FEDERAL COURT OF AUSTRALIA

 

Kowa Company Ltd v N V Organon [2005] FCA 1282

TRADE MARKS – appeal against a decision of the Trade Marks Office – application for removal of trade mark on ground of non-use – meaning of ‘person aggrieved’ – whether ‘use’ established – Court’s discretion in a non-use application – whether marks substantially identical or deceptively similar – onus in an opposition to registration.

Trade Marks Act 1995 (Cth), ss 6, 72(1), 44, 60, 33(1), 12

Therapeutic Goods Act 1989 (Cth)

Patents Act 1990 (Cth)

Drugs, Poisons and Controlled Substances Act 1981 (Vic)

Shanahan’s Australian Law of Trade Marks & Passing Off (3^rd ed, 2003)

Blount Inc v Registrar of Trade Marks (1998) 83 FCR 50 cited

Registrar of Trade Marks v Woolworths Ltd (1999) 93 FCR 365 cited

Woolly Bull Enterprises Pty Ltd v Reynolds (2001) 107 FCR 166 cited

The Ritz Hotel Ltd v Charles of the Ritz Ltd (1987) 88 ALR 217 cited

Gordon & Rena Merchant Pty Ltd v Ocky Docket (Australia) Pty Ltd (1992) 24 IPR 357 cited

La Cravatte Di Pancaldi SRL v Camiceria Di Pancaldi and B SRL (1999) 45 IPR 533 cited

Kraft Foods Inc (previously known as Kraft General Foods Inc) v Gaines Pet Food Corporation (1996) 34 IPR 198 cited

Upjohn Co v Sanofi (1998) 42 IPR 576 cited

George Weston Foods Ltd v Manildra Flour Mills Pty Ltd (1999) 47 IPR 145 cited

NSW Dairy Corporation v Murray-Goulburn Co-Operative Company (1989) 14 IPR 75 cited

Re J Lyons & Coy Ld’s Application (1959) 76 RPC 120 cited

Lomas v Winton Shire Council [2002] FCAFC 413 cited

Renaud Cointreau and Cie v Cordon Bleu International Ltee (2002) 193 ALR 657 cited

Torpedoes Sportswear Pty Ltd v Thorpedo Enterprises Pty Ltd (2003) 204 ALR 90 cited

Austereo Pty Ltd v DMG Radio (Australia) Pty Ltd (2004) 209 ALR 93 cited

McCorquodale v Masterson [2004] FCA 1247 cited

Health World Ltd v Shin-Sun Australia Pty Ltd [2005] FCA 5 cited

BP plc v Woolworths Ltd 62 IPR 545 cited

Clinique Laboratories Inc v Luxury Skin Care Brands Pty Ltd (2004) 61 IPR 130 cited

Jafferjee v Scarlett (1937) 57 CLR 115 cited

The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 cited

Clark v Sharp [1898] 15 RPC 141 cited

Australian Woollen Mills Ltd v F S Walton & Co Ltd (1937) 58 CLR 641 cited

Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 cited

Anheuser-Busch Inc v Budejovicky Budvar (2002) 56 IPR 182 cited

McCormick v McCormick (2001) 51 IPR 102 cited

Rysta Ltd’s Application (1943) 60 RPC 87 cited

KOWA COMPANY PTY LTD v N V ORGANON

 

VID 783 of 2002

 

 

 

 

LANDER J

13 SEPTEMBER 2005

ADELAIDE (HEARD IN MELBOURNE)

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VID 783 OF 2002

 

BETWEEN:	KOWA COMPANY LTD APPLICANT
AND:	N V ORGANON RESPONDENT

 

JUDGE:	LANDER J
DATE:	13 SEPTEMBER 2005
PLACE:	ADELAIDE (HEARD IN MELBOURNE)

THE COURT ORDERS THAT:

 

1.         The appeal be allowed.

2.         The mark LIVALO be registered for goods in Class 5 limited to prescription pharmaceutical preparations for the treatment of hyperlipidemia.

3.         The application for partial removal of the respondent’s trade mark LIVIAL from the Register be dismissed.

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

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VID 783 OF 2002

 

BETWEEN:	KOWA COMPANY LTD APPLICANT
AND:	N V ORGANON RESPONDENT

 

JUDGE:	LANDER J
DATE:	13 SEPTEMBER 2005
PLACE:	ADELAIDE (HEARD IN MELBOURNE)

REASONS FOR JUDGMENT

THE PROCEEDINGS

1                     This case involves two separate, but related matters. The first is an appeal against a decision of the Trade Marks Office on 25 October 2002 that upheld the respondent’s opposition to the registration of the applicant’s trade mark for LIVALO (‘the appeal’). The second is an application by the applicant made on 23 April 2003 for removal of the respondent’s trade mark LIVIAL, on the ground of its non-use in respect of most of the goods for which the mark is currently registered (‘the non-use application’).

2                     The applicant is a multinational company incorporated under the laws of Japan. It was established in 1939 and initially engaged in manufacturing and trading activities in various products including information technology, textiles and machinery. In 1947 it opened a pharmaceutical division that manufactures and supplies pharmaceuticals to Australia and overseas. It is the owner of the LIVALO trade mark, registration for which has been granted in over 30 countries and applications for registration are currently pending in 15 countries.

3                     The respondent is a company incorporated under the laws of the Netherlands. On 29 November 1982 it applied for registration of the trade mark LIVIAL (Registration No. 384555).  On 13 September 1984 the application was accepted.  Since that date it has been the registered proprietor of the trade mark LIVIAL for ‘Pharmaceutical products for human use’ in Class 5 of the Register of Trade Marks. The respondent commenced sales of its LIVIAL brand of pharmaceutical products in the Netherlands in 1988. Since that date it has been sold in many countries throughout the world. The respondent commenced its sales of LIVIAL in Australia in September 2000.

HISTORY OF THE APPEAL

4                     On 11 November 1999 the applicant filed its trade mark application for the mark LIVALO for goods in Class 5, being ‘pharmaceutical preparations’ (Trade Mark Application No. 813512). The application was accepted for registration and advertised on 17 August 2000. The respondent filed a notice of opposition to registration of the application on 15 November 2000.

5                     On 25 October 2002 the Registrar of Trade Marks (by his delegate, Mr McDonagh) allowed the respondent’s opposition, and refused registration of the trade mark on the basis that the applicant’s proposed mark LIVALO was deceptively similar to the respondent’s registered trade mark LIVIAL, and thereby offended s 44(1) of the Trade Marks Act 1995 (Cth) (‘the Act’).

6                     The applicant filed a notice of appeal against the Registrar’s decision on 15 November 2002. The appeal against the delegate’s decision was on the grounds that:

‘3.        (a)  The decision was wrong in law.

(b)   The decision was contrary to the evidence and/or not supported by the facts or evidence.

(c)    The delegate should have refused the opposition and allowed the registration of the Trade Mark Application.

4. The delegate erred in finding that there was a real likelihood that many consumers would confuse the trade mark LIVALO with LIVIAL.

5. The delegate erred in finding that LIVALO is deceptively similar to LIVIAL.

6. The delegate should have found that there was no real likelihood of confusion between the trade mark LIVALO and LIVIAL.

7. The delegate should have found that LIVALO is not deceptively similar to LIVIAL.

7                     The appeal is brought pursuant to s 56 of the Act and is a hearing de novo: Blount Inc v Registrar of Trade Marks (1998) 83 FCR 50 at 59; Registrar of Trademarks v Woolworths Ltd (1999) 93 FCR 365 at 377.

8                     In its third amended points of defence the respondent pleaded:

‘2.        The Respondent denies the facts and each of them alleged in paragraphs 11 and 16 of the Points of Claim and says:

 

(a)        The Applicant’s mark “LIVALO” is a mark which is and at all material times was substantially identical with or deceptively similar to the Respondent’s registered mark 384555 “LIVIAL”, which mark is registered in respect of “pharmaceutical preparations for human use” in Class 5 of the Register of Trade Marks (“the Respondent’s Goods”).

 

(b)        Further and in the alternative, The Applicant’s mark “LIVALO” is a mark which is and at all material times was substantially identical with or deceptively similar to the Respondent’s registered mark 384555 “LIVIAL”, which mark is registered in respect of the Respondent’s Goods and which mark had acquired a reputation in Australia in respect of the said goods as at the priority date of the Applicant’s mark.

 

Particulars

 

The Applicant sought registration for its mark in Class 5 of the Register of Trade Marks in respect of goods being “Pharmaceutical preparations”, which include the Respondent’s Goods and goods of the same description.

 

The priority date for registration of the Applicant’s mark was not earlier than the priority date for the registration of the Respondent’s mark.

 

(c)        By reason of the above, the Delegate of the Registrar of Trade Marks was correct in allowing the Opposition of the Respondent based upon the provisions of Section 44(1) of the Trade Marks Act 1995.

 

(d)        Further and in the alternative, the Respondent relies upon Section 60 (a) and (b) of the Trade Marks Act 1995.  The Respondent’s registered mark “LIVIAL” had acquired a reputation in Australia before the priority date for registration of the Applicant’s mark and because of that reputation, the use of the Applicant’s mark “LIVALO” would be likely to deceive or cause confusion.

 

(e)        By reason of the above matters the relief sought by the Applicant should be refused and the Appeal dismissed.’

9                     Because it is a rehearing, no presumption arises that the decision appealed from is correct, although respect will be accorded to the Registrar’s opinion.  On the rehearing the Court must proceed to apply the same legal criteria as the Registrar was bound to apply:  Woolworths Ltd.

HISTORY OF THE NON-USE APPLICATION

10                  On 23 April 2003 the applicant applied to the Registrar of Trade Marks pursuant to s 92(4)(b) of the Trade Marks Act 1995 (Cth) (‘the Act’) for partial removal of the LIVIAL trade mark from the Register. The applicant seeks to limit the LIVIAL registration to ‘[p]harmaceutical products, other than anabolic steroids for the treatment of menopausal syndrome in humans’.

11                  In its points of claim the applicant has pleaded:

‘15.      At no time during the continuous period of 3 years ending one month before the day on which the Non Use application was filed has the respondent used trade mark 384555 in Australia in relation to any goods for which it is registered other than anabolic steroids for the treatment of menopausal syndrome in humans.

PARTICULARS

During the continuous period of 3 years ending one month before the day on which the Non Use application was filed, the Respondent’s use of trade mark 394555 in Australia has been limited solely to use in relation to pharmaceutical products containing the anabolic steroid tibolone as active ingredient for the treatment of symptoms resulting from natural or surgical menopause in humans.’

12                  Subsections 92(1) and 92(4)(b) of the Act provide:

‘(1)      A person aggrieved by the fact that a trade mark is or may be registered may, subject to subsection (3), apply to the Registrar for the trade mark to be removed from the Register.

…

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

            …

(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.’

13                  On 26 November 2003 the Deputy Registrar of Trade Marks referred the non-use application to this Court pursuant to s 94 of the Act. This Court can hear and determine the matter as if the application had been made to it: s 94.

14                  The respondent has pleaded in its points of defence that the use of its trade mark was not restricted to use in respect of the goods referred to in paragraph 15 of the applicant’s points of claim, that at all material times the respondent intended to use a mark in respect of all goods in Class 5 of the Register and as the mark relates to pharmaceutical compounds used for particular purposes usage of the mark may have occurred in the period referred to even if the respondent was unaware of such usage.

THE WITNESSES

Applicant’s Witnesses

15                  The applicant read four affidavits. I will summarise the applicant’s evidence at this stage to give some introduction to the witnesses and the general nature of their evidence.

16                  Mr Masanori Kawaguchi is a director of the applicant. Mr Kawaguchi gave evidence as to the applicant’s trade mark applications and registration in countries other than Australia and as to the intention of Kowa to use the LIVALO mark as the name of pharmaceutical preparations manufactured by it, to be sold in Australia. Mr Kawaguchi was not cross-examined.  The applicant coined the mark in March 1998 for use to distinguish its pharmaceutical preparations to lower lipid and vascular events in patients.  The drug lowers bad cholesterol.  The word ‘LIVALO’ was coined by combining the first two letters of each of the words ‘lipid’, ‘vascular’ and ‘lower’.

