, the final phase of the Find it in Yellow campaign, ran from May to June of 2006 at a cost of $1.07 million. It used a combination of advertisements in newspapers, television, outdoors, online and printed directories.
92 Following completion of this phase, market research was again undertaken by Zenith and TNS, which showed that the campaign was successful in increasing use of YELLOW PAGES products. Key findings were:
(a) 79% of respondents would consider using YELLOW PAGES products (compared with an objective of 77%);
(b) 51% of respondents would consider using YELLOW PAGES Online (compared with an objective of 53%); and
(c) 65% of respondents would consider using YELLOW PAGES directories (compared with an objective of 65%).
Again the report said nothing about increased consumer recognition of YELLOW directories.
Discussions regarding moving to the YELLOW Trade Mark
93 Mr Harvy says that while the print YELLOW PAGES directories remained popular their growth had begun to slow by the early 2000s as Internet engines such as Google and Yahoo became more popular. He says that the market for online directories had entered a new phase of development at this time and in about mid-2005 Telstra began to explore ways which would ensure that YELLOW PAGES would remain competitive.
94 In July 2005 market research and consulting company, Carey Thomas Australia, advised Telstra that the YELLOW PAGES directories and related goods and services required rebranding.
95 Over the period from July 2005 to about March 2006 Mr Harvy and his marketing team met and discussed rebranding the YELLOW PAGES portfolio of products. This was an important decision which took time to make. In March 2006 the marketing team made the decision to recommend rebranding the YELLOW PAGES product portfolio under the YELLOW Trade Mark.
96 In March 2006 Mr Harvy made a formal recommendation to Bruce Akhurst, Chief Executive Officer of Sensis, to move to the YELLOW Trade Mark as the overarching brand. Mr Harvy met with Mr Akhurst again on 8 May 2006 and at that meeting Mr Akhurst authorised the change.
97 Mr Harvy says, and I accept, that Telstra then commenced to implement YELLOW as the umbrella brand for Telstra’s directory products with the plan that the print and online directories would commence being marketed by reference to the word yellow later in 2006.
The launch of the YELLOW Trade Mark
98 In September 2006 Telstra relaunched its print and online YELLOW PAGES directories as Yellow directories. The effect of Mr Harvy and Ms Sherwood’s evidence is that they considered the evolution and prominence of the YELLOW PAGES trade mark meant that the word YELLOW had, by extension, become a recognisable brand element by which consumers would recognise its business directories across all types of media.
99 It is not contentious that from September 2006 Telstra used the YELLOW Trade Mark as the overarching brand of its directories and related goods and services.
100 Significant press attention accompanied the launch of the YELLOW mark and in the 2006-2007 financial year Telstra allocated a budget of just under $20 million to the campaign. The word YELLOW then featured prominently on the home page and each subsequent page of Telstra’s online directory, and the domain name was changed to www.yellow.com.au. The launch was accompanied by a refreshment of the branding of other Telstra print and electronic products and services, including:
(a) Home at Yellow, a website launched in July 2006 to provide users with in depth information relating to home renovations;
(b) Yellow Mobile, an application allowing mobile phone users to browse Telstra’s business listings online via their phone; and
(c) Yellow in the Car, a glove box sized print directory.
101 Mr Harvy’s evidence is that the first advertising campaign using the YELLOW Trade Mark was called “Search by Suburb”, which ran between September and December 2006. The objective of this campaign was to introduce the new overarching YELLOW Trade Mark and to maintain and increase usage of YELLOW products by both consumers and advertisers. The campaign used print media, flyers, television advertisements and online advertisements and cost a total of $3.3 million.
102 These advertisements consistently made prominent use of the YELLOW Trade Mark and the colour yellow, sometimes also with the Walking Fingers trade mark. Phrases such as “They come out of YELLOW”, “Welcome to the world of YELLOW”, “Open new doors with YELLOW” and “Get online with YELLOW” were used to reinforce the new brand.
103 From January to February 2007 Telstra ran the Origami campaign in the Melbourne and Sydney markets. Mr Harvy says that this campaign was aimed at increasing the use of YELLOW print directories and improving the perceptions of consumer usage among advertisers. The budget of $1.4 million was spent on a variety of print media, television and radio advertisements. Some were targeted at consumers encouraging them to search the directories, and other were targeted at businesses encouraging them to use YELLOW products to promote their goods and services.
104 These advertisements show consistent use of the YELLOW Trade Mark in some way, both alone and sometimes accompanied by the Walking Fingers trade mark. The campaign had considerable reach and, by way of illustration, Telstra distributed 45,000 “Yellow Regional Ad Options” brochures, 30,000 “How to design an effective advertisement” and 25,000 “Yellow Mobile” brochures.
105 From April 2007 Telstra conducted the Yellow Integrated campaign which was intended to increase awareness and use of YELLOW products. The marketing brief identified the primary objectives as being to:
(a) increase consideration of the YELLOW directories from 45% in February 2007 to 50% in June 2007;
(b) increase consideration of the YELLOW brand from 72% in February 2007 to 79% in June 2007; and
(c) remind consumers of the benefits of using the YELLOW directories.
106 The campaign strategy was to identify the most valuable consumer and advertiser categories within the directories and to relate these to common real life situations. The budget of $8.3 million funded advertisements in print media, television, radio and outdoors. The YELLOW INTEGRATED campaign was nationwide in its coverage. The most prominent component was the “Need a hand?” television advertisements and corresponding radio advertisements depicting a scene in which a person encountered a succession of problems while renovating their home which were resolved by obtaining assistance through the YELLOW directory. The television commercial was screened over 7000 times.
107 In 2008 Telstra conducted the Chicken Boy campaign. This campaign featured a boy in a chicken suit and the tagline “How will you get noticed if you’re not in Yellow?” The total cost of the campaign was approximately $3.6 million. Television was the primary medium and between May and August 2008 the advertisement was screened 6500 times in metropolitan areas alone. The advertisements featured the YELLOW Trade Mark, in conjunction with the Walking Fingers logo. There were corresponding radio, outdoor, paper and internet advertisements mimicking aspects of the television advertisement. Post-it notes were also distributed bearing the phrase “How will you get noticed if you’re not in Yellow?” featuring the YELLOW Trade Mark accompanied by the Walking Fingers logo.
108 In my view it is significant that Telstra adduced no cogent evidence to establish that the different YELLOW campaigns such as “Search by Suburb”, YELLOW INTEGRATED, and Chicken Boy, were effective in changing consumers’ understanding of the origin of its print and online directories from the well-recognised YELLOW PAGES brand to YELLOW.
The market surveys for the period July 2006 to June 2007
109 Although not specific to any particular phase of the campaigns, TNS was commissioned by Telstra to conduct consumer surveys covering the period July 2006 to June 2007, and it provided a report setting out the survey results in June 2007 (“June 2007 TNS Report”). The report covered the timeframe over which Telstra ran the YELLOW campaign and it reported on the level of consumer recognition of YELLOW printed and online directories.
110 The survey was undertaken by asking consumers, without prompting them, about which services they were aware of that could help them find information within Australia. The June 2007 TNS Report stated that out of almost 1000 respondents:
(a) 0% were aware of the Yellow directory;
(b) only 3% were aware of yellow.com.au; and
(c) where Yellow was recalled by a consumer, that recall was typically accompanied by a direct or indirect reference to YELLOW PAGES.
That is, despite the extensive $20 million YELLOW campaign, the report recorded a negligible level of unprompted consumer awareness of yellow directories.
111 It is significant that when the survey taker prompted the consumer by mentioning, amongst other things, the Yellow Pages directories, 79% of the respondents said they were aware of the yellow directory. But because this only arose from prompting, the survey indicated a low level of unaided consumer recognition of the Yellow brand.
112 Telstra seeks to rely on a finding in the June 2007 TNS Report that 48% of respondents had a spontaneous awareness of what the report described as “Nett Yellow”. However its reliance is quite misplaced. The figure of 48% spontaneous awareness of “Nett Yellow” recorded in the report is just an aggregation of the negligible recognition of YELLOW products with the higher levels of recognition of Yellow Pages, Yellow Pages Metro directory, Yellow Pages Local Directory, and www.yellowpages.com.au.
The abandonment of YELLOW as the umbrella brand
113 In 2009 Telstra abandoned the YELLOW Trade Mark as the umbrella brand for its directories and related goods and services. Both Mr Harvy and Ms Sherwood give evidence that the YELLOW campaign did not fail. As I later explain, I do not accept this evidence. I infer from the circumstances, particularly the inherent descriptiveness of the YELLOW mark, the June 2007 TNS Report, and Telstra’s decision to abandon the mark despite spending almost $30 million on the FIND IT IN YELLOW and YELLOW campaigns, that it did not operate to sufficiently distinguish its goods and services.
The evidence of use of the colour and word yellow by other traders
114 To assist the Court to grapple with the voluminous evidence as to the use of the colour and word yellow by other traders, the parties were directed to file an Agreed List of Use of Yellow by Third Parties.
115 In respect of Australian print business directories the list sets out, amongst other things:
(a) the use of the word yellow;
(b) the use of the colour yellow on the front cover, spine and back cover;
(c) the use of the yellow pages in the business directory section; and
(d) the geographical distribution of the directories,
before and after the Lodgement Date. Similar information is provided in relation to international print directories.
116 In respect of online Australian business directories the list sets out, amongst other things:
(a) the domain name of the website;
(b) the use of the word yellow on the website; and
(c) the dominant colour of the website.
The same information is provided in relation to overseas online directories but only for the period after the Lodgement Date.
117 I now set out the salient features of the evidence of use of the word and colour yellow by other traders.
Pre-Lodgement Date use of the colour and word yellow within Australia
The BIG Directory 1987 to 2002
118 Mr Moule gives evidence that BMA published “The Melbourne BIG” directory annually in Melbourne from 1987, which in about 1991 underwent a name change to “BIG Colour Pages” (“the BIG Directory”). Over the period 1991 to 1997 the geographical coverage and distribution of the BIG Directory expanded until it was published annually in Melbourne, Sydney, Perth, Brisbane, Gold Coast, Sunshine Coast, Northern Territory, Adelaide, Hobart, Northern NSW, Cairns, Townsville, Wollongong and Canberra. During the period from 1997 until 2002 (when the BIG Directory ceased) BMA distributed approximately 3.5 million BIG Directories nationwide each year.
119 From its inception BMA used yellow pages in the business directory section of the BIG directory. Mr Moule’s evidence, which I accept, is that BMA’s decision in about 1986 to use yellow pages was made because yellow was accepted worldwide as the industry standard colour used for business directories. He says that yellow was so commonly used in international directories that BMA hardly considered using a different colour. He also says that having yellow pages was a good choice for a business directory as black writing on a yellow background stood out.
120 While Mr Moule conceded that Telstra set the industry standard in Australia, it was not put to him that BMA’s adoption of the colour yellow involved an improper motive. I accept that BMA acted innocently in using the colour yellow as it did.
PDCA Directories and Local Directories 1993 to 2003
121 Ms McGarry gives evidence of PDCA’s publication of print directories. PDCA produced its directories each year from 1993 in Rockhampton/Gladstone, from 1995 in Alice Springs, from 1996 until 2000 in the Gold Coast, from 1995 to 1996 in the Sunshine Coast, from 1996 in Townsville, from 1997 to 1998 in Cairns and Darwin, from 2001 in Mackay and from 2003 in Mt Isa. PDCA distributed approximately 1.655 million directories in these regions pre-Lodgement Date.
122 The evidence shows that from 1993 until 2003 these directories:
(a) used yellow pages in the business directory section;
(b) used yellow as the dominant colour on the covers from 1996; and
(c) described the business directory section as “Yellow” from 1994 and as the “Yellow Section” from 2000.
PDCA also adopted yellow as its corporate colour, and had a strong yellow theme in its marketing and signage.
123 In 2001 PDCA established a website at the domain name www.pdc-group.com.au. It made only incidental use of the colour yellow in a header and in an image of a PDCA print directory. The use of the word yellow was confined to references to “yellow page directories” and “Yellow Section”.
124 Senior Counsel for Telstra cross-examined Ms McGarry and submits that PDCA set out to produce directories that as closely as possible resembled Telstra’s directories, and that its motive in using the colour and word yellow as it did was improper. However, I am not satisfied that its motives were improper. Firstly, this is because the use of the word and colour yellow was widespread overseas and yellow was the industry standard colour for business directories. Secondly, I could take little from the cross-examination because Ms McGarry was the only PDCA employee to give evidence and she did not commence employment with the PDCA group until April 1998 when its use of the colour and word yellow was already established. When she commenced she did so only as a personal assistant rather than in a position of seniority.
The Rockingham, Kwinana and Mandurah Community Directories, (aka Yellow Directories) 1985 to 2003
125 Mr Kerferd gives evidence that from 1985 Sound International (later trading as RMK) published the Rockingham/Kwinana Community Directory annually in Rockingham, Kwinana and Mandurah, Western Australia. The evidence shows that these directories:
(a) used yellow as the dominant colour on the covers;
(b) used yellow pages in the business directory section; and
(c) yellow was the dominant colour in RMK’s media advertising, corporate and promotional materials, invoices and statements, business cards, staff uniforms, car signage and in corporate sponsorship. The company branding had an unmistakeably strong yellow theme.
The evidence shows that from 1985 until 2000 between 30,000 to 40,000 copies of the directory were distributed each year.
126 Ms Kerferd says that RMK chose the colour yellow as a core part of its branding because it stood out and because it was complemented by other colours. She says that she chose yellow because it was a primary colour that worked with other colours, was easily identifiable, and was an appropriate corporate colour. I accept her evidence.
127 In 2000 RMK registered the business name Yellow Directories and the domain name www.yellowdirectories.com.au. From 2001 RMK published separate print directories for each of the Rockingham, Kwinana and Mandurah regions and also ran an online business directory for those regions. The evidence shows that RMK used:
(a) yellow as the dominant colour on the covers of the print directories;
(b) yellow pages in the print directory;
(c) yellow as the dominant colour on the website;
(d) a large yellow Yellow Directories on each cover of the print directories, on the title pages and on the base of other pages;
(e) the Yellow Directories name prominently on the website; and
(f) yellow as the dominant colour in RMK’s corporate branding.
RMK distributed approximately 180,000 directories under the name Yellow Directories from 2001 to 2003.
128 In about March 2003, in response to threats of legal action by Telstra, Ms Kerferd deregistered the business name YELLOW DIRECTORIES, and changed the domain name. At Telstra’s demand she gave an undertaking not to use the name Yellow Directories “or any trade mark or name incorporating the word yellow” in respect of directory or similar products or services. I accept her evidence that she took these steps to avoid costly litigation rather than because she accepted the correctness of the legal position that Telstra asserted.
129 The evidence does not indicate that RMK had an improper motive in using the colour and word yellow as it did. I accept Ms Kerferd’s evidence that its directories were named YELLOW DIRECTORIES from 2000 to 2003 without reference to Telstra’s YELLOW PAGES.
Regional community directories in Western Australia 1999 to 2003
130 Mr Lee gives evidence as to Market Creation’s publication of two regional community directories in Western Australia prior to the Lodgement Date, namely:
(a) Karratha & Districts Chamber of Commerce & Industry Business & Community Directory annually in 2000 to 2002; and
(b) Mid West Business & Community Directory annually from 1999.
131 These directories did not use yellow coloured pages, but they used yellow or a yellow/orange colour coding on the edge of the pages to identify the business directory section. The Karratha & Districts directory referred to that section as the “Yellow Pages”.
132 Importantly, Mr Lee’s evidence is that “the public probably looks at the colour yellow as being synonymous with business advertising in these sorts of publications”.
133 The evidence indicates that Mr Lee chose the yellow colour coding in part because of his view that the public saw the colour yellow as being synonymous with business directories. It was not put to Mr Lee that he had an improper motive for using the colour yellow on the business directory or in the use of the words Yellow Pages to describe that section. I do not conclude that he had such a motive.
The Yellow Envelope direct mail service 1997 to 2003
134 Evidence as to the use of the colour and word yellow in respect of Telstra’s designated goods was not restricted only to directories. Horizon distributed a direct mail package of advertising material and in 1997 its name was The Yellow Envelope Co Pty Ltd. In September 2000 it registered the trade mark “The Yellow Envelope” in class 35 for “unaddressed direct mailer for direct advertisers to regional and rural areas.” These services are closely related to Telstra’s designated goods and services of “marketing, merchandising, retail and wholesale distribution services (excluding transport)” within the same class.
135 From 1997 Horizon distributed an envelope containing direct marketing material to households throughout Australia, which prominently featured the words “The Yellow Envelope” and used yellow as its dominant colour. The Yellow Envelope was distributed around Australia to each recipient either once per year, three times per year or five times per year in the following volumes:
| Year | Annual Volume |
| 1997 | 4.41 million |
| 1998 | 11.76 million |
| 1999 | 17.05 million |
| 2000 | 18.47 million |
| 2001 | 18.70 million |
| 2002 | 16.89 million |
| 2003 | 16.93 million |
136 The evidence shows that the marketing of The Yellow Envelope had a strong yellow theme, and that a significant element of its brand was the colour yellow and the word yellow. There is no evidence that Horizon had an improper motive in using the colour or word yellow as it did.
Conclusion regarding use of the colour and word yellow by Australian traders
137 The evidence shows that prior to the Lodgement Date other traders in Australia commonly used the colour yellow and the word yellow in respect of print and online directories.
Pre-Lodgement Date use of the colour and word yellow by overseas traders
138 Use of the colour and word yellow in respect of directories was not restricted to Australia. One of the annexures to Mr Harvy’s affidavit is a 2006 Sensis document titled “Yellow – a timeline”, which states:
1975 The Yellow Pages directory is born. The pink pages of the classified directory are changed to yellow, which is the internationally recognised colour for classified directories. The conversion is also prompted by a world shortage of pink paper and pollution problems associated with its manufacture. (Emphasis added.)
Mr Harvy made no attempt to distance himself from this document and I accept it as correct.
139 Mr Harvy accepted that the words “Yellow Pages” and the Walking Fingers logo were in use in the USA prior to Telstra commencing to use them in 1975. He conceded that when Telstra commenced using YELLOW PAGES it looked at the international marketplace in respect of business directories and picked up on an international trend in adopting YELLOW PAGES and the Walking Fingers logo.
140 Mr Moule testifies that from 1976 to 1986 he worked for Directories Australia Pty Ltd (“Directories Australia”) and then for Australian Directory Services Pty Ltd, which at the time published the YELLOW PAGES directories in Australia under contract with Telstra. He says that Directories Australia was a subsidiary of GTE which published business directories around the world, including in the USA. As he put it the directories “were always yellow”. He gives evidence, which I accept, that prior to the Lodgement Date yellow was accepted worldwide as the industry standard colour for business directories. This is confirmed by the document “Yellow – a timeline”.
141 The applicants produced copies of some international directories showing pre-Lodgement Date use of the colour and word yellow, namely:
(a) the 1993 Jackson Hole, Wyoming, USA print directory which used yellow coloured pages for the business directory section and named that section the “Yellow Pages”. The evidence is that this directory was used by PDCA as a sales tool when it was first promoting its telephone directories in the early 1990s;
(b) the 2000 Pacific Bell “Smart Yellow Pages” print directory for the Napa Valley, California, USA. This used yellow as the dominant colour on its cover, used yellow coloured pages for the business directory section, and had the words “Yellow Pages” in its title; and
(c) the 2003 Papua New Guinea “Yellow Pages” print directory. This also used a yellow cover and “Yellow Pages” in its title. I infer that it also used yellow coloured pages.
