FEDERAL COURT OF AUSTRALIA

PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd [2021] FCAFC 128

ORDERS

THE COURT ORDERS THAT:

1.    Save and except for orders 3 and 4 below, the appeal be dismissed.

2.    The cross-appeal be dismissed.

3.    Order 1 made by the primary judge on 14 August 2020 be set aside.

4.    Pursuant to s 101(2) of the Trade Marks Act 1995 (Cth), the following be removed from the categories of goods in respect of which Australian registered trade mark no 1042646 is registered:

savoury dips; dessert toppings and sauces, including chocolate toppings and sauces, and fruit flavoured toppings and sauces; confectionery, including chocolates and sweets, but excluding frozen confections

5.    Subject to order 6 below, PDP pay 90% of Grasshopper's costs of the appeal and cross-appeal, as agreed or taxed.

6.    Any party wishing to vary order 5 may, within 7 days, file and serve written submissions not exceeding two pages identifying the costs order sought and the reasons in support. If any such submission is filed the other party may, within 7 days thereafter, file and serve written submissions in answer not exceeding two pages identifying the costs order sought and the reasons in support, whereupon the question of costs will be determined on the papers.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE COURT:

1.    INTRODUCTION

1    This matter involves an appeal and cross-appeal against the primary judge’s orders dismissing claims for trade mark infringement: PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd [2020] FCA 1078; (2020) 154 IPR 68 (primary judgment).

2    In the early 1990’s Ralph Valentine started selling strawberries and other fresh produce at flea markets around Brisbane. Towards the end of that decade he decided that he wanted to add value to his products by selling a chocolate dipping sauce with the strawberries. As the years passed his range of dipping sauces expanded and he applied the name “Wicked” as a trade mark to the tubs that he sold. He registered a trade mark for a stylised form of that word in February 2005 which included a devil’s tail on the letter “D” (Wicked Tail Mark). Over time, various corporate entities under the control of Mr Valentine owned and used the trade mark ([18]). From about late 2014 the trade mark applied to dipping sauces was changed to take a new form (New Wicked Mark) and Grasshopper Ventures Pty Ltd, the respondent to the appeal, applied to register that trade mark on 19 March 2015 ([13]).

3    Paul Polly is the sole director of PDP Capital Pty Ltd and PDP Fine Foods Pty Ltd ([16]) (collectively, PDP). PDP Fine Foods is the owner of a trade mark for the words “Wicked Sister Fine Foods” in a stylised form for goods including olives, dairy desserts, rice puddings and other such goods with a priority date of 29 May 2008 (First WS Device Mark) ([8]). PDP Capital is the registered owner of another stylised “Wicked Sister Fine Foods” mark, this time with a priority date of 9 February 2016 and including, amongst other goods, dipping sauces (Second WS Device Mark) ([9]). Additionally, PDP Capital is the owner of a registered trade mark for the words “Wicked Sister” (WS Word Mark) in respect of the same goods and with the same priority date as the Second WS Device Mark ([10]).

4    The details of the trade marks in suit are set out in more detail in section 2 below.

5    PDP commenced proceedings against Grasshopper for infringement of the First and Second WS Device Marks, as well as the WS Word Mark, by reason of Grasshopper’s use of the New Wicked Mark. PDP also sued for relief for breach of ss 18 and 29 of the Australian Consumer Law (ACL) (Competition and Consumer Act 2010 (Cth) Sch 2) and the tort of passing off.

6    In dismissing their trade mark infringement claim, the primary judge determined four primary matters adversely to PDP on the question of infringement under s 120 of the Trade Marks Act 1990 (Cth). First, a threshold issue as to whether Grasshopper was an entity who had used the New Wicked Mark ([488]). Secondly, that the New Wicked Mark was not substantially identical with or deceptively similar to the First or Second WS Device Marks, or the WS Word Mark ([201] and [205]). Thirdly, that, with respect to the First WS Device Mark, dipping sauces are not goods of the same description to the goods in respect of which that mark was registered ([219]). Fourthly, that, with respect to the Second WS Device Mark and the WS Word Mark, dipping sauces should be removed for non-use ([428(2)]).

7    In the present appeal it is necessary for PDP to overturn the primary judge’s findings in respect of each of these matters in order to succeed in its claim for trade mark infringement. For the reasons set out in more detail below, the appeal fails in respect of the first and second matters which are raised in grounds 1 and 2 of the appeal. It is therefore unnecessary for us to decide the third which is raised in ground 3 of the appeal. We do, however, find that the appeal also fails in respect of the fourth matter which is raised in ground 5 of the appeal. In grounds 1 and 2 of its notice of cross-appeal, Grasshopper contends that if we conclude that grounds 2 or 3 of the appeal should succeed, then for various reasons arising under ss 44, 60 and 88 of the Trade Marks Act the First and Second WS Device Marks should be removed from the register. Having regard to our conclusion in relation to grounds 1 and 2 of the appeal, it is not necessary for us to consider these grounds. Nor is it necessary for us to consider the several statutory defences that were contingently raised by Grasshopper in answer to the infringement claim in ground 1 of its notice of contention and ground 1 of its notice of cross-appeal.

8    The claims brought under the ACL and for passing off were to some extent dependent on the resolution of the question of deceptive similarity between the First and Second WS Device Marks and the New Wicked Mark but also upon the relevant reputation of PDP. The primary judge rejected each of those claims at [517] and [528]. PDP appeals from those findings in ground 6 of its appeal. We have determined that this ground of appeal must also be dismissed.

9    The following further matters were before the primary judge concerning the validity of registered trade marks owned by the parties:

(1)    PDP’s claim seeking the removal of the Wicked Tail Mark from the register for non-use pursuant to ss 92 and 101 of the Trade Marks Act. This application was largely unsuccessful ([588]), and PDP challenges that conclusion in ground 4 of the appeal. In grounds 3 and 4 of its notice of contention, Grasshopper raises further bases upon which it contends the primary judge ought to have found in its favour. We conclude below that aspects of the appeal have been made out and reject the further bases raised in the notice of contention.

(2)    Grasshopper’s claim applying for the removal of each of the First and Second WS Device Marks, and the WS Word Mark. This claim was successful in relation to certain goods ([428]). In ground 5 of the appeal, PDP challenge that result insofar as it relates to the Second WS Device Mark and the WS Word Mark. We reject that challenge.

2.    THE TRADE MARKS IN ISSUE AND SUMMARY OF FINDINGS IN RELATION TO RELEVANT REGISTRATIONS

10    Below, we adopt the definitions of the various trade marks in issue as used by the primary judge in section 1.1 of the primary judgment.

2.1    Grasshopper’s trade marks

11    Grasshopper is the owner of the Wicked Tail Mark,, being registered trade mark no 1042646 with a priority date of 18 February 2005. At the time of the trial it was registered in respect of the following goods in class 30 (Registered Wicked Tail Mark Goods):

dips, including chocolate dips and savoury dips; desert [sic] toppings and sauces, including chocolate toppings and sauces, and fruit flavoured toppings and sauces; confectionery, including chocolates and sweets, but excluding frozen confections.

12    In allowing ground 4 of the appeal and rejecting grounds 3 and 4 of the notice of contention, we have found that the goods that should be permitted to remain in the Wicked Tail Mark registration are as follows:

dips, including chocolate dips and savoury dips; desert [sic] toppings and sauces, including chocolate toppings and sauces, and fruit flavoured toppings and sauces; confectionery, including chocolates and sweets, but excluding frozen confections.

13    On 19 March 2015 Grasshopper applied for registration of the New Wicked Mark, , in respect of the following goods in class 30:

flour and preparations made from cereals, bread, pastry and confectionery including chocolates and sweets and frozen confections, ices; dips including chocolate, vanilla, caramel and white chocolate dips and savoury dips; dessert foods in this class including chilled and frozen sweet mousses, chocolate mousses and white mousses, dessert toppings and sauces including chocolate toppings and sauces and fruit flavoured toppings and sauces; sauces (condiments).

2.2    PDP’s trade marks

14    PDP Fine Foods is the owner of registered trade mark no 1240821 with a priority date of 29 May 2008 for (First WS Device Mark). At the time of the trial it was registered in respect of the goods specified below in classes 29 and 30 (Registered First WS Goods):

•    class 29: cheese; olives, preserved; prepared olives; processed olives; peppers (prepared); pickled peppers; dairy desserts; food preparations with a vegetable base; food spreads consisting principally of vegetables for sandwiches; desserts made from yoghurt; fruit flavoured yoghurts; low fat yoghurts; yoghurt desserts; yoghurts containing pulped fruits; and

•    class 30: creamed rice; rice puddings; rice tapioca; sauces for rice; food preparations for use as sandwich spreads; cheesecakes.

15    Grasshopper obtained orders for the rectification of the register by the removal of some of the Registered First WS Goods. Those orders are not challenged on appeal. The final form of the goods in respect of which the First WS Device Mark are registered are ([248], [271] and [428]):

•    class 29: cheese; olives, preserved; prepared olives; processed olives; peppers (prepared); pickled peppers; dairy desserts; food preparations with a vegetable base; food spreads consisting principally of vegetables for sandwiches; desserts made from yoghurt; fruit flavoured yoghurts; low fat yoghurts; yoghurt desserts; yoghurts containing pulped fruits; and

•    class 30: creamed rice; rice puddings; rice tapioca; sauces for rice; food preparations for use as sandwich spreads; cheesecakes.

16    PDP Capital in its capacity as trustee of the PDP Capital Unit Trust is the owner of registered trade mark no 1751267 with a priority date of 9 February 2016 for (Second WS Device Mark). At the time of the trial it was registered in respect of the goods specified below in classes 29 and 30 (Later Registered WS Goods):

•    class 29: desserts made from yoghurt; fruit flavoured yoghurts; low fat yoghurts; yoghurt desserts; dairy products and dairy based foods; yoghurt; dairy based desserts including desserts made from yoghurt (excluding frozen yoghurt); fruit flavoured yoghurts; low fat yoghurts; yoghurts containing pulped fruits; yoghurt preparations; desserts made wholly or principally of dairy products; panna cottas; crème caramels; custards; chilled desserts; and

•    class 30: creamed rice; rice puddings; rice tapioca; dessert sauces; dipping sauces; cheesecakes; bakery products; cakes; confectionery; frozen yoghurt; ice cream; frozen confections including ice cream desserts; all other desserts in this class including prepared desserts; chilled desserts; mousse and mousse style desserts; tiramisu; puddings, desserts.

17    PDP Capital in its capacity as trustee of the PDP Capital Unit Trust is also the owner of registered trade mark no 1751266 with a priority date of 9 February 2016 for the word mark WICKED SISTER (WS Word Mark) in respect of the same goods as those covered by the Second WS Device Mark i.e. the Later Registered WS Goods.

18    The primary judge concluded that the registrations for the Second WS Device Mark and the WS Word Mark should be rectified as set out below ([358] and [402]):

•    class 29: desserts made from yoghurt; fruit flavoured yoghurts; low fat yoghurts; yoghurt desserts; dairy products and dairy based foods; yoghurt; dairy based desserts including desserts made from yoghurt (excluding frozen yoghurt); fruit flavoured yoghurts; low fat yoghurts; yoghurts containing pulped fruits; yoghurt preparations; desserts made wholly or principally of dairy products; panna cottas; crème caramels; custards; chilled desserts; and

•    class 30: creamed rice; rice puddings; rice tapioca; custard dessert sauces; dipping sauces; cheesecakes; bakery products; cakes; confectionery; frozen yoghurt; ice cream; frozen confections including ice cream desserts; all other desserts in this class including prepared desserts; chilled desserts; mousse and mousse style desserts; tiramisu; puddings, desserts.

This conclusion is challenged in ground 5 of the appeal.

19    In the reasons set out in section 8 below, we conclude that the challenge to the rectification in ground 5 fails.

20    The First WS Device Mark and the Second WS Device Mark are referred to collectively as the WS Device Marks and the WS Device Marks and the WS Word Mark are referred to collectively as the Wicked Sister Marks.

3.    GROUND 1: THE THRESHOLD INFRINGEMENT ISSUE

3.1    Introduction

21    PDP contended below that Grasshopper infringed the WS Device Marks by the sale of the following products (defined by the primary judge as the Infringing Products) being ([208]):

(1)    Wicked dipping sauces which have been sold under the New Wicked Mark since 2014; and

(2)    Wicked Waffle Dippers which have been sold under the New Wicked Mark since 2018.

22    Examples of the packaging for the Infringing Products are depicted below:

23    In short form, the threshold issue concerns whether Grasshopper’s authorisation of the use of the New Wicked Mark by other companies is capable, as a matter of law, of constituting trade mark infringement ([488]).

24    This issue arises against a background of the following findings of fact, which are not challenged on appeal:

(1)    Mr Valentine is responsible and in control of each of four companies, being Wicked Products Pty Ltd, Brisbane Market Brokers Pty Ltd (BMB), Brisbane Fine Foods Pty Ltd ([18(1)]) and Grasshopper ([21], [476]), which the primary judge referred to as the Valentine Companies ([18(1)]);

(2)    Grasshopper has been the owner of the Wicked Tail Mark since its registration and has applied for registration of the New Wicked Mark ([12], [14]);

(3)    Since about 1 July 2010, BMB and Brisbane Fine Foods have operated the Wicked Business including by selling dipping sauces and other products under the trade mark “Wicked” with the division between them being about 90% by BMB and about 10% by Brisbane Fine Foods ([20]);

(4)    The alleged Infringing Products are manufactured by Valentine Companies except for Grasshopper. Those companies apply the New Wicked Mark to the Infringing Products and supply them for retail sale with the approval of Grasshopper ([476]);

(5)    The use by the Valentine Companies of the New Wicked Mark was “authorised use” within the meaning of that term as it is used in s 7(3) of the Trade Marks Act in the sense that such use was under the control of Grasshopper ([440] and [476]).

25    In ground 1 of the appeal PDP challenges the finding of the primary judge to the effect that the authorisation by Grasshopper of the use of the New Wicked Mark is not capable of constituting trade mark infringement.

3.2    The reasoning of the primary judge

26    The primary judge summarised the arguments and authorities cited by the parties and then considered the construction of the relevant sections as follows:

[449]    The issue for resolution is whether, where an authorised user is alleged to have engaged in infringing conduct under s 120 of the TM Act pursuant to its authorisation, the owner of the infringing mark (whether registered or unregistered) can also be liable for direct infringement under s 120 of the TM Act.