17                  Dr Graeme Lehm Baro is a general practitioner. Dr Baro deposed to the manner in which doctors prescribe drugs in practice and the use of computer-based software to assist them in doing that. He also gave evidence as to whether he would be confused or likely to be confused about the LIVIAL and the LIVALO marks.

18                  The third affidavit read by the applicant was that of Mr Rodney Cruise, a patent attorney. Mr Cruise gave evidence of particular registrations for different kinds of drugs and instances of different drugs bearing similar names. Mr Cruise was not cross-examined.

19                  The fourth affidavit relied upon by the applicant was that of Dr John Stone, who is also a general practitioner. Dr Stone, like Dr Baro, gave evidence about how doctors prescribe drugs and the use of computer based software to assist in the prescription process.

20                  The applicant also referred to the statutory declaration of Ian Peter Horak which was made on 22 April 2003. Mr Horak is a patent attorney and solicitor employed by the applicant’s solicitors.  He said in his statutory declaration that enquiries which he had made on behalf of the applicant show that the use of the trade mark LIVIAL is limited to a specific substance known as ‘tibolone’.  Tibolone is a synthetic anabolic steroid used in the treatment of menopausal syndrome.  He exhibited a copy of the entry for tibolone from Budavari, Susan et al (ed.) ‘The Merck Index, 11^th ed., Merck & Co Inc. (1989) which showed that LIVIAL was then regarded as synonymous with tibolone.  He also exhibited the 2001 Australian MIMS Annual, 25^th ed., June 2001, which indicated that LIVIAL related to a substance for the treatment of symptoms resulting from natural or surgical menopause having the active ingredient tibolone.  He concluded his statutory declaration by saying that his enquiries failed to disclose any use of the LIVIAL mark by the respondent for any pharmaceutical products for human use other than tibolone.

Respondent’s Evidence

21                  The respondent read the affidavits of six witnesses, four of whom were cross-examined.  I will also introduce those witnesses and the general nature of their evidence.

22                  Mr Darko Katalinic who became the managing director of Organon Australia, a subsidiary of the respondent in August 2000, gave evidence of the registration of the LIVIAL trade mark in Australia.

23                  Mr Leon Moore became the marketing and sales director of Organon Australia in 2001.  He had previously held other positions in the company. Mr Moore gave evidence of the sales history of LIVIAL and of conferences in Australia at which the LIVIAL product was distributed prior to 11 November 1999.

24                  The third affidavit read by the respondent was that of Dr Bjorn Oddens who was the medical director of Organon Australia from October 2000. He gave evidence of potential uses for the product (or goods) sold under the name LIVIAL.

25                  The respondent’s fourth witness was Mr Michael Chapman. Mr Chapman is a professor of obstetrics and gynaecology at the University of New South Wales and has held that position for over 10 years. Mr Chapman deposed to having been involved in trials of LIVIAL since 1983.

26                  The fifth affidavit read by the respondent was that of Professor Alistair MacLennan, a professor in the department of obstetrics and gynaecology. In his affidavit, Professor MacLennan deposed to the state of knowledge of LIVIAL amongst medical practitioners. Professor MacLennan was not cross-examined.

27                  Finally, the respondent relied upon the affidavit of Dr Henry Burger, a specialist in menopause and an honorary professor at Monash University. In his affidavit, he deposed to the state of knowledge of LIVIAL amongst medical practitioners. Dr Burger was also not cross-examined.

THE LIVALO AND LIVIAL PRODUCTS

28                  Mr Kawaguchi said that the applicant intends to use the LIVALO mark as the name of a preparation manufactured by it and intended to be sold in each country including Australia for the treatment of, but not limited to, hyperlipidemia. ‘Hyperlipidemia’ is a general term for elevated concentration of cholesterol. Dr Stone said that in Australia such a preparation is likely to be only available by prescription.

29                  In March 1998, the respondent applied to the Australian Therapeutic Goods Administration (TGA) to sell LIVIAL for treatment of symptoms resulting from natural or surgical menopause and for prevention of post-menopausal bone mineral density loss. Approval was given in May 2000 for LIVIAL to be used in connection with hormone replacement therapy for post-menopausal women and osteoporosis prevention in women. It contains a steroid known as ‘tibolone’ as its active ingredient.  At present, LIVIAL is only available in Australia by doctor’s prescription.

ISSUES ARISING IN THE NON-USE APPLICATION

30                  There are two issues arising on the non-use application. The first is whether the applicant is a ‘person aggrieved’ within s 92 of the Act. The second issue is whether there ought to be a partial removal of the respondent’s mark for non-use pursuant to that section.

31                  Section 92 of the Act relevantly provides:

            ‘Application for removal of trade mark from Register etc

92 (1) A person aggrieved by the fact that a trade mark is or may, subject to subsection (3), apply to the Registrar for the trade mark to be removed from the Register.

(2) The application:

(a)   must be in accordance with the regulations; and

(b)   may be made in respect of any or all of the goods and/ or services in respect of which the trade mark may be, or is, registered.

(3) An application may not be made to the Registrar under subsection (1) if an action concerning the trade mark is pending in a prescribed court, but the person aggrieved may apply to the court for an order directing the Registrar to remove the trade mark from the Register.

(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.

PERSON AGGRIEVED

32                  The applicant claimed that it was a ‘person aggrieved’ within the meaning of s 92.  A person aggrieved is not defined in the Act.  It is only a person aggrieved who is entitled to bring an application under s 92.  In Woolly Bull Enterprises Pty Ltd v Reynolds (2001) 107 FCR 166, Drummond J said at 168-169:

‘Though the public and not just the applicant for removal of a mark has an interest in non-used marks not being allowed to remain on the Register, the right to apply for removal created by s 92 is not given to “any person”, only to “a person aggrieved”.’

33                  If the applicant is not an aggrieved person then the application must be dismissed without any further inquiry.  It is a threshold question. 

34                  The material time for determining whether the applicant is a person aggrieved is the date of the application, that is, the date of the commencement of the proceedings in which the claim for removal of the mark is made.

35                  In The Ritz Hotel Ltd v Charles of the Ritz Ltd (1987) 88 ALR 217 at 254-255 (‘Ritz Hotel’), McLelland J said:

‘7.1      Meaning of “person aggrieved”

 

            The meaning of the expression “person aggrieved” in legislation cognate with ss 22(1) and 23(1) of the Act has been the subject of consideration in numerous cases, the reconciliation of which I do not propose to attempt, even if it were thought possible.  Decisions of high authority appear to me to establish that the expression has no special or technical meaning and is to be liberally construed: see Attorney-General (NSW) v Brewery Employés Union of NSW (1908) 6 CLR 469; William Powell (trading as Goodall, Backhouse & Co) v Birmingham Vinegar Brewery Co Ltd [1894] AC 8; “Daiquiri Rum” Trade Mark [1969] RPC 600; Crean & Co v Dobbs & Co [1930] 3 DLR 22.  It is sufficient for present purposes to hold that the expression would embrace any person having a real interest in having the register rectified, or the trade mark removed in respect of any goods, as the case may be, in the manner claimed, and thus would include any person who would be, or in respect of whom there is a reasonable possibility of his being, appreciably disadvantaged in a legal or practical sense by the register remaining unrectified, or by the trade mark remaining unremoved in respect of any goods, as the case may be, in the manner claimed.  In my opinion the concept does not admit of further refinement.  In deference to a submission by the defendants based on, inter alia, “Consort” Trade Mark [1980] RPC 160 at 166, I would merely add that in my view there is no legitimate basis for introducing into the concept of “person aggrieved” for the purposes of ss 22(1) or 23(1) any restriction based on the conditions required to be fulfilled by an applicant for registration of a trade mark.  I reject the defendants’ submission that “the plaintiff must show a trade rivalry by demonstrating that it is either in trade or has a fixed and present intention to enter trade in Australia in goods sufficiently similar to those covered by Classes 3 and 26 as to be likely to cause confusion”.  In the present case the question whether the plaintiff is a “person aggrieved” in relation to any of the claims made in the proceedings has no necessary relationship to the question whether the plaintiff could itself successfully apply for registration of any of the subject marks: for example, see Re Riviére’s Trade Mark  (1884) 26 Ch D 48; Re Trade Mark of La Société Anonyme des Verreries de l’Etoile (1894) 11 RPC 142; Pink v J A Sharwood & Co Ltd (1913) 30 RPC 725.’

36                  In Kraft Foods Inc (previously known as Kraft General Foods Inc) v Gaines Pet Food Corporation (1996) 34 IPR 198 at 207 (‘Kraft Foods’), Sackville J (with whom Shepherd and Tamberlin JJ agreed) said:

‘I think that the remarks of McLelland J are helpful in construing the expression “person aggrieved” to the present context.  I also agree with His Honour’s comment that there is no legitimate basis for introducing into the concept, for the purpose of s 23(1) of the TM Act, any restriction based on the conditions required to be fulfilled by an applicant for registration of a trade mark.

While care must be taken not to introduce too much refinement, the authorities have identified certain circumstances in which an applicant for removal of a trade mark is, or is very likely to be, a “person aggrieved”.  Powell v Birmingham Brewery illustrates that a person who is in the same trade as the registered proprietor of the mark and who shows that he or she will use the mark, is ordinarily a “person aggrieved” for the purposes of a removal application.  A trader who has dealt in the same class of goods as the registered proprietor and shows that he or she could use the mark, establishes a prima facie case that he or she is a person aggrieved for the purposes of a removal application.  The inference may be rebutted by evidence from the objector, demonstrating that the applicant will not take advantage of the opportunity to use the mark, but in the absence of such evidence the prima facie inference remains.  A person who has used a mark, especially if the mark has been used on a similar class of goods, and who remains in the same business also will usually be a “person aggrieved” for the purposes of s 23(1) of the TM Act: Farley v Alexander, at 492; Continental Liqueurs Pty Ltd v G F Heublein & Bro Inc (1960) 103 CLR 422 at 427-8, per Kitto J, rev’d on other grounds; (1962) 109 CLR 153; The application by Carl Zeiss Pty Ltd (1969) 122 CLR 1 at 4, per Kitto J.  The same applies to an alleged infringer of a mark; New South Wales Dairy Corp v Murray Goulburn Cooperative Co at 77.’

37                  The applicant contended that the onus rested upon the respondent to satisfy the Court that it did not have standing to bring the non-use application: La Cravatte Di Pancaldi SRL v Camiceria Di Pancaldi and B SRL (1999) 45 IPR 533 at 538 (‘La Cravatte’).  I do not think the authority cited stands for the proposition contended for.  But in any event I do not agree with the submission.

38                  In La Cravatte, the delegate of the Registrar of Trade Marks said at 538:

‘The opponent did not challenge the standing of the removal applicant.  The removal applicant had, when making its application, filed the necessary declaration under regulation 9.2.  That declaration established to the satisfaction of the Trade Marks Office that the removal applicant is a person aggrieved.  That is sufficient: the onus is on the opponent to undermine the applicant’s standing, not on the applicant to bring in evidence to justify its right to make the application.  I will not, in the absence of any argument from the opponent on the issue, say anything more except that I am satisfied the applicant has the necessary standing.’

39                  In that case the delegate proceeded in the way that he did because there was no challenge to the applicant’s standing and the applicant had asserted that the applicant was a person aggrieved.  It does not follow that where there is a challenge that the onus lies upon the respondent to establish that the applicant is not a person aggrieved.  In my opinion, once there has been a bona fide challenge to a removal applicant’s standing, the removal applicant has the onus of establishing the status of a person aggrieved.

