FEDERAL COURT OF AUSTRALIA

TRADE MARKS - appeal against refusal of registration of device and word marks “The Sports Cafe” – whether “deceptively similar” to existing mark “The Circuit Sports Cafe” – whether marks alike – whether idea conveyed by marks relevant – whether costs order should be made against Registrar

Trade Marks Act 1995 (Cth) s 44(1)(a)

Australian Woollen Mills Ltd v F S Walton & Company Limited (1937) 58 CLR 641 applied

Cooper Engineering Company Proprietary Limited v Sigmund Pumps Limited (1952) 86 CLR 536 applied

In the matter of an Application by The Pianotist (1906) 23 RPC 774 applied

THE SPORTS CAFE LIMITED v THE REGISTRAR OF TRADE MARKS

NO. NG 153 of 1998

WILCOX, HEEREY and LINDGREN JJ

SYDNEY

18 DECEMBER 1998

On appeal from a single judge of the Federal Court of Australia

THE COURT ORDERS THAT:

1.         The appeal be allowed in part.

2.         The orders of Burchett J dated 10 February 1998 be set aside.

3.         The decision of the delegate of the Registrar of Trade Marks dated 28 April 1997, in respect of Application 605397, be set aside.

4.         The respondent accept for registration the said Application, subject to any other relevant provision of the Trade Marks Act 1995 (Cth).

5.                  The decision of the delegate of the Registrar of Trade Marks, dated 28 April 1997, in respect of Application 602441, be confirmed.

6.                  The respondent pay to the appellant two-thirds of its costs of the proceeding before Burchett J and of the appeal.

Note:                Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

On appeal from a single judge of the Federal Court of Australia

REASONS FOR JUDGMENT

THE COURT:  This appeal calls into question a decision by a judge of the Court (Burchett J) that applications of the appellant, The Sports Cafe Limited, for registration of two trade marks be rejected.  The primary judge held each mark was deceptively similar to a trade mark registered by another person in respect of similar services (“the cited mark”):  see s44(2)(a)(i) of the Trade Marks Act 1995.

The marks

Each of the applications was for registration in class 42 in Part A of the Register of Trade Marks, in respect of “catering services; bar, restaurant, cafe, public house, cafeteria, snack bar and hotel services”.  Application 602441 was for the words “THE SPORTS CAFE”  (“the appellant’s word mark”).  Application 605397 was for a device (“the appellant’s device mark”) as follows:

The cited mark was for a device as follows:

The judgment below

Burchett J commented it was apparent “that neither of the marks sought to be registered is substantially identical with the cited mark, and the sole question raised by the appeal, is whether the appellant’s marks are deceptively similar to the cited mark”.  In dealing with that question, his Honour mentioned a number of authorities, in particular Australian Woollen Mills Ltd v F S Walton & Company Limited (1937) 58 CLR 641 at 658.  That case emphasised that, in issues of deceptive similarity, the marks ought not be compared side by side and regard must be had to “the impression or recollection which is carried away and retained”, as well as the effect of “spoken description”.  His Honour then said:

“Where as in this case, two marks look or sound alike, that is in itself a reason for taking into account, in deciding whether they are likely to deceive, the fact that they convey the same idea:  Cooper Engineering Company Proprietary Limited v Sigmund Pumps Limited (1952) 86 CLR 536 at 539, per Dixon, Williams and Kitto JJ.  In this respect, the meaning does matter, and in taking it into account the court should not overlook the significance of the onus.  As Williams J said in Sym Choon and Company Limited v Gordon Choons Nuts Limited (1949) 80 CLR 65 at 78:

‘The basic principle is that the proposed mark must be so unlike the rival mark that it is not reasonably probable that a purchaser who knows of the latter and has an imperfect recollection of it is likely to be confused.’