[450]    Section 7(3) of the TM Act provides that “[a]n authorised use of a trade mark by a person … is taken, for the purposes of this Act, to be use of a trade mark by the owner of the trade mark” (emphasis added). Section 8, in turn, defines “authorised user” and “authorised use” (see [433] above). Section 120 of the TM Act (see [430] above) focuses on the use by a person of a sign as a trade mark that is substantially identical with or deceptively similar to a registered trade mark in relation to, among other things, goods or goods of the same description in respect of which the trade mark is registered.

[451]    Two things can be observed from the language of these sections. First, the effect of s 7(3) is that use of a trade mark, in this case the New Wicked Mark, by a person, in this case one of the Valentine Companies other than Grasshopper, under the control of the owner of the mark, Grasshopper, is taken to be use of the trade mark by the owner of that mark, that is, Grasshopper. Section 7(3) provides that the section operates for the purposes of the TM Act. Secondly, as PDP submits, there is nothing in the language of ss 7, 8 or 120 of the TM Act which limits the concept of authorised use to registered marks.

[452]    Section 120 of the TM Act focuses on use of a sign by a person. That is, infringement will be made out where, for example, a person uses as a trade mark a sign that is substantially identical with or deceptively similar to a registered trade mark in relation to goods that are the same or of the same description as goods in respect of which the trade mark is registered. The notes to each of s 120(1), (2) and (3) of the TM Act relevantly refer the reader to s 6 (for the definition of registered owner) and s 10 (definition of deceptive similarity) but do not refer to s 7(3). As Grasshopper points out, this is in contrast to other sections of the TM Act. For example, note 1 to s 101(4) which is in Pt 9 “Removal of trade mark from Register for non-use” (see [245] above) refers to s 7(3) of the TM Act and includes “[i]f the registered owner of a trade mark has authorised another person to use it, any authorised use of the trade mark by that person is taken to be a use of the trade mark by the registered owner”.

27    It will be observed that the primary judge here recognised a distinction between the provision made for infringement in s 120 and the “authorised use” provisions of ss 7 and 8. The primary judge referred to the decision of Wilcox J in Aristocrat Technologies Australia Pty Ltd v Vidtech Gaming Services Pty Ltd [2006] FCA 275; (2006) 68 IPR 229. In that case, in rejecting an argument that the respondent had infringed Aristocrat’s trade marks by reason of the conduct of a third party applying Aristocrat’s trade marks to perspex panels, the Court observed at [134] that the Trade Marks Act did not have a comparable doctrine to the law of authorisation such as that which operates under copyright law.

28    The primary judge noted that this reference to copyright law was to provisions such as s 36 of the Copyright Act 1968 (Cth) which provides:

(1)    Subject to this Act, the copyright in a literary, dramatic, musical or artistic work is infringed by a person who, not being the owner of the copyright, and without the licence of the owner of the copyright, does in Australia, or authorizes the doing in Australia of, any act comprised in the copyright.

(1A)    In determining, for the purposes of subsection (1), whether or not a person has authorised the doing in Australia of any act comprised in the copyright in a work, without the licence of the owner of the copyright, the matters that must be taken into account include the following:

(a)    the extent (if any) of the person’s power to prevent the doing of the act concerned;

(b)    the nature of any relationship existing between the person and the person who did the act concerned;

(c)    whether the person took any reasonable steps to prevent or avoid the doing of the act, including whether the person complied with any relevant industry codes of practice.

29    The primary judge also referred to the decision of Dowsett J in Louis Vuitton Malletier SA v Toea Pty Ltd [2006] FCA 1443; (2006) 156 FCR 158 at [140]-[143], where his Honour made the observation that no provision extends civil liability to “secondary” tortfeasors under the Trade Marks Act and, as a result, the applicant in that case relied on principles as to liability in tort drawn from the general law.

30    PDP relied on three cases in support of their submissions.

31    The first was Scandinavian Tobacco Group Eersel BV v Trojan Trading Company Pty Ltd [2016] FCAFC 91; (2016) 243 FCR 152 (Besanko, Nicholas and Yates JJ). The primary judge distinguished this case on the basis that Trojan, the purchaser of products from the registered proprietor of the mark, affixed the registered proprietor’s marks to repackaged goods and contended that in doing so it was not using those marks as trade marks. The primary judge noted that this was a different position to the present where Grasshopper contends that whilst it has authorised the use of the New Wicked Mark by other Valentine Companies, the only alleged infringing conduct for the purposes of s 120 of the Trade Marks Act can have been by those companies ([466]).

32    The second was Playgro Pty Ltd v Playgo Art & Craft Manufactory Ltd [2016] FCA 280; (2016) 335 ALR 144 (Moshinsky J). This case concerned whether the company in the corporate group that owned the impugned mark had used it by reason of the conduct of another company in the same group making and applying it to the relevant products at the owner’s direction: see Playgro at [139]-[147]. However, the primary judge observed that the issue raised in the present case was not debated before Moshinsky J, and there had been no argument advanced that the owner of the impugned mark had not used the impugned mark ([475]).

33    The third was Southcorp Brands Pty Ltd v Rush Rich Winery Pty Ltd [2019] FCA 720; (2019) 369 ALR 299 (Beach J). This was a summary judgment case where the Court found the fourth respondent to be directly liable for infringing the trade marks in issue for the reason that it had licensed the first and second respondents to use the impugned marks. His Honour found at [71] that there had been use of the impugned marks by the first and second respondents which had been authorised by the fourth respondent and, accordingly, pursuant to s 7(3) of the Trade Marks Act such use “is taken…to be a use of the trade mark by” the fourth respondent. His Honour also concluded that the fourth respondent was liable as a joint tortfeasor: Southcorp Brands at [73].

34    In the present case the primary judge noted (at [483]) that it was not apparent from the reasoning of Beach J what construction arguments had been advanced on behalf of the applicant in relation to s 7(3). The primary judge also noted that that decision was irreconcilable with an earlier interlocutory decision of Moore J in Unilever Australia Limited v PB Foods Ltd [2000] FCA 798. In Unilever the applicant alleged that PB Foods had contravened s 120 of the Trade Marks Act. PB Foods sought to rely on a defence to the effect that Cadbury, the entity who authorised PB Foods’ use of the mark, would have been able to obtain registration of the impugned marks and, accordingly, it was entitled to rely on a defence under s 122(1)(f) of the Trade Marks Act ([484]). Unilever then sought to join Cadbury as a party, initially framing its case against Cadbury as one alleging that it had contravened s 120 of the Trade Marks Act by authorising PB Foods’ conduct: Unilever at [7]. Although Moore J expressed the view that there was sufficient evidence of authorisation to sustain a conclusion of a prima facie case against Cadbury, that was expressed with the caveat “if the legal foundation for that case can otherwise be demonstrated”. In relation to this the primary judge (at [486]) quoted Moore J’s reasons at [7] where his Honour determined:

The claim against Cadbury as initially framed involved a bare allegation of contravention of s 120 of the 1995 Act. Cadbury submitted that use by PB Foods did not constitute use by it for the purposes of s 120 even if it had authorised the use. Senior counsel for Unilever disavowed, at the hearing on 21 March 2000, any reliance on s 7 of the 1995 Act, notwithstanding that I had earlier accepted a submission of PB Foods (then contested by Unilever but unsuccessfully) that PB Foods’ defence based on s 122(1)(f) was not unarguable because Cadbury, though not PB Foods, might secure registration of the alleged infringing marks. Rather, PB Foods submitted that the authorisation of the use of infringing marks was itself an infringement. Reference was made to s 20 though that plainly concerns authorisation by a registered proprietor which Cadbury is not at least for the purposes of the 1995 Act. I was not referred to any material that would suggest use, in fact, by Cadbury nor any provision of the 1995 Act (apart from s 7) or authority that would support the proposition that infringing use by an authorised user rendered the owner liable for contravention of s 120. Accordingly, I am not satisfied that the case against Cadbury as originally propounded, raised a prima facie case against Cadbury.

(emphasis added)

35    The primary judge noted that, in Unilever, Moore J had the benefit of more developed argument in relation to the present issue than Beach J in Southcorp Brands and preferred that decision ([487]).

36    Her Honour concluded in relation to the threshold issue ([488]):

It follows that I would determine the threshold issue in favour of Grasshopper. Based on the matters set out above, its authorisation of the use of the New Wicked Mark is not capable of constituting trade mark infringement. That is, in its role as the owner of the New Wicked Mark who licensed it to other Valentine Companies to use, it cannot be the subject of the present action for direct liability pursuant to s 120 of the TM Act. That is not to say that no cause of action would lie against Grasshopper or a party in its position. As was the case in Southcorp and other cases, an action may lie against such a party as a joint tortfeasor. But that is not the basis on which PDP seeks to impugn Grasshopper’s conduct.

3.3    PDP’s submissions

37    PDP submit that s 7(3) of the Trade Marks Act provides in relation to authorised use that such use by a person “is taken, for the purposes of this Act, to be use of the trade mark by the owner of the trade mark”. Section 8 provides that an authorised use of a trade mark by a person occurs where, and to the extent that, that person uses the mark in relation to goods or services under the control of the owner of the mark, citing Lodestar v Anstalt v Campari America LLC [2016] FCAFC 92; (2016) 244 FCR 557 in relation to the concept of control. In the present case there was no dispute that the impugned use of the New Wicked Mark by related entities of Grasshopper was authorised use under the control of Grasshopper within ss 7(3) and 8 of the Trade Marks Act. Accordingly, PDP submit, it should be understood as use by Grasshopper for the purposes of infringement.

38    PDP submit that the plain words of s 7(3) support their argument, as they provide that an authorised use “is taken, for the purposes of this Act, to be a use by the owner of the trade mark”. This must be understood to include the infringement section, s 120. Further, they submit that there is nothing in the language of ss 7, 8 or 120 which limits the concept of authorised use to registered marks and so the concepts of ownership and control set out in ss 7(3) and 8 apply also to the owner of an unregistered mark. They contend that the primary judge erroneously relied on the absence of a note to s 120 confirming the applicability of s 7(3) to that section, citing s 15AB of the Acts Interpretation Act 1901 (Cth). Further, they submit that the primary judge’s approach undermined the clear words “for the purposes of this Act”, which PDP submit must be understood to mean for all purposes under the Trade Marks Act. PDP submit that other parts of the Trade Marks Act support the proposition that an authorised use of a trade mark may give rise to infringement by the person authorising use. In particular, they emphasise that s 20(1) provides that a registered trade mark confers on the registered owner the exclusive rights to “(a) use the trade mark; and (b) to authorise other persons to use the trade mark”.

39    PDP submit that the construction for which they contend harmoniously ensures that the definition of infringement in s 120 is commensurate with the scope of the registered owner’s exclusive rights, and in particular with limb (b) in s 20(1). In this context, PDP draw an analogy with: first, s 13(1) of the Patents Act 1990 (Cth) which they submit makes similar provision to s 20(1) of the Trade Marks Act and has long been held to create a species of infringement by authorisation; and, secondly, the authorisation provisions in the Copyright Act.

40    PDP submit that it would be incongruous if the regime providing for authorised use of trade marks operated as a “one way street” where the owner of a mark would benefit from use occurring via an authorised user, but at the same time be immune from a finding of infringement via that same authorised use. Finally, PDP submit that the authorities support the construction for which they contend, referring to or distinguishing the single judge decisions considered by the primary judge.

3.4    Consideration

41    The essence of PDP’s submissions on appeal is that Grasshopper should be taken to have engaged in an act of infringement by authorising one or more of the Valentine Companies to make and apply the New Wicked Mark to various products. In this sense they submit that Grasshopper’s conduct falls within that proscribed by s 120 of the Trade Marks Act. In our view, the primary judge was correct to reject that argument.

42    The facts of the present case do not frequently arise. This is because the well-established law in relation to joint tortfeasorship provides an available means by which an alleged infringer, who has not engaged in a primary act of infringement within s 120, may nonetheless be found to infringe: see, for instance, Hashtag Burgers Pty Ltd v In-N-Out Burgers, Inc [2020] FCAFC 235; (2020) 385 ALR 514 at [136]-[141] (Nicholas, Yates and Burley JJ). For unexplored reasons, joint tortfeasorship was not alleged in this case.

43    The task of the Court in construing any statute requires consideration of the text of the provisions and also consideration of their context, which includes the general purpose and policy of the provisions, in particular the mischief they are seeking to remedy: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 at [47] (Hayne, Heydon, Crennan and Kiefel JJ). The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all of the provisions of the statute. The meaning of the provision must be determined by reference to the language of the instrument viewed as a whole: Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 at [69] (McHugh, Gummow, Kirby and Hayne JJ). In interpreting a provision of an Act, the interpretation that would best achieve the purpose or object of the Act (whether or not that purpose or object is expressly stated in the Act) is to be preferred to each other interpretation: Acts Interpretation Act s 15AA; see also Northern Territory of Australia v Collins [2008] HCA 49; (2008) 235 CLR 619 at [16] (Gummow ACJ and Kirby J) and [99] (Crennan J). While this may permit a “strained construction” of the words used in order to ensure effect is given to the intention of the legislature, “(w)here the words actually used are not reasonably capable of being construed in the manner contended for, they will not be so construed”: R v Young [1999] NSWCCA 166; (1999) 46 NSWLR 681 at [15] (Spigelman CJ); see also Newcastle City Council v GIO General Ltd [1997] HCA 53; (1997) 191 CLR 85 at 113 (McHugh J) and Secretary, Department of Health & Ageing v Nguyen [2002] FCAFC 416; (2002) 124 FCR 425 at [22] (Black CJ, Sundberg and Finkelstein JJ). Extrinsic material may be considered in the task of construction: Acts Interpretation Act s 15AB. Nevertheless, the “words of the statute, not non-statutory words seeking to explain them, have paramount significance”: Nominal Defendant v GLG Australia Pty Ltd [2006] HCA 11; (2006) 228 CLR 529 at [22] (Gleeson CJ, Gummow, Hayne and Heydon JJ).

44    Part 12 of the Trade Marks Act contains ss 120-130A and is entitled “Infringement of trade marks”. Sections 120(1) and (2) provide:

(1)    A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered.

Note 1:    For registered trade mark see section 6.

Note 2:    For deceptively similar see section 10.

Note 3:    In addition, the regulations may provide for the effect of a protected international trade mark: see Part 17A.

(2)    A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to:

(a)    goods of the same description as that of goods (registered goods) in respect of which the trade mark is registered; or

(b)    services that are closely related to registered goods; or

(c)    services of the same description as that of services (registered services) in respect of which the trade mark is registered; or

(d)    goods that are closely related to registered services.

However, the person is not taken to have infringed the trade mark if the person establishes that using the sign as the person did is not likely to deceive or cause confusion.

Note 1:     For registered trade mark see section 6.

Note 2:     For deceptively similar see section 10.

Note 3:    In addition, the regulations may provide for the effect of a protected international trade mark: see Part 17A.