40                  In Kraft Foods,Sackville J (with whom Shepherd and Tamberlin JJ agreed) said at 209:

‘In the present case, Kraft bore the burden of establishing the facts necessary to show that it was a “person aggrieved” for the purposes of an application under s 23(1) of the TM Act to remove Gaines’ trade marks from the register.  It was perfectly clear from an early stage of the proceedings that Kraft’s standing to claim relief was an issue.  Yet, in substance, the only evidence adduced by Kraft to support its claim to be a “person aggrieved” was proof that it had filed the application for registration of the GAINES mark on 22 June 1989 (the day before the removal application was filed) and that it had subsequently lodged a statement of use.’

41                  I reject the applicant’s contention that the onus rested upon the respondent to satisfy the Court that the applicant did not have standing.’

42                  It is for the applicant to establish that it is a person aggrieved.

43                  The time at which the applicant must be a person aggrieved is at the date of the application: Ritz Hotel at 255.  However, McLelland J said:

‘If an applicant were, relevantly, a “person aggrieved” at the commencement of the proceedings but had ceased to be so at the time of the hearing, the court would in my opinion have power to grant the application, assuming a case for relief to have been otherwise made out, although it might decline to do so on discretionary grounds: cf Motor Terms Co Pty Ltd v Liberty Insurance Ltd (1967) 116 CLR 177 at 194-5 in respect of somewhat analogous circumstances in a winding up application.’

44                  The applicant said that it intends to use the trade mark LIVALO as the name of a pharmaceutical preparation manufactured by it, to be sold in Australia. In that regard, it relied on Mr Kawaguchi’s evidence that it intends to use the LIVALO mark as the name of a preparation manufactured by it and intended to be sold in each country including Australia for the treatment of (but not limited to) hyperlipidemia.  I accept that the applicant intends to market a pharmaceutical product for the treatment of hyperlipidemia.  As I understand Mr Kawaguchi’s evidence, the mark has been registered for Class 5 preparations in the countries to which he refers for the purpose of marketing a pharmaceutical to treat hyperlipidemia.  That was also the reason for coining the mark.  There is no evidence, apart from Mr Kawaguchi’s bland assertion, that the applicant intends to market other pharmaceutical preparations under that name.  I am not prepared to find that the respondent intends to market any other pharmaceutical under the mark LIVALO except a pharmaceutical to treat hyperlipidemia.  I find, therefore, that the applicant has established that it intends to market a pharmaceutical preparation in Australia by using the mark LIVALO for the treatment of hyperlipidemia. 

45                  The applicant says that its registration is being prevented or obstructed by the respondent’s registration for LIVIAL.  Further, the applicant says the respondent opposes the applicant’s application for registration of the mark LIVALO which is the subject of the appeal in these proceedings.  It argues that the only impediment to the registration of LIVALO is the LIVIAL registration.

46                  It follows, therefore, that its claim to be a person aggrieved must, at least, depend upon its success on that appeal.  I say ‘at least’ because, if the applicant’s appeal succeeds but only upon the basis that its mark is registered for pharmaceutical preparations within Class 5 that do not overlap with the goods within Class 5 for which the respondent’s mark is registered, the applicant will not be an aggrieved person.  The very basis for its claim that it is an aggrieved person will have been removed.

47                  The respondent contended that the applicant was not a ‘person aggrieved’ for two reasons. First, the application for registration of the LIVALO mark was not hampered by the respondent’s mark. The respondent submitted that even if the Court ordered the partial removal of the LIVIAL mark, such an order would be prospective and not retrospective. It said that this result was implicit in the power to remove conferred by s 101(2) of the Act. Section 101 addresses the determination of an opposed application.  Subsection 101(2) provides:

‘(2)      Subject to subsection (3) and to section 102, if, at the end of the proceedings relating to an opposed application, the court is satisfied that the grounds on which the application was made have been established, the court may order the Registrar to remove the trade mark from the Register in respect of any or all of the goods and/or services to which the application relates.’

48                  The respondent claimed that the rights of the applicant to register its mark are to be assessed at the priority date, 11 November 1999. On this basis, it asserted that the applicant was in no way hampered by existence of the LIVIAL mark on the register: Kraft Foods; Shanahan’s Australian Law of Trade Marks & Passing Off (3^rd ed, 2003)at paragraphs 14.95 and 15.35.

49                  Secondly, it submitted that the applicant failed to establish an intention to use the mark in the future. It claimed that the applicant has not used the LIVALO mark in Australia to date and there was no evidence of definite plans or evidence of preparation to trade. The respondent contended that the assertion of Mr Kawaguchi that the applicant intends to use the mark in the future is a mere assertion of intention and does not provide a basis to suggest that such use is likely to occur. The respondent suggested that if the applicant became affected by the LIVIAL mark in the future, it should file another removal application.

50                  I can deal with the second of the respondent’s contentions quickly.  I do not accept the argument that there is insufficient evidence to establish that the applicant intends to use the LIVALO mark in the future.  I think the evidence clearly establishes a finding that the applicant does intend to use, or at least there is a reasonable probability that the applicant will use, the LIVALO mark in Australia as soon as it may.  As I have already said, I accept Mr Kawaguchi’s evidence in that regard.

51                  It was put by the respondent that because an order made under s 101(2) of the Act is prospective, the applicant could never be a person aggrieved.  In my opinion, that argument ought to be rejected.

52                  I will assume the order has only prospective effect.  The applicant’s application to register LIVALO will be considered as at the priority date, 11 November 1999.  However, the applicant is still intending to use the LIVALO mark.  It could apply again for registration if the appeal were unsuccessful.  The LIVIAL mark would continue to hamper its registration.

53                  The applicant’s appeal will succeed for reasons which I am about to give.  It will succeed and the mark LIVALO will be accepted and registered.  It will be registered in respect of goods in Class 5 but limited to ‘prescription only pharmaceutical preparations for the treatment of hyperlipidemia’.  The only pharmaceutical which I have found it intends to market under the mark is for treatment of hyperlipidemia.  It is not suggested that that pharmaceutical can treat any other condition in humans. 

54                  In those circumstances, it has nearly obtained the result it contended for on the appeal.  The class has been limited to goods in accordance with the respondent’s alternative submission: [116].  The mark LIVIAL is no longer a bar to the registration of the mark LIVALO.  Therefore, the continued existence of the mark LIVIAL does not give rise to any appreciable disadvantage in a legal or practical sense.

55                  In my opinion, the applicant is not a person aggrieved and the application for non-use must fail.

56                  In case I am wrong about that, I will make findings in relation to the applicant’s claim that the respondent has not used the mark LIVIAL except as an anabolic steroid in the treatment of menopausal symptoms (syndrome) in humans.

NON-USE

57                  Because of the provisions of s 92(4)(b) of the Act, the relevant inquiry into non-use is over the three years ending one month before the day on which the non-use application was filed.  The non-use application was filed on 23 April 2003.  The relevant inquiry then is over the period between 23 March 2000 and 23 March 2003.

58                  Section 100(1)(c) provides:

‘In any proceedings relating to an opposed application, it is for the opponent to rebut:

(c)        any allegation made under paragraph 92(4)(b) that the trade mark has not, at any time during the period of 3 years ending one month before the day on which the opposed application was filed, been used, or been used in good faith, by its registered owner in relation to the relevant goods and/or services.’

59                  The respondent therefore has the burden of establishing the use of the trade mark during the period to which I have referred.

60                  The applicant claimed that in the relevant period, the respondent’s use of the LIVIAL mark was limited to a specific substance known as tibolone and that the mark had not been used in Australia in relation to any goods for which it was registered other than anabolic steroids for the treatment of menopausal syndrome in humans.  The applicant contended that the respondent has no intention of using the LIVIAL trade mark on any goods other than its tibolone product in the future. It claimed that the only extension of the use of the trade mark suggested by the respondent was on the basis that it gained approval from the TGA for further indications for tibolone. The applicant submitted that the respondent has not applied for any such further indications in relation to tibolone.

61                  The respondent submitted that it may obtain an extension to its current approved use for LIVIAL in the future.  It claimed:

‘…at all material times the Respondent intended to use the mark in respect of all goods in Class 5 of the Register and as the mark relates to pharmaceutical compounds for particular purposes usage of the mark may have occurred in the period referred to… even if the Respondent was unaware of such usage.’

62                  The respondent asserted that its evidence established that a drug used to treat one condition may subsequently be discovered as being useful to treat another. In his affidavit, Dr Oddens gave evidence of three medications, namely Viagra, Rogaine and Zyban that were initially used for one purpose but were later found to be effective in the treatment of other conditions and, consequently, approved for their alternative uses. The respondent submitted that even if LIVIAL has been used in respect of a particular product for treatment of an identified problem, the fact that the product itself is capable of treating another problem meant that the mark has been used in relation to that problem as well.

63                  The respondent led evidence of clinical trials to establish use in the relevant period in respect of pharmaceutical products other than the uses approved by the TGA (hormone replacement therapy and osteoporosis). In their affidavits, Mr Katalinic and Dr Oddens said that in the relevant period, there were investigations undertaken by the respondent into the possible uses of the LIVIAL product for the treatment of established osteoporosis and for use as hormone replacement therapy for women with a history of breast cancer. The evidence of Dr Oddens was that in the alleged non-use period, the results of various ‘promising’ trials in relation to the use of LIVIAL in different ‘disease areas’ were published. These included the results of trials conducted in relation to the use of LIVIAL product in the treatment and/or prevention of venous thrombeoembolism including deep vein thrombosis and pulmonary embolism (published in Fertility and Sterility in July 2000); the use of the LIVIAL product for breast cancer diagnosis (published in the American Journal of Obstetrics and Gyneacology in April 2002); the use of the LIVIAL product for the treatment of mood disorders (published in The Journal of the North American Menopause Society in 2002); the use of the LIVIAL product for treatment of symptoms and diseases resulting from GnRH analog treatment (published in Bone in 1995, in Fertility and Sterility in 1996 and 2002); and the use of the LIVIAL product for the prevention of coronery artery disease and cardiovascular disease.

64                  Dr Oddens also said that in this period the respondent had also caused clinical trials to be conducted relating to potential expanded uses (or ‘indications’) for the active ingredient Tibolone including a trial which commenced in May 2001 concerning the use of the LIVIAL product in the treatment of osteoporosis (the ‘LIFT’ trial) which is due to be completed by 2007; and a trial which commenced in May 2002 concerning the use of the LIVIAL product in the treatment of climacteric symptoms in women with a recent history of breast cancer (the ‘LIBERATE’ trial) which is due to be completed by November 2008.

65                  In the alternative, the respondent contended that if the Court concluded that there had been no use in respect of the other indications, that in reliance on s 100(3) of the Act, it had established that the use of the mark had been met with obstacles which hampered the possibility of such and therefore it had rebutted the non-use allegation.

66                  Section 100(3) of the Act relevantly provides:

‘(3)  For the purposes of paragraph (1)(c), the opponent is taken to have rebutted the allegation that the trade mark has not, at any time during the period referred to in that paragraph, been used, or been used in good faith, by its registered owner in relation to the relevant goods and/or services if:

 

            …

 

(c)        the opponent has established that the trade mark was not used by its registered owner in relation to those goods and/or services during that period because of circumstances (whether affecting traders generally or only the registered owner of the trade mark) that were an obstacle to the use of the trade mark during that period.’

67                  The respondent contended that the investigations to which I have referred were necessary components of bringing the LIVIAL product to the market in respect of alternative uses and are in fact required for TGA approval. As such, it was submitted that they were ‘obstacles’ to the use of the mark for the purposes of s 100(3)(c): Upjohn Co v Sanofi (1998) 42 IPR 576 (‘Upjohn’). The respondent requested a certificate pursuant to s 105(1)(b) of the Act in the event that I find that the non-use resulted from an obstacle pursuant to s 100(3)(c).