Applying these propositions to the present case, the idea of a sports cafe is common to the cited mark and the marks proposed for registration.  It is true that in the cited mark the word ‘circuit’ is emphasized; and on this fact counsel for the applicant substantially rested his whole case.  He suggested that the words ‘the sports cafe’ were ‘buried’ in the cited mark.  But graphic though this metaphor may sound, it cannot get over the awkward fact that the words do actually comprise three of the only four words contained in the mark.  The mark is not just ‘circuit’, it is ‘the circuit sports cafe’.  If, as would be usual in relation to a restaurant or cafe, the establishment were referred to in conversation or in the making of a booking over the telephone, the applicant’s argument is met by the reality that the words ‘sports cafe’ might well be used.  Although the word ‘circuit’ is prominent, it is used as a qualifying word, either suggesting that the cafe in question is on a circuit, or that the sports in question are circuit sports.  Taken ‘as a whole’, as Gummow J said it should be in Johnson & Johnson v Kalnin (1993)26 IPR 435 at 441, the cited mark cannot be divorced from the idea either of sports generally or, alternatively, of circuit sports.  Of course, it is beyond doubt that the proposed marks express the idea of sports.

When the marks are compared as a whole, and bearing in mind that allowance must be made for imperfect recollection, even the devices associated with the two device marks reinforce the impression created by the identity of some of the words in the cited mark with all of the words in the proposed marks, and by the common idea of sports.  For the oval of the cited mark leaves, on a mind accustomed to the conventional representation of shapes by drawing, the impression of a circle seen from a little distance, that circle being intersected on one side by a much smaller straight sided figure (the squat triangle).  It will be remembered that the proposed device mark also has a smaller figure at one side of a circle, and imperfect recollection might very well overlook that in the one case the figure is an oblong and in the other a triangle and in the one case it is at the bottom of the circle and in the other at the top.  Thus, while the devices are plainly different when compared side by side, the impression one might leave in the mind, particularly in association with the common idea of sports, might well be recalled, after an interval of time, by the other, so as to cause confusion.

Although it is true that the word ‘circuit’ is emphasized by being written in very large letters in the cited mark, no comparison of the impressions made by the marks can properly be made on the basis of blanking out the other words, which actually appear.  The word ‘circuit’ simply refers to an inanimate thing, on which, it is true, activities may take place.  But the word ‘sports’ evokes activities themselves, and dramatic activities at that.  It is much the more vivid word.  Such words are likely to echo in the mind.  Just as in the mark ‘Polo Club’, the word ‘Polo’ carried more distinction than the blander word ‘club’ (see Polo Textile Industries Pty Limited v Domestic Textile Corporation Pty Limited (1993) 42 FCR 227 at 230), so here, its meaning makes the word ‘sports’ too striking for the applicant’s argument to be accepted.”

The arguments on appeal

Counsel for the appellant, Mr D K Catterns QC, argued that Burchett J’s reasoning involved four steps:

            “(a)     the Appellant’s marks contain three of the four words in the cited mark;

(b)               if the cited mark were spoken, the words ‘sports cafe’ might be used;

(c)                the concepts embodied in the device marks are similar; and

(d)               the word ‘Sports’ is a vivid word which is likely to echo in the mind.”

Mr Catterns pointed out that steps (a) and (b) involve a comparison between the words contained in the appellant’s mark and the words contained in the cited mark; however, these words formed only one component of the appellant’s device mark.  He submitted that, contrary to the view of Burchett J, the appellant’s device mark and the cited mark do not look alike, so it is immaterial that they both embody the concept of a sports cafe.  He went on:

“The right which a registered proprietor obtains (under section 20 of the Act) is a right to exclusive use of the mark as registered, in the sense that the registered proprietor does not obtain exclusive rights to the component parts of the registered mark.  Therefore, the registration of a ‘device’ mark, or a mark containing multiple elements including words, is not the same as the registration of the words themselves.  The registered owner of a device mark incorporating words may not be able to prevent the use of the words themselves by another trader, particular if the mark used by the other trader incorporates its own distinctive visual (or other) elements.  This is all the more so if the words in the registered mark are presented in such a way that their significance or distinctiveness is minimised.