45    Section 120 relevantly provides for infringement in three circumstances:

(1)    where a person has used a substantially identical or deceptively similar mark in relation to the goods or services for which the mark is registered: s 120(1);

(2)    where a person has used a substantially identical or deceptively similar mark in relation to goods or services that are in broad terms similar to those for which the mark is registered: s 120(2); and

(3)    where a person has used a substantially identical or deceptively similar trade mark in relation to goods or services that are in broad terms dissimilar to those for which the trade mark is registered, but the trade mark is well known: ss 120(3) and (4).

46    Part 3 of the Trade Marks Act is entitled “Trade marks and trade mark rights”. Significantly, s 20(1) and (2) provides for the rights given by virtue of registration of a trade mark and states:

20    Rights given by registration of trade mark

(1)    If a trade mark is registered, the registered owner of the trade mark has, subject to this Part, the exclusive rights:

(a)    to use the trade mark; and

(b)    to authorise other persons to use the trade mark;

in relation to the goods and/or services in respect of which the trade mark is registered.

Note 1:    For registered owner see section 6.

Note 2:    For use see section 7.

Note 3:    In addition, the regulations may provide for the effect of a protected international trade mark: see Part 17A.

(2)    The registered owner of a trade mark has also the right to obtain relief under this Act if the trade mark has been infringed.

Note:    For what amounts to an infringement of a trade mark see Part 12.

47    It may be seen that s 20 draws a distinction between, on the one hand, the exclusive rights of the registered owner conferred by s 20(1) to use the mark and authorise the use of the mark and, on the other hand, the additional but separate right in s 20(2) to obtain relief if the trade mark has been infringed. The right of a registered owner to sue for trade mark infringement is defined, as the note to s 20(2) states, in Part 12 of the Trade Marks Act.

48    The rights so conferred are not co-extensive.

49    First, under s 20(1)(a) the exclusive right conferred is to “use the trade mark” which, when read with the definition in s 7(1), means to use the mark itself or with additions or alterations that do not substantially affect the identity of the trade mark. This has been interpreted to mean that the owner may use a trade mark that is substantially identical to the trade mark as registered: Optical 88 Ltd v Optical 88 Pty Ltd (No 2) [2010] FCA 1380; (2010) 275 ALR 526 (Optical 88 FCA) at [256] (Yates J) (affirmed on appeal Optical 88 Ltd v Optical 88 Pty Ltd [2011] FCAFC 130; (2011) 197 FCR 67 (Optical 88 FCAFC) at [39] (Cowdroy, Middleton and Jagot JJ)), citing Carnival Cruise Lines Inc v Sitmar Cruises Ltd [1994] FCA 68; (1994) 120 ALR 495 at 513 (Gummow J);  Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd [1963] HCA 66; (1963) 109 CLR 407 at 414 (Windeyer J). By contrast, the right conferred by s 20(2) is defined in s 120 as including the right to obtain relief in respect of uses that are not only substantially identical with, but also deceptively similar to the registered trade mark. Secondly, the exclusive right under s 20(1) is in respect of use “in relation to the goods and/or services in respect of which the trade mark is registered”. By contrast, the right conferred under s 20(2) is defined in s 120(2) to extend more broadly to goods and services that are “of the same description” or goods/services that are “closely related” to the services/goods of the registered mark. Under s 120(3) this right extends to unrelated goods and services.

50    These two differences no doubt animated Gummow J in JT International SA v Commonwealth of Australia [2012] HCA 43; (2012) 250 CLR 1 to observe at [72] that the exclusive right of use in respect of the goods or services for which there is a registration is given effect and extended by the infringement provision in Part 12 by operation of s 120.

51    It is notable that the exclusive right in s 20(1)(b) extends explicitly to the right “to authorise other persons to use the trade mark”. No equivalent language is used in ss 20(2) or 120. It may be taken that the legislature’s decision to refrain from doing so was deliberate. This point is amplified by the legislative history of ss 7(3) and 8.

52    The Trade Marks Act replaced the earlier Trade Marks Act 1955 (Cth) (1955 Act). The authorised use provisions were introduced in order to modernise the law in relation to the validity of registered trade marks and, in particular, the provisions relating to whether a trade mark registration can be removed from the register on the ground of non-use.

53    The 1955 Act contained terms whereby a trade mark could be removed from the register if it was not used by its owner or by a “registered user” who was permitted by the owner to use the mark. In Lodestar Besanko J (with whom Allsop CJ, Greenwood and Nicholas JJ agreed) said of this scheme at [67]:

The 1955 Act contained provisions dealing with registered users, that is to say, persons who used a trade mark with the permission of the registered owner or under a licence granted by the registered owner. The 1955 Act did not refer to an authorised user. Part IX of the Act dealt with registered users and provided that they could be registered under the Act. An application was required and the information to be provided to the Registrar included particulars of the degree of control by the registered proprietor over the permitted use (s 74(2)(a)). Section 74(4) provided that the Registrar shall not register a person as a registered user of a trade mark if it appeared to him that “the registration would tend to facilitate trafficking in the trade mark”. The effect of the registration of a registered use was addressed in ss 77 (effect of permitted use) and 78 (infringement proceedings).

54    As Besanko J explains at [68]-[77], despite the provisions requiring use either by the registered owner or a registered user, case law in the United Kingdom and Australia developed to the point that use by a licensee, whether registered as a “user” or not, was sufficient to protect a trade mark from attack on the grounds of non-use: Pioneer Kabushiki Kaisha v Registrar of Trade Marks [1977] HCA 56; (1977) 137 CLR 670 at 683 (Aickin J); Polo Textile Industries Pty Ltd v Domestic Textile Corporation Pty Ltd [1993] FCA 265; (1993) 42 FCR 227 at 238-239 (Burchett J).

55    The rationale for this was stated by Aickin J in Pioneer at 683:

[T]he essential requirement for the maintenance of the validity of a trade mark is that it must indicate a connexion in the course of trade with the registered proprietor, even though the connexion may be slight, such as selection or quality control or control of the user in the sense in which a parent company controls a subsidiary. Use by either the registered proprietor or a licensee (whether registered or otherwise) will protect the mark from attack on the ground of non-user, but it is essential both that the user maintains the connexion of the registered proprietor with the goods and that the use of the mark does not become otherwise deceptive.

56    The new provisions addressed this rationale. As Besanko J noted in Lodestar at [95]:

The meaning of “under the control of” in s 8 is informed by the principle stated by Aickin J in Pioneer, that is to say, that the trade mark must indicate a connection in the course of trade with the registered owner. The connection may be slight, such as selection or quality control or control of the user in the sense in which a parent company controls a subsidiary. It is the connection which may be slight. Aickin J was not saying the selection or quality control or financial control which may be slight. I think the principle stated by Aickin J informs the meaning of “under the control of” for the following reasons. First, the attribute of control by the registered owner was a key feature of the principle stated by Aickin J as his Honour’s remarks make clear. The same may be said of the approach taken in England as the English cases to which I have referred make clear. Furthermore, two of the examples given by Aickin J in Pioneer of a sufficient connection, namely, quality control and financial control are embodied in s 8 (subs (3) and subs (4)). This suggests to me that Parliament did not intend to effect a major change in the law in enacting s 8 in the Act. This conclusion is supported by the report of the Working Party. The Working Party expressed the view that a sufficient connection in the course of trade between the registered owner and the goods or services of the licensee should remain the law. Finally, I am fortified in reaching this conclusion by the fact that both Gyles J at first instance and the Full Court in Yau took a similar approach.

57    When the Trade Marks Bill 1995 (Cth) was introduced to Parliament, the Senator in the second reading speech noted that it no longer included provisions relating to the registration of users, but rather provided that:

...where owners of trade marks exercise control over use of their trade marks by other persons, that use can be taken to be use by the owner. This is prescribed by the WTO Agreement and can be used by trade mark owners to defend an action to deregister their trade mark on the basis that they have not used it. The WTO Agreement does not require use under the control of the owner of the trade mark to be registered. Consequently, there is little benefit in retaining additional provisions for the registration of users. This change will simplify the new trade marks legislation significantly. Recent developments in Canada and the UK are consistent with this approach.

58    The introduction of the definitions in ss 7 and 8 was accompanied by provisions that provided powers to an authorised user under s 26 as well as provisions relevant to the validity of registered trade marks including s 59 (“Applicant not intending to use trade mark”) and those in Part 9 (“Removal of trade mark from Register for non-use”).

59    No reference is made in either the report prepared by the Working Party established to review the trade marks legislation, the Explanatory Memorandum to the Trade Marks Bill 1995 (Cth) or the second reading speeches given in relation to that Bill of an intention on the part of Parliament to bring about a change to the infringement provisions by means of the definition of “authorised user”. It might be said that the mischief to which s 7(3) was directed concerned bringing the old scheme of registered users into line with modern licensing practices and Australia’s international obligations.

60    Turning to the scheme of the Trade Marks Act, it is apparent that it designates that the ability to enforce a trade mark right arises entirely from Part 12. This proposition is reinforced when one notes that the defences to infringement are all expressed either to operate “[i]n spite of s 120” (in the case of ss 122, 122A and 123), or in language which closely mirrors that of s 120 (in the case of s 124). Were the Trade Marks Act to be construed such that enforcement action could be taken on the basis of the exclusive rights conferred by s 20(1) the consequence would be a curious bifurcation of rights enforceable by a trade mark owner into those defined by both ss 120 and 20(1). If that were the case, the defences so adumbrated in Part 12 would be subverted, a point made in Australian Trade Mark Law (2nd ed, Oxford University Press, Melbourne, 2016) by the authors (R Burrell and M Handler) at p 369.

61    Section 7(3) provides:

7    Use of trade mark

…

(3)    An authorised use of a trade mark by a person (see section 8) is taken, for the purposes of this Act, to be a use of the trade mark by the owner of the trade mark.

62    Section 8 provides:

8    Definitions of authorised user and authorised use

(1)    A person is an authorised user of a trade mark if the person uses the trade mark in relation to goods or services under the control of the owner of the trade mark.

(2)    The use of a trade mark by an authorised user of the trade mark is an authorised use of the trade mark to the extent only that the user uses the trade mark under the control of the owner of the trade mark.

(3)    If the owner of a trade mark exercises quality control over goods or services:

(a)    dealt with or provided in the course of trade by another person; and

(b)    in relation to which the trade mark is used;

the other person is taken, for the purposes of subsection (1), to use the trade mark in relation to the goods or services under the control of the owner.

(4)    If:

(a)    a person deals with or provides, in the course of trade, goods or services in relation to which a trade mark is used; and

(b)    the owner of the trade mark exercises financial control over the other person’s relevant trading activities;

the other person is taken, for the purposes of subsection (1), to use the trade mark in relation to the goods or services under the control of the owner.

(5)    Subsections (3) and (4) do not limit the meaning of the expression under the control of in subsections (1) and (2).

63    Section 120 provides that “[a] person infringes a registered trade mark if the person uses as a trade mark...” a sign in a particular way. The definition of “trade mark” in s 17 of the Trade Marks Act is not confined to registered trade marks. PDP emphasises that s 7(3) is expressed so that “authorised use” is to be taken “for the purposes of this Act” to be use of the trade mark by the owner of the trade mark. Accordingly, PDP submit, the use by a person within s 120 will incorporate authorised use within the meaning of ss 7(3) and 8.

64    For the reasons which follow, we do not consider that this argument points to the correct or preferable construction.

65    First, the language of s 120 emphasises the personal nature of an act falling within s 120. It is the act of “the person” that attracts a finding of infringement. The language does not suggest use by one person will constitute an infringement by another person. Rather, it emphasises the action of the person who uses a sign in a particular way.

66    Secondly, having regard to the text of the Trade Marks Act as a whole, it is apparent that not every reference to the use of a trade mark is intended to import the definition of “authorised use” by an “authorised user” as those terms are defined by s 8. This may be seen immediately from s 20(1), which distinguishes in s 20(1)(a) between “use” and s 20(1)(b) which refers separately to “authoris[ing] other persons to use” a trade mark. Many other sections in the Trade Marks Act refer to “use” per se and also separately to authorising use: see for example ss 24(3)(a), 27(1)(b), 59(a), 92(4)(a) and 100(1)(a). Sections 41(5), 44(4) and 101(4) are examples where there is a reference to trade mark use by a trade mark owner or applicant without reference to “authorised use”. Those sections incorporate notes to the following effect, no doubt in order to make clear that this is the legislature’s intention:

If the registered owner of the trade mark has authorised another person to use it, any authorised use of the trade mark by that person is taken to be a use of the trade mark by the registered owner (see subsection 7(3)).

67    Although somewhat lacking in clarity, it is apparent that whilst the reference to authorised use in ss 7(3) and 8 applies for the purposes of the Trade Marks Act generally, not every reference to use of a trade mark is to be taken to incorporate “authorised use”. It is necessary to consider the context in which the reference appears in order to determine how it is to be understood. In this regard it is to be noted that s 120 refers to use “as a trade mark” but not to “authorised use”, thereby leaving ambiguous how it is to be understood in light of ss 7(3) and 8. It was relevant for the primary judge to observe that there is no notation equivalent to that reproduced above, which might otherwise clarify its meaning.

68    Thirdly, “authorised use” must be by an “authorised user” which introduces into the Trade Marks Act a scheme whereby there must be a connection in the course of trade between the owner of the trade mark and the mark itself. By s 8, that must be by the owner of the trade mark exercising control over the user, and an “authorised use” takes place only to the extent that the user uses it under that control. Control may include the exercise of quality control or financial control. This meets the purpose of the Trade Marks Act, as set out in Pioneer, of providing an indication to consumers and traders as to the trade origin of goods or services to which the trade mark is applied.

69    The word “authorise” has been found under the Copyright Act and the Patents Act to mean “sanction, approve, countenance”: University of New South Wales v Moorhouse [1975] HCA 26; (1975) 133 CLR 1 at 12 (Gibbs J) and 20 (Jacobs J with whom McTiernan ACJ agreed); Bristol-Myers Squibb Company v F H Faulding & Co Limited [2000] FCA 316; (2000) 97 FCR 524 at [97] (Black CJ and Lehane J). Section 36 of the Copyright Act (see [28] above) now provides guidance as to the relevant considerations including the extent of the person’s power to prevent the doing of the infringing act, the nature of the relationship between the actor and the alleged authoriser, and whether the alleged authoriser took any reasonable steps to prevent or avoid the doing of the impugned act.