68                  Mr Katalinic accepted that during the alleged non-use period, tibolone was only sold for the treatment of menopausal symptoms and for the reduction of bone density loss, pursuant to the TGA approval. Dr Oddens’ evidence was that LIVIAL was only used as a mark for tibolone. On this basis, the applicant submitted that during the relevant period, the respondent failed to establish any use of the LIVIAL mark for goods within the specification, other than for approved uses.

69                  Mr Moore agreed in cross-examination that if tibolone was modified to treat conditions other than approved uses (such as high cholesterol), that product would be given a different name to the existing tibolone and marked under a different name to LIVIAL.  Dr Oddens’ evidence was to the same effect.

70                  The applicant further submitted that the ‘promising’ other uses referred to by Dr Oddens amounted to no more than a ‘theoretical or logical possibility that in the future Organon may wish to seek to use the Tibolone product for other disease areas’. It relied on the cross-examination of Dr Oddens and Mr Katalinic in submitting:

‘           Organon had not, by March 2003, sought any marketing or TGA approval to use its product in these other areas. All Organon has done is point to past academic research and trials into the relevance of the Tibolone product to these other “promising” areas (which conclude that it should not be used in these other areas or there is insufficient data at this stage to say whether or not it may be used). The continuing trials covered by the Oddens… affidavit …very largely overlap with the existing uses for menopausal symptoms and osteoporosis.

It is not, in any event, a question of the Tibolone product, but use of the LIVIAL mark. There is no evidence whatsoever that Organon has taken any concrete or real steps during the non-use period to apply or use the LIVIAL mark on any other goods within the specification for the other disease areas. There is no evidence of any marketing by Organon of the LIVIAL mark for any pharmaceutical products, other than for menopausal or anti-osteoporosis uses.’

71                  The applicant ultimately submitted that a partial or limited removal of a registration as to certain goods within the class is unexceptional: George Weston Foods Ltd v Manildra Flour Mills Pty Ltd (1999) 47 IPR 145; Gordon & Rena Merchant Pty Ltd v Ocky Docket (Australia) Pty Ltd (1992) 24 IPR 357; La Cravette.

72                  The respondent claimed that the applicant’s removal application was too narrowly framed. It contended that the evidence of Dr Oddens establishes that LIVIAL is not an ‘anabolic steroid’ but is a steroid. It also contended that the product has been approved for and prescribed for osteoporosis as well as hormone replacement therapy in the alleged non-use period. The respondent contended that if the Court was minded to order the partial removal of the LIVIAL mark, the registration should read: ‘pharmaceuticals for use in humans except for pharmaceuticals for use in the treatment of hyperlipidemia’.

73                  There are a number of issues which arise on the non-use application.  First, am I satisfied that over the relevant three year period there has been a non-use of the mark LIVIAL?  Secondly, if satisfied of either a non-use or partial non-use, should I exercise the discretion provided for in subsections (2) and (3) of s 101 and should the respondent be granted a certificate under s 105(1)(b)?  Thirdly, if the applicant succeeded, how should the limitation of registration be expressed?

74                  I accept the applicant’s contention that the mark was limited to the use of the specific substance tibolone and the mark has not been used in relation to any goods for which it was registered other than steroids for the treatment of menopausal syndrome in humans.  I am not satisfied that the mark has been used other than as a steroid for treatment of menopausal syndrome in humans during the relevant period.

75                  I am not persuaded that the mark would be used on any other goods other than tibolone in the future.  Mr Moore’s and Dr Oddens’ evidence was that if tibolone was modified in some way to treat conditions other than symptoms in menopausal women, the resulting steroid could not be called tibolone.  The pharmaceutical product, if it were to be marketed, would have to be marketed under a different mark.  I accept that evidence because it is plainly right.

76                  Therefore, I find that the respondent did not intend at any time during the relevant period to market a modified form of tibolone under the mark LIVIAL.

77                  There have been studies of tibolone reported since 1980.  The published papers are all reporting on past work.

78                  I am not persuaded that the various trials, to which reference was made, indicated any form of intention on the part of the respondent to use the pharmaceutical product with the active ingredient tibolone in the relevant period for other uses other than those presently approved by the TGA.  I do not accept that any of those other trials were promising.  Indeed, some suggested no further uses for tibolone in other disease areas.  At best, the trial suggested some further research was necessary.

79                  The respondent has not made any application to the TGA to extend the indications for which LIVIAL might be used.  I think it can be inferred that no such application has been made because no such application could succeed.

80                  In any event, it is not a question so much of what can be done with tibolone in the future.  The question is the use of the LIVIAL mark.

81                  There is no evidence from the respondent that it has done anything to use the LIVIAL mark for any other pharmaceutical products for any other diseases during the relevant period.

OBSTACLES

82                  Section 100(3)(c) would deem the respondent to have rebutted an allegation of non-use during the relevant period if the respondent establishes that the trade mark was not used because of circumstances, whether general or specific, that were an obstacle to the use of the trade mark during that period.  Section 105(1)(b) provides that, if the Court finds that a trade mark has not been used during a particular period solely because of circumstances that were an obstacle to its use, then the Court must, if requested by the registered owner of the trade mark, give to the registered owner a certificate of those findings.

83                  I am not persuaded that the evidence supports any finding that there are any obstacles to the use of the trade mark during the period.

84                  I am not prepared to find that the respondent has established that the trade mark was not used either for any reasons within the industry or any reasons peculiar to the respondent because of an obstacle to the use of the trade mark during the period.

THE COURT’S DISCRETION IN A NON-USE APPLICATION

85                  The respondent submitted that even if the grounds for removal have been established, in accordance with ss 101(2) and 101(3) of the Act, the Court has a discretion whether or not to remove the mark.

86                  The respondent advanced a number of reasons as to why I should exercise my discretion not to remove the mark.

87                  First, it claimed that the applicant has failed to establish the intended use of the LIVALO mark in Australia.

88                  Secondly, it asserted that by contrast, it has demonstrated why it has taken it a substantial period of time to use its mark. It claimed to have extensively used the mark in relation to its approved indication and further argued that it had demonstrated that it has a significant reputation in relation to LIVIAL for the treatment of those approved indications.

89                  Thirdly, the respondent claimed that the respondent has not ‘sat on its hands’ in relation to other potential indications. Rather, it said that research results had indicated other potential uses and those had been and continue to be the subject of ongoing substantial expenditure and investigation.

90                  Fourthly, the respondent claimed that it ought to be given the opportunity to pursue those other indications and if they proved worthwhile, to market the product using its desired trade mark. It claimed that it would be unfair to force it to choose another mark and incur further expenses in developing a new reputation and goodwill in a new mark.

91                  The applicant claimed that the limited nature of the removal sought should mean that I should exercise my discretion adversely to the respondent because the respondent would still have the LIVIAL mark, but for the narrower range of goods on which it has used the mark.

92                  The applicant also submitted that the discretion should not be exercised in the respondent’s favour on the basis of its private interests, as the guiding principle behind the discretion is public interest, particularly in the integrity of the Register: NSW Dairy Corporation v Murray-Goulburn Co-Operative Company (1989) 14 IPR 75; Upjohn at 585 citing Re J Lyons & Coy Ld’s Application (1959) 76 RPC 120 (‘Lyons’).

93                  The two subsections raise two different issues.  Section 101(2) allows the Court to order the Registrar to remove the trade mark from the Register in respect of any or all of the goods and/or services to which the application relates.  Subsection 101(2) therefore allows for a partial removal.  That is in fact what is sought by the applicant.

94                  Section 101(3) provides for a wider discretion which allows the Court not to remove the trade mark from the Register even if the grounds on which the application was made have been established.

95                  In Lyons, the Court of Appeal considered s 26 of the English Trade Marks Act 1938 which provided a discretion to refuse an application to remove a mark from the Register ‘if it is shown that there has been … during the relevant period … bona fide use of the trade mark by any proprietor thereof for the time being in relation to goods of the same description, being goods in respect of which the trade mark is registered’.

96                  Lord Evershed MR said, at 130:

‘In my judgement, the terms of the proviso (to the effect that if the use of the mark is shown as there specified, the Tribunal “may refuse the application”) carry with them the unavoidable implication that, if such use is not shown, then prima facie the Tribunal ought not to refuse the application.  That is not to say that no discretion whatever is left by the use of the word “may” in the second line of the sub-section.  Exceptional circumstances may arise, for example from the special nature of the mark, which would make it just to refuse the application even though the proviso were not at all called into play.’

97                  That decision was relied upon by the Deputy Registrar of Trade Marks in Upjohn.  There are significant differences in the section considered by the Court of Appeal in Lyons and s 101(3).  In the English section, regard had to be had to the bona fide use of the trade mark during the relevant period.  No such regard is had in subsection 101(3).  It is always dangerous to have regard to a statement of principle in relation to the exercise of a discretion in a section in an Act which is not in pari materia with a section of a second Act for the purpose of considering the way in which a discretion should be exercised in that second Act.

98                  In Upjohn it was said that the power may be applied in ‘exceptional circumstances’.  Subsection 101(3) does not say that.  There is no warrant to read the expression ‘exceptional circumstances’ into the subsection.  That would be to give the subsection a construction contrary to its express terms.  In my opinion, the discretion which is to be exercised under s 101(3) is to be exercised as the subsection itself says, ‘when it is reasonable to do so’.  To suggest that the party against whom the non-use has been put in a case such as this should establish exceptional circumstances is to put too high a hurdle in that party’s path.

99                  In any event, in a consideration of this matter, I am not satisfied that it would be reasonable to not remove the mark from the Register.  The respondent’s first point must fail for the reasons I have already given.  The second point is contrary to the findings of fact which I have made.  I do not accept the third point as a matter of fact.  There is nothing to suggest that the respondent has been in any way active in relation to other potential indications.  On the contrary, the evidence rather suggests that the respondent has sat by and allowed research to occur from time to time in which it has a passing interest.  The respondent has had the opportunity, it seems to me, which it seeks now in the fourth point, to pursue those other indications.  In my opinion, if I were called upon to exercise a discretion under s 101(3), I would exercise it adversely to the respondent.  I would, if the applicant had established the threshold question, have made an order in accordance with the terms of the application.

100               As it is, because I have reached the conclusion that the applicant is not a person aggrieved, the application must be dismissed.

THE ORDER FOR REMOVAL

101               As I have said above, the application raises for consideration the precise terms of the order which ought to be made.  For reasons which I have already given, no order should be made because the applicant has not established that it is a person aggrieved.

102               In any event, the respondent, in its closing submissions, asked to be heard on any proposed order for removal to formulate an appropriate category should the Court be minded to order a partial removal.  It argued that the order sought by the applicant was inappropriate.

103               Because I do not think any order should be made and because the respondent wished to be further heard in relation to the order itself, it would not be appropriate to attempt to fashion an order at this stage.

ISSUES ARISING IN THE APPEAL

104               The respondent opposed the applicant’s application for registration of the mark LIVALO on two grounds.

105               First, it relied on s 44 of the Act, claiming that LIVALO was substantially identical with or deceptively similar to LIVIAL. Section 44 of the Act relevantly provides:

‘Identical etc trade marks

 

44(1) Subject to subsections (3) and (4), an application for the registration of a trade mark (“applicant’s trade mark”) in respect of goods (applicant’s goods”) must be rejected if:

            (a) the applicant’s trade mark is substantially identical with, or deceptively similar to:

(i)            a trade mark registered by another person in respect of similar goods or closely related services; or

(ii)          a trade mark whose registration in respect of similar goods or closely related services is being sought by another person; and

            (b) the priority date for the registration of the applicant’s trade mark in respect of the applicant’s goods is not earlier than the priority date for the registration of the other trade mark in respect of the similar goods or closely related services.’

106               The term ‘deceptively similar’ is defined in s 10 as follows:

‘Definition of “deceptively similar”

10 For the purposes of this Act, a trade mark is taken to be “deceptively similar” to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.’