These matters must be borne in mind when considering questions of registrability.  A comparison of the words used and aural comparisons are relevant to the overall question of deceptive similarity, but the other elements of a mark cannot be disregarded.”

Mr Catterns submitted that a comparison based predominantly on the words contained in the relevant marks is wrong in law, in that it gives a registered proprietor a greater monopoly than that to which it is entitled.

Mr Catterns particularly criticised what Burchett J said in the last paragraph of his reasons extracted above.  He contended his Honour erred in concentrating on the “idea” of the marks, rather than on a viewer’s likely recollection of the marks themselves.  He submitted that, taking into account the essential features and overall effect of each mark, when considered as a whole and allowing for imperfect recollection, the Court should hold there is no real risk that people will be caused to wonder whether the appellant’s services are provided by the entity offering services under the cited mark.

Counsel for the Registrar, Mr D M Yates SC and Mr D R Sibtain, accepted the legal standard posited by Mr Catterns.  But they emphasised the appellant’s onus of proof and the doctrine of imperfect recollection:  see Aristoc Ltd v Rysta Ltd [1945] AC 68 at 86 and Reckitt & Colman (Australia) Limited v Boden (1945) 70 CLR 84 at 89.  They referred to the comment of Lord Radcliffe in de Cordova v Vick Chemical Co (1951) 68 RPC 103 at 106 to the effect that marks are usually remembered by general impression or a significant detail, rather than as a photographic recollection of the whole.  Counsel also referred to the need to consider aural similarity, which they said was particularly important where the ideas of the two marks are similar.  They said that, while similarity between the ideas of the marks is not decisive, “if two marks look alike or sound alike, a comparison of the idea conveyed by each mark is relevant to the question of deception or confusion”.  Finally, they emphasised the role of the primary judge in determining an issue of deceptive similarity and suggested an appellate court ought to intervene only where it concluded the primary judge had erred in law or principle.

The idea behind the mark

In Cooper Engineering the application was for registration of the words “Rain King”.  The opponent’s mark was “Rainmaster”.  Dixon, Williams and Kitto JJ cited (at 538) the principles summed up by Parker J in the Pianotist case (1906) 23 RPC 774 at 777 as follows:

“You must take the two words.  You must judge of them, both by their look and by their sound.  You must consider the goods to which they are to be applied.  You must consider the nature and kind of customer who would be likely to buy those goods.  In fact, you must consider all the surrounding circumstances; and you must further consider what is likely to happen if each of those trade marks is used in a normal way as a trade mark for the goods of the respective owners of the marks.  If, considering all those circumstances, you come to the conclusion that there will be a confusion – that is to say, not necessarily that one man will be injured and the other will gain illicit benefit, but that there will be a confusion in the mind of the public which will lead to confusion in the goods – then you may refuse the registration, or rather you must refuse the registration in that case.”

After pointing out the differences between the suffix “master” and the word “King” in appearance and sound their Honours continued:

“The two words are so unlike to the eye and to the ear that counsel for the appellant was forced to rely on the likelihood of deception arising from the two words conveying the same idea of the superiority or supremacy of the article as a mechanism for making a spray similar to falling rain or artificial rain as it was called during the argument.  But it is obvious that trademarks, especially word marks, could be quite unlike and yet convey the same idea of the superiority or some particular suitability of an article for the work it was intended to do.  To refuse an application for registration on this ground would be to give the proprietor of a registered trademark a complete monopoly of all words conveying the same idea as his trademark.  The fact that two marks convey the same idea is not sufficient in itself to create a deceptive resemblance between them, although this fact could be taken into account in deciding whether two marks which really looked alike or sounded alike were likely to deceive.”

Thus the fact that two marks convey a common idea becomes relevant only if the marks themselves look or sound alike.  Commonality of idea might then tip the balance in favour of a finding that the likeness is deceptive. 