70    It is apparent that the concept of use under the control of the owner, so understood, sits uncomfortably in the context of trade mark infringement. The scheme of ss 7(3), 8 and 120 of the Trade Marks Act would produce an odd vehicle for establishing indirect (or secondary) infringement, which is dependent on ascertaining the identity of the “owner” of the impugned, allegedly infringing mark, and then considering matters going to the quality and financial control over the use by the alleged primary infringer. It also would raise questions that are logically irrelevant to conventional consideration of whether or not a person is indirectly liable for an act of infringement, as indicated by the meaning attributed to “authorise” as that term is understood under copyright and patent legislation.

71    The secondary materials to which we have referred above do not provide any indication that it was the intention of the legislature to introduce, by the operation of ss 7(3) and 8, liability for authorising infringement of a registered trade mark. Had the legislature intended to do so, it is likely that they would have said so. Further, in our view, had it been the intention of Parliament to craft a remedy for infringement by authorisation, it would not have implemented such a clumsy scheme for doing so. These matters point in favour of the position advanced by Grasshopper.

72    Fourthly, contrary to the submission advanced by PDP, we do not consider that PDP’s construction leads to a result that is analogous to the terms of the Patents Act or the Copyright Act. In addition to the points that we have made above we note that s 13 of the Patents Act provides explicitly for a patentee to have exclusive rights to exploit the invention and to authorise another person to exploit the invention. Unlike s 20(2) of the Trade Marks Act, the Patents Act contains no provision addressing infringement. Case law developed under the Patents Act has structured the right to relief available to a patentee around the exclusive rights; namely, the ability to exclude others from exploiting or authorising others to exploit the invention: see Grain Pool of Western Australia v The Commonwealth [2000] HCA 14; (2002) 202 CLR 479 at [81]-[85] (Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ); Apotex Pty Ltd v Sanofi-Aventis Australia Pty Ltd [2013] HCA 50; (2013) 253 CLR 284 at [293] (Crennan and Kiefel JJ).

73    The Trade Marks Act, on the other hand, confers on the owner of a registered trade mark a separate right to obtain relief for the infringement of that mark: s 20(2). Notably, this right is expressed as being separate to the exclusive rights conferred under s 20(1) and the note under s 20(2) directs attention to Part 12, in which s 120 is located, for what amounts to trade mark infringement. Section 120 then defines the circumstances in which a registered trade mark will be infringed (see [45] above). Given the clear textual link between the right conferred by s 20(2) to obtain relief for infringement and the definition of infringement in s 120, in our view, the statutory scheme leaves little, if any, room for the Court to develop a further species of infringement centred on the exclusive rights granted under s 20(1). The schemes established by the Patents Act and the Trade Marks Act are sufficiently different to require their differing constructions in this respect.

74    PDP also seeks to draw support for its construction from the Copyright Act. However, as we have noted the Copyright Act makes explicit provision for infringement by acts of authorisation: see s 36 set out at [28] above. The anomalies that arise in relation to the application of s 7(3) by reference to s 120 to which we have referred above do not arise under the Copyright Act. Accordingly, we reject the contention advanced by PDP that s 7(3) read with s 120 has the same effect as the authorisation provisions, ss 36 and 101(1)-(1A), of the Copyright Act.

75    Finally, we note that the primary judge considered closely a number of decisions of single judges referred to by the parties in support of their positions. We agree with the analysis that she conducted ([439]-[488]), and with the observation that to the extent that those cases differ from the view to which we have referred, it is apparent that the Court did not have the advantage of the full argument provided by the parties in the present case.

76    Accordingly, ground 1 of the appeal must be dismissed.

4.    GROUND 2: DECEPTIVE SIMILARITY

4.1    Introduction

77    At trial PDP contended that the sale of the Infringing Products amounted to infringement of the Wicked Sister Marks by reason of the New Wicked Mark being either substantially identical with or alternatively deceptively similar to those trade marks. The primary judge rejected both of those contentions ([201]).

78    In ground 2 of their appeal PDP confined their challenge to the contention that the primary judge erred in finding that the New Wicked Mark was not deceptively similar to either of the WS Device Marks. They give particulars of this ground by reference to six asserted errors, namely that the primary judge:

(1)    incorrectly adopted a side by side comparison of the marks;

(2)    failed to give due weight to similarities between the respective marks (as opposed to the differences), including the word “wicked” with a stylised “W” as reflecting the prominent feature of the mark;

(3)    gave undue weight to the fact that the products to which the respective marks were applied were likely to be purchased in different locations in supermarkets or other stores;

(4)    failed to give sufficient weight to the lesser attention that a consumer would pay to products found to be fast moving consumer goods;

(5)    gave insufficient weight to evidence of confusion from three witnesses; and

(6)    ought to have found that there was a real tangible danger of confusion, allowing for imperfect recollection.

79    For the reasons set out in more detail below, we reject this ground.

4.2    The reasoning of the primary judge

80    The primary judge summarised the relevant principles applicable to the task under s 120 of determining whether one mark is deceptively similar to another ([157]-[162]). No party challenges that summary.

81    The primary judge posed the question for the Court as being whether there is a real, tangible danger of deception or confusion by reason of the use of the New Wicked Mark, having regard to the imperfect recollection of the notional consumer and taking into account all of the surrounding circumstances ([165]). Her Honour considered that the New Wicked Mark and the WS Device Marks were not visually or aurally similar, drawing attention to the similarities and differences between the words in each of the marks and also the stylised differences and similarities in the lettering of those marks as follows:

[168]    In terms of their visual appearance, the Wicked Sister Marks are made up, in the case of the WS Device Marks, of four words and, in the case of the WS Word Mark, of two words. In the WS Device Marks both the words “wicked” and “sister” are stylised:

(1)    the word “wicked” appears with:

(a)    a capital “W” with a pitchfork device on the middle arm or stem only;

(b)    the balance of the word in lowercase; and

(c)    a flame to dot the “i”; and

(2)    the word “sister”, which is unique to the Wicked Sister Marks, appears with:

(a)    a capital “S”;

(b)    the balance of the word in lowercase;

(c)    a flame to dot the “i”; and

(d)    and a swirling devil’s tail on the second “s”.

[169]    In contrast, the New Wicked Mark comprises one word in lower case, and the “w”, about which PDP makes much complaint, includes a pitchfork device on all three of its arms, in contrast to the single use of the pitchfork device on the middle arm or stem of the “W” in the WS Device Marks, while the outer arms curve inwards and do not include the pitchfork device. That both the WS Device Marks and the New Wicked Mark use in the word “wicked” a shortened arm on the “e” and a sans serif “d” is not sufficient to make the marks visually similar.

82    Her Honour considered that the marks were not aurally similar, noting that the WS Device Marks were made up of four words “Wicked Sister Fine Foods”, and that although the latter two words were not likely to remain in the memory, the two words “Wicked Sister” would. By contrast the New Wicked Mark was made up of only the single word “wicked” ([171]).

83    Turning to the meaning of the respective marks, her Honour considered that when rendered alone “wicked” is an adjective, an abstract concept which could describe anything being wicked, whereas the words “wicked sister” convey a different meaning, with the “sister” being a noun ([172]). In this context her Honour drew upon the reasoning of the Full Court in Telstra Corporation Limited v Phone Directories Company Australia Pty Ltd [2015] FCAFC 156; (2015) 237 FCR 388 at [180]-[181] (Besanko, Jagot and Edelman JJ).

84    Her Honour next considered the main or essential features of the WS Device Marks ([174]-[178]). She considered that the word “wicked” by itself was not a strongly distinguishing feature of the WS Device Marks rejecting the submission, reliant on In the matter of London Lubricants (1920) Limited’s Application (1925) 42 RPC 264 at 279, that the word “wicked” as the first word in the WS Device Marks had more prominence or was more important as a point of distinction ([174]). Nor did the primary judge consider that the word “wicked” was any more essential than the word “sister”, both words being of ordinary English and neither being properly characterised as an “essential feature” ([177]). Her Honour noted at [178]:

PDP submits that its pitchfork shaped “w” is, however, an essential feature of the WS Device Marks. As I have already observed, the “w” in the word “Wicked” as depicted in those marks includes a pitchfork device in the middle arm or stem of the “w”. But that feature no more strikes the eye and fixes in the recollection than the devil’s tail used in the second “s” in the word “sister” or the flames which dot the “i” in both the words “wicked” and “sister”. In other words, I do not think any single feature has prominence over the others.

85    Having made this finding her Honour then turned to consider the question of imperfect recollection, having regard to her characterisation of the WS Device Marks, concluding at [179] that they did not satisfy the “caused to wonder” test of deceptive similarity:

People of ordinary intelligence and memory who see the Wicked Sister Marks are likely to recall that they are made up of (at least) two words and that the appearance, in the case of the WS Device Marks, of the words “wicked’ and “sister” is stylised. People of ordinary intelligence and memory who see the New Wicked Mark are likely to recall that it is made up of one word stylised in some way. But it is not the case that the marks are so similar that a person recollecting them would be left to wonder whether the goods sold under the New Wicked Mark came from the same source as the Wicked Sister Products.

86    Her Honour was not persuaded that the usual manner in which ordinary consumers acquired the respondents’ goods, being fast moving consumer goods, would alter the assessment ([181]).

87    The primary judge then turned to reject two forensic matters that PDP submitted were relevant to the assessment. In the first the primary judge was invited to find that Mr Valentine or Mr Smithson (the designer of the New Wicked Mark) were influenced by the design of the WS Device Marks in their decision to adopt the New Wicked Mark. However, after considering the evidence of Mr Valentine and his son, David, her Honour concluded at [185] that proposition had not been established. This finding is not challenged on appeal.

88    In the second the primary judge considered the evidence put forward by PDP as evidence of actual confusion given by three individuals, who were not cross-examined, in the context of a submission advanced on behalf of the appellants that “[e]vidence of actual cases of deception, if forthcoming, is of great weight”: citing Australian Woollen Mills Limited v FS Walton and Company Limited [1937] HCA 51; (1937) 58 CLR 641 at 658 (Dixon and McTiernan JJ). Her Honour concluded that such evidence should be given little weight, for reasons to which we refer in more detail below ([194]-[200]).

4.3    PDP’s submissions

89    PDP first submit that the primary judge erred in holding that the respective marks were not visually or aurally similar, which they contend involved the imposition of a threshold of similarity for the purposes of deceptive similarity that was too high and made too little allowance for the imperfect recollection of consumers. Rather, they contend that the primary judge’s reasoning was based on a detailed side by side comparison of the marks which was more apt for consideration of the question of substantial identity.

90    Secondly, having accepted that “Fine Foods” would not remain in the memory of consumers, PDP submit that the primary judge ought to have held that the first word “Wicked” with its stylised “W” in the form of a pitchfork “was an essential, distinctive and memorable feature” of the marks which would likely be recalled by consumers. In this context they submit that the presence of “Sister” does not detract from this, rather the consistent styling of both words would likely increase the prospect of consumers recalling the pitchfork aspect of the “W”. PDP emphasise that they do not assert any monopoly in the word “wicked” in and of itself. In this regard, they accept that the word alone is an English word which lacks any relevant distinctiveness. Rather, they submit that it is the stylised form of the marks that is important, and that stylisation of the word “wicked” and in particular the pitchfork stylisation, is critical. It is this unusual feature that PDP submit will fix itself in the idea and the recollection. In this context they submit that the primary judge was incorrect to rely on the decision of the Full Court in Telstra Corporation, which concerned only plain words.

91    PDP thirdly submit that having accepted that the goods in question were fast moving consumer goods at a low price point, her Honour ought to have found that this increased the likelihood of confusion.

92    Fourthly, they submit that at [181] her Honour erred by considering how the parties’ respective goods were in fact sold, rather than considering the full scope of PDP’s registrations, including the way in which those marks could be used. In this regard PDP emphasise their registrations including “chilled desserts and sweet snacks” were to be considered against the actual use of the sweet flavoured dipping sauces and waffle-dippers of Grasshopper which could be, and were, sold from refrigerated areas of supermarkets ([126]-[127], [150], [181]). The finding at [181] that “consumers are able to view the products and their associated trade marks” is no answer, PDP submit, to the question of deceptive similarity, which involves reference to consumers’ recollection of the registered mark, which may be imperfect.

93    Finally, PDP challenge the primary judge’s evaluation of the evidence of Mr Brebbia, Ms Medley and Mr Masluk, the three individuals who gave evidence of confusion, as well as that given by Mr Polly, to which PDP submit the primary judge gave insufficient weight.

4.4    Consideration

94    The infringement findings of the primary judge depended on the application of s 120 of the Trade Marks Act and the principles relevant to determining whether one mark is deceptively similar to another.

95    The test for deceptively similarity has been long settled. In Australian Woollen Mills, Dixon and McTiernan JJ described it as follows at 658:

But, in the end, it becomes a question of fact for the court to decide whether in fact there is such a reasonable probability of deception or confusion that the use of the new mark and title should be restrained.

In deciding this question, the marks ought not, of course, to be compared side by side. An attempt should be made to estimate the effect or impression produced on the mind of potential customers by the mark or device for which the protection of an injunction is sought. The impression or recollection which is carried away and retained is necessarily the basis of any mistaken belief that the challenged mark or device is the same. The effect of spoken description must be considered. If a mark is in fact or from its nature likely to be the source of some name or verbal description by which buyers will express their desire to have the goods, then similarities both of sound and of meaning play an important part. The usual manner in which ordinary people behave must be the test of what confusion or deception may be expected. Potential buyers of goods are not to be credited with any high perception or habitual caution. On the other hand, exceptional carelessness or stupidity may be disregarded. The course of business and the way in which the particular class of goods are sold gives, it may be said, the setting, and the habits and observation of men considered in the mass affords the standard. Evidence of actual cases of deception, if forthcoming, is of great weight.

96    A little later, their Honours emphasised that the determination for the Court is one of estimation and impression, it is never susceptible of much discussion (at 659).

97    The distinction between consideration of whether one mark is deceptively similar to another, rather than substantially identical, lies in the point of emphasis on the impression or recollection which is carried away and retained of the registered mark, when conducting the comparison. In this context, allowance must be made for the human frailty of imperfect recollection. In New South Wales Dairy Corporation v Murray Goulburn Co-operative Company Ltd [1989] FCA 124; (1989) 86 ALR 549, in a passage in his judgment not affected by the proceedings on appeal, Gummow J said at 589:

In determining whether MOO is deceptively similar to MOOVE, the impression based on recollection (which may be imperfect) of the mark MOOVE that persons of ordinary intelligence and memory would have, is compared with the impression such persons would get from MOO; the deceptiveness flows not only from the degree of similarity itself between the marks, but also from the effect of that similarity considered in relation to the circumstances of the goods, the prospective purchasers and the market covered by the monopoly attached to the registered trade mark: Shell Co of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 414–15; Polaroid Corp v Sole N Pty Ltd [1981] 1 NSWLR 491 at 498. The latter case is also authority (at 497) for the proposition that the essential comparison in an infringement suit remains one between the marks involved, and that the court is not looking to the totality of the conduct of the defendant in the same way as in a passing off suit.