I infer that these directories were published in this format not only in the years for which evidence was adduced but also in some later years.
142 The post-Lodgement Date evidence includes examples in 2009 or 2011 from numerous locations in the USA, and on Yellow Pages and similar websites in South Africa, Thailand, Singapore, Hong Kong, Peru, France, Italy, Indonesia, Papua New Guinea, Egypt, Malaysia, China, Eritrea, Bahrain, Cyprus, Germany, USA, Macau, Vietnam, Bermuda, Malta, Turkey, Brazil, United Kingdom and through www.jewishyellow.com. Of these websites, approximately 28 used the words Yellow Pages in the title and many used these words in the domain name too. Many had domain names incorporating the word yellow, such as USA websites www.yellowpages.com and www.yellowbook.com, Canadian website www.yellowpages.ca, South African website www.sayellow.co.za, Singapore website www.yellowpages.com.sg and Thai website www.yellowpages.co.th. Mr Harvy accepted in cross-examination that “Yellow Pages” print directories were published in Canada, France, Ireland, Israel, New Zealand and the Netherlands and for the most part used yellow covers.
143 I infer from this widespread international usage of the colour and word yellow post-Lodgement Date, and from the evidence of Mr Moule and Mr Harvy, that there were more examples of overseas pre-Lodgement Date use than the applicants adduced. I am satisfied that prior to the Lodgement Date in many overseas countries:
(a) yellow pages were used in print business directories;
(b) yellow was used as the dominant colour on the cover of print business directories;
(c) “Yellow Pages” was used in respect of print and online directories; and
(d) yellow was used as the dominant colour on online directory websites.
Post-Lodgement Date use of the colour and word yellow in Australia and overseas
144 The parties put on voluminous evidence as to the use of the colour and word yellow after the Lodgement Date in Australia and internationally.
145 I have already summarised the evidence of the international post-Lodgement Date use of the word and colour yellow at [142]. I now set out the post-Lodgement Date use by other traders in Australia.
146 PDCA continued to publish its directories bearing largely the same features that I described at [121] to [124], and significantly expanded the geographical coverage of the directories. It published directories annually in Alice Springs from 2003, Mackay from 2004, Darwin from 2005, the Sunshine Coast in 2007, and Townsville from 2008. Each directory had a distribution commensurate with the size of the relevant region ranging from approximately 25,000 for the Alice Springs directory to approximately 120,000 for the Townsville directory.
147 PDCA developed its online directory to correspond with its expanding printed directories. Its 2004 website at www.yourlocalphonebook.com.au referred to “yellow page listings” and “Yellow Section” and displayed images of a PDCA directory, but it did not use yellow as the dominant colour. In 2005 the website commenced to refer to PDCA being a fully accredited member of the “Yellow Pages Publishers Association” and made prominent use of the colour yellow throughout the website. PDCA then published a website at www.localdirectories.com.au which used yellow as the dominant colour.
148 RMK continued to publish its print and online directories for Mandurah, Rockingham and Kwinana. Consistently with the undertaking provided to Telstra, it no longer used the name YELLOW DIRECTORIES but it continued to use yellow as the dominant colour on the covers of its print directories and on its website. The directories no longer used yellow coloured pages. RMK distributed approximately 64,000 copies of the directories annually.
149 Market Creations continued producing regional community directories in regional Western Australia and expanded the distribution to include directories for Jurien Bay, Narrogin, Newman, Carnarvon, Esperance, Broome, as well as Karratha and the Mid West. Each directory had a distribution commensurate with the size of the relevant region ranging between 6000 and 20,000 copies annually. The business directory sections commonly used a yellow or yellow/orange colour coding for its business directory section and some editions used yellow headings in the business directory section.
150 Yellowbook published its directories at www.yellowbook.com.au and www.yellowbook.net.au from 2006. As well as using the word yellow in the domain name and throughout the website, it used the colour yellow in the header, footer and search button. In 2008 Yellowbook launched www.yellowcoupons.com.au with similar features and layout, in 2011 www.yellowdirectory.com.au, and in 2012 www.yellpages.com.au and www.yellbook.com.au.
151 Other Australian print business directories are in evidence including the Chinese Business Directory, the Australian Business Directory – Your Multicultural Guide, and Market Creations’ Community Directories. Many of these adopted yellow as the colour for the spine of the print directories but they had little other significant use of yellow. Some other online directories were also in evidence including chineseyellowpagesaustralia.com.au, christianyellowpages.com.au, and jewishyellowpagesaustralia.net. These all used the word yellow in their title and domain name, but had little use of the colour yellow on the websites.
152 I conclude that, post-Lodgement Date, the colour and word yellow were commonly used by other traders in Australia and internationally in respect of print and online business directories.
A. the yellow appeals
153 I now deal with PDCA and Yellowbook’s opposition to Telstra’s application to register the YELLOW Trade Mark.
inherent capacity to distinguish – section 41 of the act
The legislative framework
154 Section 41 of the Act is central in the YELLOW Appeals. It has been amended since the events in question but at the relevant time it provided:
Trade mark not distinguishing applicant’s goods or services
(1) For the purposes of this section, the use of a trade mark by a predecessor in title of an applicant for the registration of the trade mark is taken to be a use of the trade mark by the applicant.
Note 1: For applicant and predecessor in title see section 6.
Note 2: lf a predecessor in title had authorised another person to use the trade mark, any authorised use of the trade mark by the other person is taken to be a use of the trade mark by the predecessor in title (see subsection 7(3) and section 8).
(2) An application for the registration of a trade mark must be rejected if the trade mark is not capable of distinguishing the applicant’s goods or services in respect of which the trade mark is sought to be registered (designated goods or services) from the goods or services of other persons.
Note: For goods of a person and services of a person see section 6.
(3) In deciding the question whether or not a trade mark is capable of distinguishing the designated goods or services from the goods or services of other persons, the Registrar must first take into account the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons.
(4) Then, if the Registrar is still unable to decide the question, the following provisions apply.
(5) If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:
(a) the Registrar is to consider whether, because of the combined effect of the following:
(i) the extent to which the trade mark is inherently adapted to distinguish the designated goods or services;
(ii) the use, or intended use, of the trade mark by the applicant;
(iii) any other circumstances;
the trade mark does or will distinguish the designated goods or services as being those of the applicant; and
(b) if the Registrar is then satisfied that the trade mark does or will so distinguish the designated goods or services - the trade mark is taken to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons; and
(c) if the Registrar is not satisfied that the trade mark does or will so distinguish the designated goods or services - the trade mark is taken not to be capable of distinguishing the applicant’s goods or services from the goods or services of other persons.
Note 1: For goods of a person and services of a person see section 6.
Note 2: Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).
(6) lf the Registrar finds that the trade mark is not to any extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons, the following provisions apply:
(a) if the applicant establishes that, because of the extent to which the applicant has used the trade mark before the filing date in respect of the application, it does distinguish the designated goods or services as being those of the applicant - the trade mark is taken to be capable of distinguishing the designated goods or services from the goods or services of other persons;
(b) in any other case - the trade mark is taken not to be capable of distinguishing the designated goods or services from the goods or services of other persons.
Note l: Trade marks that are not inherently adapted to distinguish goods or services are mostly trade marks that consist wholly of a sign that is ordinarily used to indicate:
(a) the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; or
(b) the time of production of goods or of the rendering of services.
Note 2: Use of a trade mark by a predecessor in title of an applicant and an authorised use of a trade mark by another person are each taken to be use of the trade mark by the applicant (see subsections (1) and 7(3) and section 8).
The correct approach to s 41
155 A key consideration in s 41 is the extent to which the trade mark is inherently adapted to distinguish the designated goods or services from the goods or services of other persons. In Blount Inc v Registrar of Trade Marks [1998] FCR 50 (“Blount”) at 56 to 57, Branson J explained that s 41(3) to (6) are intended to control the process by which the Registrar (and it follows the Court) reaches a conclusion as to whether the trade mark for which registration is sought is capable of distinguishing the designated goods or services. Branson J construed the section to describe the appropriate process and I agree with her Honour’s approach.
156 Sundberg J adopted the same approach to s 41 in Chocolaterie Guylian at [9], succinctly describing the process as involving the following steps:
(a) The Registrar must first “take into account the extent to which the trade mark is inherently adapted to distinguish” the relevant goods [or services] from the goods [or services] of others: s 41(3);
(b) If that consideration leads to a conclusion that the trade mark is capable of distinguishing the goods [or services] from those of others, then, so long as the Registrar is not satisfied that any other grounds for rejecting the [application for registration] exist, she must accept the [application for registration]...;
(c) However, if the Registrar is “unable to decide” whether the trade mark is capable of distinguishing the goods [or services] by the “inherently adapted” consideration alone, then either s 41(5) or s 41(6) applies: see s 41(4). Section 41(5) will apply if the Registrar finds that the trade mark “is to some extent inherently adapted to distinguish the … goods [or services] from the goods [or services] of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the … goods [or services]”. By contrast, s 41(6) will apply if the Registrar finds that the trade mark “is not to any extent inherently adapted to distinguish”.
(d) If the Registrar finds the trade mark is to some extent inherently adapted (s 41(5)), the Registrar is then required to consider whether the trade mark “does or will distinguish the … goods [or services] as being those of the applicant”, by taking into account the combined effect of the following three matters (s 41(5)(a)):
• the extent to which the trade mark is inherently adapted to distinguish;
• the use, or intended use, of the trade mark by the applicant; and
• any other circumstances.
(e) After taking those matters into account, the trade mark is “taken to be capable of distinguishing the applicant’s goods [or services] from the goods [or services] of other persons” only if the Registrar is “satisfied” that the trade mark in fact does or will so distinguish the goods: s 41(5)(b). If the Registrar is not so satisfied, then the trade mark is taken not to be capable of distinguishing (see 41(5)(c)), a ground for rejecting the [application for registration] will thereby exist and the Registrar is then required to reject the [application for registration]….
(f) In the alternative scenario that the Registrar finds that the trade mark is not to any extent inherently adapted to distinguish (s 41(6)), then the trade mark is taken not to be capable of distinguishing the goods [or services] unless the applicant “establishes” that, because of the extent to which the applicant has used the trade mark prior to the relevant filing date of the application, the trade mark does in fact distinguish the goods [or services] as being those of the applicant: s 41(6)(a) and (b). (Emphasis in original.)
157 Counsel for Yellowbook contends that this approach ignores the plain words of s 41, arguing that if an opponent to registration establishes that the trade mark sought to be registered has no inherent adaption to distinguish, then s 41(4) precludes resort then being had to s 41(6). He argues that the Court is then well able to decide the s 41(2) question - the mark is not capable of distinguishing.
158 In my view Counsel’s construction of s 41 is misconceived. It fails to properly construe the provision as a whole and ignores that a mark with no inherent adaption to distinguish may become distinctive by pre-Lodgement Date use, as envisaged by s 41(6). I prefer Branson J’s construction which has been cited with approval on a number of occasions: see Ocean Spray Cranberries Inc v Registrar of Trade Marks (2000) 47 IPR 579 at [11] per Wilcox J; Time Warner Entertainment Compnay LP v Stepsam Investments Pty Ltd (2003) 134 FCR 51 at [26] per Wilcox J; Modena Trading Pty Ltd v Cantarella Bros Pty Ltd (2013) 215 FCR 16 at [56] per Mansfield, Jacobson and Gilmour JJ.
The Delegates’ decisions
159 In relation to the capacity of the YELLOW Trade Mark to distinguish Telstra’s designated goods and services Delegate Kirov found in summary:
(a) with respect to Telstra’s designated goods, the word yellow may describe the physical appearance of some of Telstra’s designated goods, but that does not make the YELLOW Trade Mark generic for such goods, unlike, for example, the words “directory”, “directories”, “business listings”, or “service directory”. He rejected the submission that the word yellow falls into the category of marks referred to in the note to subsection 41(6) of the Act as lacking any inherent adaptation to distinguish goods – namely those “ordinarily used to indicate the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods... or the time of production of goods”: Khoury v Telstra at [39] and [43];
(b) with respect to Telstra’s designated services, the word yellow is not needed in the ordinary course of trade, and without improper motive, by other traders to describe their similar services. He said that it was difficult to see how Telstra’s designated services could be characterised as or described as “yellow services” (at [40]);
(c) Telstra had used the YELLOW Trade Mark in relation to its goods to a significant extent since 2006 (at [44]);
(d) Telstra had expended considerable monies on promoting its goods and had gained substantial revenue under the YELLOW Trade Mark which was indicative of public recognition of the word as a trade mark of Telstra (at [44]); and
(e) although that use had not always been consistent, Telstra had demonstrated sufficient usage to establish that the YELLOW Trade Mark does or will distinguish the designated goods and that accordingly, the mark should be taken to be capable of distinguishing Telstra’s goods from those of other persons (at [44] and [45]).
160 Delegate Williams found in summary:
(a) that as at the Lodgement Date the YELLOW Trade Mark was not, within s 41(3) of the Act, entirely devoid of inherent adaption to distinguish. He too did not consider that the word yellow should be seen as a sign within the scope of the note to subsection 41(6) of the Act, as lacking any inherent adaptation to distinguish goods: PDCA v Telstra at [28].
(b) under s 41(5) of the Act, while there was some validity in the suggestion that YELLOW was a limping trade mark because the word YELLOW generally appeared with the Walking Fingers device or as a composite mark, any defects that it had in that respect had been cured by the extent of usage. In his view, although the word YELLOW typically appeared with the Walking Fingers device from late 2006 onward, the word YELLOW was prominent. He said that the Walking Fingers device would not be readily verbalised and customers would be likely to understand the brand by the word “yellow” alone. He noted that in aural and oral contexts such as Telstra’s radio commercials the Walking Fingers device was not used at all in conjunction with the word yellow, and said that it was unrealistic to suggest that the word yellow depended on the device to achieve status as a trade mark (at [40]); and
(c) that the YELLOW Trade Mark was sufficiently inherently adapted to distinguish, in combination with the extent of use of the mark and other circumstances, to conclude that as at the Lodgement Date it was capable of distinguishing the designated goods or services. In his view the fact that the FIND IT IN YELLOW campaign which commenced in 2005, and the use of YELLOW from 2006, operated to smoothly and effectively reshape the YELLOW PAGES trade mark, tended to confirm that it was capable of distinguishing the designated goods and services as at the Lodgement Date (at [38] and [44]).
161 I have considered the decisions of the Delegates, and have sought to give their evaluative judgements appropriate weight, but I have reached a different conclusion as to the capacity of the YELLOW mark to distinguish Telstra’s goods and services.
Issues 1.1 and 1.2: is the yellow trade mark inherently adapted to distinguish the designated goods and services to any, and if so what, extent - section 41(3)?
162 The first step in determining whether a trade mark has a capacity to distinguish is the enquiry under s 41(3) of the Act as to the inherent adaptability of the mark to distinguish.
163 This enquiry is not concerned with any acquired secondary meaning. Inherent adaptability to distinguish is something which depends on the nature of the trade mark itself and is not something that can be acquired: Burger King Corporation v Registrar of Trade Marks (1973) 128 CLR 417 (“Burger King”) at 424 per Gibbs J; Clark Equipment Co v Registrar of Trade Marks (1964) 111 CLR 511 (“Clark Equipment”) at 513 per Kitto J.
164 The question is not whether the YELLOW Trade Mark would indeed distinguish Telstra’s goods and services from those of other traders if it were registered as a mark and other manufacturers were thereby precluded from using it in relation to the designated goods and services, but rather whether it is capable of so doing. As Mansfield J explained in Philmac Pty Ltd v The Registrar of Trade Marks (2002) 126 FCR 525 (“Philmac”) at [46]:
Stating the question in that way does no more than state that by securing a monopoly in a phrase, colour, smell or any other sign, a trader would, in using that sign, distinguish its goods or services from those of other traders. Whether a mark is capable of registration under the Act and by virtue of s 41(2) and (3) is a conceptually distinct question.
165 Whether a trade mark is inherently adapted to distinguish is determined by reference to the test stated by Lord Parker in Registrar of Trade Marks v W & G Du Cros Ltd [1913] AC 624 at 635:
…whether other traders are likely, in the ordinary course of their business and without any improper motive, to desire to use the same mark, or some mark nearly resembling it, upon or in connection with their own goods.
166 In Clark Equipment Kitto J approved Lord Parker’s test in the following terms at 513 to 514:
…the question whether a mark is adapted to distinguish [is to] be tested by reference to the likelihood that other persons, trading in goods of the relevant kind and being actuated only by proper motives – in the exercise, that is to say, of the common right of the public to make honest use of words forming part of the common heritage, for the sake of the signification which they ordinarily possess – will think of the word and want to use it in connexion with similar goods in any manner which would infringe a registered trade mark granted in respect of it.
In doing so his Honour reflected the natural disinclination of the Courts to allow traders to obtain a monopoly, through registration of a trade mark, in words or signs that others may legitimately desire to use.
167 In practice a word may be treated as capable of distinguishing goods and services if it is shown not to be a sign which is descriptive of the character or quality of the relevant goods or which uses a geographical name in connection with them. Such words have significations or associations that invite confusion, and registration of a trade mark using such words would preclude the use by others whose goods have similar qualities or which have a connection with the relevant areas: Kenman Kandy v Registrar of Trade Marks (2002) 122 FCR 494 (“Kenman Kandy”) at [145] to [147] per Stone J; Philmac at [50] per Mansfield J.
168 If Telstra was applying to register the colour yellow as a trade mark it would face an uphill battle to establish that it was inherently adapted to distinguish its products. The learned authors M. Davison, A. Monotti and L. Wiseman in Australian Intellectual Property Law (Cambridge University Press, 2010) at 97 state:
It will be difficult, if not impossible, to establish that a single colour is inherently distinctive and the applicant will have to rely on s 41(6) to demonstrate distinctiveness.
Similarly, Halsbury’s Laws of Australia (at 1 October 2007) Trade Marks, ‘Colour Marks’ [240-8370] notes that:
Colour marks typically have difficulty demonstrating any level of inherent capacity to distinguish.
169 In BP PLC v Woolworths (2004) 212 ALR 79 (“BP”) at [18] Finkelstein J held that a colour mark can never be inherently distinctive and is capable of distinguishing only through usage. In another well-known case Cadbury Ltd applied to register the colour purple in respect of its confectionary, but conceded that the colour had no inherent adaptability to distinguish. It ran its case on the basis of acquired distinctiveness only: Darrell Lea Chocolate Shops Pty Ltd v Cadbury Ltd (2006) 69 IPR 386 at [67].
170 Of course, the present application is for a word denoting a colour rather than a colour itself. But, in my view it is difficult to draw a distinction between a word denoting a colour and a colour when dealing with the issue of a trade mark’s inherent capacity to distinguish. Each of the parties relied on authorities pertaining to colour marks in their submissions.