107               In the alternative, and indeed in addition, the respondent claimed that its LIVIAL mark had a significant reputation in Australia and that the registration of LIVALO would be likely to deceive or cause confusion. To that end, the respondent also relied upon s 60 which provides:

‘Trade mark similar to trade mark that has acquired a reputation in Australia

60 The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:

            (a) it is substantially identical with, or deceptively similar to, a trade mark that, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, had acquired a reputation in Australia; and

            (b) because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.´

108               In addressing that second argument, the respondent relied on its submissions in relation to s 44 relating to substantially identical and deceptively similar.

109               Thus, the issues to be determined in the appeal are:

(1)        whether the mark LIVALO was substantially identical or deceptively similar at the priority date to LIVIAL; and

(2)        whether the mark LIVALO was substantially identical or deceptively similar at the priority date to LIVIAL and whether LIVIAL had required a reputation in Australia before the priority date, so that the use of LIVALO would be likely to deceive or cause confusion.

110               Section 12 of the Act provides that the ‘priority date’ for registration of a trade mark is ‘the day that would be the date for registration of the trade mark in respect of those goods or services if the trade mark were registered’. By the definition of ‘date of registration’ in s 6 and s 72(1), the date of registration of a trade mark ‘is taken to have had effect from (and including) the filing date in respect of the application for registration’. In this case, the priority date is 11 November 1999, the date when the applicant lodged its application for registration of the mark LIVALO.

111               In its closing submissions, the applicant sought to narrow its application for registration to ‘Pharmaceutical preparations available only by prescription, other than pharmaceutical preparations for the treatment of menopausal symptoms or for osteoporosis’.The applicant further submitted that if this application were rejected, it sought to further amend its specification of goods to ‘prescription only pharmaceutical preparations for the treatment of hyperlipidemia and related conditions’.

112               The respondent contended that as the proceedings were contested on a wider basis, any narrowing by the applicant of its application, if successful, should have consequences in costs. That may be so, but that is not relevant to a determination of the appeal itself. The respondent also submitted that the applicant had not requested any leave to amend nor had it complied with the sections of the Act relating to amendments (including s 65 et seq). The respondent further submitted that if any narrowing of the applicant’s application were to occur, it should be in the following terms: ‘prescription pharmaceutical preparations for the treatment of hyperlipidemia’.

113               In its application to the Registrar, the applicant sought registration of the mark LIVALO for goods in Class 5, being pharmaceutical preparations.

114               As will be noticed, it accepted that that that might give rise to overlap with the LIVIAL mark.  That is why it sought to narrow its application as indicated in [112].  The evidence adduced before me was that the only pharmaceutical which was to be marketed under the mark LIVALO was for treatment of hyperlipidemia.  Indeed, that is why the mark was coined: [16].

115               In those circumstances, there is no ground for registration of the mark simply as pharmaceutical preparations or as pharmaceutical preparations available only by prescription other than pharmaceutical preparations for the treatment of menopausal symptoms or for osteoporosis.  The mark is not intended to be used in such a wide class.

116               On the evidence adduced in the applicant’s own case, the mark will only be used in the class described in the respondent’s alternative submission, namely, prescription pharmaceutical preparations for the treatment of hyperlipidemia.

117               For those reasons, the registration which will follow, for the reasons I am about to give, will be limited to prescription pharmaceutical preparations for the treatment of hyperlipidemia.

ONUS AND STANDARD

118               A separate issue relating to onus was raised. The applicant contended that the respondent bore the onus of establishing that the applicant’s mark should ‘clearly not be registered’. The respondent contended that it bore no such onus and that the application should be rejected if the relevant grounds in s 44 and or s 60 are made out, with any doubt being resolved in favour of the respondent.

119               It would be appropriate to deal with this question first.  Section 33(1) raises a presumption of registrability.  The Registrar is obliged to accept an application for the registration of a trade mark unless the Registrar is satisfied that the application has not been made in accordance with the Act or there are grounds for rejecting it.  In Registrar of Trade Marks v Woolworths Ltd (1999) 93 FCR 365, French J (with whom Tamberlin J agreed) said at [24]:

‘The mandatory language of s 33 gives effect to the intention, expressed in the Second Reading Speech, that there is to be a presumption of registrability when the application is examined by the Registrar of Trade Marks.  This is a shift from the position under the previous law whereby the onus was on the applicant to establish registrability: Jafferjee v Scarlett (1937) 57 CLR 115 at 119 and 126.  In respect of the 1955 Act, see Advanced Hair Studio of America Pty Ltd v Registrar of Trade Marks (1988) 10 IPR 583 at 587 (King J).  This shift reflects recommendation 4A of the Working Party’s 1992 Report that “the legislation should be expressed in terms which make it clear that there is to be a presumption of registrability when examining an application for registration”.  It brings the Australian law into line with the approach taken internationally as expressed in the European Community’s Directive on Trade Mark Laws (December 1988), the TRIPS Agreement and developments in the United Kingdom and New Zealand.’

120               He said at [33], after discussing the decision in Blount Inc v Registrar of Trade Marks:

‘There is therefore no presumption in favour of the correctness of the Registrar’s decision save that weight will be given to the Registrar’s opinion as that of a skilled and experienced person.  But the Court on appeal from the Registrar must, in determining the question of acceptance of the application, apply to it the same legal criteria that the Registrar is required to adopt.  That is to say the application must be accepted unless the Court is satisfied that it has not been made in accordance with the Act or that there are good grounds for rejecting it.  If the matter is left in doubt, then the application should be accepted.  That is consistent with the possibility, adverted to earlier, that after a contested opposition registration may eventually be refused.  Weight can be given to the Registrar’s opinion without compromising the duty of the Court to construe the relevant legal criteria.  When the proper principles are applied to the manner in which a judgment is to be made about an issue such as “deceptive similarity” there is room for a degree of deference to the evaluative judgment actually made by the Registrar.  That does not mean the Court is bound to accept the Registrar’s factual judgment.  Rather it can be treated as a factor relevant to the Court’s evaluation.’

121               He said at [47]:

‘Section 33 imposes upon the Registrar and the Court, on appeal from the Registrar, an obligation to accept the application unless satisfied either that the application has not been made in accordance with the Act or that there are grounds for rejecting it.  The decision to reject an application regularly made must now be based upon positive satisfaction that a ground for rejecting it is made out.’

122               The presumption created by s 33 will be displaced if the application has not been made in accordance with the Act or where there are grounds for rejecting it.  In those circumstances, s 33(3) applies and the Registrar must reject the application.  Division 2 of Part 4 identifies the grounds for rejecting the registration, one of which, relevantly, is the ground in s 44 of the Act.

123               The question of onus was considered by the Full Court of this Court in Lomas v Winton Shire Council [2002] FCAFC 413; (2003) AIPC 91-389 (‘Lomas’).  In that case, the Court said at [17]:

‘           No submissions were addressed to the Court concerning the standard to be applied by a single judge in considering an appeal under s 56 of the Act.  The presence of s 195(2) suggests that a parallel should be drawn with the scheme of appeals in opposition proceedings under the Patents Act 1990 (Cth).  On that basis, on appeal under s 56, the Court should consider whether the trade mark should clearly not be registered.  Only if so satisfied should the Court decide to uphold an opposition.’

124               The approach there adopted by the Full Court is consistent with the decision of the Full Court in Renaud Cointreau and Cie v Cordon Bleu International Ltee (2002) 193 ALR 657.  In that case, when discussing the question of leave, the Full Court said there should be uniformity in the Court’s approach to the determination of applications for leave to appeal in the area of intellectual property as a whole.

125               Lomas has been followed by Bennett J in Torpedoes Sportswear Pty Ltd v Thorpedo Enterprises Pty Ltd (2003) 204 ALR 90 at [16]-[22] (‘Torpedoes’) who, in turn, was followed by Finn J in Austereo Pty Ltd v DMG Radio (Australia) Pty Ltd (2004) 209 ALR 93 at [4].  In that case, Finn J said he ought to follow the standard adopted by Bennett J in Torpedoes and applied the standard that ‘the opposition should be upheld only if the Court is satisfied that the trade mark should clearly not be registered’.  Both Lomas and Torpedoes were followed by Kenny J in McCorquodale v Masterson [2004] FCA 1247 at [24] and by Cooper J in Health World Ltd v Shin-Sun Australia Pty Ltd [2005] FCA 5.

126               The respondent argued that the decisions in Lomas and Torpedoes are wrong in that those cases, and the cases which follow them, have impermissibly drawn parallels with the Patents Act 1990 (Cth) procedures.  In support of that submission, I was referred to the decision of Finkelstein J in BP plc v Woolworths Ltd 62 IPR 545, where his Honour said:

‘My approach conforms to that suggested in Blaunt Inc v Registrar of Trade Marks (1998) 83 FCR 56 but may be inconsistent with the views expressed in Lomas v Winton Shire Council (2003) AIPC 91-839 at 17-19 and Torpedoes Sportswear Pty Ltd v Thorpedo Enterprises Pty Ltd (2003) 329 at 330 and 331-332.  The latter two cases were dealing with a slightly different point and, in any event, may have impermissibly borrowed from patent law.’

127               The respondent also relied upon the decision of Gyles J in Clinique Laboratories Inc v Luxury Skin Care Brands Pty Ltd (2004) 61 IPR 130 at 132-133 (‘Clinique’):

‘[10]    It was submitted by counsel for the respondent that a presumption in favour of registration underlies the policy of the Act as reflected particularly in s 33 and he referred to Registrar of Trade Marks v Woolworths Ltd (1999) 93 FCR 365 at [24]; 45 IPR 411 at 418.  It was submitted that unless the applicant is able to establish that the application should clearly not be registered, the opposition should be dismissed and that opposition proceedings and appeals from oppositions are quasi summary in nature, referring to Lomas v Winton Shire Council [2002] AIPC 91–839 at [17]–[19], [36] and Torpedoes Sportswear Pty Ltd v Thorpedo Enterprises Pty Ltd (2003) 204 ALR 90; 59 IPR 318; (2003) AIPC 91-919 at [15]–[22].

[11]     Counsel for the applicant accepts that his client bears the onus of establishing a ground of opposition by reason of the operation of ss 55 and 33.  He does not accept that it is necessary to show that the application should clearly not be granted or that opposition proceedings and appeals from oppositions are quasi summary in nature.

[12]     This raises an important issue for this jurisdiction.  There is support for the submissions on behalf of the respondent in the passages from the judgments to which reference was made.  Counsel for the applicant submitted that the respondent’s argument sought to put a gloss on the clear words of s 55 of the Act.  The opponent has to establish a ground of opposition and there is nothing in s 55 (or s 33) which indicates that this is to be done either to any special standard of proof or in a summary or cursory fashion.  Section 54 governs procedure and, apart from the opportunity of being heard, proceedings must be in accordance with the regulations.  There is nothing in the regulations to limit the ability of an opponent to prove a ground of opposition.  Counsel submitted that the dicta in Lomas and Torpedoes was based upon a false analogy with patent proceedings which could not withstand scrutiny of the legislative history of the provisions and relevant extrinsic material.  He submitted in particular that the relevant portion of the Report of the Working Party to Review the Trade Marks Legislation, July 1992, has been misunderstood.  The extent to which procedure relevant to patent examination has been incorporated is reflected in the provisions of the Act and regulations governing procedure rather than by an unstated gloss.’

128               The same submission that was put to Gyles J in Clinique was put to me in this case and, in particular, that the reasoning in Lomas was inconsistent with the report of the Working Party to Review the Trade Marks Legislation (July 1992) (the Working Party).

129               Recommendation 4A of the Working Party provided:

‘4         Registrability

A         The legislation should be expressed in terms which make it clear that there is to be a presumption of registrability when examining an application for registration.’

130               It was that recommendation to which French J referred in Registrar of Trade Marks v Woolworths.  However, it was argued that recommendation 4A applied only in relation to the registration stage.  It was contended that recommendation 4A was not intended to apply in respect of the opposition stage.