This passage was approved by the Full Court in C A Henschke & Co v Rosemount Estates Pty Ltd [2000] FCA 1539; (2000) 52 IPR 42 at [44] (Ryan, Branson and Lehane JJ) and more recently by the Full Courts in Combe International Ltd v Dr August Wolff GmbH & Co. KG Arzneimittel [2021] FCAFC 8; (2021) 157 IPR 230 at [27] (McKerracher, Gleeson and Burley JJ) and Hashtag Burgers at [64].

98    The determination of whether a sign used as a trade mark is deceptively similar to a registered trade mark involves an evaluative exercise upon which reasonable minds might differ. An appellate court can only intervene “if it is first shown that [the] assessment was affected by error of fact or law”: Food Channel Network Pty Ltd v Television Food Network GP [2010] FCAFC 58; (2010) 185 FCR 9 at [92] (Keane CJ, Stone and Jagot JJ); Christian v Société Des Produits Nestlé SA (No 2) [2015] FCAFC 153; (2015) 327 ALR 630 at [123] (Bennett, Katzmann and Davies JJ). Questions of judgment, nuance and degree are involved. Moreover, in a case of this kind, absent an error of principle, and unless the appeal court comes to an affirmative conclusion that the decision of the primary judge is wrong, weight should be given to the primary judge’s opinion: S & I Publishing Pty Ltd v Australian Surf Life Saver Pty Ltd [1988] FCA 1463; (1998) 88 FCR 354 at 361 (Hill, Nicholson and Emmett JJ). Error may lie in the taking of a false step in the reasoning, or manifest itself where the appellate court has a sufficiently clear difference of opinion: Aldi Foods Pty Ltd v Moroccanoil Israel Ltd [2018] FCAFC 93; (2018) 261 FCR 301 at [49] (Perram J). Where the process of evaluation by the primary judge has miscarried, the Full Court should carry out its own evaluation: Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd [2017] FCAFC 83; (2017) 251 FCR 379 at [55] (Greenwood, Jagot and Beach JJ); Aldi Foods at [2]-[10] (Allsop CJ, with whom Markovic J agreed) and [49]-[50] (Perram J); see also Homart Pharmaceuticals Pty Ltd v Careline Australia Pty Ltd [2018] FCAFC 105; (2018) 264 FCR 422 at [35]-[37] (Murphy, Gleeson and Markovic JJ); Verrocchi v Direct Chemist Outlet Pty Ltd [2016] FCAFC 104; (2016) 247 FCR 570 at [45]-[47] (Nicholas, Murphy and Beach JJ); Hashtag Burgers at [8]; Combe International at [12]-[15].

99    The task of an appellate court in reviewing an evaluative assessment was explained by Allsop J (as his Honour then was) in Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833; (2001) 117 FCR 424 at [28]-[29] (Drummond and Mansfield JJ agreeing):

[28]    …First, the appeal court must make up its own mind on the facts. Secondly, that task can only be done in the light of, and taking into account and weighing, the judgment appealed from. In this process, the advantages of the trial judge may reside in the credibility of witnesses, in which case departure is only justified in circumstances described in Abalos v Australian Postal Commission (1988) 171 CLR 167; Devries v Australian National Railways Commission (1993) 177 CLR 472 and SRA v Earthline, supra. The advantages of the trial judge may be more subtle and imprecise, yet real, not giving rise to a protection of the nature accorded credibility findings, but, nevertheless, being highly relevant to the assessment of the weight to be accorded the views of the trial judge. Thirdly, while the appeal court has a duty to make up its own mind, it does not deal with the case as if trying it at first instance. Rather, in its examination of the material, it accords proper weight to the trial judge’s views. Fourthly, in that process of considering the facts for itself and giving weight to the views of, and advantages held by, the trial judge, if a choice arises between conclusions equally open and finely balanced and where there is, or can be, no preponderance of view, the conclusion of error is not necessarily arrived at merely because of a preference of view of the appeal court for some fact or facts contrary to the view reached by the trial judge.

[29]    The degree of tolerance for any such divergence in any particular case will often be a product of the perceived advantage enjoyed by the trial judge. Sometimes, where matters of impression and judgment are concerned, giving “full weight” or “particular weight” to the views of the trial judge might be seen to shade into a degree of tolerance for a divergence of views [citations omitted] … However, as Hill J said in Commissioner of Taxation (Cth) v Chubb Australia (1995) 56 FCR 557 at 573 “giving full weight” to the view appealed from should not be taken too far. The appeal court must come to the view that the trial judge was wrong to interfere. Even if the question is one of impression or judgment, a sufficiently clear difference of opinion may necessitate that conclusion.

100    As noted, there is no criticism advanced on appeal of the primary judge’s recitation of the principles relevant to assessing deceptive similarity. Instead, PDP challenges the primary judge’s reasoning.

101    We do not consider that the first three arguments advanced have merit.

102    It is true that the primary judge, at the invitation of PDP, commenced by looking closely at the WS Device Marks and comparing them to the New Wicked Mark. In so doing, her Honour pointed out similarities and differences between the marks, some in fine detail. Had that been the end of the analysis it would have reflected error by confusing the test for substantial identity with that for deceptive similarity. But it was not. Her Honour went on to consider aural similarities and differences ([171]). She also considered the meaning of the respective marks ([172]) and what might be considered by the ordinary consumer to be the essential features of the WS Device Marks that would strike the eye or fix in the recollection of consumers ([178]). Only then did the primary judge proceed to consider what persons of ordinary intelligence and memory who see the WS Device Marks are likely to recall of those marks ([179]). The primary judge found that such people are likely to recall both words (“wicked” and “sister”), and that they are stylised ([179]). Her Honour rejected the argument that the first word “wicked” with its first letter “W” stylised in the form of a pitchfork was an essential, distinctive and memorable feature of those marks. In so doing, her Honour considered that whilst all of the four words in “Wicked Sister Fine Foods” formed part of the marks, the two words “Wicked Sister” were the most likely to be retained by the ordinary consumer ([171]). She rejected the contention that “wicked” was of greater prominence. In her evaluation, the word “wicked” as an adjective used in conjunction with the noun “sister” was not a strongly distinguishing feature. We consider these matters to be typical of the type of evaluation that a court is asked to undertake. PDP has not demonstrated error in the primary judge’s approach.

103    Her Honour explained her view that “wicked” was not a strongly distinguishing feature of the Wicked Sister Marks by reference to the Full Court decision in the Telstra Corporation case. In that case the Full Court found that YELLOW as a trade mark was not deceptively similar to YELLOW DUCK, YELLOW ZONE or YELLOW DOOR because the word “yellow”, when used as an adjective, tended to fade as a strongly distinguishing feature in the presence of the arbitrary noun that actually distinguished the services in question. The Full Court also noted the clear phonetic and visual differences between the marks and the different idea conveyed by them. Plainly enough, in the present case it is the registered mark that includes the two words WICKED SISTER and the impugned mark that uses WICKED alone, but the analysis remains applicable and her Honour was entitled to consider that matter in reaching her evaluative conclusion.

104    PDP seek to distinguish Telstra Corporation. They submit that in that case the word YELLOW was a plain word mark without stylisation. Although they accept that WICKED is an ordinary English word to which no party can claim exclusive right “in and of itself”, they submit that the stylisation of the word WICKED, and in particular the pitchfork stylisation of the first letter “W”, is “critical” as an unusual feature. However, it is necessary to look at all of the elements of the mark in their context, including the size, prominence and stylisation of words and device elements, and their relationship to each other: Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd [2004] FCAFC 196; (2004) 209 ALR 1 at [91]-[103] (Moore, Sackville and Emmett JJ); Bavaria NV v Bayerischer Brauerbund eV [2009] FCA 428; (2009) 177 FCR 300 at [21]-[22] and [32] (Bennett J); Optical 88 FCA at [100]. Even were it to be assumed for present purposes that “wicked” had no distinctiveness (which we doubt), it would not be appropriate to ignore its presence in the WS Device Marks, or to conclude that because it is an ordinary word, consumers would only pay attention to aspects of stylisation of that word and ignore the presence and meaning of the word in the context of the mark as a whole.

105    Furthermore, the primary judge plainly accepted that the relevant goods in question were fast moving consumer goods, and took that factor into account when weighing up whether or not a consumer, not credited with any high perception having regard to that circumstance, would be caused to wonder at the similarity between the marks ([179]-[181]).

106    In their fourth argument PDP submit that the primary judge emphasised the evidence as to how the parties’ respective goods were in fact sold and overlooked the need to consider the full scope of PDP’s registrations for the WS Device Marks, including the way in which they could be used in relation to the goods the subject of the registrations. They also submit that, in the passage emphasised below, the primary judge erred by conducting a side by side comparison of the respective marks.

107    At [181] her Honour said:

The evidence establishes that the goods are likely to be purchased in a supermarket or online from a supermarket or equivalent retailer. The goods are displayed in considerable quantities together. That is, the Wicked Sister Products are displayed together in the refrigerated section and the Wicked dips can either be displayed together at room temperature or placed in the refrigerated section with the berries. As Mr Valentine explains, the choice of where the Wicked dips are displayed is one for the retailer (see [83] above). Based on my observations of the evidence, while both products can be, and in the case of the Wicked Sister Products are, displayed in refrigerated sections, they are found in different parts of the stores. That is, the Wicked Sister Products are displayed in the refrigerated section in the dairy aisle while the Wicked dips, when refrigerated, are in the refrigerated section of the fresh produce area. In any event, consumers are able to view the products and their associated trade marks. While a consumer is not to be credited with any high perception, given the way they are displayed and the ability to view the brand and the product, I do not accept that simply because the goods are fast moving consumables consumers are more likely to be confused.

(Emphasis added)

108    There is force in the criticism advanced by PDP insofar as [181] suggests that the comparison to be made is between, on the one hand, the use of the impugned sign on goods bearing the sign by the accused infringer and, on the other hand, the actual use of the registered mark by its owner.

109    The relevant question is whether the impugned sign is deceptively similar to the registered trade mark having regard to the goods in respect of which that mark is registered. In that regard, it is necessary and appropriate for the Court to consider the course of business and the way in which the particular class of goods are sold. This gives the setting, and the habits and observations of the ordinary consumer considered in the mass affords the standard, to determine whether the impugned mark is, properly judged, deceptively similar: Australian Woollen Mills at 658.

110    It is relevant to consider such contextual matters in order to set the broad standard of analysis by reference to the likely behaviour of the ordinary consumer. Typically, the characteristics of that consumer may be discerned from:

(a)    whether or not the goods are expensive or of personal or intimate interest, in which case closer attention may be given to detail of trade marks;

(b)    whether or not the goods are cheaper or a fast moving consumer good where the consumer may be less involved and pay less attention to trade marks;

(c)    how the goods are promoted and acquired which may indicate the relevance and importance of aural or visual aspects of the mark; and

(d)    the outlets from which goods of the class are typically acquired, which may indicate how trade marks are likely to be displayed and perceived.

111    However, it is important to bear steadily in mind that the issue under s 120 is not whether the alleged infringer’s conduct is deceptive or confusing, but whether the alleged infringer’s trade mark is deceptively similar to the registered trade mark. Beyond having a general bearing on the habits and practices of consumers, more granular detail of actual trade circumstances of either parties’ conduct is not relevant to the inquiry. This represents an important distinction between an infringement action under s 120 and proceedings for misleading or deceptive conduct under the Australian Consumer Law or the tort of passing off, where the inquiry into surrounding circumstances is broader, a point recently made with some emphasis by the Full Court in Australian Meat Group Pty Ltd v JBS Australia Pty Limited [2018] FCAFC 207; (2018) 268 FCR 623 at [68] (Allsop CJ, Besanko and Yates JJ).

112    It was not appropriate for the primary judge to descend to fine detail about the actual uses of the WS Device Marks. However, consideration of the trade context of use of goods within the scope of the registration was appropriate and necessary. In [181] the primary judge concluded that the goods are likely to be purchased in a supermarket or online from an equivalent retailer and that they are likely to be displayed in considerable quantities together, most likely in refrigerated sections of the stores. Those observations are typical of the required consideration of trade circumstances for goods sold in supermarkets of the type within the WS Device Marks’ registrations. It is the further finding that the Wicked Sister Products (being those products defined by the primary judge at [91]) are displayed in the refrigerated section in the dairy aisle while the Wicked dips, when refrigerated, are in the fresh produce section, that involved an overly detailed focus on the actual presentation of the Wicked Sister Products rather than the uses authorised by the scope of PDP’s registrations for the WS Device Marks.

113    In this regard we do not consider that this reasoning in [181] vitiates the conclusions of the primary judge in relation to the question of deceptive similarity. It may be noted that this paragraph appears following her Honour’s conclusion at [179] that persons of ordinary intelligence would not, upon recalling the Wicked Sister Marks, consider that the New Wicked Mark was so similar that they would be left to wonder whether the goods sold under the New Wicked Mark came from the same source. Her Honour had also found at [180] that the goods in question are fast moving consumer goods sold at a low price point. There is no suggestion on appeal that that finding is not applicable to the goods within the scope of the Wicked Sister Marks’ registrations. Accordingly, the observation of concern might be considered to be a stray remark. It went nowhere in her Honour’s reasoning, because she had already acknowledged and applied herself correctly to the question of whether or not the ordinary consumer, with an imperfect recollection of PDP’s marks, would be caused to wonder as to the source of the goods to which the New Wicked Mark had been applied.

114    Finally, we note that the emphasised sentence in [181] of the primary judgment (set out at [107] above), contrary to the submission advanced by PDP, does not suggest that the primary judge erroneously conducted a side by side comparison. We understand the observation to indicate that the primary judge considered that when goods are on display in the refrigerated section of a supermarket, consumers are able to see the product upon which the trade mark is applied. The evidence of typical displays of goods of the type falling within the registrations shows that observation to be apt.

115    PDP’s final argument challenges the “little weight” that the primary judge gave to evidence going to actual confusion given by three trade witnesses, Mr Brebbia, Ms Medley and Mr Masluk ([194]).

116    In her findings at [195]-[198] the primary judge observed that none of these witnesses were as close to the hypothetical shopper as a witness could be, each having a personal or trade affiliation with either Mr Polly or PDP. Nor was it apparent to her Honour that these witnesses compared the New Wicked Mark with the WS Device Marks ([196]) or how they reconciled the difference between the New Wicked Mark applied to the impugned products with their knowledge of the differences between that mark and the WS Device Marks ([197]), citing the remarks of Nicholas J in Vivo International Corporation Pty Ltd v Tivo Inc [2012] FCAFC 159; (2012) 294 ALR 661 at [143].