The YELLOW Trade Mark is descriptive
171 Telstra submits that when used in relation to services, the word yellow is simply an arbitrary word. While accepting that yellow is in common linguistic use, it argues that a service cannot be coloured yellow and therefore the word cannot be in any way descriptive of such services. It contends that the proposed mark does not suggest or describe any ingredient, quality or characteristic of Telstra’s designated services as provided in Note 1 to s 41(6) of the Act. Being an arbitrary word in relation to services, it argues that the word yellow is distinctive almost from first use and inherently capable of distinguishing the services without evidence of use or intended use.
172 When used in relation to goods, Telstra concedes that the YELLOW Trade Mark may be seen to describe the physical appearance of its yellow coloured print directories. But it argues that the word yellow does not have any other meaning or signification that might be said to be descriptive of or otherwise relevant to the kind, quality, quantity, intended purpose, value, geographic origin or some other characteristic of its goods. It says that, as print directories can be produced in almost any colour, the word yellow is inherently adapted to distinguish its directories.
173 Telstra argues that the word yellow is not a generic term in respect of directories because of extensive use of the colour and word yellow in Australia and overseas. It contends that its registration of the YELLOW PAGES Trade Mark in 1977 has meant that it has been able to legitimately prevent the words Yellow Pages, and also the word yellow, from becoming generic in respect of directories in Australia.
174 Telstra notes that the YELLOW PAGES word marks were accepted as distinctive in 1990 under s 26(2) of the 1955 Act. It also notes that when the word marks were registered in 1990 (and 1996) the Registrar must have accepted that YELLOW PAGES was to some extent inherently adapted to distinguish its goods and services. It argues that it must be recognised that the non-distinctive word “pages” adds little to the YELLOW PAGES mark and the distinguishing role is primarily played by the word YELLOW.
175 I do not accept Telstra’s contentions. It is axiomatic that for a trade mark to operate as a badge of origin of the source of the goods or services to which it is applied, it must be distinctive. Distinctiveness may be directly contrasted with descriptiveness, and the more descriptive a trade mark is the less easily it does a job as a badge of origin.
176 In BP Finkelstein J dealt with an application to register the colour green as applied to BP service stations. Although overturned on appeal his Honour’s reasoning as to s 41(3) of the Act was not the subject of appeal. Finkelstein J noted at [19] that the test for inherent adaption to distinguish is often expressed in negative terms, stating:
The test is a negative one. In Yorkshire Copper Works Ltd’s Application for a Trade Mark (1954) 71 RPC 150 Lord Simonds said (at 154): “it is perhaps easier to define ‘inherent adaptability’ in negative than in positive terms…”
177 I agree with his Honour when he explains at [20] that a negative test is not always satisfactory, and it is sometimes appropriate to decide the question by reference to a positive test. At [19] his Honour approved the formulation of the different categories of distinctiveness in Abercrombie & Fitch Co v Hunting World Inc 537 F 2d 4 (1976) at 9 to 11. As his Honour explained:
The categories are: (1) generic; (2) descriptive; (3) suggestive; and (4) arbitrary or fanciful. Generic marks can never be trade marks. Descriptive terms can, but only if they have acquired a secondary meaning. Suggestive arbitrary or fanciful terms are inherently distinctive. (Citations omitted.)
178 In my view the YELLOW trade mark is descriptive because, firstly, yellow is a word in ordinary usage which describes a primary colour. The Oxford English Dictionary relevantly defines it as an adjective meaning “of the colour of gold, butter, the yolk of an egg, various flowers, and other objects”, and also a noun meaning “one (the most luminous) of the primary colours, occurring in the spectrum between green and orange.” Telstra does not contend that yellow has any colloquial or new meaning such that the dictionary definition has limited application: see Sports Warehouse at [86].
179 Secondly, the word yellow is not a made up, meaningless or fanciful word which is distinctive as a result (such as “fuddruckers” for hamburgers and restaurant services: Michael Sharwood & Partners Pty Ltd v Fuddruckers Inc (1989) 15 IPR 188).
180 Thirdly, the word yellow is not distinctive on the basis that it is dislocated from or inappropriate to the designated goods and services, such as in the often used example of “North Pole bananas”. The word yellow is “devoid of any distinctive character” in the sense discussed by Jacob J in British Sugar plc v James Robertson & Sons Ltd [1996] RPC 281 at 306 where his Honour said:
Is it the sort of word (or other sign) which cannot do the job of distinguishing without first educating the public that it is a trade mark? A meaningless word or a word inappropriate for the goods concerned (‘North Pole’ for bananas) can clearly do. But a common laudatory word such as ‘Treat’ is, absent use and recognition as a trade mark, in itself…devoid of any distinctive inherently character [sic inherently distinctive character].
181 Fourthly, I cannot accept Telstra’s contention that yellow is an arbitrary term. That cannot be so when the evidence shows that, prior to the Lodgement Date, yellow was the colour commonly used in respect of print and online directories by Telstra and other traders in Australia and also by other traders overseas.
182 As Lord Simonds LC said in Yorkshire Copper Works Limited’s Application for a Trade Mark (1954) 71 RPC 150 (“Yorkshire Copper Works”) at 154;
…the more apt a word is to describe the goods of a manufacturer, the less apt it is to distinguish them: for a word that is apt to describe the goods of A, is likely to be apt to describe the similar goods of B.
The evidence shows that YELLOW is descriptive of the colour that Telstra and other traders used on their directories.
183 While there are categories of goods and services in relation to which colour has no inherent significance, as the trial judge Whitford J said in Blue Paraffin Trade Mark [1977] RPC 473 (“Blue Paraffin”) at 494:
In relation to a vast range of goods, colour or words denoting colour must necessarily be inherently descriptive – paints, for example, or articles of clothing such as socks.
His Honour must then have been referring to the fact that socks are goods which are invariably coloured, and stating that a word denoting the colour of the sock is inherently descriptive of the sock. As the colour and word yellow were commonly used pre-Lodgement Date in respect of business directories in Australia by Telstra and other traders, I see the YELLOW Trade Mark as referring to a character or a quality of some of the designated goods and services. In my view it falls within Note 1 to s 41(6).
184 Fifthly, while I accept Telstra’s contention that YELLOW PAGES is not a generic term in Australia, I do not accept that this means that YELLOW is inherently adapted to distinguish. Telstra’s registration of YELLOW PAGES since 1977 has meant that other Australian traders have been unable to use that phrase to signify their products, which is an important feature of the “setting or context” in which I must consider the distinctiveness of the YELLOW Trade Mark: see Unilever Australia Ltd v Societe Des Produits NestlÉ S.A. (2006) 69 IPR 255 at [31] per Bennett J. But even when considered in this setting the word yellow, standing alone, is merely descriptive.
185 Further, Telstra’s contention that YELLOW is inherently adapted because other traders have been unable to use YELLOW PAGES tends to conflate the two separate questions arising under s 41 of the Act. The test for inherent adaptability to distinguish under s 41(3) is essentially hypothetical: Sports Warehouse at [96]. It is only ss 41(5) and (6) which permit the applicant for a trade mark to rely on actual use of the mark in support of registration. As Mansfield J said in Philmac at [46], the test of inherent adaption to distinguish excludes the possibility of trade mark significance arising from use. If it did not do so a trade mark could be treated as inherently adapted merely because it had been registered and other traders were therefore precluded from using it.
Whether other traders, acting without improper motive, would wish to use the YELLOW mark, or a similar mark, in a way likely to infringe it if registered?
186 The authorities establish that the extent, if any, of the inherent adaptability of the YELLOW Trade Mark to distinguish turns on whether there is a likelihood that other traders will, in the ordinary course of their business and without improper motive, want to use the same or a similar trade mark, in a manner that is likely to infringe the proposed mark.
187 In making this assessment the Court may take into account evidence as to the actual activities of other traders prior to the Lodgement Date, and also what hypothetical other traders are likely to do: Sports Warehouse at [102].
188 I set out the pre-Lodgement Date use of the colour and word yellow by other traders in Australia and overseas at [118] to [143]. As I said, I am satisfied that prior to the Lodgement Date other traders in Australia and overseas commonly used the colour and word yellow in respect of their print and online business directories. The evidence does not show that any such Australian trader had an improper motive in doing so.
The relevance of international usage of the colour and word yellow
189 Telstra contends that evidence as to overseas use of the colour and the word yellow in respect of directories cannot assist the Court in determining whether the YELLOW Trade Mark is inherently adapted to distinguish the designated goods and services from those of other traders. On its case the evidence of use of the colour and word yellow in foreign jurisdictions is irrelevant because whatever may be the case elsewhere, YELLOW PAGES is a registered trade mark in Australia and YELLOW is unavailable for use.
190 In this regard it relies on Eclipse where Dixon CJ, Williams and Kitto JJ said at 310:
…“Adapted to distinguish” in sub-s. (2) of s. 16 of the Trade Marks Act [1955] means adapted to distinguish in Australia having regard to the practice and conditions of the trade here, the question being whether, quite apart from the effects of registration, “the mark itself, if used as a trade mark, is likely to become actually distinctive of the goods of the person so using it”.
In my view this observation does not stand for Telstra’s contention that evidence of overseas use of a trade mark is irrelevant to the issue of whether other traders wanted to use the mark in Australia.
191 Telstra also relies on The Seven Up Co v O.T. Ltd (1947) 75 CLR 203 at 215 per Latham CJ. Here the Court was concerned with an application by a USA corporation to remove the trade mark “8 UP” from the Australian register, essentially on the ground of its similarity to the well-established USA registered “7 UP” trade mark. Latham CJ cited with approval the remarks of Tomlin J in Impex Electrical Co v Weinbaum (1927) 44 RPC at 410 where his Honour said:
For the purpose of seeing whether the mark is distinctive, it is to the market of this country alone that one has to have regard. For that purpose, foreign markets are wholly irrelevant, unless it be shown by evidence that in fact goods have been sold in this country with a foreign mark on them, and that the mark so used has thereby become identified with the manufacturer of the goods.
192 Latham CJ’s approval was given in a context which is readily distinguishable from the present case. It is significant to the decision that there had been little or no use of the 7 UP mark in Australia, and the statement that “foreign markets are wholly irrelevant” must be understood in that context. It is not authority for the proposition that overseas use of trade indicia is not relevant to whether other traders want to use, or as to the motives of other traders in using, the same indicia in Australia.
193 At a minimum the evidence of use by overseas traders of the colour and word yellow in respect of directories is relevant because it goes to what hypothetical other traders in Australia are likely to do. In my view the contention that such evidence is irrelevant is quite unrealistic when, since at least the 1960s large numbers of Australians have been travelling to the USA, watching American movies and television, listening to American music and reading American novels. This is likely to have spread knowledge of these practices in respect of directories to Australian traders. The growth in use of the internet in the last 15 or so years is likely to have had the same effect. Overseas commercial practices, particularly from the USA, often take root in Australia: see also Australian Health & Nutrition Association Limited trading as Sanitarium Health Food Company v Irrewarra Estate Pty Ltd trading as Irrewarra Sourdough [2012] FCA 592 at [34] per Jagot J. Delegate Williams expressed a similar view: PDCA v Telstra at [19].
194 The evidence of Mr Moule about BMA’s decision to use yellow coloured pages in the BIG Directory in 1987 is a direct example of how overseas practices relevantly affected local commercial practices. He says in effect, and I accept, that the international usage of yellow was so widespread that “I don’t think it ever entered our head that it would be anything other than yellow…”
195 Of course, as Telstra contends, the overseas situation is not directly comparable to Australia as in many overseas countries YELLOW PAGES is not protected by a registered trade mark. It must be accepted that other traders in Australia were prevented from:
(a) using Yellow Pages associated with the Walking Fingers logo or a deceptively similar mark from 1977; and
(b) using the words yellow pages or a deceptively similar mark from 1990.
196 Even so, in my view it is likely that the legitimate desire of Australian traders to use the word yellow in respect of print and online directories in Australia was formed or strengthened by the knowledge of the widespread (and apparently successful) pre-Lodgement Date use by overseas traders of the colour and word yellow in respect of their directories.
197 The evidence of overseas use of the colour and word yellow prior to the Lodgement Date also shows the weakness of Telstra’s contention that were it not for its own long-standing use of the words YELLOW PAGES and the word yellow, other traders would not want to use those words for similar goods and services to Telstra’s in such a manner that would infringe Telstra’s rights. I do not accept this. Prior to Telstra’s adoption of yellow in 1975 the use of the colour and word yellow overseas was already widespread. As Mr Harvy conceded, Telstra was itself following an international trend when it adopted yellow coloured pages and the YELLOW PAGES composite mark with the Walking Fingers logo.
The use of yellow by Yellowbook
198 Yellowbook’s first use of the domain name www.yellowbook.com.au and its application to register the YELLOWBOOK mark was not until 2006, about three years after the Lodgement Date. Post-Lodgement Date use is to be given little weight. I treat Yellowbook’s post-Lodgement Date activities as of no real significance in assessing the distinctiveness of the YELLOW mark as at the Lodgement Date: see Sports Warehouse at [96] and [102].
The likelihood that other traders will want to use the word yellow as a trade mark
199 Telstra contends that the word yellow is not the only or natural word that could be used by other traders in relation to their own directory products, either as a badge of origin or in a purely descriptive sense. It points to Mr Moule’s evidence that the BIG Directory’s name was chosen in order to differentiate it from Telstra’s directory, and it argues that there are many ways to describe the yellow coloured sections of a business directory, such as “Classified” or “Business Section”. It also points to examples where providers of goods and services covered by the YELLOW Trade Mark (such as www.hotfrog.com.au and Pocket Book) do not use the colour yellow and whose trade marks do not include the word yellow. On its submissions other traders could present the relevant goods in any colour of the spectrum or any combination thereof.
200 I accept that other colours and words denoting other colours are available for use by other traders, but it is not necessary for an opponent to registration to establish that the trade mark is required by other traders. It is enough if innocent other traders want to use it. For example, in Clark Equipment at 513 to 514 Kitto J spoke of the “desire” of other traders to use the same mark, and said that traders may “think of the word and want to use it”. In Burger King at 425 Gibbs J took the reference to “likelihood” by Kitto J as a reference to whether another trader “might”, without improper motive, want to use the mark.
201 The evidence shows that prior to the Lodgement Date the colour and word yellow were commonly used in Australia and overseas in respect of print and online business directories. This use is likely to have formed or strengthened the desire of innocent traders to use the word yellow in respect of their directories. Because the word yellow is descriptive of the colour widely used in respect of directories, and because it is likely that consumers recognise directories by reference to that colour, traders are likely, without improper motive, to want to use the word yellow to signify their goods in a way that will infringe the YELLOW Trade Mark if registered. Delegate Williams reached a similar view: PDCA v Telstra at [28].
202 Although his Lordship was speaking of geographical names, Lord Simonds LC’s observation in Yorkshire Copper Works at 154 is apposite. His Lordship said:
…I would say that a geographical name can only be inherently adapted to distinguish the goods of A when you can predicate of it that it is such a name as it would never occur to B to use in respect of his similar goods.
203 The evidence of pre-Lodgement Date use of the colour and word yellow in Australia and overseas in respect of business directories indicates that it cannot be said that it would never innocently occur to another trader to use the YELLOW Trade Mark in respect of similar products. The present case may be distinguished from Blue Paraffin where Buckley LJ (at 501) agreed with the trial judge’s observation that colouring the applicant’s paraffin blue in fact distinguished it because “no other trader could have any reason to dye paraffin blue except for the purpose of benefiting from the [applicant’s] reputation.”
204 It is important to remember that if there is any doubt as to the likelihood of other traders legitimately wishing to use the proposed mark the application should be refused: Chancellor, Masters and Scholars of the University of Oxford (Trading as Oxford University Press) v Registrar of Trade Marks (1990) 24 FCR 1 at 25 per Gummow J.
205 In another contention Telstra maintains that there is no evidence that other traders that used yellow coloured pages or yellow highlighting to signify their business directories pre-Lodgement Date, needed or wanted to use the word yellow as a badge of origin. It points out that, with the exception of RMK’s use of the name Yellow Directories as a badge of origin for about three years from 2000, the use of the word yellow by other traders was descriptive of the colour of the business directories and/or their pages. I accept that such use of the word yellow was not use in a way that informed the public that the directories came from a particular commercial source. That is, it was not use of YELLOW as a trade mark.
206 However, contrary to Telstra’s contention, it does not follow therefore that other traders might not want to use the word yellow or a similar mark as a badge of origin. I say this because the legitimate use of the word yellow by other traders as a badge of origin is likely to have been discouraged by Telstra’s strong stance in claiming exclusive rights to that word in respect of directories.
207 I infer from Mr Moule’s evidence that in 1987 BMA did not use the word yellow in respect of its directories at least in part because of a desire to avoid a dispute with Telstra. Similarly it is plain on Ms Kerferd’s evidence that RMK only ceased to use YELLOW DIRECTORIES as a badge of origin because of Telstra’s threat of legal action. Telstra required RMK to undertake that in future it would not use any name containing the word yellow in respect of its directories.
208 Letters from Telstra’s solicitors to 22 other parties using yellow-related trade indicia are in evidence, including in relation to PDCA’s directories, Yellow Coupons, Yellow Book, and Yellow Duck. The letters show that Telstra strenuously claimed exclusive rights in the word yellow. For example, in a letter to Mr Khoury on 9 March 2006 regarding his use of the YELLOWBOOK domain name Telstra’s solicitors stated:
Telstra is also the registered owner of other trade marks and business names containing the word “Yellow” and uses them in relation to its directories and directory related products and services in Australia. Our clients’ widespread use of the [YELLOW PAGES and Walking Fingers] Trade Marks to identify their directory products and services mean that our clients have developed a substantial and valuable reputation and goodwill in the Trade Marks and in the word “Yellow” in the field of directory products in Australia.
209 In a similar demand to that made to Ms Kerferd, Telstra demanded that Mr Khoury undertake:
...never in the future to use, or authorise the use of … the word “Yellow” (whether alone, or as part of any other word or with any other words) … in any format whatsoever in relation to Australian online directory services or directory-related goods or services which are targeted to Australian customers.
210 Mr Khoury refused to accede to Telstra’s demands in relation to the word yellow. He then successfully argued before the World Intellectual Property Organisation (“WIPO”) that the domain name yellowbook.com.au was not confusingly similar to the YELLOW PAGES domain name. Of course, Telstra was then successful in arguing before Delegate Kirov that the YELLOWBOOK Trade Mark was deceptively similar to the YELLOW PAGES Trade Marks. I concur with the Delegate’s conclusion as to the deceptive similarity of the YELLOWBOOK mark to the YELLOW PAGES mark, but this does not mean that I accept that Telstra has exclusive rights to the word yellow in respect of directories.
211 Nor has the Registrar accepted that Telstra has exclusive rights to the word yellow in respect of directories and related goods and services. Notwithstanding Telstra’s YELLOW PAGES Trade Marks, since 1977 different delegates have accepted THE YELLOW ENVELOPE, YELLOW DUCK, YELLOW ZONE and YELLOW DOOR trade marks in respect of similar or closely related goods and services.