131               Recommendation 8C was in the following terms:

‘C        In opposition proceedings the onus should continue to be generally on the applicant to justify registration and if the matter is left in doubt, it should be resolved against the applicant.’

132               In his Second Reading Speech, the then Minister for Communications and the Arts and Minister for Tourism said:

‘The Working Party made 57 recommendations for change to Australia’s trade marks system.  Except for three recommendations relating to the so-called “association” of Trade Marks and the structure of the Trade Marks Register, the working party’s recommendations were unanimous.  The Government accepted those unanimous recommendations.  In regard to those recommendations on which the working party could not agree, the Government decided that it would accept the minority recommendations of the working party in the interests of harmonising the law with international needs.’

133               Thus, it was argued that recommendation 8C was accepted.  It was argued that at the opposition stage there was no presumption of registrability.

134               The respondent further argued that a trade mark applicant is not in the same position as a patent applicant.  A patent applicant has one chance to establish the monopoly which is claimed.  A trade mark applicant may file repeated applications for the same trade mark.  The respondent also argued that since the decisions in Lomas and Torpedoes, an amendment has been made to s 49(1) of the Patents Act 1990 (Cth) to add the word ‘satisfied’ in s 49(1)(a).

135               The respondent’s arguments are not easily rejected.  The Working Party did discriminate between the registration stage and the opposition stage.  It did recommend at that first stage that there be a presumption of registrability but, at the same time, it also recommended, as the respondent has contended, that at the opposition stage the onus should continue to be generally on the applicant to justify registration.  That recommendation is consistent with the decision of the High Court in Jafferjee v Scarlett (1937) 57 CLR 115 at 119.

136               I think there is less force in the second submission that there is a distinction between a patent applicant’s circumstances and a trade mark applicant’s circumstances.  I think the reasoning in Lomas relied upon the question of leave rather than the question of entitlements to applications.  I am not so sure there is anything in the third point.  I am not sure how the inclusion of the word ‘satisfied’ in s 49(1)(a) of the Patents Act 1990 (Cth) affects the correctness or otherwise of the decisions under challenge.

137               I must say I share the same doubts that were expressed by Finkelstein J and Gyles J in their consideration of this point.  However, there is authority of the Full Court directly on point.

138               I do not think that the decision in Registrar of Trademarks v Woolworths is ambiguous.  French J said that there is a presumption of registrability; that Jafferjee no longer is relevant; that the Court must apply the same legal criteria as the Registrar; that because of the obligation imposed by s 33 the application must be accepted unless the Court is satisfied that the application has not been made in accordance with the Act or there are grounds for rejecting it; and that the decision to reject must be made upon positive satisfaction that the ground has been made out.

139               Both Registrar of Trademarks v Woolworths and Lomas stand for the proposition that the Court as well as the Registrar should approach the question of registration with the presumption of registrability in mind and when on appeal to this Court the Court should consider whether the trade mark should clearly not be registered.

140               I think I am bound to follow Woolworths and Lomas, and I should as a matter of comity follow Torpedoes because it has been followed by other judges of this Court.

141               Therefore, I would proceed on the basis that the onus lies on the respondent to establish the grounds of opposition it relies upon and that I should not uphold those grounds unless I am satisfied that the trade mark should clearly not be registered.

RELEVANCE OF THE NON-USE APPLICATION TO THE APPEAL

142               The applicant submitted that if I were to restrict or confine the registration of the LIVIAL mark in the non-use application to a narrower class of goods, this would be a relevant consideration in determining whether LIVALO is substantially identical with or deceptively similar to LIVIAL on the basis that the relevant comparison must be made with the goods specified for LIVIAL ‘as so restricted or confined by the Court’.

143               There are two reasons why this point does not need to be addressed.  First, because I have dismissed the application for partial removal.  Secondly, because I think the appeal should succeed in any event.

THE APPLICATION

144               The applicant’s application for registration of LIVALO is for goods in Class 5, being ‘pharmaceutical preparations’.  The respondent’s registered trade mark LIVIAL is also for goods in Class 5 in respect of ‘pharmaceutical products for human use’.  The applicant conceded that there might appear to be a substantial overlap between the goods specified by the applicant for LIVALO and the goods specified by the respondent for LIVIAL on the Register as both statements of goods stand.  However, it argued that it does not necessarily follow that the marks are substantially identical or deceptively similar for the purposes of ss 44 or 60 of the Act.  It argued the Court still had the obligation to determine whether the two marks were substantially identical or deceptively similar for the purpose of those sections.

145               That must be so.  Having regard to my ruling in relation to onus and standard, the question that has to be answered is whether the respondent has established the elements of the two sections to the degree of satisfaction required to rebut the presumption which arises under s 33 of the Act.

SUBSTANTIALLY IDENTICAL

146               The appropriate test for determining substantial identity was not disputed. In determining whether two marks are ‘substantially identical’ they must ‘be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison’: The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 414 per Windeyer J.

147               The applicant submitted that the marks LIVALO and LIVIAL are not substantially identical because ‘they are visually and aurally different’. In particular, it argued that when the marks LIVALO and LIVIAL are compared they are different in the following respects:

‘(a) LIVALO and LIVIAL are clearly visually different when written;

(b) LIVALO ends in “O”, whereas LIVIAL ends in a “L” – this points to quite a different pronunciation (because LIVALO ends in a vowel, as Australians would naturally and ordinarily pronounce that word, it would have a more open sound as the last syllable; whereas LIVIAL ends in a consonant, which means it would have a more closed or clipped sound as the last syllable);

(c) it is natural for Australian speakers to emphasise or stress the middle syllable of LIVALO, and to a lesser extent the final syllable “LO” – on the other hand it is natural for Australian speakers to emphasise or stress the first and last syllables of LIVIAL;

(d) LIVALO has the letter “O” , but LIVIAL does not;

(e) LIVALO has the letter “l” only once, whereas LIVIAL has two “I’s”;

(f) after the common first three letters of each mark, the differences in the last three letters and the letter order both point to quite different pronunciations and visual representations, which overwhelm this initial similarity”.

148               The applicant also relied on the manner in which the LIVALO mark was coined in claiming that it has different ‘essential features’ to LIVIAL. I have already referred to Mr Kawaguchi’s evidence in relation to the coining of the LIVALO mark. The applicant contrasted this to the ‘upbeat slogan’ of ‘LIVE-IT-ALL’ for LIVIAL, which it claimed conveys a positive message of an active and satisfying lifestyle in the context of treating symptoms of menopause, that include depression and lowered libido. In my opinion, there is nothing in that submission.

149               Whilst the respondent did not put the argument that the marks were substantially identical at the forefront of its submissions, the respondent relied on its submissions in relation to deceptive similarity to support its claim that the marks are substantially identical. In relation to the similarities between the marks the respondent submitted that:

‘(a) they are both tri-syllabic (see Re Lancer Mark [1987] RPC 303 at 324)

            (b) they both have identical first syllables and prefixes “LIV-” (the first syllable identity is important having regard to the tendency of users of the English language to slur the ending of words (see London Lubricant Ltd’s Application (1925) 42 RPC 264; Allied Colloids v Johnson 19 IPR 447; see also Johnson & Johnson v Kalnin & Anor 26 IPR 435 where “BAND>>IT” was refused registration in the face of “BANDAID”; Expanded Metal Co. Limited v Finn Blinds (1986) AIPC 90-305 where “PERMALUX” was refused registration in the face of “PERMA” );

(c) they both have six letters

(d) they both predominately repeat the “L” which appears in the prefix

(e) they both contain “LIV-” and “-AL” in conjunction

(f) they are both invented words and thus have no “fixed point of reference” for a person who sees or hears of them. They do not convey any definite separate ideas or meanings. They thus are more likely to be confused than an ordinary English word compared to an invented word or two ordinary English words compared

(g) the stress in pronunciation of the marks falls on the “L” and the “V” and he presence of two “Ls” in the respective marks

(h) the presence of the common suffix may lead persons to be “caused to wonder” whether a series of marks are being used by the manufacturer of LIVIAL and whether LIVALO is one of the series.’

150               Of course, in considering whether the marks are substantially identical, it is not a matter of adding up on one side of the ledger the similarities and on the other side the dissimilarities and deciding whether there are more similarities than dissimilarities.  That would be wrong for no other reason than more weight must be put on some factors than others.  But as well, in the end, it is one of total impression which is arrived at; a ‘general effect of the respective wholes’: Clark v Sharp [1898] 15 RPC 141 at 146.

151               In my opinion, the marks are not substantially identical.  They look different.  Whilst both of the words are made up in the sense that they have no separate idea or meaning as the respondent contended, the two words look different. 

152               The words when spoken also sound different.  I agree with the applicant’s contention that in respect of LIVALO the stress is on the middle syllable which is made up of the letter ‘a’.  I also think that when spoken that middle syllable is given a long sound.  On the other hand, when the word LIVIAL is spoken, the main stress is put on the last syllable and the middle syllable, the letter ‘i’, is given a short sound.

153               I do not think the marks are substantially identical.

DECEPTIVE SIMILARITY

154               Both ss 44 and 60 speak of marks being ‘deceptively similar’ so ss 44 and 60 will not be made out by showing only that the marks are similar.  As previously noted, s 10 of the Act provides that two marks are deceptively similar if they so nearly resemble each other that it is likely to deceive or cause confusion.

155               The ultimate question for determination is whether the use of the LIVALO mark in relation to pharmaceutical preparations, or as the application was later limited to prescription only pharmaceutical preparations for the treatment of hyperlipidemia and related conditions or as was contended for (in the event that I was otherwise against the respondent) for prescription pharmaceutical preparations for the treatment of hyperlipidemia, would be likely to cause deception and confusion with the LIVIAL mark’s use for pharmaceutical products.

156               The test is different from that which applies when considering whether the marks are substantially identical. 

157               In Australian Woollen Mills Ltd v F S Walton & Co Ltd (1937) 58 CLR 641 at 658, Dixon and McTiernan JJ said when considering the question of deceptive similarity:

‘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 bias will express their desire to have the goods, then similarities both of sound of meaning may 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 higher perception of 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 forthcoming, is of great weight.’

158               In the end result it is a question of fact whether there is a reasonable probability that the mark which is sought to be registered so nearly resembles the registered mark that it is likely to deceive or cause confusion.

159               In The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd at 415, Windeyer J said:

‘On the question of deceptive similarity a different comparison must be made from that which is necessary when substantial identity is in question.  The marks are not now to be looked at side by side.  The issue is not abstract similarity, but deceptive similarity.  Therefore the comparison is the familiar one of trade mark law.  It is between, on the one hand, the impression based on recollection of the plaintiff’s mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant’s television exhibitions.’

160               In considering the likelihood of deception or confusion, the Court must consider whether there is a real and substantial risk that the result of the use of the mark will be that a reasonable person (or a number of persons in the relevant class of likely purchasers) will be caused to wonder whether it might not be the case that the two products come from the same source. In making this assessment, all of the surrounding circumstances need to be taken into account, including the circumstances in which the marks will be used, the circumstances in which the goods or services will be bought and sold, and the character of the probable purchasers of the goods and services: Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592 at 595; Registrar of Trade Marks v Woolworths Ltd (1999) 93 FCR 365 at 382-383; Anheuser-Busch Inc v Budejovicky Budvar (2002) 56 IPR 182 at 218; McCormick v McCormick (2001) 51 IPR 102 at 107.

161               The applicant claimed that although the respondent’s mark LIVIAL is registered in respect of ‘pharmaceutical products for human use’, the sole use by the respondent of the LIVIAL mark is as a trade name for the chemical compound tibolone. In this respect it relied on evidence given by the respondent’s witness, Dr Oddens, which was to the effect that the use of the name LIVIAL in Australia has been limited to the tibolone product. I accept that evidence.

162               Tibolone is a pharmaceutical product, the sale of which is regulated by the Therapeutic Goods Act 1989 (Cth). Because of the provisions in s 25 of that Act, the respondent is only entitled to sell tibolone for particular uses. Those uses are described as ‘indications’ and include:

·         treatment of symptoms resulting from the natural or surgical menopause;

·         prevention of post-menopausal bone mineral density loss.’