117    We consider that her Honour’s findings as to weight were within the range of conclusions reasonably open to her Honour on the basis of the evidence provided. No error is apparent in her evaluation of this evidence.

118    Mr Brebbia is an Italian food manufacturer who produces chilled dairy products on behalf of PDP. On a visit to Australia he observed the sale of some of Grasshopper’s WICKED caramel sauce dip and believed that it was “part of the WICKED SISTER range” because: (1) the word “Wicked” was stylised in the same way as it appeared in the Wicked Sister brand; (2) the location of the products on the shelf close to where he would expect to find the WICKED SISTER range; and (3) the fact that the impugned product was also a dessert product. The latter two considerations are largely extraneous to the question of whether the marks are deceptively similar and no aspect of the evidence gives guidance as to how much weight Mr Brebbia gave to any of the three considerations.

119    From June 2015 to July 2017 Ms Medley was a category manager at Coles for chilled desserts when PDP supplied Coles with its Wicked Sister Products. At an unspecified date (her affidavit was sworn in September 2019) she saw WICKED branded dipping sauces and believed them to be manufactured by or on behalf of PDP “due to the similarity in branding” between the the WICKED dipping sauce and the Wicked Sister Products. Like Mr Brebbia, she had a professional affiliation with PDP that went well beyond that of the ordinary consumer. In her evidence she gives no guidance as to why she regarded the brands to be similar, whether it was because of the New Wicked Mark or because of the get up of the packaging or otherwise.

120    Mr Masluk is a friend of Mr Polly. In 2018 he visited a Coles supermarket and found a product called “wicked chocolate dip”. He believed it to be part of the “WICKED SISTER range” because the wicked chocolate dip: (1) shared the common word “wicked” and similar style and lettering; (2) was a type of dessert similar to those sold under the WICKED SISTER range; and (3) it was located in the refrigerated section of the supermarket. Similarly to Mr Brebbia, Mr Masluk gives no evidence as to the influence of the latter two considerations in the formation of his belief.

121    In Vivo Nicholas J (with whom Dowsett J agreed) observed at [137] that although evidence of actual confusion may be highly persuasive, it must be assessed and evaluated by the Court to determine what weight should be given to it. This involves consideration of the quality of the evidence by reference to its internal logic, other evidence available in the case, and the Court’s own knowledge of human affairs.

122    In our view it was entirely open to the primary judge to form the view that because of the content of the evidence and the particular circumstances of each witness, their evidence should weigh slightly in the balance. The same may be said of her Honour’s conclusion that the evidence of Mr Polly, summarised in the primary judgment at [146]-[148], should not be given much, if any, weight. Mr Polly’s evidence of undocumented complaints from third parties to PDP left no rational basis upon which one could form an understanding as to the basis for the complaints received.

123    Accordingly, ground 2 of the appeal must be dismissed.

5.    GROUND 3: GOODS OF THE SAME DESCRIPTION

124    Like grounds 1 and 2, ground 3 of the appeal concerns the primary judge’s findings relevant to PDP’s trade mark infringement claim. In ground 3, PDP contend that the primary judge erred in finding that the goods to which the New Wicked Mark were applied were not goods of the same description as those the subject of the registrations for the WS Device Marks. This is the third aspect of the appeal upon which PDP must succeed in order to overturn the primary judge’s conclusion that their trade marks were not infringed by the conduct of Grasshopper. Given that we have found that the first and second grounds fail, we do not consider that it is necessary or appropriate for us to address this ground: Boensch v Pascoe [2019] HCA 49; (2019) 94 ALJR 112 at [7]-[8] (Kiefel CJ, Gageler and Keane JJ).

6.    GROUNDS 1 AND 2 OF THE CROSS-APPEAL AND GROUND 1 OF THE NOTICE OF CONTENTION

125    At trial, Grasshopper advanced a defensive, alternative case that in the event that the Wicked Sister Marks were infringed by the New Wicked Mark, then the Wicked Sister Marks were liable to be cancelled. The grounds advanced for cancellation were said to arise under ss 88(2)(a), because the marks could have been opposed under ss 44 and/or 60, and also under s 88(2)(c), of the Trade Marks Act. The factual basis for the alternative case is that if Grasshopper’s New Wicked Mark is deceptively similar to either of the WS Device Marks, then these grounds for rectification become available. Grounds 1 and 2 of the cross-appeal are advanced on the same contingent basis. Accordingly, as a result of our conclusions on the question of infringement, it is unnecessary for us to address the cross-appeal further.

126    The same position applies to ground 1 of the notice of contention, which raises defences to infringement under ss 122(1)(e), 122(1)(fa), 124 and 120(2) of the Trade Marks Act. These only arise in the event that the primary judge’s conclusions in relation to infringement are overturned. Again, having regard to our findings, it is not necessary to address these defences.

7.    GROUND 4: PDP’S REMOVAL CLAIM (AND NOTICE OF CONTENTION GROUNDS 3 AND 4)

7.1    Introduction

127    The primary judge considered a challenge brought by PDP to the registration of the Wicked Tail Mark pursuant to s 92(4)(b) of the Trade Marks Act on the basis that none of the Registered Wicked Tail Mark Goods had been used in the relevant non-use period (defined by the primary judge as the third non-use period) between 18 September 2015 and 18 September 2018 ([561]).

128    The Registered Wicked Tail Mark Goods are:

dips, including chocolate dips and savoury dips; desert [sic] toppings and sauces, including chocolate toppings and sauces, and fruit flavoured toppings and sauces; confectionery, including chocolates and sweets, but excluding frozen confections.

129    The primary judge found that Grasshopper had discharged its onus of establishing use during the third non-use period (under s 100(1)(c)) only in respect of “dips, including chocolate dips”. However, in the exercise of her discretion under s 101(3), her Honour determined that all of the listed goods should remain, with the exception of “savoury dips” ([586]-[587]).

130    In ground 4 of the appeal, PDP contend that the primary judge erred in finding that:

(a)    there had been use of the Wicked Tail Mark during the third non-use period in relation to “dips, including chocolate dips” (at [572]-[581]); and

(b)    there was any intention, or a sufficiently definite intention, to use the Wicked Tail Mark in relation to any other goods (at [582]-[587]) such as to justify the exercise of the discretion to allow the Wicked Tail Mark to remain on the register.

131    In grounds 3 and 4 of the notice of contention, Grasshopper contends that the primary judge ought to have made other findings in its favour. We address these contentions in more detail below.

132    Section 92(4)(b) provides:

(4)    An application under subsection (1) or (3) (non-use application) may be made on either or both of the following grounds, and on no other grounds:

(a)    ...

(b)    that the trade mark has remained registered for a continuous period of 3 years ending one month before the day on which the non-use application is filed, and, at no time during that period, the person who was then the registered owner:

(i)    used the trade mark in Australia; or

(ii)    used the trade mark in good faith in Australia;

in relation to the goods and/or services to which the application relates.

133    Under s 100(1), the burden lies with the opponent to the non-use application, here Grasshopper, to rebut an allegation made under s 92(4).

7.2    The reasoning of the primary judge

134    The primary judge made findings of fact at [574] that from about late 2014 the Wicked Business gradually transitioned from using the Wicked Tail Mark to packaging bearing the New Wicked Mark. The packaging bearing the New Wicked Mark was initially sold in Coles and other chain stores, while products bearing the Wicked Tail Mark continued to be sold in independent stores. This transition continued until about early 2016, when all of the pre-printed labels using the Wicked Tail Mark had been used. The primary judge accepted the evidence of Mr Valentine that Fruitlink, a Brisbane wholesaler, maintained a website and that a screenshot taken on 27 May 2019 from that website depicted the form in which the Wicked Tail Mark had been applied prior to it being phased out in early 2016.

135    Her Honour considered that this was sufficient to establish use by Grasshopper in respect of “dips, including chocolate dips” (at [576], [581]), citing E & J Gallo Winery v Lion Nathan Australia Pty Ltd [2010] HCA 15; (2010) 241 CLR 144 at [51], [52] and [64] (French CJ, Gummow, Crennan and Bell JJ).

136    Her Honour concluded that the use of the Wicked Tail Mark was not limited to that depicted in the Fruitlink website, but included use in the period when the packaging was being phased out ([581]).

137    Turning then to the discretion, the primary judge recorded the submissions advanced on behalf of Grasshopper in favour of the exercise of discretion under s 101(3) for the retention of all of the goods within the registration rather than only the products in respect of which use had been proved:

[585]    Grasshopper submits that the Court should exercise its discretion pursuant to s 101(3) of the TM Act in its favour. Grasshopper relies on three matters: first it says that the public interest will be adversely affected if, relevantly, the registration is removed for any of the Registered Wicked Tail Mark Goods; secondly, it says that no member of the public is likely to have been deceived or confused by the circumstances said to justify removal; and thirdly, to the extent that it did not use the Wicked Tail Mark in relation to any of the Registered Wicked Tail Mark Goods, it intends to do so in the future, including by way of the Wicked Word Mark and the New Wicked Mark, “as to which see s 7(1) of the TM Act”.

138    Her Honour declined to exercise that discretion in favour of retaining the “savoury dips” category of goods, but otherwise decided:

[587]    The balance of the Registered Wicked Tail Mark Goods should remain. Given my findings about use at [581] above, there is no issue about “dips, including chocolate dips”. As to the balance of the categories, dessert toppings and sauces, including chocolate topping and sauces, and fruit flavoured toppings and sauces, and confectionery, including chocolates and sweets, but excluding frozen confections, the evidence before me, which I have accepted, is that Mr Valentine intends to use or authorise use of the Wicked Tail Mark in the future in relation to chocolate, rocky road and fruit flavoured topping sauces. Accordingly, I would not exercise my discretion in favour of removing the Wicked Tail Mark from the Register in respect of those categories of goods.

(Emphasis added)

7.3    The submissions

139    PDP submit that the primary judge erred in accepting that the respondent had discharged its onus of proving use via the evidence of Mr Valentine that packaging of dipping sauces under the Wicked Tail Mark continued until 2016, when there was no evidence of actual use during the relevant period. They submit that the primary judge also erred in the exercise of her discretion under s 101(3) of the Trade Marks Act, in finding that the respondent had any intention, or a sufficiently definite intention, to use the Wicked Tail Mark in relation to certain other goods, there being no objective evidence that the respondent had used that mark since the introduction of the New Wicked Mark in 2014. In this regard, PDP submit that the primary judge erred at [587] by finding that Mr Valentine intended to use or authorise the use of the Wicked Tail Mark in the future in relation to the goods set out there, that finding being inconsistent with the evidence.

140    Grasshopper generally defends the primary judge’s findings and supplements those reasons with the further point, made in ground 3(a) of its notice of contention, that use of the New Wicked Mark amounts to use of the Wicked Tail Mark within the meaning of s 7(1) of the Trade Marks Act, because the New Wicked Mark is the Wicked Tail Mark with additions or alternations that do not substantially affect the identity of the Wicked Tail Mark. This, it submits, provides another basis, additional to those summarised in its submissions to the primary judge at [585], to support the primary judge’s findings. Grasshopper accepts that the primary judge erred in [587] of her reasons in referring to Mr Valentine’s intention to use the Wicked Tail Mark in the future, but submits that this was a “slip” and should be understood as a reference to the New Wicked Mark. If that is not read by this Court to be a typographical error, then Grasshopper contends that in the re-exercise of the discretion under s 101(3), this Court would permit the goods to remain on the register substantially for the reasons set out in its submissions recorded at [585] of the primary judge’s reasons.

7.4    Consideration

141    The first aspect of ground 4 of the appeal is that the primary judge erred in finding that there had been use of the Wicked Tail Mark during the relevant non-use period in relation to “dips, including chocolate dips” (at [572]-[581]). We do not consider this error has been established.

142    The primary judge took into account the evidence of use given by Mr Valentine, who had been cross-examined on the subject, and who adhered to his testimony on the subject of use of the Wicked Tail Mark. Her Honour also had regard to the Fruitlink website, which the primary judge accepted, on the basis of the evidence of Mr Valentine, demonstrated use during the third non-use period. It was open to her Honour to reach that conclusion on the evidence.

143    Having decided this, Grasshopper accepts that there is no need to consider the issue raised in ground 3(a) of the notice of contention, namely that the respondent had authorised the use of the Wicked Tail Mark by authorising the use of the New Wicked Mark, within s 7(1) of the Trade Marks Act. Nor is it necessary to consider ground 3(b) of the notice of contention, which would involve consideration of whether or not the primary judge ought to have exercised the discretion pursuant to s 101(3) of the Trade Marks Act in favour of permitting “dips, including chocolate dips” to remain on the register.

144    The second aspect of the ground 4 of the notice of appeal concerns the exercise by the primary judge of her discretion to permit the retention of the balance of the goods in the Wicked Tail Mark registration (with the exception of savoury dips).

145    In [587] the primary judge refers to having earlier accepted the evidence of Mr Valentine that he intends to use or authorise the use of the Wicked Tail Mark in the future in relation to chocolate, rocky road and fruit flavoured topping sauces. Although Grasshopper seeks to characterise the reference to the Wicked Tail Mark as a slip of the pen which should be understood to mean the New Wicked Mark, we do not think that it can be so characterised.

146    The primary judge’s earlier acceptance of Mr Valentine’s evidence appears in [548]-[554] of her reasons, where her Honour was considering whether or not the Wicked Tail Mark should be removed from the register pursuant to s 59 of the Trade Marks Act; namely, because at the time that he applied for registration of the mark, being 18 February 2005, Mr Valentine did not intend to use it in respect of the Registered Wicked Tail Mark Goods.

147    The primary judge found that at that time Mr Valentine did have such an intention in respect of all of the Registered Wicked Tail Mark Goods for a number of reasons. One was his express evidence of his intention as at the priority date ([551], [553(1)-(2)]), another was his subsequent conduct from February 2005 to August 2008 ([552]). The final, most tangential, finding of the primary judge was that “Mr Valentine intends for the Wicked Business to relaunch or launch chocolate, rocky road and fruit flavoured topping sauces in the future” ([553(5)]). This last reason was directed to a present intention to resume sale of the goods. However, the primary judge made no finding about the trade mark that Mr Valentine intended to apply to those goods. Nor does Mr Valentine’s evidence going to that subject, to which we were taken on appeal do so.