212 Similarly, in Telstra Corporation Ltd v Robert George Coles [2004] ATMO 16 (“Telstra v Coles”) a delegate considered the Yellow duck application in respect of an online directory. Telstra opposed registration on grounds that included that the proposed mark was deceptively similar to Telstra’s YELLOW PAGES, YELLOW MANIA and HELLO YELLOW trade marks. The delegate rejected Telstra’s opposition and at [18] rejected Telstra’s submission that it had a family of YELLOW trade marks. The delegate found (correctly in my view) that Telstra had a family of YELLOW PAGES trade marks.
213 I intend no criticism of Telstra’s actions in defending its intellectual property rights as it sees them. But it must be accepted that its strong stance is likely to have discouraged other traders from using trade marks containing the word yellow even where legally entitled to do so. On this basis I attribute less significance to the evidence showing little use of yellow by other traders as a trade mark.
The likelihood of infringement
214 In my view, if the YELLOW mark is registered, it is likely that any use of the word yellow in a trade mark in respect of directories and related goods and services will infringe it. Any such use is likely to create a risk that consumers will be deceived or confused. Certainly, based on its contentions (although it made some different arguments under s 44), on the evidence of Ms Sedgwick and Ms Courmadias, and on its letters of demand, if the YELLOW Trade Mark is registered Telstra can be expected to contend in future that any use of the word yellow in respect of directories will infringe the mark.
Telstra’s offer to disclaim rights to the colour yellow
215 If the YELLOW mark is registered, there is also a prospect that Telstra may argue in future that use of the colour yellow as a badge of origin by other traders infringes it because that colour is deceptively similar and may cause confusion to consumers. During the running of the appeal Telstra belatedly offered to disclaim an entitlement to exclusive right to the colour yellow in respect of its goods.
216 However, the Trade Marks Office Manual of Practice and Procedure provides published by IP Australia (“Trade Marks Office Manual”) (Part 24, 4.3) provides:
Disclaimers are not to be considered in determining whether the trade mark as a whole is capable of distinguishing. A disclaimer does not affect the inherent capacity, or otherwise, of a trade mark to distinguish.
217 I agree with Lee J in Bausch & Lomb Inc v Registrar of Trade Marks (1980) 28 ALR 537 at 549. His Honour held in relation to a disclaimer offered in that case:
It seems to me that whether a word is registrable or not is a matter that first must be determined in accordance with the principles laid down in regard to the registration of trademarks, and a word which does not pass the tests established by those principles ought not to be registered. Disclaimer undoubtedly has a place in registration (eg s 32 of the Act) but it is not a device to be used to permit registration of a word that should be regarded as unregisterable.
218 In any event it is difficult to divorce the colour yellow from the word denoting that colour. Traders and consumers are likely to find it even more difficult. I agree with the New Zealand Court of Appeal per William Young P, Glazebrook and Ellen France JJ in Cadbury Ltd v Effem Foods Ltd (2007) 78 IPR 672 (“Cadbury v Effem”) at [28] and [34]. The Court was concerned with an application to register the word “purple” in circumstances where the designated goods expressly excluded purple coloured goods. Their Honours said at [34]:
Because of the close link between the word purple and the colour, we also consider that it would provide a disincentive to use the colour purple or similar colours on goods in class 30 for fear consumers may associate those goods with the word mark PURPLE and thus with Cadbury. The granting of a monopoly over what is essentially a feature of the goods in the relevant class is not, in our view, within the scheme of the trade mark regime.
219 Telstra submits that use of the colour yellow by third parties in Australia in relation to directory goods and services cannot be determinative of whether or not the word yellow is inherently adapted to distinguish. It contends that there is no authority for the proposition that the use of a colour itself will infringe a trade mark of a word for a colour and argues that if registration of the YELLOW Trade Mark is allowed it will not extend Telstra’s rights to exclusive use to the colour yellow. It also relies on its belated offer to accept an endorsement on any registration of the YELLOW Trade Mark to specify that the registration gives no rights to the colour yellow in respect of the designated goods.
220 While I accept that the use of the colour yellow by other traders cannot be determinative in relation to the word yellow, in my view the use of the colour yellow and the word yellow cannot be separated as cleanly as Telstra contends. It must be remembered that registration of the word yellow as a trade mark will affect consumers and traders in household and commercial settings far removed from the refinement and nuanced expression of Senior Counsel in a courtroom. As the New Zealand Court of Appeal said in Cadbury v Effem at [28], it is difficult to divorce the use of a word denoting a colour from use of the colour itself.
221 Given the exclusive rights that would be granted to Telstra upon registration of the YELLOW Trade Mark there are likely to be serious difficulties for other traders in knowing where to draw the line in using trade marks that contain the word yellow or use the colour yellow.
A commercial imperative for other traders to use yellow?
222 In Philmac Mansfield J considered an application to register the colour “terracotta” as applied to polypipe fittings. At [65] his Honour set out strict limitations to be applied in relation to colour marks, holding that a colour could only be seen as inherently adapted to distinguish where:
• the colour does not serve a utilitarian function: that is, it does not physically or chemically produce an effect such as light reflection, heat absorption or the like;
• the colour does not serve an ornamental function: that is, it does not convey a recognised meaning such as the denotation of heat or danger or environmentalism;
• the colour does not serve an economic function: that is, it is not the naturally occurring colour of a product and registration of that colour in respect of that product would not thereby submit competing traders to extra expense or extraordinary manufacturing processes in order to avoid infringement;
• the colour mark is not sought to be registered in respect of goods in a market in which there is a proven competitive need for the use of colour, and in which, having regard to the colour chosen and the goods on which it is sought to be applied, other properly motivated traders might naturally think of the colour [and] use it in a similar manner in respect of their goods.
223 In Cadbury v Effem at [27] the New Zealand Court of Appeal also held that it was only in limited circumstances that a colour could be inherently distinctive. Their Honours observed:
In our view, the word PURPLE is in most cases inherently descriptive and connotes… the colour purple. Goods in the same market as the goods for which registration is sought are commonly coloured purple. Traders would be inhibited in using the word purple in relation to those goods. The word is thus not inherently adapted to distinguish Cadbury’s goods from those of any other trader, although it could become distinctive by use. This is not to suggest that this will always be the case. There will be cases where colour does not serve any utilitarian, ornamental or economic function or where the colour is an “out of left field choice”. See the discussion in M Davison, K Johnston and P Kennedy, Australian law of trade marks and passing off, 3th ed, Lawbook, Pyrmont, NSW, 2003, at [2.90]–[2.100], [6.60] and [6.65]. (Emphasis added.)
224 In a similar vein, in Re W M Wrigley Jr Co’s Application [1999] ETMR 214 (“Re Wrigley”) at [21] the Third Board of Appeal of the Office for Harmonisation of the Internal Market held that a colour mark may be inherently distinctive, but only:
…in the case of, first, very specific goods for very specific clientele and, secondly, a colour exhibiting a shade which is extremely unusual or peculiar in the relevant trade.
225 I take a similar approach to Mansfield J in Philmac (echoed as it is in Cadbury v Effem and Re Wrigley). In my view the widespread and apparently successful use of the colour and word yellow in respect of directories may be seen by traders to create a commercial imperative for them to signify their products by the word yellow. Such an imperative is akin to the competitive need to which Mansfield J referred.
226 Taking the approach enunciated in Philmac in relation to a colour mark and applying it to a word denoting a colour, I can see several reasons why other traders might legitimately want to use the word yellow to signify their products. Firstly, contrary to Telstra’s contentions, the evidence indicates that use of the colour yellow may serve a utilitarian or economic function in respect of directories, including that:
(a) yellow is a primary colour which stands out so as to be readily noticed, which complements other colours, and which is a good choice for a corporate colour (as per Ms Kerferd’s evidence). The high visibility of yellow gives it a practical utility. Further, yellow is a good choice for business directories as the black typing in a business directory stands out against it (as per Mr Moule’s evidence). The use of the colour yellow points to an economic basis for signifying directory products by use of that colour; and
(b) business directories are traditionally produced using yellow coloured pages (as per the evidence of Mr Moule), which indicates a “competitive need” for the colour;
227 These utilitarian and economic functions in the colour yellow also point to a commercial imperative for other traders to use the word yellow. This is confirmed by the evidence that prior to the Lodgement Date the public saw the colour yellow as synonymous with business directories (as per Mr Lee’s evidence), and yellow was seen by other traders as the standard colour for business directories (as per the evidence of Mr Moule, Mr Harvy and “Yellow – a timeline”).
228 Secondly, Telstra did not express a limitation in the YELLOW mark to an unusual, peculiar or “out of left field” shade of yellow. The shade of yellow used by Telstra and the shades used by other traders in Australia are generally similar.
229 Thirdly, although comparable to those covered by the YELLOW PAGES marks, Telstra’s designated goods and services are quite broad. They include goods and services seemingly unrelated to print and online directories, including:
(a) in Class 9, computer software including computer programs;
(b) in Class 35, retail and wholesale services including business advisory services, business planning and analysis services, business management and business administration services; business surveys, appraisals and research; conduct of business studies and preparation of business reports; economic forecasting and analysis for business purposes; market analysis, research and monitoring services for business purposes;
(c) in Class 38, telecommunications and communication services including transmission of information on a wide range of topics including online transmission; arranging and providing electronic, digital and computerised communications services and facilities between wholesalers, retailers, customers, and transport service providers; and
(d) in Class 41, computer programming services; computer rental services; computer software design services; installation, maintenance and construction of computer software programs; research and development of technology, including research and development in relation to telecommunications goods and services.
230 It is likely that innocent traders will want to use the word yellow or a similar mark in respect of these broad non directory-related products because such a mark has utilitarian and economic benefits, including that:
(a) yellow branding in colour and name is likely to be attractive to other traders because of its visibility, and the way it stands out;
(b) yellow conveys caution or care in some circumstances (as with yellow or amber traffic lights) and the use of yellow to convey this is likely to be attractive in respect of some designated goods and services, such as for example economic forecasting or business analysis.
Using the approach in Yorkshire Copper Works, it cannot be said that it would never innocently occur to another trader in non directory-related products to use the word yellow to signify their products.
231 Telstra was resistant to cutting down the breadth of the designated goods and services, and it took a similar approach before the Delegate: PDCA v Telstra at [23]. Contrary to Yellowbook’s contention, I consider the Court has power under s 65(7) of the Act to cut down the breadth of the application but I do not take that course when no party argued that the Court should do so, or identified a principled basis upon which the Court could approach such a task.
Policy considerations
232 Policy considerations also point away from allowing Telstra exclusive rights to the word yellow in respect of the broad classes of goods and services designated. Registration would significantly restrict use of the word and Telstra should not be allowed to “enclose part of the great common of the English language and to exclude the general public of the present day and of the future from access to the enclosure”: Joseph Crosfield & Son’s Application (“Perfection”) (1909) 26 RPC 837 at 854 per Cozens-Hardy MR.
233 In my view the widespread pre-Lodgement Date use by other traders in Australia and overseas of the colour and the word yellow in respect of print and online directories tends to show that other traders, acting innocently, will want to use the word yellow or a similar mark in a way that would infringe the YELLOW Trade Mark.
234 While the issue is not straightforward I consider that the YELLOW mark has no inherent adaption to distinguish the designated goods and services.
Issue 1.3: if the YELLOW Trade Mark has no inherent capacity to distinguish, did it in fact distinguish the designated goods and services as at the Lodgement Date – section 41(6)?
235 Having decided that the YELLOW Trade Mark has no inherent adaption to distinguish, the appeals falls to be determined pursuant to s 41(6) of the Act. The onus is upon Telstra to establish that, because of the extent to which it used the YELLOW mark before the Lodgement Date, the mark in fact distinguished the designated goods and services: Sports Warehouse at [40].
236 Importantly, for Telstra’s pre-Lodgement Date use of the word yellow to distinguish the designated goods and services it must be use of that word as a trade mark, or with additions or alterations that do not substantially affect the identity of the mark: s 7 of the Act.
237 In Woolworths Ltd v BP plc (2006) 154 FCR 97 (“Woolworths v BP”) at [79] the Full Court per Heerey, Allsop and Young JJ explained:
…it is important to appreciate that it is the use of the trade mark, as a trade mark, before the application date that determines what can be registered. The trade mark that is the subject of the application must conform with the trade mark that was used before the relevant filing date, because it is the extent to which that prior use has distinguished the designated goods or services as being those of the applicant which must be assessed. It is only where the extent of that prior use has had the consequence that the trade mark does distinguish the applicant’s designated goods or services from those of other persons that the trade mark is “taken to be capable” of so distinguishing the applicant’s goods or services: s 41(6)(a). If the prior use has not had that consequence, the trade mark is taken not to be capable of distinguishing the applicant’s goods or services and the application for registration must be rejected: s 41(2) and (6)(b). Under s 41(6), there is no wider inquiry into the capacity or adaptability of the mark to distinguish the applicant’s goods or services.
238 At [81] and [82] the Full Court endorsed Mansfield J’s approach in Philmac, and explained that two matters were to be considered when applying s 41(6) to a colour mark:
[Section] 41(6) calls for a more precise analysis. In Philmac Pty Ltd v Registrar of Trade Marks at [71], Mansfield J said that for the purposes of applying s 41(6) to a colour mark two issues needed to be addressed. The first is whether the use of the colour in the manner described in the application has, prior to the date of the application, constituted use of the colour as a trade mark. The second issue is whether the trade mark applied for does in fact distinguish the applicant’s products, having regard to evidence concerning the actual use of the colour as a trade mark. We agree with that approach. Thus s 41(6) requires specific consideration of the extent to which BP has used each of the marks applied for as a trade mark before the date of filing and whether that use was sufficient to distinguish the designated goods and services as being those of BP…
For the purpose of s 41(6), the focus of the inquiry should be on the use of the marks applied for, rather than use of colour as part of the get-up or packaging of goods generally…(Citations omitted.)
While their Honours’ explanation concerned a colour mark and not a word mark denoting a colour, similar considerations apply.
239 Under s 41(6) there is no requirement to consider post-Lodgement Date use of the proposed trade mark. If by the Lodgement Date the mark has not acquired distinctiveness by established use, then registration must be refused. The Trade Marks Office Manual (Part 23.5, paragraphs 5.2-5.4) provides in relation to s 41(6):
It relies not on intended use, but on established use prior to filing… Acceptance of a trade mark that is not to any extent inherently adapted to distinguish is on the basis that the trade mark is already distinguishing the applicant’s goods/services in the Australian marketplace. To be able to demonstrate this, the use must be before the filing date. Use after that date will not be considered. Evidence of use overseas could only be an adjunct to the main evidence demonstrating use in Australia, and would not of itself be convincing.
Telstra’s pre-Lodgement Date use of the YELLOW trade mark
240 Telstra contends that it used the word yellow as a trade mark prior to the Lodgement Date, both alone and as a key constituent of its YELLOW PAGES Trade Marks. While the question as to whether Telstra’s use of YELLOW is trade mark use is not clear cut, I do not accept its contention.
241 The Full Court explained in Woolworths v BP at [77]:
Whether or not there has been use as a trade mark involves an understanding from an objective viewpoint of the purpose and nature of the use, considered in its context in the relevant trade. How the mark has been used may not involve a single or clear idea or message. The mark may be used for a number of purposes, or to a number of ends, but there will be use as a trade mark if one aspect of the use is to distinguish the goods or services provided by a person in the course of trade from the goods or services provided by any other persons, that is to say it must distinguish them in the sense of indicating origin. (Citations omitted.)
242 As Kitto J said in Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 422, in determining whether use of the mark is use as a badge of origin context is everything. In the present case this requires consideration of Telstra’s purpose in using, and the nature of its use of, the word yellow on its print and online directories and in its advertisements. In particular it requires consideration as to whether Telstra used the word yellow, standing alone, as a badge of origin or merely as part of its YELLOW PAGES marks.
243 The evidence shows that over the period from 1977 to the Lodgement Date in 2003 Telstra registered various yellow-related trade marks, namely:
(a) the composite YELLOW PAGES Trade Marks, which includes the words YELLOW PAGES associated with the Walking Fingers logo in 1977 (which also appears with an Open Book logo);
(b) the composite mark ELECTRONIC YELLOW PAGES, which includes the Walking Fingers in 1987 (without the Open Book logo and instead associated with a representation of a computer);
(c) the word marks TALKING YELLOW PAGES, HELLO YELLOW, and YELLOWMANIA in 1989 and 1990;
(d) the words YELLOW PAGES on their own in 1990;
(e) the Walking Fingers logo without the words YELLOW PAGES in 1991; and
(f) the composite mark, which includes the words YELLOW PAGES, the Walking Fingers logo set out in yellow on a black background in 2000;
244 Telstra contends that its pre-Lodgement Date use of the YELLOW mark can be seen in several main ways:
(a) The use of yellow standing alone and as a key constituent of the YELLOW PAGES Trade Marks throughout the period from 1977 to 2003. In this period Telstra spent more than $200 million on promoting its YELLOW PAGES directories in extensive campaigns. The evidence shows that the YELLOW PAGES Trade Marks were successful and well recognised as at the Lodgement Date, as confirmed by the 2003 decision of the Superbrands Council to describe YELLOW PAGES as one of Australia’s most loved and memorable brands.
(b) The use of yellow, standing alone, and as a key constituent of the HELLO YELLOW slogan in the HELLO YELLOW campaign from late 1982 to 1984, as detailed at [54] to [64].
(c) The use of the word yellow, standing alone, and as a key element of the name and the operator’s welcome message in Telstra’s HELLO YELLOW operator assisted directory service from 1993 to 1994 until 1997 , as detailed at [66] to [67]. Users who telephoned the service would be asked “Hello Yellow, how can I help you?”
(d) The use of the word yellow, standing alone, in the early 2000s, set out at [68], when Telstra’s online directory business employees customarily referred to that business as YELLOW between themselves, and when telephoning customers and potential customers introduced themselves as being from YELLOW.
245 It is established that a word may be used as mark even where it is a component of a larger composite mark: Chocolaterie Guylian at [97]; Sports Warehouse at [133]; Natures Blend Pty Ltd v Nestle Australia Ltd [2010] FCA 198 at [40] per Sundberg J. Whether use of a mark in a particular case is use as a trade mark turns on the facts of the case, and the trade mark in question viewed in the context of those facts. In my view Telstra failed to establish that, on an objective view, any of its pre-Lodgement Date use of the word yellow was use of it as a trade mark.
246 In the 26 year period from 1977 to the Lodgement Date Telstra primarily used the YELLOW PAGES composite marks on its directories and in its marketing. Except as I set out below, it:
(a) only used the word yellow as part of the phrase “Yellow Pages”, which itself had the capacity to distinguish (as was recognised when those words were registered as a trade mark in 1990); and
(b) predominantly used the phrase “Yellow Pages” as a component of the composite YELLOW PAGES Trade Marks featuring the Walking Fingers logo, which itself had a strong capacity to distinguish.
I do not consider this to be use of YELLOW standing alone. In my view the use of the word yellow as a component of the composite YELLOW PAGES marks is not use of it as a separate badge of origin.
247 That Telstra was using YELLOW PAGES (rather than YELLOW) as the badge of origin of its directories can be seen, firstly, in the fact that:
(a) over the 28 years from 1975 until the Lodgement Date Telstra distributed more than 300 million printed directories carrying the YELLOW PAGES Trade Marks and not YELLOW; and
(b) over the nine years from 1994 until the Lodgement Date Telstra conducted its online directory at the internet address www.yellowpages.com.au and carrying the YELLOW PAGES Trade Marks.