Comparison of the appellant’s device mark and the cited mark

We do not think the appellant’s device mark and the cited mark look or sound alike.  Each mark is dominated by one word, in the one “sports” and in the other “circuit”.  Applying the letter count approach adopted in Cooper Engineering at 538, there is only one letter (t) in common.  “Circuit” has two syllables and “sports” one.  Although both words are used here adjectivally, when used as nouns, “circuit” is singular and “sports” plural.  The words sound quite different.  They do not rhyme.

As to the visual appearance of the two marks, there is an obvious difference in the type face.  The word “sports” is in upper case in what one of the witnesses described as a “very 1950s and 1960s style of typeface”.  The word “circuit” is in lower case and in a style which suggests raised or three dimensional lettering.  The dominating geometric features are in the one case a circle with a flat oblong underneath and in the other a flat oval with an inverted triangle on top.  The oval in the cited mark is distinctly flattened.  It would not, in our opinion, create an impression of a circle.  It seems unlikely that a customer of the services associated with the cited mark would carry away an impression of a mark that had geometric features and, holding in his or her mind an impression at that level of abstraction, think that the appellant’s device mark might be the same because it too had geometric features. 

It is relevant to consider, as his Honour did, how the cited mark might be used informally, especially in speech.  “The Circuit Sports Cafe” is a rather unwieldy expression.  Given the Australian tendency to shorten expressions, particularly when referring to places of popular resort or entertainment, it is likely to be abbreviated in vernacular speech.  If shortening does occur, it seems the more likely abbreviation would be “The Circuit”, rather than “The Sports Cafe”. 

There was evidence that the proprietor of the cited mark had adopted this shortening in relation to its establishment in North Fitzroy.  A flyer issued by the establishment displayed the cited mark and then the words:

“                                   KIDS ONLY

- CLUB -

The perfect place for the kids, Birthday

or sports club parties!  Bring a group of

10 or more kids to the “CIRCUIT”

and we will entertain them!

·          HEAPS OF GAMES

·          A SPECIAL LUNCH

$10 including a Burger, a guzzler filled with coke, an ice cream sundae, and a Circuit cap!

PARENTS – BOOK YOUR STRESS FREE PARTIES NOW!!!

KIDS MUST BE SUPERVISED BY ADULTS!

324 ST. GEORGES ROAD, NORTH FITZROY,  3065

TELEPHONE:  489 8222”

Mr Malcolm Cooke, an employee of the appellant’s solicitors, deposed to a visit to the establishment.  He observed that the cited mark was used on the outside of the building and on T-shirts worn by staff.  He saw no other evidence  of use of the cited mark.  However, he noted a number of references to “The Circuit” or “Circuit”.  He deposed:

“4.       (a)        In the Men’s toilets, above the urinal, appears a very large graffiti art sign reading ‘CIRCUIT’.

            (b)        There is a noticeboard on one wall which contains handwritten messages from prominent sports people  Of the messages that contained an addressee, the vast majority of them were addressed to ‘The Circuit’.  I saw one that was addressed to ‘The Circuit Sports Cafe’.

            (c)        Scattered throughout the hotel are items of what is known as ‘sports memorabilia’, being items belonging to or used by sporting stars.  Many of these items contained a written greeting as well as the autograph of the sportsperson.  Of the items which I examined that referred to the venue, all references were to ‘The Circuit’, not ‘The Circuit Sports Cafe’.”

Mr Cooke was not cross-examined.  It is to be inferred from his evidence that he did not observe any use of the words “The Sports Cafe” without the word “Circuit”. 

In Australian Woollen Mills Dixon and McTiernan JJ remarked (at 657):

“In a question how possible or prospective buyers will be impressed by a given picture, word or appearance, the instinct and judgment of traders is not to be lightly rejected …”

Their Honours were speaking of the rule that if a mark or get-up is adopted deliberately for the purpose of appropriating part of the trade or reputation of a rival, it is to be presumed that such an effect would in fact occur.  However their Honours’ observation is in our opinion equally applicable in the present case.  The proprietor of the North Fitzroy business presumably wishes to encourage customers to associate that business with the cited mark, in an informal, natural and easily-remembered fashion.  It chooses to do so by shortening the words of the cited mark to “The Circuit”, not to “The Sports Cafe”.  The proprietor obviously believes customers will be prepared to adopt that usage.