148    Nevertheless, understood in the context of these references, it would appear that her Honour’s final consideration was directed towards the use and intended use of the Wicked Tail Mark. We are not satisfied that her Honour’s later reference to the Wicked Tail Mark at [587] was a slip. This view is perhaps supported by the fact that had the primary judge intended to refer to the New Wicked Mark rather than the Wicked Tail Mark, then one might have expected to see some analysis of Grasshopper’s submission (set out two paragraphs earlier at [585]) to the effect that the use of the New Wicked Mark equated to use of the Wicked Tail Mark by reason of the operation of s 7(1) of the Trade Marks Act.

149    Accordingly, we consider that within the welter of overlapping issues advanced by the parties, her Honour made an error, and that she did intend at [587] to refer to the Wicked Tail Mark. In so doing, her Honour erred.

150    Grasshopper accepts that if we reach this conclusion, then it must be the case that the discretion under s 101(3) miscarried, because the Court misapprehended the evidence relevant to its exercise within House v R [1936] HCA 40; (1936) 55 CLR 499 at 504-505 (Dixon, Evatt and McTiernan JJ).

151    It is necessary for us to re-exercise the discretion on appeal.

152    Section 101(3) provides:

101    Determination of opposed application—general

…

(3)    If satisfied that it is reasonable to do so, the Registrar or the court may decide that the trade mark should not be removed from the Register even if the grounds on which the application was made have been established.

153    The following propositions are relevant to the exercise of this discretion:

(1)    It is broad and is unfettered in the sense that there are no express limits on it. It is to be understood as limited only by the subject-matter, scope and purpose of the legislation and, in particular, by the subject-matter scope and purpose of Part 9 of the Trade Marks Act: Austin Nichols & Co Inc v Lodestar Anstalt [2012] FCAFC 8; (2012) 202 FCR 490 at [35] (Jacobson, Yates and Katzmann JJ).

(2)    The scope and purpose of the Trade Marks Act strikes a balance between various disparate interests. On the one hand there is the interest of consumers in recognising a trade mark as a badge of origin of goods or services and in avoiding deception or confusion as to that origin. On the other is the interest of traders, both in protecting their goodwill through the creation of a statutory species of property protected by the action against infringement, and in turning the property to valuable account by licensing or assignment. This balance was articulated by the High Court in Campomar Sociedad, Limitada v Nike International Ltd [2000] HCA 12; (2000) 202 CLR 45 at [42] (Gleeson CJ, Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ) and JT International at [30] (French CJ) and [68] (Gummow J); see also Austin Nichols at [36]-[37].

(3)    The particular purpose of Part 9, within which s 101 falls, is to provide for the removal of unused trade marks from the Register. It is designed to protect the integrity of the Register and in that way the interests of consumers. At the same time, it seeks to accommodate, where reasonable to do so, the interests of registered trade mark owners: Austin Nichols at [38]. Accordingly, the Court must be positively satisfied that it is reasonable that the trade mark should not be removed. The onus in this respect lies on the trade mark owner to persuade the Court that it is reasonable to exercise the discretion in favour of the owner: Austin Nichols at [44]. This a reflection of the importance of the public interest in maintaining the integrity of the Register (Austin Nicholls at [38]) and so ensuring that trade marks that fail to comply with the conditions that underpin the entitlement to the statutory monopoly are removed from the Register.

(4)    The discretion in s 101(3) is expressed in the present tense. It requires consideration of whether, at the time that the Court is called upon to make its decision, it is reasonable not to remove the mark: Austin Nichols at [41].

(5)    The range of factors considered in the exercise of the discretion has included whether or not:

(a)    there has been abandonment of the mark;

(b)    the registered proprietor of the mark still has a residual reputation in the mark;

(c)    there have been sales by the registered owner of the mark of the goods for which removal was sought since the relevant period ended;

(d)    the applicant for removal had entered the market in knowledge of the registered mark;

(e)    the registered proprietors were aware of the applicant’s sales under the mark;

see Hermes Trade Mark [1982] RPC 425 (Falconer J) as followed in E & J Gallo Winery v Lion Nathan Australia Pty Limited [2008] FCA 934; (2008) 77 IPR 69 (Flick J)) at [202]-[203].

(f)    A further factor, explicitly noted in s 101(4), but which falls within the scope of the discretion in s 101(3), is whether or not the trade mark under consideration has been used by its registered owner in respect of similar goods or closely related services: Pioneer Computers Australia Pty Ltd v Pioneer KK [2009] FCA 135; (2009) 176 FCR 300 at [173] (Bennett J); Goodman Fielder Pte Ltd v Conga Foods Pty Ltd [2020] FCA 1808; (2020) 158 IPR 9 at [271] (Burley J).

154    We accept that to this list may be added the point advanced by Grasshopper, namely that some of these discretionary considerations may be applied having regard to the operation of s 7(1) of the Trade Marks Act. This provision provides that if the Court, having regard to the circumstances of the case, thinks fit, it may decide that a person has used a trade mark if it is established that the person has used the mark with additions or alterations that do not substantially affect the identity of the trade mark.

155    In the present case we do not consider that the discretion should be exercised in favour of retention of the remaining goods on the register in respect of the Wicked Tail Mark, those goods being: savoury dips, dessert toppings and sauces, including chocolate toppings and sauces, and fruit flavoured toppings and sauces, and confectionery, including chocolates and sweets, but excluding frozen confections.

156    First, there had been no use of such goods, even to the point of the hearing of the proceedings.

157    Secondly, the evidence of Mr Valentine does not state one way or another what trade mark he intended to apply those goods if launched in the future. In circumstances where Grasshopper bears the onus to satisfy the Court that the trade mark should remain on the register in respect of those goods, this omission is telling. It has not been established that Grasshopper has any intention to use the Wicked Tail Mark on those goods.

158    Thirdly, the findings of the primary judge make tolerably clear that Grasshopper intends to move entirely away from the Wicked Tail Mark to the New Wicked Mark ([46]-[63]).

159    Fourthly, on 19 March 2015 Grasshopper applied for registration of the New Wicked Mark in respect of the range of goods to which (it may be inferred) it then intended to apply that trade mark.

160    Fifthly, we do not accept, having regard to consideration of the two marks (that we set out again below, for convenience) that they may be regarded to be substantially identical to each other:

The Wicked Tail Mark: The New Wicked Mark:

161    As we have noted earlier, s 7(1) has been interpreted to require that the two marks be substantially identical to each other: Optical 88 FCA at [256], affirmed in Optical 88 FCAFC at [35]-[39]. In this regard (in short), the Court must be affirmatively satisfied that, when viewed side by side, having regard to their similarities and differences, a total impression of similarity emerges from a comparison of the two marks in question; here, the Wicked Tail Mark and the New Wicked Mark: see Shell at 414 (Windeyer J); Carnival at 513 (Gummow J).

162    Having regard to the presentation of the two marks, including the distinctive tail on the “D” of the Wicked Tail Mark and the font and block characteristics of the New Wicked Mark, we do not consider them to be substantially identical. We do not consider that intended use in respect of the New Wicked Mark equates to intended use of the Wicked Tail Mark in respect of the goods currently under consideration.

163    Accordingly, ground 4 of the appeal should be allowed insofar as the primary judge incorrectly permitted the following goods to remain on the trade marks register for the Wicked Tail Mark:

dessert toppings and sauces, including chocolate topping and sauces, and fruit flavoured toppings and sauces, and confectionery, including chocolates and sweets, but excluding frozen confections.

8.    GROUND 5: GRASSHOPPER’S REMOVAL CLAIM

8.1    Introduction

164    At trial, Grasshopper applied for the partial removal of the Second WS Device Mark and the WS Word Mark (which were defined collectively in the primary judgment as the Later Registered WS Marks ([208])) for non-use pursuant to s 92(4)(a) of the Trade Marks Act ([358]). Grasshopper alleged that from the date of the filing of the applications on 9 February 2016 until 21 August 2018, PDP Capital did not use those trade marks in relation to following goods, which the primary judge defined as the Second Non-Use Goods:

in class 29, desserts made from yoghurt, fruit flavoured yoghurts, low fat yoghurts, yoghurt desserts, yoghurt, fruit flavoured yoghurts, yoghurts containing pulped fruit, and yoghurt preparations (which the primary judge defined as Yoghurt Products); and

in class 30, dessert sauces, dipping sauces, bakery products, cakes, confectionery, ice cream confections including ice cream desserts, all other desserts in this class including prepared desserts, and puddings.

165    The primary judge found that Grasshopper had established grounds for removal under s 92(4)(a) for the following Second Non-Use Goods, defined by the primary judge as the Remaining Second Non-Use Goods ([402]):

bakery products, confectionery, ice cream confections, dipping sauces and the Yoghurt Products

166    Having determined this, the primary judge then considered whether the discretion under s 101(3) should be exercised to not remove the Later Registered WS Marks from the register in respect of the Remaining Second Non-Use Goods. Her Honour concluded that the Later Registered WS Marks should be removed from the register insofar as they were registered for the Remaining Second Non-Use Goods and that the registration for “dessert sauces” in class 30 should be replaced with “custard” ([428(2)]).

167    In ground 5 PDP contend that the primary judge erred:

(a)    in finding that PDP Capital had no intention to use the Later Registered WS Marks, and had not used them during the non-use period of 9 February 2016 to 21 August 2018 in relation to the Remaining Second Non-Use Goods ([366]-[402]);

(b)    in finding that the Later Registered WS Marks should be removed from the register in relation to the goods identified at ([428(a)]), and in failing to find that it was not reasonable (in the exercise of the discretion under s 101(3) of the Trade Marks Act) to make an order to that effect ([403]-[428]).

168    Section 92(4)(a) of the Trade Marks Act provides:

(4)    An application under subsection (1) or (3) (non-use application) may be made on either or both of the following grounds, and on no other grounds:

(a)    that, on the day on which the application for the registration of the trade mark was filed, the applicant for registration had no intention in good faith:

(i)    to use the trade mark in Australia; or

(ii)    to authorise the use of the trade mark in Australia; or

(iii)    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 to which the non-use application relates and that the registered owner:

(iv)    has not used the trade mark in Australia; or

(v)    has not used the trade mark in good faith in Australia;

in relation to those goods and/or services at any time before the period of one month ending on the day on which the non-use application is filed…

8.2    The reasoning of the primary judge

169    The primary judge noted that s 92(4)(a) of the Trade Marks Act has two limbs which must be established. First, that on the priority date, being 9 February 2016, PDP Capital had no intention to use or authorise the use of the Later Registered WS Marks in relation to the Second Non-Use Goods. Secondly, that PDP Capital has not used the Later Registered WS Marks in relation to the Second Non-Use Goods during the relevant non-use period ([359]). The primary judge also noted that if satisfied that these requirements are established, the question arose as to whether she should exercise her discretion under s 101(3) of the Trade Marks Act not to make an order for removal ([403]).

170    In relation to the first limb, lack of intention, the primary judge made the following general findings in relation to all of the Second Non-Use Goods:

(1)    The only evidence of intention to use arises implicitly from the fact that PDP Capital had applied to register the Later Registered WS Marks for those goods ([373]).

(2)    No evidence was given by Mr Polly or anyone else on behalf of PDP Capital that as at the date of filing the Later Registered WS Marks there was the requisite intention ([374]).

(3)    There was no evidence of use of the Later Registered WS Marks in relation to the Second Non-Use Goods after the date of the applications that would assist in drawing inferences about the issue of intention to use as at the date of the applications ([375]).

(4)    The only evidence that might have assisted going to intention in the future was given by Mr Polly in 2019 to the effect that PDP Capital planned “to expand its range to include additional Wicked Sister Products” as set out in a strategic plan prepared in October 2018. The primary judge found at [375]:

...It is difficult to see how this evidence and the Wicked Sister Strategic Plan can be evidence of use of the Later Registered WS Marks in relation to any of the Second Non-Use Goods such that an inference could be drawn that there was an intention to use or to authorise the use of those marks as at 9 February 2016. Mr Polly’s evidence and the Wicked Sister Strategic Plan are expressed in the most general of terms. Even if it could be said to relate to the Second Non-Use Goods insofar as they include the “adjacent categories” referred to in the Wicked Sister Strategic Plan, it rises no higher than a “speculative possibility” of an intention to expand into those product areas at some future, but not yet ascertained, time: see Optical 88 Appeal at [87]; Optical 88 at [266].

171    In relation to the second limb, the actual lack of use requirement, the primary judge directed attention to each of the Second Non-Use Goods in turn as follows:

(a)    For dessert sauces, the primary judge was satisfied that use by PDP Capital of the Later Registered WS Marks in relation to custard fell within that broader class ([379]) and later found that the class should be narrowed to be custard only ([427]).

(b)    For bakery products, the primary judge was not satisfied that PDP Capital had established use. Her Honour did not accept that PDP Capital had established that it had in fact used the Later Registered WS Marks in relation to chocolate profiteroles within the non-use period ([383], [384]). Her Honour also rejected the submission that use in relation to chocolate profiteroles would amount to use within the description of “bakery goods” ([381]). Her Honour categorised profiteroles, consistently with the characterisation given by PDP Capital in its own documents, as “chilled desserts” ([382]).

(c)    For cakes, her Honour accepted that use of the Later Registered WS Marks in relation to tiramisu amounted to sufficient use ([386]).

(d)    For confectionery, her Honour rejected the submission advanced by PDP Capital that its use of the Later Registered WS Marks on crème brulée, mousse, panna cotta, lamington and coco mango fell within the meaning of “confectionery” ([387]).

(e)    For ice cream confections, her Honour found that no evidence established use ([391]).

(f)    For puddings, the primary judge accepted that the use of the Later Registered WS Marks in relation to rice pudding was use within this description ([393]).

(g)    For all other desserts in this class, including prepared desserts, the primary judge accepted that PDP Capital had established use of the Later Registered WS Marks in relation to panna cotta, which fell within this description, but found that those marks had not been used in relation to either lamington and coco mango ([394]-[399]). Her Honour later found that, contrary to Grasshopper’s submission, in the exercise of her discretion this class should not be narrowed to be panna cotta only ([427(2)]).

(h)    For dipping sauces, the primary judge noted at [400] that PDP Capital made no submissions to the effect that it had applied the Later Registered WS Marks in relation to dipping sauces, and that it had not established such use.

(i)    For yoghurts, the primary judge noted that again, PDP Capital had relied on no evidence of use in relation to those products ([401]).

172    In summary, the primary judge found that Grasshopper had established grounds for removal under s 94(2)(a) in respect of each of the Remaining Second Non-Use Goods being ([402]):

bakery products, confectionery, ice cream confections, dipping sauces and the Yoghurt Products.

173    The primary judge then turned to the exercise of discretion under s 101(3) of the Trade Marks Act. Her Honour noted that PDP Capital had advanced two submissions in favour of the exercise of discretion. The first was that goods in respect of which she had found there to be use could be understood to be “goods of the same description” as the remaining goods that were presently under consideration. Secondly, that it would be misleading or deceptive or likely to mislead or deceive if another trader was permitted to use the Later Registered WS Marks on any of those goods ([405]-[407]).