248 Secondly, over this period Telstra’s marketing campaigns were also in support of the YELLOW PAGES brand (rather than YELLOW). Over the 28 years from 1975 to the Lodgement Date Telstra did not use the word yellow, standing alone, in its marketing. Except for the relatively short HELLO YELLOW campaign which I deal with below, the campaigns were based around the composite YELLOW PAGES marks with the Walking Fingers logo.
249 I accept that the word yellow is an important part of the composite YELLOW PAGES marks but:
(a) it is a word which is descriptive of the colour of the directories, and of the colour commonly used on business directories;
(b) it appeared only as part of the phrase YELLOW PAGES; and
(c) that phrase appeared as part of the composite mark associated with the Walking Fingers logo.
Neither the advertising campaigns or the print and online directories themselves indicated that YELLOW was their place of origin instead of, or as well as, YELLOW PAGES.
The HELLO YELLOW campaign
250 I now turn to consider the other marketing on which Telstra relies to establish its pre-Lodgement Date use of the YELLOW Trade Mark. The HELLO YELLOW campaign between late 1982 and 1984 is the highpoint of its contentions. It relies on the HELLO YELLOW television advertisements “Beach House”, “Tortoise and the Hare”, “Love Story”, “Who’s Walking Who”, and “Stadium Scene” as indicating use of YELLOW standing alone.
251 As I have said, Mr Harvy deposes that the advertisements referred to “Yellow on its own”. Having reviewed the television advertisements on which Telstra relies I do not accept this evidence. The advertisements only use the phrase HELLO YELLOW, and the advertisements do not contain any reference to YELLOW on its own.
252 I described representative examples of the television advertisements at [56] to [62]. The message of the advertisements is that the viewer should use the YELLOW PAGES directories to look up the information sought. They refer only to the YELLOW PAGES directories, and they resolve to a picture of the YELLOW PAGES directory including a composite YELLOW PAGES Trade Mark containing the Walking Fingers logo. As the jingle confirms, the reference to yellow in the HELLO YELLOW trade mark is just a shortened reference to YELLOW PAGES. The advertisements are plainly in promotion of the YELLOW PAGES and not YELLOW, and I infer that was Telstra’s purpose in the campaign.
253 In this campaign Telstra only used the word yellow:
(a) as part of the distinctive HELLO YELLOW phrase (later registered as a trade mark); and
(b) as part of the distinctive YELLOW PAGES composite marks in the way I have described.
The television advertisements consistently used the YELLOW PAGES composite marks including the Walking Fingers logo. By way of example, the “Goggomobil” television commercial concludes with a still picture of the YELLOW PAGES composite trade mark below.
254 The same is true of the other television advertisements to which Mr Harvy refers, and it is true too of the corresponding print advertising.
255 Throughout the HELLO YELLOW campaign Telstra continued to distribute millions of print directories each year carrying the brand YELLOW PAGES. While the word yellow is an important part of the HELLO YELLOW trade mark, I do not consider that, standing alone, yellow signified the origin of Telstra’s products. It is descriptive of the colour commonly used on business directories, it was not used alone, and it was just a shorthand reference back to the well-recognised YELLOW PAGES trade mark rather than an attempt to separately brand the directories and related goods and services.
256 It must also be kept in mind that the HELLO YELLOW campaign only ran for about two of the 28 years from 1975 to the Lodgement Date, and over this whole period Telstra used the YELLOW PAGES marks.
The other use of YELLOW
257 In the 19 years following cessation of the HELLO YELLOW campaign in 1984 until the Lodgement Date, Telstra relies only on:
(a) the operation of the HELLO YELLOW directory assistance service for three to four years from 1993 to 1994 to 1997, and the practice of the operator of the service to welcome users with the words “Hello Yellow, how can I help you?”;
(b) the practice (for one or two years prior to the Lodgement Date) commencing in the early 2000s for employees in Telstra’s online directory section to introduce themselves as being from “Yellow” when telephoning customers or potential customers.
258 While these practices can be argued to be a reference to YELLOW standing alone, the references are of little significance viewed in context, that:
(a) over the 28 years from 1975 to the Lodgement Date Telstra conducted broad reaching marketing campaigns spending more than $200 million to promote YELLOW PAGES directories (rather than YELLOW);
(b) over the 28 years to the Lodgement Date Telstra distributed more than 300 million print directories to Australian businesses and households, all carrying the YELLOW PAGES Trade Marks (rather than YELLOW);
(c) from its commencement in 1994 Telstra operated its online directory at the YELLOW PAGES internet address www.yellowpages.com.au and (and not at a YELLOW internet address) and promoted it as YELLOW PAGES Online; and
(d) the HELLO YELLOW operator assisted directory service only ran for three to four years.
259 The other practice to which Ms Sherwood refers, that of employees in Telstra’s online directory section referred to the YELLOW PAGES directories as YELLOW between themselves, is of little significance. Such communications internal to Telstra are of little assistance in deciding whether Telstra used YELLOW as a badge of origin in the marketplace or assessing whether consumers recognised YELLOW as distinguishing Telstra’s products.
Dilution of any trade mark use of YELLOW
260 Mr Harvy provides little detailed evidence as to how the different YELLOW PAGES marks were used over the 19 years from cessation of the HELLO YELLOW campaign in 1984 until the Lodgement Date, but the evidence shows Telstra usually used the composite YELLOW PAGES marks including the Walking Fingers logo.
261 If contrary to my view Telstra’s pre-Lodgement Date use of the word yellow is accepted to be use of it as a trade mark, it can only be seen as light use. Yellow was not used standing alone and only as a component of the YELLOW PAGES and HELLO YELLOW trade marks. In my view this reduces the trade mark significance of the use of the word yellow.
262 In Sports Warehouse the applicant, Sports Warehouse, sought registration of the words TENNIS WAREHOUSE as a trade mark. Sports Warehouse had consistently used those words on its website but did so in association with an oval logo containing the abbreviation “TW”, as follows:
263 Kenny J held at [132] to [133] that:
[132] …the close association of the “TW” logo within the oval and the words “TENNIS WAREHOUSE” to some degree deprived the use of the words “TENNIS WAREHOUSE” of their significance as a trademark on the webpage that standing alone they formerly had. It is, so it seems to me, unnecessary to decide whether the words together with the “TW” logo amounted to the one composite mark, or whether the words and the “TW” logo were two marks placed together in close association. Even if the latter, the effect of the “TW” logo placed in close association with the words “TENNIS WAREHOUSE” had the effect of substantially diluting any trade mark significance that attached to the words used by themselves.
[133] …In my view, when the “TW” logo was placed in close association with the words “TENNIS WAREHOUSE” in 2003, this had the effect of substantially diluting any trade mark significance that attached to the words “TENNIS WAREHOUSE” by themselves.
264 The same can be said of the word yellow appearing as part of the phrase “Yellow Pages”, which itself appeared as one component of the YELLOW PAGES composite mark associated with the Walking Fingers logo. Any significance that the word yellow had as a trade mark was substantially diluted by its association with the other important elements of the mark, particularly the well-known Walking Fingers logo.
265 Dodds Streeton J found to similar effect in Fry Consulting v Sports Warehouse (2012) 201 FCR 565 (“Fry Consulting”). This case concerned an application by Fry Consulting for registration of the following mark:
Prior to the Lodgement Date Fry Consulting had predominantly used this mark in conjunction with the tag-line “Your online tennis shop!”, as follows:
266 Her Honour said that although the trade mark sought was inherently capable of distinguishing Fry Consulting’s services, had she been required to assess use of the mark under s 41(5) she would have found that the applicant had not used it. Her Honour held at [112] that the addition of the tag-line substantially affected the identity of the trade mark. I take a similar view of the use of the word yellow as part of the composite YELLOW PAGES marks.
Any trade mark use of YELLOW was light and for a short period
267 Finally, if (contrary to my view) it is accepted that Telstra did use YELLOW as a trade mark prior to the Lodgement Date it did not do so for a sufficient time or for a sufficient duration to in fact distinguish its goods and services from the goods and services of others.
268 The Trade Marks Office Manual (Part 23.5, paragraph 5.2) provides, and I agree, that s 41(6):
…places a heavy onus on the applicant to demonstrate that the trade mark designates only its goods or services in the mind of the relevant buying public and that the ordinary signification of the word, device etc. is eclipsed by its trade reputation. It will not usually be enough to establish the extent and duration of the applicant’s own use. It may also be necessary to establish the nature of the perception enjoyed by the trade mark in the marketplace. The applicant will need to establish to the Registrar’s satisfaction that ordinary customers associate the trade mark exclusively with the applicant as being the trade source for the particular goods and/or services.
269 Telstra did not establish that it used the YELLOW Trade Mark to any significant extent prior to the Lodgement Date. This can be seen in the fact that:
(a) any use of the word yellow as a trade mark was diluted by its association with the other elements in the YELLOW PAGES composite mark;
(b) the HELLO YELLOW marketing campaign on which Telstra relies only ran for about two years from 1982 to 1984; and
(c) the HELLO YELLOW operator assisted directory service only ran for about three to four years from 1993 to 1994.
What did consumers understand?
270 In determining what consumers understood to be the commercial origin of Telstra’s directories such minor use of YELLOW as a trade mark must be viewed against the fact that Telstra had distributed a huge number of directories carrying the YELLOW PAGES brand, continued to operate its yellow pages Online directory from 1994 to 2003 under the YELLOW PAGES brand, and conducted its marketing campaigns under the YELLOW PAGES Trade Marks (and not YELLOW). As a result the composite YELLOW PAGES Trade Marks had become one of Australia’s most recognised trade marks as at the Lodgement Date.
271 Considered in this context Telstra draws a long bow in relying on its relatively light use of the word yellow as showing that in July 2003 consumers saw YELLOW as the commercial origin of the directories rather than YELLOW PAGES. It is significant that Telstra adduced little or no cogent evidence as to consumer recognition of the YELLOW Trade Mark prior to the Lodgement Date, and did not establish that consumers saw Telstra’s products as originating from YELLOW rather than, or as well as, from YELLOW PAGES.
272 It is Telstra’s onus and it failed to establish that, as at the Lodgement Date, the YELLOW Trade Mark in fact distinguished the designated goods and services.
273 Pursuant to s 41(6) of the Act Telstra’s application to register YELLOW as a trade mark must be refused.
Issue 1.4: does or will the yellow trade mark distinguish the designated goods and services as at the Lodgement Date – section 41(5)?
274 Given my finding that the YELLOW Trade Mark has no inherent adaption to distinguish the designated goods and services, and that the pre-Lodgement Date use of the mark did not in fact distinguish the designated goods and services under s 41(6), it is strictly unnecessary to deal with the remaining questions. But having regard to the prospect of an appeal, it is best that I also deal with the other Agreed Issues.
275 If, contrary to my finding above, the YELLOW Trade Mark is accepted to be to some extent inherently adapted to distinguish the designated goods and services, the appeals fall to be determined pursuant to s 41(5) of the Act. I set out s 41 in full at [154] above.
276 As Kenny J explained in Sports Warehouse at [111]:
Section 41(5) permits the registration of a trade mark that is not inherently sufficiently adapted to distinguish, but that has as at the lodgement date in fact acquired a capability to distinguish the relevant services. In other words, s 41(5) recognises that marks which are insufficiently inherently adapted to distinguish may nevertheless by their use or other circumstances have become distinctive in the minds of consumers so that they will be able to “do the job of distinguishing” the applicant’s goods. (Emphasis added and citations omitted.)
277 In deciding whether as at the Lodgement Date the YELLOW Trade Mark does or will distinguish the designated goods and services as Telstra’s, the Court is required to consider, in combination:
(a) the extent to which the trade mark is inherently adapted to distinguish;
(b) the use, or intended use, of the trade mark by the applicant; and
(c) any other circumstances.
278 As the factors are to be considered in combination, where a trade mark has a low level of inherent adaption to distinguish it will require a correspondingly higher level of use and other circumstances to satisfy the court that it does or will distinguish the designated goods and services. The less a trade mark is inherently adapted to distinguish the more actual use of the mark or other circumstances will be required: Sports Warehouse at [110] and the authorities cited therein. This is important in the present case because if the YELLOW Trade Mark is to some extent inherently adapted to distinguish, it must only be so to a minor extent.
279 Although the assessment under s 41(5) must be made as at the Lodgement Date, evidence of post-Lodgement Date use of the trade mark may also be relevant. Post-Lodgement Date use of the mark may establish that the trade mark has in fact become distinctive, which allows the inference that as at the Lodgement Date it had a capacity to distinguish: Austereo Pty Ltd v DMG Radio (Australia) Pty Ltd (2004) 61 IPR 257 (“Austereo”) at [33] per Finn J; Sports Warehouse at [112] to [113].
280 As Kenny J explained in Sports Warehouse, in citing Austereo with approval at [112] to [113]:
[112] Evidence of use after the lodgement date may be relevant under s 41(5): see Austereo at 265 [32]-[33] and Re Pound Puppies Trade Mark [1988] RPC 530 at 533. As was said in the latter case:
... it is permissible when deciding whether the mark was capable of distinguishing to take into account use after the date of application. If a mark has in fact become distinctive, then it is at least likely to have had a capacity to distinguish.
[113] As the above passage shows, the relevance of post-lodgement use depends on whether it supports an inference that the trade mark was capable of distinguishing the applicant’s services at the lodgement date. In Austereo at 264 [33] Finn J said:
What requires emphasis…is that subsequent use evidence, no less than evidence of intended use, is relevant only to the question of whether the mark possessed the required capability at the priority date. It will not assist an applicant for registration if that use demonstrates no more than (i) the mark has the potential or capacity to acquire that capability in the future; or (ii) that the mark has acquired distinctiveness only because the relevant community has since the priority date been “educated” to see the mark as an indicator of the origin of particular services.
(Emphasis added and citations omitted.)
281 In Austereo Finn J held (at [52]) that post priority date use of the trade mark meant that it had acquired distinctiveness. But his Honour refused registration of the mark because the evidence did not support an inference that the required capability existed as at the priority date.
282 I now turn to the matters to be considered in combination pursuant to s 41(5), namely the extent to which YELLOW is inherently adapted to distinguish, the use or intended use of YELLOW by Telstra, and any other circumstances.
The extent of the YELLOW Trade Mark’s inherent adaption to distinguish
283 If it is accepted that the YELLOW Trade Mark is to some extent inherently adapted to distinguish, then for the reasons previously expressed its inherent adaption must be to a minor extent only.
Telstra’s pre-Lodgement Date use of the YELLOW Trade Mark
284 As I have said, Telstra contends that it used the word yellow as a trade mark, both standing alone and as a key constituent of:
(a) the YELLOW PAGES Trade Marks used on its directories and in its marketing campaigns from 1975;
(b) the HELLO YELLOW marketing campaign from late 1982 to 1984;
(c) the HELLO YELLOW operator assisted directory service from 1993 to 1994 and 1997; and
(d) the online directory business employees referring to that business as YELLOW in the early 2000s, and introducing themselves to customers and potential customers as being from YELLOW.
285 I deal with these contentions in detail at [244] to [273] and it is unnecessary to do so again. As I said at [260], I do not accept that Telstra used the YELLOW mark as a trade mark at all before the Lodgement Date. While it used the word yellow, its use was not use of it as a trade mark. Further, as I said at [261] to [273], even if it is accepted that Telstra’s use of the word yellow was trade mark use it did not in fact distinguish its goods and services because:
(a) its trade mark significance was substantially diluted by the association of the word yellow with the other elements of the composite YELLOW PAGES Trade Marks; and
(b) it did not use YELLOW to a sufficient extent or for a sufficient duration.
Telstra’s post-Lodgement Date use of the YELLOW Trade Mark
286 Telstra relies on two main marketing campaigns in relation to its post-Lodgement Date use of the Yellow mark.
The FIND IT IN YELLOW campaign
287 The first campaign on which Telstra relies is the FIND IT IN YELLOW campaign which ran from early 2005 until mid-2006. I set out the five phases of this campaign in detail at [78] to [91]. The campaign:
(a) cost in the order of $9 million to conduct;
(b) was large and broad-reaching, using press, television, electronic, distribution of merchandise, outdoor and online advertising; and
(c) included the nationwide distribution of about 10.2 million printed YELLOW PAGES metropolitan, local, regional, and On the Go directories featuring the FIND IT IN YELLOW trade mark accompanied by the composite YELLOW PAGES Trade Marks.
288 In Mr Harvy’s words this campaign “used the YELLOW mark without the reference to PAGES.” Mr Harvy says that through this campaign the public was “well educated that the YELLOW trade mark was used for Telstra’s directory goods and services.” Telstra argues, as Delegate Williams found, that this campaign had the effect of shifting “the focus of earlier trade marks from the ‘pages’ of Yellow Pages to the ‘yellowness’ … of those pages” and that the campaign inevitably had an effect on public perceptions: PDC v Telstra at [37] to [38].
289 Telstra contends that the campaign focused on just the word YELLOW rather than YELLOW PAGES. It argues that its use of the word yellow in this campaign was a reference to Telstra’s directories which evidenced its confidence that consumers would recognise the YELLOW PAGES directories by its use of the first word of that mark. As I have previously said, I do not accept that this campaign used the word yellow, standing alone. Nor do I accept that the FIND IT IN YELLOW campaign had the effect that Telstra contends.
The YELLOW campaign
290 The second campaign upon which Telstra relies is the YELLOW campaign which commenced in September 2006. I detail the different phases of this campaign at length at [98] to [108]. This campaign:
(a) was aimed at rebranding the YELLOW PAGES print and online directories as YELLOW;
(b) promoted YELLOW as an umbrella brand in respect of Telstra’s print and online business directories;
(c) was broad-reaching and launched with significant publicity;
(d) cost just under $20 million in 2006 to 2007;
(e) promoted the entire range of Telstra’s business directory products under the YELLOW mark; and
(f) made extensive use of the YELLOW mark on its online directory, in its promotional campaigns, and on material handed out to consumers.
291 During the campaign Telstra made substantial changes in the branding of its products including by distributing about 16 million printed metropolitan, local, regional, and Yellow In the Car directories featuring YELLOW, standing alone (rather than the YELLOW PAGES Trade Marks) nationwide between September 2006 and June 2007.
292 Telstra also rebadged its online directory under the YELLOW Trade Mark by changing the internet address for the webpage to www.yellow.com.au, and by displaying the word YELLOW, standing alone, prominently on the home page and on each subsequent screen. In the 12 months following September 2006 Telstra’s online directory attracted more than 2 million unique browsers each month.
293 At the same time it upgraded and introduced other print and electronic products and services and branded them under the YELLOW Trade Mark, such as HOME AT YELLOW, YELLOW MOBILE, YELLOW OFFERS, YELLOW FEATURED OFFERS and YELLOW IN THE CAR.
294 In the YELLOW campaign Telstra’s purpose in using, and the nature of its use of, the word yellow was plainly to move from the YELLOW PAGES Trade Marks to the YELLOW Trade Mark as the badge of origin of Telstra’s directories and related goods and services. I accept that its use of the YELLOW Trade Mark from September 2006 was use of it as a trade mark. The applicants did not contend otherwise.