163               LIVIAL is only available on presentation of a doctor’s prescription.  It is almost exclusively prescribed by medical specialists practising in the treatment of menopause and osteoporosis and, in particular, those specialising in gynaecology.

164               The prescription of pharmaceutical substances is regulated by each of the States and Territories.  In Victoria the relevant legislation is the Drugs, Poisons and Controlled Substances Act 1981 (Vic)and the regulations made thereunder.  Relevantly, the only person who can prescribe pharmaceutical prescriptions, at least for LIVIAL, would be a medical practitioner.  That legislation also regulates pharmacists.  If a drug is a prescription drug a pharmacist can only dispense that drug on a doctor’s prescription.

165               I find that LIVIAL will only be prescribed by medical practitioners who will usually be specialist gynaecologists.  It will only be prescribed to women.  LIVIAL would only likely to be prescribed for older women.  It will only be provided to older women by pharmacists in response to a prescription.

166               I have found that the applicant intends to use the LIVALO trade mark for the treatment of hyperlipidemia.  Dr Stone said that drugs for the treatment of hyperlipidemia of this kind are generally not sold over the counter but are available only on prescription.  I accept that evidence.  I find that the pharmaceutical preparation sought to be sold under the mark LIVALO would only be available on prescription, probably in the case of this pharmaceutical written by a general practitioner. 

167               The respondent contended that:

‘Where prescription supply is involved, general practitioners, specialists, chemists and ultimate consumers are the relevant classes of persons to consider when one is assessing confusion. On the other hand when non prescription supply is involved the relevant classes are chemists and supermarkets and other retailers of pharmaceutical products and consumers.’

168               The respondent claimed that people in each relevant class would be ‘caused to wonder’ whether there was some connection between products bearing the LIVIAL and LIVALO marks. It suggested that the applicant’s inquiry into the likely confusion of doctors (with assumed knowledge of the drugs), after careful assessment of the marks, did not address the issue as to whether they may or may not initially wonder where the LIVALO product comes from. The respondent further contended that the question of confusion is one for the Court and not for any witness. In relation to the likelihood of deception or confusion, the respondent submitted:

‘If two drugs have a similar prefix if a doctor knows of one drug and sees a new drug with a similar prefix it is possible that he might think that there was a connection between them or that they were from the same “family” of drugs. This potential problem must apply a fortiori in the case of drugs having the same prefix and similar suffixes.

On the whole doctors either handwrite prescriptions or they prepare them on a computer themselves. As Dr Baro frankly acknowledged in cross-examination doctors in the past have been notorious for producing poorly handwritten scripts and errors in communication between doctors and chemists have always occurred. He also (frankly) volunteered that it was “common” and “unfortunate” in medicine and hospitals for a wrong product to be administered and therefore “every step has to be taken to reduce that possibility”.

There are a number of possible instances where confusion might arise with prescription pharmaceuticals whose names are similar. First, errors may occur in the transcription process when a doctor is typing or handwriting a prescription. A graphic illustration occurred in these very proceedings when Dr Baro’s affidavit was transcribed. The word LIVIAL was spelt “LIVAL”. Dr Baro did not notice the error when he swore his affidavit and corrected it from the witness box. If the same error were to occur on a handwritten or typed prescription, or, for example, a doctor’s “scrawl” were to be illegible, a chemist receiving it could well draw the conclusion that LIVALO was intended and not LIVIAL and wrongly supply the LIVALO product. Dr Baro acknowledged this. Secondly, errors may occur at the pharmacist level (either in pharmacies or hospital dispensaries). The chemist may be presented with a poorly handwritten script or a typed script which contains an error. Alternatively the chemist may take the wrong product from his storage area even though the script is legible and accurate. Alternatively a doctor may phone chemist and ask them to supply LIVIAL urgently and send a prescription to that chemist the following day. The aural and written confusion may arise in that situation. Thirdly, a patient may have been prescribed both LIVIAL and LIVALO (an occurrence which Dr Baro described as likely to occur…) and mistakenly take one intending it to be the other. Alternatively there may be two patients living together one taking LIVIAL and the other LIVALO and one may mistakenly take the wrong pharmaceutical.

A large number of pharmaceuticals are available to patients in Australia “off the shelf” (from pharmacies and non-pharmacies) and on prescription…If both or either LIVIAL and LIVALO were (notionally) to become available “over the counter” then the possibility of both aural and written confusion must be considered. A chemist may not hear a customer properly or a customer may have incorrectly identified the product and may ask for the wrong one. The possibility of confusion is heightened to an even greater degree when “off the shelf” pharmaceuticals sold in supermarkets, alternative health shops etc are considered. The customer may reach out in the haste of the shopping process and mistakenly take the LIVALO product (or vice versa)…’

169               The respondent emphasised the need to apply the doctrine of ‘imperfect recollection’ when determining the likelihood of confusion. It referred to dicta of Luxmoore LJ in Rysta Ltd’s Application (1943) 60 RPC 87 at 108 who said that:

‘The Court must be careful to make allowance for imperfect recollection and the effect of careless pronunciation and speech on the part not only of the person seeking to buy under the trade description, but also of the shop assistant ministering the person’s wants.’

170               The respondent contended that in the context of the present case, where the two marks are meaningless words, the risk of ‘imperfect collection’ must increase.

171               The decision to prescribe pharmaceuticals is invariably that of the treating medical practitioner.  It is the medical practitioner who determines how his or her patients will be treated and whether they will be treated with a particular pharmaceutical.  The patient does not make any real contribution to the decision about which pharmaceutical is to be prescribed.

172               In those circumstances, in considering whether there is likely to be any deception or confusion at the point of obtaining the pharmaceutical, regard must be had to the risk of the doctor misprescribing one pharmaceutical for the other.

173               There is an attendant risk, of course, as the respondent addressed, that the pharmacist could mistakenly dispense one product for the other.  It must be remembered, however, that the pharmacist is the recipient of the prescription.  He or she plays no part in the prescribing of the pharmaceutical.  The pharmacist’s obligation is to dispense the pharmaceutical.

174               For reasons which I have already given, in my opinion, it is likely that LIVIAL will only be prescribed for conditions for which it is presently permitted to be sold (i.e. the treatment of symptoms resulting from natural or surgical menopause and prevention of post-menopausal bone mineral density loss).

175               Dr Stone and Dr Baro both gave evidence that they would be unlikely to confuse the names of the two drugs when prescribing medication.  Dr Stone said that he takes extreme care in prescribing drugs. He deposed that he understands that small differences in a product name are likely to refer to a different pharmaceutical.  Dr Stone offered examples of pharmaceutical products bearing similar names that are available for prescription in Australia, including: ZINNAT and ZINVIT; AVANZA and AVANDIA; ANAPROX, AROPAX and APRINOX. He stated that although those names are similar, he immediately recognises the differences between them and the respective pharmaceuticals to which they apply. He said that he recognises that the name LIVIAL is different from the name LIVALO and that the common LIV prefix does not lead him to assume that the pharmaceuticals sold under those names are related in any way.

176               Dr Stone’s evidence was that he would be unlikely to confuse the names LIVALO and LIVIAL even if the names were used on the same type of pharmaceutical product and would be less likely to confuse the names if they were used on different or unrelated types of pharmaceutical products. Dr Stone was not cross-examined on this evidence.

177               Dr Baro’s also said that he would not be likely to confuse the names LIVALO and LIVIAL. In his affidavit, he deposed that:

‘[s]mall differences in pharmaceutical names can identify completely different pharmaceuticals and accordingly it is necessary to take great care in reading the names of pharmaceuticals and when prescribing them to patients.’

178               Dr Baro also offered examples of a number of pharmaceuticals having a common sequence of letters, including: PROPECIA, PROSCAR and PROZAC. His evidence was that PROPECIA and PROSCAR are essentially the same pharmaceutical sold by the one company but under a different name. He said that PROZAC is a completely different pharmaceutical to PROPECIA and PROSCAR and is sold by a different company.

179               Dr Baro indicated that despite the common ‘LIV’ prefix, he recognises that LIVIAL and LIVALO are different names. He said that he believed these names would be written differently and when spoken each would sound different such that he would be no more likely to confuse those names than he would be to confuse many other names presently used for pharmaceuticals.

180               Dr Baro further said that given that small differences in the names of pharmaceuticals may indicate a completely different pharmaceutical, he takes a careful note of the complete name when prescribing a pharmaceutical. His evidence was that the common ‘LIV’ prefix in LIVIAL and LIVALO would not lead him to assume that the names were associated. He stated that the names were sufficiently different such that he would be unlikely to confuse the two. In the penultimate sentence of his affidavit, Dr Baro deposed:

‘Where the pharmaceuticals corresponding to each of the respective names LIVALO and LIVAL [sic] have different uses or correspond to different pharmaceuticals then this difference would make it even more apparent to me that different pharmaceuticals are meant by each of the different names.’

181               In cross-examination, Dr Baro admitted that although such an error was unlikely to occur, if an error on a prescription of the kind that was made in the penultimate sentence of his affidavit was made, a pharmacist could provide a patient with LIVALO when they were meant to have LIVIAL.

182               Dr Baro said that when a new drug is introduced to the market that has the same prefix as an existing drug, it may be possible for a doctor to think that there is a connection between one and the other. He said that in his opinion, however, a medical practitioner would take steps to investigate the drug before prescribing it to a patient.

183               Dr Baro’s evidence was that, on the whole, doctors either handwrite prescriptions or they prepare them on a computer. In cross-examination, Dr Baro acknowledged that doctors historically have been notorious for producing poorly handwritten scripts. Errors in communication between doctors and pharmacists have occurred. Dr Baro also admitted that it was ‘common’ and ‘unfortunate’ in medicine and hospitals for a wrong product to be administered and therefore ‘every step has to be taken to reduce that possibility’.

184               The respondent cross-examined Dr Baro on an error in his affidavit as an example of how confusion might arise with prescription pharmaceuticals where their names are similar. In the second to last sentence of Dr Baro’s affidavit, the word LIVIAL was spelt ‘LIVAL’. Dr Baro did not notice the error when he swore his affidavit and corrected it from the witness box. Dr Baro acknowledged that if the same error were to occur on a handwritten or typed prescription, or if a doctor’s writing were to be illegible, a pharmacist receiving it could well draw the conclusion that LIVALO was intended and not LIVIAL and wrongly supply the LIVALO product.

185               I do not think too much can be made of the error which appeared in Dr Baro’s affidavit and his failure to observe it before he saw that affidavit.  Whilst he admitted that a pharmacist could draw the conclusion that the medical practitioner had intended to prescribe LIVALO rather than LIVIAL that does not necessarily follow.  It might be thought that the pharmacist would check with the prescribing medical practitioner before dispensing the pharmaceutical.

186               I accept Dr Stone’s and Dr Baro’s evidence.  Their evidence in cross-examination was to the effect that there are a number of drugs presently on sale in Australia which have similar names. They would not assume that because those drugs or pharmaceutical preparations had similar names that they were manufactured or distributed by the one company.  Because of the similarity of names in the pharmaceutical industry, medical practitioners need to take care in prescribing those drugs.  I accept their evidence that medical practitioners take especial care in prescribing drugs because they are commonly faced with similar sounding or appearing names.  That evidence was also not challenged.  Indeed, that evidence was supported in a number of respects by the evidence given by Dr Oddens, Mr Moore and Mr Katalinic.

187               I find, therefore, that it is not uncommon in the pharmaceutical industry in Australia for drugs to bear similar sounding and looking names.  It is not usual for those dealing with those drugs to assume that because drugs have similar sounding names they are either manufactured or distributed by the one company.  Because drugs do have similar sounding names, special care must be taken by those who have the responsibility for prescribing and, indeed, dispensing drugs to ensure that the right drug is addressed.

