That just won't fly: Federal Court decision in Qantas v Edwards offers guidance on trade mark confusion - Trademark

The Federal Court's recent decision in Qantas v Edwards [2016] provides a useful exposition of two frequently-run grounds of opposition under the Trade Marks Act: the "prior mark" ground (section 44) and the "prior reputation" ground (section 60).

THE FACTS OF THE CASE

The respondent, Edwards, operates an online store selling apparel and electronic goods. Edwards sought registration of the following logo (T-shirt Logo) in respect of clothing, footwear and headgear:

Qantas, whose corporate logo has since the 1940s included a representation of a kangaroo, unsuccessfully opposed registration of the T-shirt Logo before the Trade Marks Office. It then appealed to the Federal Court at a hearing de novo, pressing grounds of opposition under sections 44 and 60 of the Trade Marks Act. The appeal failed.

QANTAS' POSITION

For the purposes of section 44, Qantas argued that the T-Shirt Logo was deceptively similar to its registration for the Triangle Logo 1984 (shown below), registered in respect of advertising, marketing and merchandising services in class 35.

In the s 60 context, Qantas argued that due to its reputation in the following logos, Edwards' use of the T-shirt Logo was likely to cause confusion:

Triangle Logo 1984	Triangle Logo 2007	Kangaroo Logo 1984	Kangaroo Logo 2007

YATES J'S DETERMINATION

On the section 44 ground, Yates J held that clothing, footwear and headgear were not "closely related" to the advertising, marketing and merchandising services covered by Qantas' registration.

Noting that virtually any product can be the subject of advertising or a vehicle for merchandising, His Honour concluded that class 25 goods are no more "related" to class 35 services than other goods commonly used as promotional items, and are certainly not "closely related".

Qantas' class 35 specification was framed in broad terms ("advertising, marketing and merchandising services"), unconstrained by a reference to a line of business or a set of goods which might form the vehicle for merchandising. His Honour flagged that Qantas might have been better positioned had its specification been more targeted in scope. Perhaps his Honour had in mind a claim such as 'design and production of promotional apparel for others'. The difficulty in the Court's analysis on this point is that those services already fall within the notional scope of Qantas' broadly-framed registration.

In any event, his Honour found, the T-shirt Logo was not deceptively similar to the Triangle Logo 1984. The 't-shirt element' present in the T-shirt Logo was conspicuous and existed in its own right, independently of the kangaroo element. Though not explicit, his Honour's finding on deceptive similarity might have been assisted by the "state of the Register" evidence suggesting that class 25 was a fairly cluttered field for devices of silhouetted bounding kangaroos depicted in profile.

For the purposes of section 60, Qantas had little difficulty establishing a prior reputation in the Triangle Logo 1984 and Triangle Logo 2007 (used extensively, albeit principally in white-on-red format). Yates J was not satisfied on the evidence that the Kangaroo Logo 1984 or the Kangaroo Logo 2007 possessed the requisite level of reputation to ground a section 60 case.

In his Honour's view, it was the kangaroo device overlaid against the triangular 'tail fin' device that served the core branding function (alongside the QANTAS word mark).

In an attempt to establish a likelihood of consumer confusion, Qantas filed a substantial volume of evidence showing use of its various kangaroo logos in relation to its air transportation and allied services, including its frequent flyer program, freight services, travel services, rental car services, provision of in-flight meals and insurance services.

The evidence included use of kangaroo logos on the Qantas fleet and across a wide array of marketing materials including drink coasters, napkins, playing cards, razors, sleep masks, kids' entertainment packs, crockery, table linen, stationery and staff uniforms.

Qantas relied on two other categories of evidence to establish a likelihood of confusion:

evidence "linking" the Triangle Logos to class 25 goods; and
expert evidence relating to brand extension.

The "linking" evidence comprised the sort of evidence that one might expect of a major international airline: use of kangaroo logos on hats sold as merchandise, on uniforms worn by Qantas-sponsored sports teams and choir members and on pyjamas provided to Business Class passengers.

Qantas also pointed to evidence of use of the Triangle Logo 1984 in connection with KOLOTEX branded pantyhose sold in the late 80s and early 90s, and a licence granted to hosiery manufacturer Ambra to use the Triangle Logo 2007 on Ambra-branded hosiery and travel socks together with the QANTAS name and the statement "official hosiery supplier".

Qantas also relied on expert evidence of brand extension in the air travel industry (citing the example of Virgin's extension to telecommunications) and on evidence of its own sales of branded luggage and travel accessories to support its submission that consumers on seeing the T-shirt Logo in relation to clothing, footwear and headgear would be confused into believing that the goods were manufactured by or with the approval of Qantas.

In finding that Edwards' use of the T-shirt Logo did not give rise to a likelihood of confusion, Yates J made the following findings:

the T-shirt Logo was "far removed" from any of Qantas' kangaroo logos;
Qantas did not have a reputation in a t-shirt device as an element of its brand;
consumers would not have regarded the T-shirt Logo as an evolution of any of Qantas' kangaroo logos; and
while consumers are acquainted with the phenomenon of brand extension, the evidence did not support a likelihood of brand extension from air travel (and affiliated) services to clothing.

Findings (b) and (c) were not strictly necessary to his Honour's conclusion. Neither a reputation in the distinguishing element of the opposed mark nor a consumer expectation of brand evolution is a prerequisite to a likelihood of confusion. Findings (b) and (c) could have effectively been subsumed within finding (a).

To support finding (d), Yates J found that the evidence of use of Qantas' kangaroo logos on Kolotex and Ambra branded hosiery was for the purposes of marketing, sponsorship or endorsement, all designed to promote Qantas as a provider of travel services. It was not use as a trade mark in relation to class 25 goods. Further, his Honour found that it was not clear from the evidence whether Qantas' use of the kangaroo logos on luggage and travel accessories was brand extension or simply promotional use designed to support Qantas' core services.

TAKEAWAYS

The decision handed down in Qantas v Edwards indicates that more than a mere possibility of brand extension is required to support the section 60 ground of opposition under the Trade Mark Act.

While the 'cluttered field factor' should not be overlooked, Yates J's approach to "likelihood of confusion" seems to set a fairly high bar for section 60. Evidence of a strong reputation in an Opponent's core market coupled with "linking" evidence suggesting a possible brand extension to the Applicant's area is frequently sufficient to support a finding of likelihood of confusion (assuming sufficient similarity between the marks).

Brand owners pressing a section 60 case may be required to affirmatively demonstrate actual brand extension in the Applicant's product category (or an affiliated category), or to bolster their case on likelihood of confusion with robust evidence of another kind, such as incidents of actual confusion or compelling survey results.

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