295 Telstra argues, as Delegate Williams found, that the FIND IT IN YELLOW campaign followed by the YELLOW campaign resulted in a smooth and effective reshaping of the YELLOW PAGES Trade Marks to the YELLOW mark. It contends that having built an extensive reputation in its YELLOW PAGES marks it then managed a well-resourced transition to YELLOW: PDCA v Telstra at [42], [44]. It submits that this strongly supports the inference that, as at the Lodgement Date, consumers would already have appreciated that YELLOW, standing alone, was an indicator of commercial origin.
296 I do not agree. The evidence tends to show that the transition did not work as Telstra intended.
Were the FIND IT IN YELLOW and YELLOW campaigns effective in altering consumers’ understanding of the origin of Telstra’s directories?
297 Ms Sherwood and Mr Harvy depose that the FIND IT IN YELLOW campaign involved use of the word yellow, standing alone. For example Mr Harvy says:
…the Yellow Pages trade mark [was used] in conjunction with the word ‘YELLOW’ alone when referring to the entirety of the Yellow Pages product.
But the advertisements did not use the word yellow alone. In cross-examination Mr Harvy conceded that it was misleading for him to so depose. He accepted that the campaign did not use the word yellow, standing alone, at any point, and said he meant only that the word yellow was being used in a tag-line to describe the set of products.
298 Telstra’s use of the word yellow was only as part of the FIND IT IN YELLOW phrase, which was itself recognised as distinctive and registered as a trade mark. While I accept that FIND IT IN YELLOW focuses attention on the word yellow, it does not use yellow, standing alone, as a badge of origin. Again, I see the word yellow as just a shorthand reference to the well-recognised YELLOW PAGES Trade Marks rather than an attempt to badge Telstra’s products as being from YELLOW.
299 This can be seen too in the fact that the marketing objectives of the FIND IT IN YELLOW campaign (as set out at [76], [83], [89], [90] and [92]) were to defend and increase the use of Telstra’s print and online YELLOW PAGES directories. Consistently with these marketing objectives Telstra:
(a) published extensive television and print advertisements which featured the YELLOW PAGES domain name and directed internet traffic to that website, and carried the composite YELLOW PAGES Trade Marks;
(b) continued to distribute between 11 and 14 million print directories each year under the YELLOW PAGES Trade Marks (rather than the YELLOW mark); and
(c) continued to operate its online directory at the www.yellowpages.com.au internet address and carrying the YELLOW PAGES Trade Marks on its website pages, rather than at a YELLOW internet address and by using that mark on its website pages.
300 The internal and external reviews of the campaign concluded that it was successful because it promoted consumer knowledge and use of the print and online YELLOW PAGES directories. The reviews said nothing about the extent to which YELLOW was recognised by consumers as a badge of origin.
301 Mr Harvy deposes that Phase 2 of the campaign was intended to maintain and further increase the usage of “the Yellow products”, but this is just another example of his overstating the use of YELLOW standing alone. There is little or no cogent evidence that, at that time, consumers saw Telstra’s directories as originating from YELLOW, as distinct from YELLOW PAGES.
302 I accept that the FIND IT IN YELLOW campaign was intended to pave the way for later branding changes in 2006 but it is not clear what those changes were to be. It may be that Telstra had the intention of using YELLOW at the time it flagged the branding changes, but it cannot be that the FIND IT IN YELLOW campaign was an attempt to move to YELLOW as the umbrella brand. The campaign started in February 2005 before Telstra was advised (in July 2005) that it should move away from the YELLOW PAGES Trade Marks to refresh its brand. Mr Harvy and his marketing team did not recommend that the YELLOW mark become the overarching brand until March 2006, and the CEO, Mr Akhurst, did not accept the recommendation until May 2006.
303 As I have said, I accept that the YELLOW campaign which commenced in September 2006 used YELLOW as a trade mark. It sought to change consumers’ perceptions so that they understood that YELLOW was the source of Telstra’s directories and related goods and services. But, unfortunately for Telstra which spent a great deal of time and money on the campaign, the evidence tends to show that its post-Lodgement Date use of the YELLOW Trade Mark was not capable of distinguishing Telstra’s goods and services.
304 I say this for a number of reasons. Firstly, Telstra adduces no cogent evidence that consumers understood from the FIND IT IN YELLOW campaign that YELLOW was the source of Telstra’s directories. Telstra’s internal and external reviews of the campaign did not survey the level of consumer recognition of the YELLOW mark, and were concerned only with the growth in recognition and use of the YELLOW PAGES print and online directories.
305 Secondly, the June 2007 TNS Report following the YELLOW and FIND IT IN YELLOW campaigns showed negligible consumer recognition of the YELLOW Trade Mark unless consumers were prompted by reference to, amongst other things, YELLOW PAGES.
306 Mr Harvy and Ms Sherwood’s evidence that the June 2007 TNS Report shows that the Yellow mark was operating effectively to distinguish Telstra’s goods and services is contrary to the evidence and not credible. It may be, as Mr Harvy says, that 1% spontaneous awareness of the YELLOW directory was a “strong result” in July 2006 because only the FIND IT IN YELLOW had been conducted at that point. But, notwithstanding its $20 million YELLOW campaign there was no improvement in the 1% result over the following 11 months. Ms Sherwood says that the YELLOW Trade Mark had achieved a high level of consumer awareness, and that the YELLOW mark had “undoubtedly done its job”. But other than such self-serving opinions Telstra offered no solid evidence that this was so, and the June 2007 TNS Report directly contradicts this. I do not accept that the YELLOW mark was well recognised.
307 Thirdly, Telstra’s decision to abandon YELLOW as the overarching brand in 2009 and revert back to YELLOW PAGES is significant. It made this decision against the backdrop that Mr Harvy and his marketing team had deliberated over about nine months before recommending that Telstra move away from its well-recognised YELLOW PAGES marks to the YELLOW mark, and it had taken two presentations to the CEO over a two month period before he agreed to it. It abandoned the mark despite having spent about $29 million on the FIND IT IN YELLOW and YELLOW campaigns in 2005 to 2007, and considerable time and effort in making the move.
308 Both Ms Sherwood and Mr Harvy say that Telstra’s reversion to the YELLOW PAGES Trade Marks as its principal brand should not be seen as adversely reflecting on the YELLOW mark’s capacity to distinguish Telstra’s products. Ms Sherwood says that the principal reason for moving back to the YELLOW PAGES marks was that the online directory products were not working as effectively as they should and Telstra decided to spend its time and energy enhancing its products rather than on advertising. She also says that Telstra’s senior management made the decision, and criticises that decision by suggesting that their preference for YELLOW PAGES merely reflected that many of them came from the USA, rather than reflecting a lack of strength in the YELLOW mark.
309 I am not satisfied on the evidence that the YELLOW mark did its job, or that it had achieved a high level of consumer awareness. The opinion evidence that it had done so is not credible, and is inconsistent with the June 2007 TNS Report which revealed negligible levels of unaided consumer recognition of YELLOW.
310 I infer from all the circumstances, including:
(a) the descriptiveness of the word yellow;
(b) the negligible unprompted consumer recognition of YELLOW revealed by the June 2007 TNS Report;
(c) Telstra’s decision to abandon the YELLOW mark in 2009 notwithstanding its broad-reaching and expensive campaigns in support of it; and
(d) Telstra’s failure to adduce cogent evidence that the YELLOW mark was well recognised by consumers;
that despite Telstra’s best efforts the high levels of consumer recognition of the YELLOW PAGES Trade Marks were not effectively transferred to the new YELLOW mark. Telstra did not establish that its post-Lodgement Date use of the YELLOW mark was capable of distinguishing Telstra’s directory products as at the Lodgement Date.
Other circumstances
311 Telstra submits, and I accept, that the fact that part of a mark is separately registered may constitute relevant “other circumstances” under s 41(5): see Re Application by Eltham Woodwind (Importing) Pty Ltd (1996) 34 IPR 668; Re Application by Reemark (2000) 50 IPR 162. Telstra’s registration and use of the YELLOW PAGES Trade Marks since 1977 is a relevant “other circumstance”.
312 Telstra argues that its use of the YELLOW PAGES mark shows its ongoing promotion and use of YELLOW as part of its brand. I accept that Telstra used the word yellow as an important element of its YELLOW PAGES marks but, for the reasons already expressed, I do not accept that it used YELLOW as a badge of origin until it launched the YELLOW campaign in September 2006.
313 Telstra also contends that it is a relevant “other circumstance” that it has persistently sought to preserve the exclusive rights to use YELLOW PAGES which it says includes YELLOW. As I have said, Telstra has exclusive rights to YELLOW PAGES, but this does not mean that it has exclusive rights to the word yellow. I note again that since registration of the YELLOW PAGES marks the Registrar has allowed YELLOW DUCK, YELLOW ZONE, THE YELLOW ENVELOPE, and YELLOW DOOR in respect of similar or closely related goods and services.
314 I can see little in the “other circumstances” to which Telstra points. In large part its contentions are a repetition of arguments which I have already dealt with.
Conclusion regarding s 41(5)
315 In my view, considering the above matters in combination, Telstra failed to establish that the YELLOW Trade Mark does or will distinguish its designated goods and services pursuant to s 41(5). In summary this is because:
(a) the extent of the inherent adaption to distinguish of the YELLOW Trade Mark is minor;
(b) Telstra did not use YELLOW as a trade mark pre-Lodgement Date;
(c) if it is accepted that Telstra used YELLOW as a trade mark pre-Lodgement Date;
(i) the trade mark significance of its use was diluted because it was only used as part of the YELLOW PAGES composite mark; and
(ii) it was not used to a significant extent or for a significant period;
(d) Telstra did not use YELLOW as a trade mark post-Lodgement Date until the YELLOW campaign in September 2006. If, contrary to my view, it is accepted that it used YELLOW as a trade mark in the FIND IT IN YELLOW campaign the trade mark significance of its use was diluted because it was only used as part of that mark; and
(e) there is little in the “other circumstances” on which Telstra relies.
Issue 2: Should registration be refused on the basis that the yellow mark is deceptively similar to specified Prior marks – section 44
316 The applicants oppose registration of the YELLOW Trade Mark under s 44 of the Act on the ground that it is deceptively similar to four earlier applications, namely THE YELLOW ENVELOPE, YELLOW DUCK, YELLOW ZONE, and YELLOW DOOR. Again, it is strictly unnecessary to decide this issue but, given the prospect of an appeal it is best that I set out my views.
The legislative framework
317 Section 44 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) it 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.
Note 1: For deceptively similar see section 10.
Note 2: For similar goods see subsection 14(1).
Note 3: For priority date see section 12.
….
(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.
318 The applicants do not contend that the YELLOW Trade Mark is substantially identical to prior trade mark applications, only that it is deceptively similar to them.
319 Section 10 of the Act provides:
For the purposes of this Act, a trade mark is deceptively similar to another trade mark if it so nearly resembles that other mark that it is likely to deceive or cause confusion.
320 Section 14 provides that goods and services are similar to other goods and services if they are the same, or if they are of the same description.
Relevant principles
321 The question of deceptive similarity has been considered by the courts many times, and the principles are well established.
322 In Woolworths at [50] French J drew on the principles enunciated by Kitto J in Southern Cross at 595, and set out the following general propositions with respect to deceptive similarity:
…
(i) To show that a trade mark is deceptively similar to another it is necessary to show a real tangible danger of deception or confusion occurring. A mere possibility is not sufficient.
(ii) A trade mark is likely to cause confusion if the result of its use will be that a number of persons are caused to wonder whether it might not be the case that the two products or closely related products and services come from the same source. It is enough if the ordinary person entertains a reasonable doubt.
It may be interpolated that this is another way of expressing the proposition that the trade mark is likely to cause confusion if there is a real likelihood that some people will wonder or be left in doubt about whether the two sets of products or the products and services in question come from the same source.
(iii) In considering whether there is a likelihood of deception or confusion all surrounding circumstances have to be taken into consideration. These include the circumstances in which the marks will be used, the circumstances in which the goods or services will be bought and sold and the character of the probable acquirers of the goods and services.
(iv) The rights of the parties are to be determined as at the date of the application.
(v) The question of deceptive similarity must be considered in respect of all goods or services coming within the specification in the application and in respect of which registration is desired, not only in respect of those goods or services on which it is proposed to immediately use the mark. The question is not limited to whether a particular use will give rise to deception or confusion. It must be based upon what the applicant can do if registration is obtained.
In respect of the last proposition, Mason J observed in Berlei Hestia Industries Ltd v The Bali Company Inc (1973) 129 CLR 353 at 362:
...the question whether there is a likelihood of confusion is to be answered, not by reference to the manner in which the respondent has used its mark in the past, but by reference to the use to which it can properly put the mark. The issue is whether that use would give rise to a real danger of confusion.
323 In Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd (2004) 61 IPR 212 (“Crazy Ron’s”) at [84] the Full Court, per Moore, Sackville and Emmett JJ, explained the relevant principles. More recently, the principles were succinctly summarised by Perram J in Mars Australia Pty Ltd v Sweet Rewards Pty Ltd (2009) 81 IPR 354 at [95], where his Honour said:
(1) The question of deceptive similarity is not to be judged by a side by side comparison. Instead what is involved is a comparison, on the one hand, of the impression based on recollection of an applicant’s mark that persons of ordinary intelligence would have and the impression such persons would get from the respondent’s mark. In that regard it is important to consider the “idea of the mark”.
(2) In assessing deceptive similarity, questions of aural impression may be important. In that context I regard the aural similarity between Malt Balls and Maltesers as negligible.
(3) The risk of deception must be tangible but it is enough if an ordinary person entertains a reasonable doubt.
(4) Allowance must be made for imperfect recollections in considering whether a mark so nearly resembles another mark that it is likely to cause confusion or deception.
(5) That principle extends even to marks which are not just invented words. If a registered trade mark includes words which can be regarded as an essential feature of the mark, another mark that incorporates those words may well infringe the registered trade mark.
324 Whether goods and services are of the same description is essentially a matter of fact, and the Court may have regard to the broad guidelines set out in Re Jellinek’s Application (1946) 63 RPC 59.
325 There is no dispute of significance between the parties as to the relevant principles, only as to their application in the present case.
The prior applications relied on
326 The applicants rely upon the following earlier applications, which relate to the comparable classes and designated goods and services set out:
| Trade Mark No. | Trade Mark | Filing Date | Class and Services | Relevant Telstra Services |
| 851576 | THE YELLOW ENVELOPE | 22 September 2000 | Class 35: Unaddressed direct mailer for direct advertisers to regional and rural areas | Class 35: marketing merchandising, retail and wholesale distribution services (excluding transport) |
| 851576 | YELLOW DUCK | 26 September 2000 | Class 35: Provision of information directory services on-line from a computer database or via the Internet | Class 35: electronic commerce services; business information services; agency services in respect of such directories and business supplements; advertising services promoting the services and goods of advertisers in such directories and business supplements in any medium |
| 872622 | YELLOW ZONE | 12 April 2001 | Class 38: Radio and television broadcasting services (whether free to air or subscription) Class 41: arranging and conducting competitions, …exhibitions, shows and balls, discotheque services, live performances | Class 38: communication services Class 41: organizing and staging sporting, cultural and entertainment events and competitions; …arranging and conducting conferences and seminars |
| 875341 | YELLOW DOOR | 10 May 2001 | Class 35: for advertising services, marked research services and wholesale services; Class 42: for consultation and design services excluding services relating to the provision of telephone directories | Class 35: as above Class 42: …research and development of technology …including directory goods and services in both electronic and non-electronic form; …designing of websites; drawing and commission writing for webpages; compilation of webpages and data for websites; consultancy in relation to all of the aforesaid services |
327 Each of the marks cited have an earlier priority date than the YELLOW Trade Mark.
328 Although it was on foot as at the Lodgement Date, the YELLOW DOOR mark was not renewed and has been removed from the register. This gives rise to a controversy as to whether it can form the basis of opposition to registration under s 44. In Davison M and Horak I, Shanahan’s Australian Law of Trade Marks and Passing Off (5th ed, Thomson Reuters, 2012) at [50.2165], the learned authors state that “[a] removed registration cannot found an opposition under s 44(1) and 92.” They cite Winton Shire Council v Lomas (2002) 119 FCR 416 and Automobiles Peugeot v Viva Tine Corp (2001) 54 IPR 568.
329 Against this PDCA points to the decision of the Full Court in E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2009) 175 FCR 386 (“Gallo”). In a part of the decision that was not overturned on appeal, at [62] to [64] Moore, Edmonds and Gilmour JJ approved the primary judge’s decision that the order for the removal of that trade mark from the register operated from the date of judgment, and not retrospectively. Infringement of the trade mark was therefore still possible up to the point when the Registrar made an entry in the register that the mark had been removed. PDCA contends by parity of reasoning with Gallo, that because YELLOW DOOR was on the register at the Lodgement Date and it was deceptively similar to the YELLOW Trade Mark, that the YELLOW mark was not registrable on that date. It contends that it would be illogical for YELLOW to be permitted to be registered simply because YELLOW DOOR was later removed.
330 Because I consider that the YELLOW mark is deceptively similar to the other three marks cited, nothing turns on this controversy in the present case. It is unnecessary to decide.
Consideration
331 It is uncontentious that some of Telstra’s designated goods and services under the YELLOW Trade Mark are the same or similar to some of the goods and services covered by THE YELLOW ENVELOPE, YELLOW DUCK, and YELLOW ZONE marks.
332 Telstra contends that the YELLOW Trade Mark is not deceptively similar to the earlier cited marks. It argues that in each of the cited marks the word yellow is used as an adjective to describe the noun that follows. For example in YELLOW DUCK it argues that yellow describes the duck, and it says what will stick in a consumer’s mind is the object described by the word yellow, namely, the duck.
333 It also contends that the YELLOW Trade Mark differs from the marks cited because it operates alone, and does not attach to any noun. It says that as a result what will stick in a consumer’s mind is the word yellow, standing alone.
334 Delegate Kirov accepted that THE YELLOW ENVELOPE and YELLOW DUCK marks were conceptually, phonetically and visually distinct from the YELLOW mark: Khoury v Telstra at [65]. Accordingly, he considered that there was no tangible danger of deception or confusion and the ground of opposition under s 44 failed. Delegate Williams took a similar approach: PDCA v Telstra at [52]. I do not agree.
335 Firstly, the YELLOW Trade Mark only has one element, the word yellow. That must be the impression that it leaves with consumers. The same is true of the cited marks as consumers will recognise yellow as the defining or central component, and it is that impression which is likely to stick in a consumer’s mind.
336 Telstra’s contention that the feature that consumers will remember of the cited marks is the object rather than YELLOW is inconsistent with its argument in the YELLOWBOOK Appeal. In that appeal Telstra contends that the word yellow is the essential feature of the YELLOWBOOK mark, and that the word “book” plays very little distinguishing role. I prefer its contention in the YELLOWBOOK Appeal.
337 Secondly, the word yellow is at the beginning of the cited marks. It provides the initial visual and aural impression and it is likely to be the most significant in the consumer’s recollection. In the YELLOWBOOK Appeal Telstra makes the same contention. This also indicates that the cited marks will leave the same impression as the YELLOW mark.