188               Mr Cruise identified 16 trade marks presently registered in Australia for a single word which commended with the letters ‘LIV’.  Not all of those, of course, are registered in Class 5.

189               In my opinion, on the evidence which has been adduced by the applicant in its case and in its cross-examination, prescription drugs are not likely to be confused with each other even when they are sold under a mark which is similar sounding or looking to a mark of another drug.  Medical practitioners are unlikely to confuse the drugs.  There is no evidence that pharmacists are likely to confuse them.  I find that pharmacists are also unlikely to confuse them.

190               In my opinion, it is unlikely that a medical practitioner would confuse LIVIAL with LIVALO.  LIVIAL will only be prescribed for older women who are menopausal or who have indications of osteoporosis.  LIVALO will be prescribed for anyone who suffers from high bad cholesterol.  The conditions are so dissimilar, in my opinion, that the risk of confusion which is very slight is even less.

191               Dr Katalinic said that in prescribing tibolone special care needs to be taken with patients who have high cholesterol levels and kidney disease. In particular, he said that in prescribing tibolone special care needs to be taken with patients who are being treated with an anti-coagulant such as warfarin as tibolone also acts as an anti-coagulant. It was said that if a patient were to receive tibolone at the same time as they were treated with warafin then it is possible that they could die from blood loss. Dr Baro said that if a person were mistakenly to receive LIVIAL instead of LIVALO from a nurse in a hospital dispensary or a pharmacist the consequences could be life threatening.  Both Dr Baro and Dr Katalinic said that LIVALO and LIVIAL could be prescribed to the same patient. Of course, having regard to the purose for which LIVIAL is prescribed, the patient would have to be a woman. Dr Baro said that in a hypothetical situation where a patient had LIVIAL for the treatment of menopausal, syndrome the patient could also be prescribed LIVALO for the treatment of high cholesterol.

192               The chances of a nurse administering LIVIAL instead of LIVALO are, in my opinion, remote.  It cannot be said it could not happen but I think it highly unlikely.  The chances are, in my opinion, no higher than a nurse administering any wrong pharmaceutical or instigating any wrong treatment.  I think the chances of a pharmacist dispensing the wrong pharmaceutical are also remote.  The persons who prescribe, dispense and administer pharmaceuticals are taught the dangers of a patient receiving the wrong medicine.  They are trained to keep the patient’s health and safety in mind.  They are aware of  the consequences.

193               It was also argued that there was a risk that patients who had been prescribed both LIVIAL and LIVALO might confuse the two drugs and take one instead of the other.  As I have already said, it would only be mature menopausal women who would be prescribed LIVIAL.  It is possible, of course, that they could also be prescribed LIVALO if it were allowed to be marketed under that mark for treatment of concurrent hyperlipidemia.

194               It cannot be said that women in that group might not inadvertently take one drug instead of the other.  However, I think the possibility of that occurring is again remote but, in any event, the consequences of such an advertence are not of the kind to which Dr Katalinic adverted in his evidence.  If a woman has been prescribed both LIVIAL and LIVALO the medical practitioner would have considered the risks associated with taking LIVIAL and internal haemorrhaging.  The woman would not have been prescribed LIVIAL in the first place.  So, if she were to take LIVIAL inadvertently rather than LIVALO, no adverse consequences would be likely to follow.

195               I think, however, that the applicant’s alternative submission, as modified by the respondent, to limit the registration to prescription pharmaceutical preparations for the treatment of hyperlipidemia further lessens the risk of any deception or confusion.

196               In my opinion, the LIVALO mark is not deceptively similar because it is not likely to deceive or cause confusion.

197               For those reasons, the respondent’s opposition to the registration relying on s 44 must be dismissed.  Of course, insofar as the respondent relied upon s 60 to oppose registration, that also must be dismissed because the first limb of s 60 requires proof of the mark being substantially identical with or deceptively similar to the respondent’s mark.  For the reasons I have already given, the respondent has failed to establish that the marks are either substantially identical or deceptively similar.

REPUTATION

198               However, if this matter has to be reconsidered elsewhere, I should also deal with the second limb of s 60 and make findings in relation to the question of the reputation of the LIVIAL mark.

199               The respondent claimed that confusion may arise between the marks LIVIAL and LIVALO as a result of the reputation it has established for LIVIAL in Australia. Although it did not obtain TGA approval to sell LIVIAL in Australia until May 2000, the respondent contended that prior to 11 November 1999 it gained a reputation in Australia in connection with the mark LIVIAL amongst a significant body if people likely to become involved in the supply channel of the product bearing that name.

200               Dr Baro and Dr Stone gave evidence that they had not heard of LIVIAL before 11 November 1999.

201               Mr Moore and Mr Katalinic said that there were no LIVIAL sales in Australia prior to September 2000.

202               The respondent submitted that it did not need to establish an actual trade in the goods bearing the LIVIAL mark in order to establish reputation for the purposes of s 60. Rather, it argued that it would be sufficient if knowledge or awareness of the mark in relation to the goods is established. The respondent also asserted that it did not need to establish that the public generally was aware of the mark but only that a significant body of those likely to be involved in the supply channel of the product bearing that name.  It also contended that the relevant comparison for s 60 purposes was between the LIVIAL mark ‘as used’ (rather than notionally used) and the LIVALO mark. The respondent claimed that the facts established that a ‘significant number of those likely to supply the product became aware of LIVIAL prior to 11 November 1999’.

203               The respondent commenced sales of its LIVIAL brand pharmaceutical product in 1988 in the Netherlands. In May 2000 the respondent was granted approval by the TGA to sell its LIVIAL product for treatment of symptoms resulting from the natural or surgical menopause and prevention of post-menopausal bone mineral density loss in Australia.

204               The respondent contended that prior to 11 November 1999 it gained a reputation in Australia in connection with the mark LIVIAL amongst a significant body of people likely to become involved in the supply channel of the product bearing that name, including medical practitioners.

205               Mr Moore and Dr Oddens said that at the priority date, the exposure of LIVIAL was limited to its use for treatment of menopausal symptoms.

206               Mr Moore, the Marketing and Sales Director of Organon (Australia), said that prior to 11 November 1999, the respondent engaged in various marketing activities that established the respondent’s reputation in Australia. Such activities included the participation in a congress in Sydney in 1996 at which the mark was referred to and displayed and books and leaflets containing the mark were distributed. Mr Moore also referred to conversations between sales representatives promoting the product and practitioners and of instances of unsolicited enquiries and subsequent supply of the LIVIAL that had been imported from overseas. Mr Moore’s evidence was that those enquiries were not restricted to practitioners and included at least one patient who was using the product by way of prescriptions obtained overseas.

207               Evidence directed to the knowledge of the LIVIAL mark in Australia prior to 11 November 1999 was given by three specialists: Professor MacLennan, Professor Chapman and Dr Burger.

208               Dr Burger and Prof. MacLennan both said they became aware of LIVIAL by reading international medical journals in the late 1980s. Professor MacLennan said that he was aware of publications circulating in Australia and available prior to 1999 which made reference to LIVIAL. He attended a 1996 conference which was attended by at least 500 Australian practitioners at which LIVIAL was displayed as a product. In cross-examination, Professor Chapman admitted that the exposure of the LIVIAL mark at the 1996 congress in Sydney was limited to specialists in obstetrics and gynaecology.

209               Professor Chapman became aware of LIVIAL in 1987 whilst in London. He gave lectures in Australia to large numbers of practitioners prior to 1999 in which he referred to LIVIAL by name. His evidence was that he would have informed approximately 500 of his colleagues of LIVIAL after he returned to Australia in 1994. They would have included a large number of general practitioners who specialised in women’s health. Professor Chapman deposed that he was involved in prescribing LIVIAL to patients who referred to it by that name prior to 1999.

210               The truth of their evidence was not disputed.  However, the applicant claimed that the highly specialised knowledge of Professors MacLellan, Chapman and Burger in relation to obstetrics, gynaecology and endocrinology meant that their evidence of the reputation of LIVIAL should not be taken as evidence of a more general and widespread knowledge of the mark

211               The applicant argued that the respondent’s evidence did not show that a substantial or significant number of persons would be likely to be deceived or confused. It relied on the evidence of Mr Moore and Mr Katalinic that there were no LIVIAL sales in Australia prior to September 2000, which was after the priority date. It relied on the evidence of Chapman given in cross-examination to support its claim that the exposure of the LIVIAL mark at the 1996 congress in Sydney was limited to specialists in obstetrics and gynaecology. The evidence of Mr Moore and Dr Oddens indicated that at the priority date, the exposure of LIVIAL was limited to its use for treatment of menopausal symptoms. It further claimed that letters to Organon about the LIVIAL product before the priority date showed only ‘a very meagre and slender knowledge of the LIVIAL mark by general practitioners’. The applicant also relied on Dr Baro and Dr Stone’s evidence that they had not heard of LIVIAL before 11 November 1999.

212               The applicant claimed that the highly specialised knowledge of Professors MacLellan, Chapman and Burger in relation to obstetrics, gynaecology and endocrinology meant that their evidence of the reputation of LIVIAL should not be taken as evidence of a more general and widespread knowledge of the mark. It submitted that evidence of a more widespread and general knowledge of the mark is required for ‘reputation’ to be established for the purposes of s 60.

213               The question for determination in this aspect of the case is first, whether the LIVIAL mark had a reputation as at the priority date, 11 November 1999 and, secondly, whether, because of that reputation, the use of the LIVALO mark would be likely to deceive or confuse.

214               There were no sales of LIVIAL prior to the priority date.  There had been some marketing activity in Sydney in 1996 where the mark was referred to and displayed.  Whilst I accept Mr Moore’s evidence, I find that the activities in 1996 and subsequent enquiries which he addressed did not establish any sort of reputation for the mark prior to the priority date.

215               I do, as I have said, accept the evidence of the three academics who became aware of LIVIAL in the manner described above.  The three academics are very highly qualified and eminent in their field.  It is not surprising that they were aware of a pharmaceutical which was marketed outside Australia prior to it being marketed in Australia.  However, in my opinion, they are not representative of medical practitioners generally but represent the elite of eminent specialists who read outside the ordinary literature which would be read by medical practitioners in both general and specialist practice.

216               Whilst they mentioned LIVIAL to a number of practitioners by name, I am not satisfied that the mark thereby acquired a reputation in Australia amongst that section of the public who it would ordinarily be expected to be aware of the mark’s reputation.  I am not satisfied that the mark had any reputation at all, except to a very small number of medical practitioners who were represented by the three eminent specialists to whom I have referred.

217               The reputation to which s 60 refers must be wider than a reputation amongst a small number of people.

218               I am prepared to accept for the purpose of deciding this issue that if the mark had acquired a reputation generally amongst medical practitioners or even specifically amongst a substantial number of medical practitioners or the greater number of gynaecologists, then it might be said that the mark had acquired a reputation. However, I am not so satisfied and therefore I am not prepared to find that the mark had any reputation of the kind contended for by the respondent as at 11 November 1999.

219               Because I do not think that the respondent has established that LIVIAL had a reputation in Australia prior to the relevant date the question of causation cannot arise.

220               I make the following orders:

1.         The appeal is allowed.

2.         The mark LIVALO be registered for goods in Class 5 limited to prescription pharmaceutical preparations for the treatment of hyperlipidemia.

3.         The application for partial removal of the respondent’s trade mark LIVIAL from the Register is dismissed.

I will hear the parties as to costs.

I certify that the preceding two hundred and twenty (220) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lander.

Associate:

Dated:              13 September 2005

Counsel for the Applicant:	Mr G Fitzgerald
Solicitor for the Applicant:	Phillips Ormonde & Fitzpatrick
Counsel for the Respondent:	Mr M R J Ellicott
Solicitor for the Respondent:	Spruson & Ferguson Lawyers
Date of Hearing:	26, 27, 28 April; 9 May 2005
Date of Judgment:	13 September 2005