This direct evidence is consistent with the human tendency to recall the particular rather than the general.  The more specific and identifiable a thing is, the more it sticks in the mind.  Thus “circuit”, while undoubtedly a word frequently associated with sport, is not applicable to all sports, or to sport in general.  In the sense of a regular program of contests conducted at fixed locations over a given period, usually one year, one would think of tennis, golf or motor racing circuits.  But nobody speaks of a cricket circuit or an Australian Rules, Rugby or soccer circuit.  The word “circuit” is more specific and memorable than the bland and generalised word “sports” (cf the word “polo” in the expression “polo club” discussed by Burchett J in the Polo Textile case). 

In our opinion, the cited mark, either as it is or in any reasonably predictable abbreviated form, is quite distinct from the appellant’s device mark.  To find a possibility of deceptive similarity with the appellant’s device mark involves in our respectful opinion an impermissible emphasis on one idea or concept conveyed by both marks.  Doubtless the expressions “The Circuit Sports Cafe” and “The Sports Cafe” both convey an idea of a cafe with a sporting ambience, constituted perhaps by a clientele who are sports participants or

sports fans, or by physical manifestations of sport such as pictures, trophies, flags and other memorabilia.  But to hold that the appellant’s device mark would thereby become deceptively similar to the cited mark would have the practical effect of giving the proprietor of the cited mark a monopoly over any mark which conveyed such an idea.  This would contravene the Cooper Engineering principle.

Although we accept the submission of counsel for the Registrar concerning the respect that an appellate court should pay to the view of a primary judge, in relation to an issue of deceptive similarity, we agree with the submission of counsel for the appellant that, in this case, the primary judge erred in principle; he allowed his comparison of the marks to be overwhelmed by the fact that they shared the common idea of sports.  If his Honour had put aside that fact for a moment, and simply considered the two marks as marks, we feel he would have shared our view that they are so different that it would be unlikely one would be confused for the other in “the impression or recollection … carried away and retained” of them.

The appellant’s word mark

Different considerations apply to the appellant’s word mark.  The word mark must be considered on the basis that it will not be used in conjunction with a substantial and distinctive geometric device, such as the large circle and smaller oblong employed in the appellant’s device mark.  The geometric device is the factor that makes the appellant’s device mark unlikely to deceive.  Take it away, and there is left only three words that are identical to three of the four words included in the cited mark.  Those three words might be used in a manner that would cause confusion to someone who knew of the cited mark.  We agree with Burchett J that the appellant’s word mark is deceptively similar to the cited mark.

Orders

The appeal should be allowed in part.  The orders of Burchett J should be set aside, as should the decision of the Registrar’s delegate in respect of the appellant’s device mark.  The Registrar should be ordered to accept that mark for registration, subject to any other relevant provision of the Trade Marks Act.  The decision of the delegate in respect of the appellant’s word mark should be confirmed.

Costs

The Registrar should pay two-thirds the costs of the appellant of the appeal and at first instance.  It is true that the remarks of Aickin J (sitting as a trial judge) in Pioneer Kabushiki Kaisha v Registrar of Trade Marks (1977) 137 CLR 670 at 691-692 suggest that such an order is exceptional.  However today government in one form or another is an every day litigant in the courts and should, generally speaking, be treated like all other litigants.  If government wins, it should ordinarily recover costs.  If Government loses it should pay, notwithstanding that the case has been brought or defended (as in the present case) reasonably and properly.

The reduction in the costs award recognises the fact that the appellant was unsuccessful in relation to its word mark.  However that issue took up very little of the hearing time of the appeal.  The appellant succeeded on the main issue.

Associate:

Dated:              18 December 1998