338 Thirdly, while the question of deceptive similarity is a matter for the Court, it is significant that Telstra now invites the Court to accept contentions which are contrary to the evidence of its two in-house lawyers, Ms Sedgwick and Ms Courmadias. This can be seen in the fact that:
(a) Ms Sedgwick gives evidence that Telstra’s registration and use of the YELLOW PAGES Trade Marks meant that it had (and has) exclusive rights to the word yellow in respect of directories. Ms Sedgwick also notes that Telstra uses direct mail to appeal to potential customers for the YELLOW PAGES, and ventures that use of the word yellow in THE YELLOW ENVELOPE trade mark may also mislead consumers into thinking that direct mail from that company was in fact from Telstra.
(b) Ms Courmadias’ position is even clearer. Her evidence is that no other trader is permitted to use the word yellow alone, or as part of any word, or with any other words, in respect of directories and related goods and services in Australia.
339 Fourthly, Telstra’s contention that the YELLOW Trade Mark is not deceptively similar to the cited marks is inconsistent with its commercial practices and its submissions and evidence before the Registrar. In evidence are letters of demand by Telstra’s solicitors to other traders which demand that other traders not use, or authorise the use of, trade marks in respect of directories and related goods or services that contain the word yellow, whether alone, as part of any other word, or with any other words. Telstra contended in Telstra v Coles that it had exclusive rights to the word yellow and that YELLOW DUCK was too close to the YELLOW PAGES marks to permit it to be registered. If Telstra’s stance in the marketplace and its position before the Registrar are treated as correct it must be the case that the YELLOW mark is deceptively similar to the mark cited.
340 Fifthly, Telstra strenuously contends that its use of the word yellow in the HELLO YELLOW and FIND IT IN YELLOW marks constitutes use of the YELLOW Trade Mark. If it is correct to say that use of the word yellow in these trade marks constitutes use of YELLOW as a trade mark, then the same can be said the use of the word yellow in YELLOW DUCK, THE YELLOW ENVELOPE or YELLOW ZONE. On its argument the YELLOW Trade Mark must be deceptively similar to the cited marks.
341 Having strenuously asserted exclusive rights in the word yellow based on its YELLOW PAGES Trade Marks, I see it as somewhat disingenuous for Telstra to now contend that if YELLOW is permitted to be registered, it will not be deceptively similar to the earlier cited marks. If registration and use of YELLOW PAGES provides exclusive rights to the word yellow as Telstra claims it is likely that registration of the YELLOW mark will extend it. Telstra now urges the Court to accept a different position to that taken by its in-house lawyers, that which it urged before the Registrar in Telstra v Coles, and its commercial position in the market place. I do not accept its contentions.
342 If it was necessary to decide I would hold that the YELLOW Trade Mark is deceptively similar to the cited marks and refuse registration accordingly.
issue 3: Should registration be refused under section 59 on the basis that, as at the Lodgement Date, Telstra did not intend to use or authorise the use of the mark?
343 PDCA (but not Yellowbook) opposes registration of the YELLOW Trade Mark under s 59 of the Act. Given my finding pursuant to s 41(6) that the mark should not be registered, it is again strictly unnecessary to decide this ground of the appeal.
The legislative framework and relevant principles
344 Section 59 of the Act provides:
The registration of a trade mark may be opposed on the ground that the applicant does not intend:
(a) to use, or authorise use of, the trade mark in Australia; or
(b) to assign the trade mark to a body corporate for use by the body corporate in Australia;
in relation to the goods and/or services specified in the application.
Onus
345 The onus is on the opponent to registration to rebut the presumption that the trade mark is being or will be used: Aston v Harlee Manufacturing Co (1960) 103 CLR 391 (“Aston”) at 401; Food Channel at [67]. Once the opponent has discharged this onus the burden then shifts to the applicant to establish intention: Health World Ltd v Shin-Sun Australia Pty Ltd (2008) 75 IPR 478 at [163] per Jacobson J.
Threshold for use or intended use
346 Section 59 reflects a concern of the trade marks scheme that a trade mark must be used or intended for use if it is to be registrable and remain registered. It has been said that the property that exists in a trade mark arises precisely because of the mark’s use or proposed use: see Stewart A, Griffith P and Bannister J, Intellectual Property in Australia (LexisNexis Butterworths, 2010) at [19.14]. The learned authors cite Re Ducker’s Mark (1928) 45 RPC 397 at 402 where Lord Hanworth MR said that “the very definition of a trade mark means that there must be at the time it is registered a resolve to use it”. The requirement of use is echoed elsewhere in the Act, notably in the s 17 definition, the s 27 criteria for registration and the s 92 procedure for removal.
347 Even so, the threshold as to what must be shown to establish use or intention to use is low. The act of filing an application for registration of a trade mark is prima facie evidence of an intention to use that mark. In Food Channel the Full Court held at [67] that:
Section 27(1)(b) of the Act requires that the applicant use or intend to use, or authorise use or intend to authorise use of, the trade mark… Only a very low threshold has been set with regard to intention to use in that the very act of making the application is, without more, sufficient to establish the requisite intention.
348 E & J Gallo Winery v Lion Nathan Australia Pty Ltd (2010) 241 CLR 144 concerned an application for removal of a mark from the register for non-use under s 92. At [64] French CJ, Gummow, Crennan and Bell JJ explained:
…in the case of genuine use, a relatively small amount of use may be sufficient to constitute ordinary and genuine use judged by commercial standards… It has been recognised … that use of a mark need not … always be quantitatively significant for it to be deemed genuine. (Citations omitted.)
Date for assessment
349 Intention to use the trade mark is to be assessed at the date the application for registration was lodged. As McClelland J said in Ritz Hotel Ltd v Charles of the Ritz Ltd (1988) 15 NSWLR 158 at 160:
An unused mark is not “proposed to be used” by the applicant, unless that applicant has, at the time of the application, a real and definite intention to use the mark publicly in Australia as a trade mark, although not necessarily immediately or within any limited time. (Citations omitted.)
350 The use or non-use of the trade mark after the Lodgement Date may though be relevant in relation to inferences to be drawn about the applicant’s intention when the application was lodged: Food Channel at [74]; Suyen Corporation v Americana International Ltd (2010) 187 FCR 169 (“Suyen”) at [147] per Dodds-Streeton J and the authorities cited.
Consideration
351 PDCA argues that Telstra did not intend to use the YELLOW Trade Mark at the time it lodged the application. Firstly, it points to the fact that Telstra did not adduce any evidence which shows:
(a) any internal discussions or meetings about filing the YELLOW Trade Mark application;
(b) any instructions given by Telstra to internal or external persons regarding the filing of the application; and
(c) any reasons for filing the application.
There are real gaps in the evidence in this regard and this underpins PDCA’s contention that Telstra had no intention to use the YELLOW mark at the relevant time. The absence of any documentary record is surprising in light of Telstra’s otherwise detailed records of its products, trade marks and advertising, as revealed in the evidence.
352 Secondly PDCA argues, and I accept, that Telstra did not use the YELLOW Trade Mark pre-Lodgement Date. Its marketing campaigns up to that point related to YELLOW PAGES or HELLO YELLOW, and not to the YELLOW Trade Mark. It argues, and I accept, that Telstra did not commence to use the YELLOW Trade Mark until September 2006.
353 PDCA contends that the filing of the yellow mark in 2003, well prior to the first instance of the use of YELLOW, standing alone, in September 2006, suggests a speculative, conditional or even defensive purpose of the kind referred to in cases such as Rawhide Trade Mark [1962] RPC 133, Pussy Galore Trade Mark [1967] RPC 265 and Rolewa Rentals Pty Ltd v Champagne Moet et Chandon (1985) 5 IPR 171. Alternatively it contends that the evidence shows Telstra’s intention to use the YELLOW mark was not formed until 2006 when it decided to move to that mark.
354 But the absence of independent use of the YELLOW Trade Mark before September 2006 does not mean that Telstra had not formed an intention to use it at the time it made its application.
355 Firstly, the intention to use a trade mark need not be acted upon by immediately using the mark. In Aston at 401 Fullagar J expressed the view that the intention referred to in s 59 should not be regarded as “an intention to use immediately or within any limited time.” I agree. On my view of the evidence it is more likely that Telstra’s delay in using the YELLOW mark reflects a slowness in its decision-making as to how to use the mark, rather than an absence of intention to use it at the relevant time.
356 Secondly, the evidence indicates that over the years prior to the Lodgement Date Telstra wanted to broaden the scope of its trade mark coverage so as to claim exclusive rights to the word yellow in respect of directories. It is difficult to pinpoint exactly when Telstra commenced to pursue such rights but its desire can be seen in the slowly extending reach of Telstra’s yellow-related trade marks. It can be seen too in:
(a) the demand made of Ms Kerferd in March 2003 that RMK undertake not to use any business name incorporating the word yellow in respect of its directories and related products; and
(b) Telstra’s claim to exclusive rights in the word yellow in opposing registration of the YELLOW DUCK trade mark in 2003: see Telstra v Coles.
357 Although they were unable to say who gave instructions to apply for registration of the YELLOW Trade Mark, the thrust of Mr Harvy and Ms Sherwood’s evidence is that prior to the Lodgement Date Telstra was evolving its trade marks so that it enjoyed exclusive rights to the word yellow. While Mr Harvy and Ms Sherwood overstated Telstra’s use of the word yellow, standing alone, I accept their evidence as showing that over time Telstra wanted to claim exclusive rights to yellow in respect of print and online directories.
358 Thirdly, the evidence of Ms Sedgwick is important. She made a statutory declaration on 14 August 2003 very shortly after Telstra lodged the YELLOW application. She declared at that time that Telstra wished “to maintain exclusive rights to trade marks containing the word YELLOW in relation to these [directory] services”, and that Telstra was “using and continuing to build its rights in the word YELLOW as a trade mark, hence the reason for applying to register the word YELLOW again.”
359 PDCA objected to the relevant parts of Ms Sedgwick’s statutory declaration but I admit the evidence. In cross-examination the thrust of her evidence was essentially the same as that part of the declaration to which objection was taken, and the objection was to little effect. I give no weight to her view that Telstra had used YELLOW as a trade mark or to her opinion as to Telstra’s exclusive rights to the word yellow, but her evidence at least shows that in August 2003 Telstra wanted to claim exclusive rights in the word yellow. This supports an inference that it intended to use the YELLOW mark as at the Lodgement Date.
360 Fourthly, Ms Sedgwick’s evidence also fills in some of the gaps as to who instructed lodgement of the YELLOW application. She says that it was her role within Telstra to apply for the trade marks and that she would do so in consultation with the marketing and brand team to ensure that any trade mark sought was consistent with their objectives. Her evidence is that any trade mark application would have to be consistent with Telstra’s strategic direction and the proposed use of the mark as advised by the marketing team at the time. Although she has no specific recollection in relation to the YELLOW Trade Mark the thrust of her evidence is that an application for a trade mark would not be made unless Telstra had an intention to use it.
361 Ms Sedgwick gives evidence from her recollection that Telstra’s external lawyers filed the application for the YELLOW mark. She also says that she provided the instructions for them to do so, but not from any recollection that she has. Her evidence is only that, as a matter of usual practice between her and Telstra’s external lawyers, they would never have filed a trade mark application without her instructions. Such evidence of usual practice should be treated with caution because of the possibility that usual practice was not adhered to: Armstrong v Commonwealth Bank of Australia [1999] NSWSC 588 at [17] per Hamilton J; Connor v Blacktown District Hospital [1971] 1 NSWLR 713 at 721 per Asprey JA, with Mason JA agreeing at 722.
362 Even so, I consider her evidence has some probative value and it is buttressed by the fact that it is unlikely that a large commercial law firm would file a trade mark application without being instructed to do so. It is also likely that Ms Sedgwick would recall if the law firm with whom she closely worked had taken the significant step of lodging a trade mark application without her having given instructions to do so.
363 PDCA contends that the Court should infer, from the absence of a documentary record of instructions to lodge and reasons for lodging the application for registration of the YELLOW mark, that Telstra gave no such formal instruction. I do not agree. I accept Ms Sedgwick and Ms Courmadias’ evidence that it is possible that no formal file was created as instructions were often given by telephone, and possible that the only record was a file note. The possibility must be accepted that any file or file note has been misplaced.
364 Fifthly, Mr Harvy’s recommendation in March 2006 to move to the YELLOW mark as the overarching brand for all of its directories and related goods and services, and the CEO’s acceptance of that recommendation, indicates a high level of confidence (albeit misplaced) in the capacity of the mark to distinguish Telstra’s goods and services. While by no means determinative, this provides some limited support for an inference that Telstra intended to use the mark as at the Lodgement Date.
365 I am satisfied that Telstra had an intention to use the YELLOW Trade Mark as at the Lodgement Date. If it were necessary to decide, I would reject the ground of opposition under s 59.
B. the Yellowbook Appeal
introduction
366 In this part of proceeding QUD 220 of 2010 Yellowbook and Mr Khoury (collectively “Yellowbook”) appeal from the decision of Delegate Kirov on 21 May 2010 to refuse registration of “yellowbook.com.au” (“the YELLOWBOOK Trade Mark”) as a trade mark.
367 This appeal raises the following questions:
(a) Section 44 – substantially identical or deceptively similar trade marks.
(i) Should registration of the YELLOWBOOK Trade Mark be refused pursuant to section 44 of the Act on the basis that it is substantially identical with, or deceptively similar to the specified YELLOW PAGES trade marks filed prior to the priority date (being 1 October 2006) in the specified classes (“the YELLOW PAGES Trade Marks”)?
(ii) To what extent is the evidence of use of the colour and word yellow by persons in Australia, other than Telstra, relevant in determining whether the YELLOWBOOK Trade Mark is identical with or deceptively similar to the YELLOW PAGES Trade Marks?
(iii) To what extent is the evidence of use of the colour and word yellow by persons overseas relevant in determining whether the YELLOWBOOK Trade Mark is identical with or deceptively similar to the YELLOW PAGES Trade Marks?
(b) Section 43 – YELLOWBOOK Trade Mark likely to deceive or cause confusion.
Should the registration of the YELLOWBOOK Trade Mark be refused under section 43 of the Act on the basis that it has the same idea or connotation as the YELLOW PAGES Trade Marks such as to cause a real and tangible danger that consumers will be deceived or confused?
(c) Section 60 – YELLOWBOOK Trade Mark similar to trade mark that has acquired a reputation in Australia.
Should the YELLOWBOOK Trade Mark be refused under section 60 of the Act on the basis that the YELLOW PAGES Trade Marks have acquired a reputation in Australia before 1 October 2006 and because of that reputation the use of the YELLOWBOOK Trade Mark would be likely to deceive or cause confusion?
368 Telstra does not contend that the YELLOWBOOK Trade Mark is substantially identical to the YELLOW PAGES Trade Marks, and the questions therefore centre on whether the YELLOWBOOK mark is likely to deceive or cause confusion. In the present case there is little difference in the operation of ss 43, 44 and 60 in relation to this issue.
369 Whether the YELLOWBOOK mark is likely to deceive or cause confusion falls to be determined by reference to the YELLOW PAGES Trade Marks. Before Delegate Kirov Telstra also contended that the YELLOWBOOK Trade Mark was deceptively similar to its YELLOW mark but it did not maintain that contention before me.
the nature of the appeal
Hearing de novo
370 As I explained at [28] to [29] the appeal is de novo and the rights of the parties are to be determined as at the Lodgement Date of the YELLOWBOOK application, namely 1 October 2006.
Onus and standard of proof
371 As I said at [30] to [39], as the opponent to registration Telstra bears the onus of establishing its grounds of opposition, and must do so on the balance of probabilities.
The facts
372 Yellowbook is a small private company incorporated on 29 September 2006 which operates an online business directory at the domain names www.yellowbook.com.au and www.yellowbook.net.au. Mr Khoury, is the Managing Director of Yellowbook.
373 On 1 October 2006 Yellowbook applied to register “yellowbook.com.au” in class 35 in respect of:
An online business directory listing advertising information such as contact details, companies name, address, addresses, telephone, phone, fax, contact, names, web, WWW, categories per states email directory services business to business, coupons to the public Australia wide.
374 It is not contentious that Telstra’s registration and use of the YELLOW PAGES Trade Marks predate the application to register the YELLOWBOOK Trade Mark.
375 Telstra points to the following goods and services in respect of which the YELLOW PAGES trade marks are registered which it says are similar or closely related to services to be covered by the proposed YELLOWBOOK Trade Mark.
| Trade Mark | Class | Goods/services |
| No. 545667 YELLOW PAGES | 16 | Telephone books, telephone directories and business directories |
| No. 545668 YELLOW PAGES | 35 | Advertising services relating to the provision and promotion of telephone directories and telephone directory business supplements of all kinds (including directories and business supplements provided to users in tangible or intangible form and those held in magnetic, electronic, electro-optic or other media) including: agency services in respect of such directories and business supplements; advertising services promoting the services and goods of advertisers in such directories and business supplements in any medium; advertising survey services, including telephonic and electronic surveys, relating to telephone directories and telephone directory business supplements; and co-operative advertising with those who advertise in telephone directories and telephone directory business supplements |
| No. 545669 YELLOW PAGES | 38 | Telecommunication services and telephone services |
| No. 704079 YELLOW PAGES | 9, 42 | Class: 9 Telephones and telephone equipment, apparatus and systems; computer software, CD ROMs and modems; publications in electronic form including publications supplied on-line from databases or from facilities provided on the Internet (including web sites); all associated parts, accessories and fittings Class: 42 Computer programming services; consultancy services; computer software design services; computer rental services; providing facilities for exhibitions, seminars and conferences; research and development of technology, including research and development in relation to telecommunications goods and services, including directory goods and services in both electronic and non-electronic form; wholesaling and retailing services namely, wholesaling and retailing of telecommunications goods, including directory goods in both electronic and non-electronic form |
The evidence
376 Telstra relies on the evidence of its in-house lawyer Ms Courmadias and Ms Sherwood. Ms Sherwood’s evidence in chief is largely based on a statutory declaration by Lisa Maree Mavrodis, a Telstra Brand and Marketing Manager, which was provided in opposition to registration to the Trade Marks Office. Counsel for the Yellowbook suggested in cross-examination of Ms Sherwood that Ms Mavrodis’ declaration was misleading in setting out that Telstra used YELLOW pre-Lodgement Date as in fact the marks being used were the YELLOW PAGES Trade Marks. While Ms Mavrodis tended to overstate Telstra’s use of the YELLOW Trade Mark prior to the Lodgement Date, in a similar way to Mr Harvy and Ms Sherwood, I do not conclude that her declaration is misleading. She deposed that “(f)or the purposes of this declaration, I will refer to Telstra’s directories as YELLOW directories”. This in part explains her repeated references to YELLOW.
377 But Ms Mavrodis’ opinion that Telstra used YELLOW as a trade mark over many years carries little weight. The evidence includes myriad examples over more than 30 years of Telstra’s use of its trade marks on its goods and services and in its advertising campaigns. As I have said, on my view of the evidence Telstra did not use YELLOW as a trade mark until September 2006.