174    The primary judge took these submissions and more into account in concluding that she should not exercise her discretion in favour of retention of the marks on the register with respect to the Remaining Second Non-Use Goods. In relation to whether Remaining Second Non-Use Goods were goods of the same description as any products that her Honour had found to have been sold by PDP Capital under the Later Registered WS Marks (the Wicked Sister Products), which consisted of tiramisu, crème caramel, custard, mousse panna cotta, crème brûlée, rice pudding and chocolate profiteroles, her Honour found at [418]:

...The Remaining Second Non-Use Goods comprise bakery products, confectionery, ice cream confections, dipping sauces and the Yoghurt Products. In relation to those categories of goods:

(1)    bakery products, confectionery and ice cream confections are unlikely to be sold in the dairy aisle of a supermarket and, in my opinion, are not of the same description as any of the Wicked Sister Products. That some of these products may be made of predominantly fresh ingredients and/or that two of the Wicked Sister Products, Chocolate Profiteroles and Classic Tiramisu, may include elements which are baked is not sufficient for me to determine otherwise. In fact the evidence before me establishes that the Chocolate Profiteroles (see [382] above) and Classic Tiramisu are chilled desserts;

(2)    dipping sauces may be sold in the dairy aisle of a supermarket or elsewhere as the evidence in this case demonstrates. There is no evidence before me that would lead me to conclude that dipping sauces are made of predominantly fresh ingredients. In fact, the Wicked dipping sauces are not and, as accepted by both parties, are shelf stable; and

(3)    the Yoghurt Products are likely to be sold in the dairy aisle of a supermarket and to be made of predominantly fresh ingredients. Notwithstanding that, yoghurt, whether plain or fruit flavoured, and panna cotta, again with or without added fruit flavouring, are not, in my opinion, of the same description. According to the definition relied on by PDP, yoghurt is made from milk that has been curdled by the action of enzymes or other cultures. That is not the case for panna cotta...

(Emphasis added)

175    The primary judge considered that the evidence of PDP Capital’s future plans to expand its products was general in nature and did not include any evidence of any “preparatory steps” being taken ([419]).

176    Further, the primary judge considered the submission advanced by PDP Capital that removal of the registrations could lead to deception or confusion because it would leave open the possibility that other traders may be permitted to use the Wicked Sister Marks on any of those categories of goods. That is, removal of the Remaining Second Non-Use Goods could lead to fragmented ownership in relation to the same or a very similar mark in respect of very similar goods, citing Sensis Pty Ltd v Senses Direct Mail and Fulfillment Pty Ltd [2019] FCA 719; (2019) 141 IPR 463 at [130] (Davies J). The primary judge noted that PDP Capital did not explain how that might occur in its case and said at [421]:

While that may well be the result, it is necessary to balance against that prospect, the maintenance of the integrity of the Register. An unused trade mark should not remain on it.

177    The primary judge concluded at [422]:

Here, there has been no use of the Later Registered WS Marks in the Second Non-Use Period in relation to the Remaining Second Non-Use Goods. Nor has there been any demonstrated use or intention to use those marks in the period after the Second Non-Use Period. In the circumstances, the need to maintain the integrity of the Register outweighs any risk of deception or confusion that might arise by reason of the removal of Later Registered WS Marks insofar as they are registered for the Remaining Second Non-Use Goods.

178    Ultimately, the primary judge found that all of the Remaining Second Non-Use Goods should be removed from the register, that “dessert sauces” should be amended to read “custard” and that “all other desserts in this class including prepared desserts” should be permitted to remain ([427]-[428(2)]).

8.3    PDP’s submissions

179    PDP challenge the primary judge’s findings that there had been no use of the Remaining Second Non-Use Goods during the relevant non-use period. The challenge is also directed to her Honour’s findings of lack of intention to use and in relation to the exercise of discretion.

180    PDP submit that the primary judge erred in discounting evidence of the use of the Later Registered WS Marks in relation to chocolate profiteroles, which her Honour found did not fall within bakery products, especially in light of the fact that the primary judge found that PDP Capital had used the Later Registered WS Marks in relation to cakes which, they submit, are bakery goods. PDP also submit that the primary judge found that PDP Capital had used the Later Registered WS Marks in relation to “dessert sauces”, being custard ([377]), but gave insufficient weight, in considering its intention, to evidence that PDP had also manufactured dessert sauces under a private label for Coles ([124]-[125]). They submit that custard and dessert sauces are goods that are the same as, or of the same description as, “dipping sauces”.

181    PDP submit that the primary judge erred in discounting the evidence of their strategic plan ([375]), which provided a firm foundation to infer a relevant intention to use the marks at the priority date for the Later Registered WS Marks, as well as use of those marks during the non-use period.

182    PDP submit that the errors listed above were compounded by the primary judge’s refusal to exercise the discretion under s 101(3) on the basis of the similarity of the goods removed to those that remained in the registrations. PDP also seek to impugn her Honour’s failure to take into account an intention to use the marks in the future or the confusion that would result from fragmented ownership of the Later Registered WS Marks if used on similar goods, having regard to PDP’s reputation as at the date of the exercise of the discretion, which included sales in excess of 20 million units each year of Wicked Sister Products across Australia and New Zealand by 2018 ([498]).

8.4    Consideration

183    As articulated in oral submissions, PDP’s primary point is that the primary judge erred in relation to her findings as to whether the requirements of s 92(4)(a), intention and use, were established with the consequence that her exercise of discretion under s 101(3) ought to be considered afresh. For the reasons set out below we disagree.

184    The primary judge’s findings as to PDP Capital’s use of, and intention to use, the Later Registered WS Marks in relation to the Second Non-Use Goods involved assessments going to the weight to be given to the evidence advanced. The evidence of intention to use as at the priority date was, her Honour found, negligible. Whilst the primary judge took into account the intention implicit in making the application itself, citing Aston v Harlee Manufacturing Company [1960] HCA 47; (1960) 103 CLR 391 at 401 (Fullagar J), the absence of affirmative evidence on the subject from PDP Capital was telling to her Honour (at [374]). So too was the absence of evidence of actual use after registration. These were orthodox applications of principle.

185    Her Honour was entitled to consider that the 2018 strategic plan was inadequate to demonstrate the requisite intention. Having regard to its contents, to which we were taken on appeal, we do not consider that PDP have established error in her Honour’s conclusion that the strategic plan spoke only in general terms about future plans that amounted to no more than raising a speculative possibility of an intention to expand into different product areas ([375]). Such possibilities may be set to one side as insufficiently determinate when considering whether, at the filing date, there was an intention to use the mark: Optical 88 FCA at [265]-[267], upheld on appeal in Optical 88 FCAFC at [88].

186    PDP submit that the primary judge wrongly failed to take into consideration the evidence of sales of chocolate profiteroles in considering the intention to use the Later Registered WS Marks in relation to “bakery products”. Two points may be made in relation to this submission.

187    First, as her Honour noted at [383], there was no evidence of use or proposed use of the Later Registered WS Marks in relation to profiteroles during the relevant non-use period. The evidence in the strategic plan was, as we have noted, considered by the primary judge to be inadequate. There was some evidence as at the date of Mr Polly’s affidavit, albeit in relation to a device mark bearing the words “WICKED SISTER desserts” rather than “WICKED SISTER fine foods” but that, again, was after the relevant non-use period.

188    Secondly, the primary judge was not satisfied that chocolate profiteroles fell within the description of “bakery products”. In this regard, her Honour noted that PDP Capital itself classified its products as “chilled desserts”, as did an article published in 2017 ([382]). PDP criticise this finding. They submit that “one [does not] need evidence to establish that a profiterole [is] a baked product”.

189    It is true that a good may be a chilled dessert and a bakery product at the same time. Goods may be susceptible to several classifications. However, the term “bakery product” (in contrast to “baked product”) refers, no doubt, to a product that may be found in a bakery. The evidence of use provided by PDP Capital was that its chocolate profiteroles are sold in a refrigerated section of a supermarket ([95]). The pastry component of a profiterole may well be baked (we were taken to no evidence on the point), but not everything baked will be a “bakery product” (baked fish, is an example). A profiterole may well be found in a patisserie, but will it be considered a “bakery product”? That was a question of fact for PDP to prove. It did not do so to the satisfaction of the primary judge. We do not consider that PDP have established error in the conclusion that she reached, based on the evidence provided. Having regard to the other matters to which the primary judge referred in her consideration of the evidence going to intention, we do not accept that PDP have established that primary judge erred in relation to her findings.

190    PDP also submit that as the primary judge had found use of the Later Registered WS Marks in relation to “cakes” during the relevant non-use period ([386]), her Honour ought also to have found such use was made in relation to “bakery products”. However, that proposition was not put to the primary judge at trial. Although the grounds advanced in the present case might suggest that an appeal represents an opportunity for the parties to re-run the trial at the appellate level, that is not the case. In any event, it does not follow (as PDP’s submissions suggest) from a finding that tiramisu falls within the category of a “cake”, that tiramisu also falls within the category of a “bakery product”.

191    Similarly, PDP now rely on the primary judge’s finding that they had used the Later Registered WS Marks in relation to “dessert sauces” (use by the sale of custard) to support the submission that her Honour ought also to have found an intention to use the marks in relation to “dipping sauces”. That submission was also not put at trial. PDP seek to circumvent this difficulty by pointing out that they contended at trial that “dessert sauces” were not relevantly different to “dipping sauces”. However, that contention could not amount to a submission that by selling custard under the Later Registered WS Marks they had used those marks in relation to dipping sauces. Furthermore, the evidence of Mr Polly, upon which PDP now rely, does not support the proposition that they are the same goods. In our view, PDP have not established a basis upon which we would permit them to rely on a case not advanced at trial in this regard. Having regard to these matters, we do not consider PDP to have established error in the primary judge’s findings as to lack of intention to use or lack of use. Nor, in our view, have they established that the primary judge erred in the exercise of discretion under s 101(3) within House v R. The reasons that we have given above suffice to address the points raised on appeal.

192    Accordingly, ground 5 must be dismissed.

9.    GROUND 6: ACL AND PASSING OFF

9.1    Introduction

193    The primary judge rejected PDP’s claim that by promoting and selling products under or by reference to the New Wicked Mark, Grasshopper had engaged in conduct in breach of ss 18 and 29 of the ACL. In particular, PDP had contended that Grasshopper had made misrepresentations to consumers in Australia that the Infringing Products (being those identified in section 3.1 above) are either the same as the Wicked Sister Products (a term defined in section 4.4 above at [112]) sold under the trade mark WICKED SISTER, have the same place of origin as the Wicked Sister Products, are made and promoted by one or both of the appellants, or that Grasshopper is sponsored by or affiliated with those companies. The primary judge rejected a similar claim advanced on the basis that Grasshopper had engaged in passing off.

194    PDP contend in ground 6 of the appeal that the primary judge erred in finding that Grasshopper had not contravened ss 18 and 29 of the ACL and engaged in passing off by the sale of the impugned products in get-up including the New Wicked Mark. They rely on the following particulars:

(a)    The primary judge erred in failing to find that PDP had an extensive and valuable goodwill and reputation in Australia in relation to the Wicked Sister Marks ([520]).

(b)    The primary judge erred in giving little or no weight to the unchallenged evidence of actual confusion given by the three witnesses who encountered Grasshopper’s impugned products sold under the New Wicked Mark ([194], [521]).

(c)    The primary judge erred in failing to find that a not insignificant number of ordinary or reasonable members of the relevant class of consumers would be likely to be misled or deceived, by reason of similarities between the products, the ingredients from which they were made, the locations of supermarkets or other stores in which they were sold, and their packaging ([519], cf [126], [181]).

9.2    The reasoning of the primary judge

195    The primary judge set out the relevant legal principles to the ACL claim ([492]-[497]), about which there is no complaint on appeal, and summarised the parties’ submissions ([498]-[505]). She rejected Grasshopper’s submission that it had not itself conduced any sales or promotional activities but rather acted simply as an intellectual property licensor for one or other of the companies controlled by Mr Valentine ([515]).

196    Turning to the ACL claim, the primary judge found that when the inquiry is focused on whether a not insignificant number of persons within the cohort of ordinary or reasonable members of purchasers of food products ( [518]) would be misled or deceived, or are likely to be misled or deceived, by the alleged conduct (at [519]):

(1)    the Wicked Sister Marks and the New Wicked Mark are not sufficiently similar or are too dissimilar for a not insignificant number of consumers to be misled or deceived. I have recorded those differences at [168]-[171] above [as to which see section 4.2 above];

(2)    added to that is the different nature of the products. As set out at [71] and [126] above, the Infringing Products are shelf stable and not dairy based while the Wicked Sister Products are refrigerated dairy desserts made from premium ingredients;

(3)    each product is sold in different areas of the supermarket. As the Infringing Products are shelf stable at ambient temperatures, they do not need refrigeration and thus do not need to be sold in the refrigerated section of a supermarket. However, the Wicked dipping sauces are sometimes offered for sale in the refrigerated fresh produce area of a supermarket with the fresh berries. On the other hand, the Wicked Sister Products require refrigeration and are sold in the dairy aisle of the supermarket; and

(4)    the packaging of the products is different. The Wicked dipping sauces are sold in single tubs with a brown lid bearing the New Wicked Mark and an image and the Wicked Waffle Dippers are sold in a foil pack bearing the New Wicked Mark (see [208] above) while the Wicked Sister Products are, for the most part, sold in twin packs wrapped in a cardboard package (see for example [92] above).

197    The primary judge considered the evidence of reputation relied upon by PDP at [520]:

The relevant date for assessing PDP’s reputation for the purposes of s 18 of the ACL is the date that the impugned conduct commenced: see Bohemia Crystal at [309]. The evidence establishes that Grasshopper commenced using the New Wicked Mark in 2014. That is thus the relevant date for assessing PDP’s reputation. The evidence before me does not establish that Wicked Sister had an “extensive and valuable goodwill and reputation in Australia and elsewhere” in each of the Wicked Sister Marks as at that date. The evidence it relies on in support of that reputation (see [498] above) is largely focused on the period commencing in 2016 and thereafter. When the cumulative sales figures for the Wicked Business and PDP are compared for the period up to 2013, it is apparent that the sales revenue generated by the Wicked Business outstrips that of PDP. By that time the Wicked Business had been trading for approximately 11 years while the PDP business had only been trading for four years. PDP has not established that it had the relevant reputation as at 2014; indeed, it appears, based on the evidence as at 2014, that it was the Wicked Business which had the stronger reputation.