378 Yellowbook relies on the evidence of Mr Khoury.
The legislative framework and relevant principles
379 I set out s 44 which relates to deceptive similarity at [319]. As I have said, s 10 provides that a trade mark is deceptively similar to another trade mark if it so nearly resembles that other mark that it is likely to deceive or cause confusion.
380 Section 43 provides:
Trade mark likely to deceive or cause confusion
An application for the registration of a trade mark in respect of particular goods or services must be rejected if, because of some connotation that the trade mark or a sign contained in the trade mark has, the use of the trade mark in relation to those goods or services would be likely to deceive or cause confusion.
381 At the relevant time s 60 provided:
Trade mark similar to trade mark that has acquired a reputation in Australia
The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:
(a) it is substantially identical with, or deceptively similar to, a trade mark that, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, had acquired a reputation in Australia; and
(b) because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.
Deceptive similarity
382 I set out the relevant legal principles at [321] to [325]. It is uncontroversial that to succeed in its opposition to registration Telstra must establish that the YELLOWBOOK mark so nearly resembles Telstra’s marks that it is likely to deceive consumers or cause them confusion.
383 The test does not involve a side by side comparison of the YELLOWBOOK and YELLOW PAGES trade marks but rather the overall impression that a person of ordinary intelligence and with a possibly imperfect recollection would have of the marks. The question is whether there is a real and tangible risk that the result of the use of the YELLOWBOOK mark will be that a reasonable person will be caused to wonder whether it might not be the case that its services are from the same source as the YELLOW PAGES services.
Consideration
Is the YELLOWBOOK Trade Mark deceptively similar to the YELLOW PAGES Trade Marks - Section 44
The similarity of the services covered by the two marks
384 It is uncontentious that some of the services designated under the YELLOW PAGES Trade Marks are similar or closely related to services to be covered by the YELLOWBOOK Trade Mark. The YELLOWBOOK mark is sought in respect of an “online business directory” and the relevant YELLOW PAGES Trade Mark covers “telephone directories and telephone directory business supplements of all kinds”.
385 The closer the relationship between the services, the more likely any similarity in the marks will prove deceptive: Woolworths at [40] per French J. In the present case, where the two marks overlap the services are exactly the same.
The use of the suffix “com.au” in the YELLOWBOOK Trade Mark
386 Yellowbook contends that the words “yellowbook.com.au” cannot objectively be seen to so nearly resemble the words “Yellow Pages” such that registration of the YELLOWBOOK mark is likely to deceive or cause confusion. In particular it points to the “.com.au” suffix of the trade mark and contends that this plays an important role in distinguishing YELLOWBOOK from YELLOW PAGES. It argues that the words yellowbook.com.au have a “hybrid role” as a domain name which puts them in a “special position”.
387 It contends that as an online business the “.com.au” element of its trade mark is an essential feature of its brand and cannot be ignored, and says that it is unsound to discount this component of the mark. It argues that yellowbook.com.au and the YELLOW PAGES Trade Marks must each be considered as a whole when determining the impression that consumers will draw from them, which requires consideration of the “.com.au” element.
388 Yellowbook also argues that consumers would immediately appreciate that the trade mark yellowbook.com.au was being used as a badge of origin for the services available at the website www.yellowbook.com.au, and there is no likelihood of confusion with YELLOW PAGES.
389 I do not accept Yellowbook’s contentions. It offers no authority for the proposition that the YELLOWBOOK Trade Mark enjoys a special position because of its “hybrid role”. In my view the addition of “.com.au” or “.net.au” as a suffix to a word mark, so that it represents a domain name as well, does not mean that the trade mark is to be considered differently. The words yellowbook.com.au may function as both a domain name and a trade mark but the same rules apply to its registration.
390 The symbol “.com.au” is common to many Australian domain names and simply signifies that the relevant website is that of a business in Australia. There is nothing distinctive in this component of the YELLOWBOOK mark, and in my view it is unlikely to play any part in indicating the commercial origin of the designated services. Nor are these common and non-distinctive words likely to be recalled by consumers or leave an impression on them.
391 That the “.com.au” words were to be disregarded was common ground between the parties before the Delegate. I agree with the approach taken by Delegate Kirov who said that, in accordance with established practice, the “.com.au” element of the YELLOWBOOK Trade Mark should be ignored in assessing whether it was deceptively similar to either the YELLOW or YELLOW PAGES Trade Marks: Khoury v Telstra at [71]. Part 14.2 of the Trade Marks Office Manual provides that when examining trade marks which consist of domain names, only the distinguishing elements of the domain name should be considered.
392 This approach is consistent with authority. In The Architects (Australia) Pty Ltd v Witty Consultants Pty Ltd [2002] QSC 139 Chesterman J was concerned with the comparison between the names “Architects Australia” and “architectsaustralia.com.au”. His Honour said at [21]:
The words in contest in this case are not merely similar, they are precisely the same. The extended suffix “.com.au” does not detract from this conclusion. It does no more than indicate that details of the business are to be found electronically, on the Internet.
393 In Sports Warehouse Kenny J held at [155]:
I do not consider that the additions or alterations substantially affected the identity of the mark. In the present case, the prefix “www.” and suffix “.com” are merely indicia of a domain name.
Her Honour held (at [156]) that use of the domain name www.tennis-warehouse.com constituted use of the TENNIS WAREHOUSE trade mark. See also: Solarhart Industries Pty Ltd v Solar Shop Pty Ltd (2011) 281 ALR 544 at [49] per Perram J; REA Group Ltd v Real Estate 1 Ltd [2013] FCA 559 at [127] per Bromberg J.
394 In my analysis of whether the YELLOWBOOK Trade Mark is likely to deceive or cause confusion I have given the “.com.au” component of the mark little significance.
The two marks are deceptively similar
395 In my view the distinctive element of the YELLOWBOOK Trade Mark is the element YELLOWBOOK. It is this element, made up as it is of two words “yellow” and “book”, which must be considered against the YELLOW PAGES Trade Marks.
396 Firstly, I see the word YELLOW as an important feature of both the YELLOW PAGES Trade Marks and the YELLOWBOOK mark. The fact that it is more distinctive than “pages” or “book”, and it is the first word in both marks means that in both marks it is YELLOW which is likely to leave an impression and be remembered. The two marks will leave a similar impression.
397 I agree with Delegate Kirov when he focussed on the word yellow in the two marks and stated (at [78]):
… The word “yellow” is thus one of the distinguishing features of Telstra’s YELLOW PAGES trade mark, at least as far as services in Class 35 are concerned, and must form an important part of the comparison of that mark with the yellowbook trade mark.
Delegate Kirov also considered that as the initial word in each of the YELLOWBOOK and YELLOW PAGES marks the word yellow was likely to be recalled.
398 The importance of YELLOW as a feature in each of the marks is accentuated by the fact that the other words, “pages” and “book”, are less distinctive. I agree with Delegate Williams in holding (at [43]) that “the element pages, within the trade mark YELLOW PAGES, is not distinctive in respect of directories and of analogous services.”
399 Similarly, in Telstra Corporation Ltd v Yellownet Corporation (1999) 44 IPR 415, in the context of comparing the YELLOW PAGES Trade Marks with YELLOWNET, Hearing Officer Zars said that the word “pages” was a non-distinctive word for goods and services in respect of YELLOW PAGES directories.
400 Secondly, although “pages” and “book” in the respective trade marks are not distinctive, each connotes the same concept. One refers to a book and the other is likely to be associated with a book. I agree with Delegate Kirov in holding that the words “book” and “pages” convey the same idea which would cause them to be remembered by consumers in the same way: Khoury v Telstra at [80]. As the Delegate said (at [81]):
(t)he word ‘pages’ is commonly used descriptively in relation to both printed matter and websites … [and] the word ‘book’ is … commonly used in the directories trade, as in the expression ‘telephone book’ for example.
Indeed the composite YELLOW PAGES Trade Marks depict an open book which also demonstrates the natural association between pages and book, and the similarity between the YELLOW PAGES and YELLOWBOOK marks.
401 Given that both marks are in respect of directories, consumers will likely take the idea of a book to be a reference to a directory. Both marks therefore create the impression of a directory, which is described as being yellow. This too illustrates their similarity.
402 Thirdly, the YELLOWBOOK and YELLOW PAGES marks are visually and aurally similar. They start with the same word followed by another word of one syllable.
403 Fourthly, the composite YELLOW PAGES Trade Marks include the Walking Fingers logo but this is not easily pronounceable and it is unlikely to be used by consumers speaking of the mark, and it is unlikely to be typed into an internet search.
404 Fifthly, in considering whether a trade mark is deceptively similar it is necessary to take all of the surrounding circumstances into consideration. In the present case the fact that both marks are in respect of online business directories means that the services are likely to be marketed to and used by the same type of consumers. Both services are provided over the internet and are directed at Australian consumers.
405 In Cooper Engineering Co Pty Ltd v Sigmund Pumps Ltd (1952) 86 CLR 536 (“Cooper”), which concerned a comparison between “Rainmaster” and “Rain King” in respect of sprinklers, Dixon, Williams and Kitto JJ said at 538:
The fact that two marks convey the same idea is not sufficient in itself to create a deceptive resemblance between them, although this fact could be taken into account in deciding whether two marks which really looked alike or sounded alike were likely to deceive.
Their Honours explained:
…you must consider the nature and kind of customer who would be likely to buy the goods. A purchaser of spray nozzles and sprinklers would not be likely to be lacking in discernment. He would not be in a hurry to buy. He would not be likely to pay any attention to the presence of a common word like rain in the combination. That prefix already appears in other trademarks for goods of the same description sold on the Australian market such as Rainwell, Rainmaker, Rain Queen, and Rainbow. (Emphasis added.)
406 The considered purchaser envisaged by the Court in Cooper may be readily contrasted with consumers using an online telephone directory. Such consumers are not making a purchase at all, and are instead accessing a free service to obtain a telephone number or address. It is unlikely that such consumers will be discerning as to subtle differences in the branding of such a service. It is established that with inexpensive goods and services it is less likely that a trade mark will be carefully considered: see Lancer Trade Mark Application [1987] RPC 303. The services in question are free.
407 It is likely too that consumers will often access the directory at the same time the information is needed and will want the answer speedily. Often access will occur while consumers are involved in other activities, including while in transit, through smart phones, tablets and similar devices. I have little doubt that consumers will give scant consideration to small differences in branding in these circumstances. I agree with Allan J in YPG IP Limited and Anor v Yellow Book.com.au Pty Ltd and Ors [2007] NZHC 1947 (“YPG IP Limited”) at [111], which concerned a trade mark dispute between the New Zealand “Yellow Pages” and Yellowbook, when he observed:
…of its nature the act of using [the] directory service is focused upon the desired outcome - so anyone using a directory is likely to pay little more than fleeting attention to branding and trade marks…
408 Yellowbook submits that the YELLOW PAGES trade marks are so well recognised that even the subtle difference between “book” and “pages” in the two marks would be noted by consumers and no deception or confusion would arise. It relies in this regard on Australian Postal Corporation v Digital Post Australia Pty Ltd (No 2) [2012] FCA 862 (“Digital Post”) per Marshall J, where his Honour found that the word mark “Digital Post” was not deceptively similar to “Australia Post”.
409 But questions as to the deceptive similarity turn on their own facts. There are significant differences between that case and the present case including that:
(a) in Marshall J’s view (at [59]) the purchasers of a digital mail service would be careful in their selection, while in my view users of a free online directory service are unlikely to be discerning;
(b) the only different words between YELLOWBOOK and YELLOW PAGES are “book” and “pages” both of which are associated with the same idea which points to the similarity of the marks. In Digital Post the two different words were “Digital” and “Australia” which shows their dissimilarity; and
(c) both the YELLOWBOOK and YELLOW PAGES marks start with the same word, namely the word yellow, which is not the case in Digital Post.
410 Yellowbook submits that Mr Harvy’s evidence is that consumers did not recognise that the YELLOW PAGES directories were available in an online as well as printed form. Based on this view of the evidence Yellowbook argues that if consumers are not aware that YELLOW PAGES Online existed they could hardly be deceived into thinking that yellowbook.com.au was in fact YELLOW PAGES Online. But this is not Mr Harvy’s evidence. In my view his evidence is that Telstra wanted to improve consumer recognition of Telstra’s online directory, but he did not suggest that consumers did not recognise and use it. The evidence shows that Telstra’s marketing efforts were directed both at maintaining and increasing consumer recognition and use of its online directories.
411 Yellowbook also argues that until at least 2008, results for www.yellowpages.com.au would not have appeared in internet search results together with the results for www.yellowbook.com.au because in its early years of operation Telstra blocked search engines such as Google from indexing the content of YELLOW PAGES Online. It contends that this reduced the opportunities for consumers to be confused by any similarities in the two marks. But while Ms Sherwood conceded that in its early years Telstra endeavoured to block access to search engines the evidence fell short of establishing that search results of YELLOWBOOK would not also produce results relating to YELLOW PAGES. Even if this was the case, it is just one aspect of the deceptive similarity of which Telstra complains.
412 In my view there is a real risk that consumers will be misled or confused if the YELLOWBOOK Trade Mark is registered. I consider it to be deceptively similar to the YELLOW PAGES Trade Marks.
Later correction of confusion
413 It is not to the point that upon accessing the YELLOWBOOK website consumers may realise that it has nothing to do with Telstra, thereby dispelling any initial confusion. I agree with Dodds-Streeton J in Tivo Inc v Vivo International Corporation Pty Ltd [2012] FCA 252 (“Tivo”) at [105] where her Honour said:
It is well established that trade marks may be deceptively similar for the purposes of ss 44(1) and (2) of the Act even if confusion is unlikely to persist up to the point of, and contribute to, inducing sale.
This was recently confirmed in the context of misleading and deceptive conduct by the High Court in Australian Competition and Consumer Commission v TPG Internet Pty Ltd [2013] HCA 54 at [50] per French CJ, Crennan, Bell and Keane JJ.
Honest concurrent use
414 Yellowbook contends that, even if the YELLOWBOOK Trade Mark is deceptively similar to the YELLOW PAGES Trade Marks, it is entitled to registration as an honest, concurrent user under s 44(3) of the Act. Amongst other things, it contends that:
(a) www.yellowbook.com.au was first registered as a domain name in January 2006 and the website commenced operation in that month, eight months prior to Telstra’s official launch of YELLOW;
(b) the word yellow is internationally recognised as being associated with business directory services;
(c) yellowbook.com.au is Yellowbook’s company name; and
(d) until about 2008 Telstra was blocking Google and other search engines from indexing its content such that no YELLOW PAGES content was available to the public unless they went to the YELLOW PAGES website. Yellowbook submits that there was no scope for deception as Telstra’s content was not available.
415 I do not accept Yellowbook’s contentions. In McCormick & Co Inc v McCormick (2000) 51 IPR 102 (“McCormick”) at [30] Kenny J set out the factors that may be taken into account in exercising the discretion to allow a deceptively similar mark to be registered because of honest concurrent use as including:
…
(1) the honesty of the concurrent use;
(2) the extent of the use in terms of time, geographic area and volume of sales;
(3) the degree of confusion likely to ensue between the marks in question;
(4) whether any instances of confusion have been proved; and
(5) the relevant inconvenience that would ensue to the parties if registration were to be permitted.
416 In Tivo at [246] Dodds-Streeton J noted that honesty in this context means “commercial honesty”, and said that the relevant factors include:
(a) whether the words which make up the trade mark are common, everyday words;
(b) the applicant’s subsequent conduct;
(c) the likelihood of confusion;
(d) the applicant’s knowledge of the opponent’s mark; and
(e) whether the adoption of the mark, and the continued use of it, was surreptitious.
417 The onus of establishing that its use of a deceptively similar mark was honest concurrent use is Yellowbook’s: Tivo at [249]. In my view it failed to establish this which can be seen in the following matters.
418 Firstly, YELLOWBOOK is visually and aurally very similar to YELLOW PAGES, both contain the same essential feature which is the word yellow, and through the use of “book” and “pages” both convey the same idea of a yellow directory. Telstra has been operating its online directory at www.yellowpages.com.au since 1994, well before Yellowbook was incorporated and well before the YELLOWBOOK website commenced in January 2006. Yellowbook was aware of the well-known YELLOW PAGES Trade Marks, yet it chose to use a mark in respect of exactly the same services that closely resembled them.
419 Secondly, it is significant that Yellowbook’s two earlier attempts to register trade marks featuring the word YELLOWBOOK were the subject of adverse reports by the Trade Marks Office on the basis of the YELLOW PAGES and YELLOW trade marks. The attempt in the present case simply involved the addition of the non-distinctive prefix “www” and suffix “.com.au” which did not reduce the similarity of the mark. That this did not add to the distinctiveness of the mark would have been plain from consideration of the Trade Marks Office Manual or a review of the authorities. It is significant too that prior to applying to register the YELLOWBOOK mark in Australia, Yellowbook was injuncted by YPG IP Ltd in New Zealand for attempting to use the mark in that country: see YPG IP Limited.
420 Thirdly, Mr Khoury conceded in cross-examination that Yellowbook and its predecessors and related companies had registered a number of well-known trade marks of other directory providers. I do not find that Yellowbook is a cyber-squatter, but there is little evidence that it operates a viable business. Rather, it is likely that its business model is to make itself a sufficient nuisance to Telstra such that Telstra is motivated to purchase it. The evidence shows that Mr Khoury sought proposals from Telstra to purchase the YELLOWBOOK online directory in October 2006.
421 Fourthly, Mr Khoury suggested in his evidence that following Telstra’s failure before the WIPO in relation to the Yellowbook domain name he believed that Telstra was satisfied with his continued use of the YELLOWBOOK mark. This evidence was untrue. In cross-examination he conceded that Yellowbook had been informed in plain terms that Telstra continued to object.
422 Yellowbook failed to establish that its use of the YELLOWBOOK mark was honest concurrent use under the Act. But even if it had been able to establish its honest concurrent use I would exercise my discretion to refuse registration of the mark. In my view there is a high likelihood that consumers will be misled or confused by the similarity of the YELLOWBOOK and YELLOW PAGES marks. There is no real scope to limit the YELLOWBOOK mark to a particular area or by particular conditions and it should not be registered.
Sections 43 and 60
423 While it is strictly unnecessary to decide, registration of the YELLOWBOOK Trade Mark must also be refused under ss 43 and 60 because:
(a) consistently with the analysis above, the mark conveys the misleading or confusing connotation that Yellowbook’s services are Telstra’s. The YELLOWBOOK mark is sufficiently similar to the YELLOW PAGES to connote that its services are Telstra’s. It is likely to deceive consumers or cause them confusion; and
(b) there can be no question that as at the Lodgement Date the YELLOW PAGES Trade Marks had acquired a reputation in Australia in respect of online directories. Yellowbook did not contend to the contrary.
Conclusion
424 I propose to order that registration of both the YELLOW Trade Mark and the YELLOWBOOK Trade Mark be refused.
425 The parties are directed to confer and prepare draft orders to give effect to these reasons within 14 days.
426 I am aware of no reason why costs should not follow the event in each of the two matters, which will involve apportioning the costs in proceeding QUD 220 of 2010 which related to both appeals. If there is no agreement as to the appropriate costs orders, the parties are to prepare and file submissions on costs within 14 days.
| I certify that the preceding four hundred and twenty-six (426) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Murphy. |
