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High Court of New Zealand Decisions |
Last Updated: 1 October 2019
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IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
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CIV-2019-485-263
[2019] NZHC 1691 |
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BETWEEN
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ENERGY BEVERAGES LLC
Appellant
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AND
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PROLIFE FOODS LIMITED
Respondent
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Hearing:
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15 August 2019
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Appearances:
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K McHaffie and P Moodley for the Appellant S Aymeric and J A Hazel for the
Respondent
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Judgment:
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26 September 2019
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JUDGMENT OF CULL J
ENERGY BEVERAGES LLC v PROLIFE FOODS LIMITED [2019] NZHC 1691 [26 September 2019]
[1]
Energy Beverages LLC (Energy Beverages) appeals against the decision of the Assistant Commissioner of Trade Marks (the Commissioner) to direct that two trade mark applications of Prolife Foods Ltd (Prolife Foods) proceed to registration.1
[2] Energy Beverages opposed the applications to register the marks
and(Prolife Foods’ marks), and now appeals her decision.2 Energy Beverages says the Commissioner erred in fact and in law in finding that Energy
Beverages failed in their grounds of opposition under s 17(1)(a) and s 25(1)(b) of the Trade Marks Act 2002 (the Act). Energy Beverages’ marks are set out in Appendix I to this judgment.
[3] Energy Beverages seeks orders reversing the Commissioner’s decision, that both Prolife Foods’ marks should not be registered, and costs, including a reversal of the costs awarded by the Commissioner.
Background
[4] On 12 August 2015 and 3 February 2016 respectively, Prolife Foods lodged applications to register the Prolife Foods’ marks. The marks are both ‘combined’ marks.
[5] The August 2015 application was for the markwith the mark name
“MOTHER EARTH NATURE AT ITS MOST DELICIOUS FRUIT BITES”.
[6] The February 2016 application was for the markwith the
mark name “MOTHER EARTH NATURE AT ITS MOST DELICIOUS ON-THE- GO!”
[7] The applications for Prolife Foods’ marks are both in relation to class 29 and 30 goods. Class 29 goods are described as preserved, dried and cooked fruits and vegetables, jellies, jams, preserves, nuts, edible nuts, food products made from nuts, prepared nuts, nut blends, spreads in the class of peanut butter, dried fruit, and dried
1 Prolife Foods Ltd v Energy Beverages LLC [2019] NZIPOTM 12.
2 Enlarged copies of the marks are displayed in Appendix II of this judgment.
fruit blends. Class 30 goods are described as essentially any and all types of baking product, chocolates, snack foods including muesli bars, cereals, dried fruit and nuts, and importantly in this case, beverages including coffee, tea, cocoa, chocolate-based beverages, cocoa-based beverages and drinking powders including chocolate and cocoa drinking powders.3
[8] Energy Beverages filed notices of opposition to prevent the registration of the marks, pleading the following grounds of opposition:
(a) Due to the awareness, knowledge, cognisance or reputation of Energy Beverages’ marks, use of Prolife Foods’ marks by Prolife Foods would be likely to receive or cause confusion. Therefore, registration of Prolife Foods’ marks would be contrary to s 17(1)(a) of the Act.
(b) Prolife Foods’ marks are similar to one or more of Energy Beverages’ registered marks, the goods listed in the specification of Prolife Foods’ marks are the same as or similar to the goods in the specification of Energy Beverages’ registered marks, and the use of Prolife Foods’ marks by Prolife Foods is likely to deceive or confuse. Therefore, registration of Prolife Foods’ marks would be contrary to s 25(1)(b) of the Act.
(c) An essential element of Prolife Foods’ marks is identical or similar to Energy Beverages’ registered mark which is well-known. The use of Prolife Foods’ marks on class 29 and 30 goods will indicate a connection in trade between Prolife Foods and Energy Beverages. This will likely prejudice the interests of Energy Beverages. Therefore, the registration of Prolife Foods’ marks would be contrary to s 25(1)(c).4
[9] Prolife Foods denied the grounds of opposition identified above. They said their marks are not visually, aurally, or conceptually similar to any of Energy Beverages’ marks; the goods covered by Prolife Foods’ marks are neither identical nor
3 See Appendix II for the full description of Prolife Foods’ marks’ goods.
4 Energy Beverages has withdrawn its appeal against the Commissioner’s finding on s 25(1)(c).
confusingly similar to Energy Beverages’ goods; the relevant market for Prolife Foods’ marks is natural food and beverages, while the relevant market for Energy Beverages’ goods is the artificial energy drink market, and consumers of energy drinks are unlikely to be deceived or confused between the parties’ goods.
The Assistant Commissioner’s decision
[10] On 10 April 2019, the Commissioner determined that Energy Beverages’ opposition to Prolife Foods’ marks did not succeed.5 In relation to s 17 of the Act, the Commissioner found that Energy Beverages failed to produce sufficient evidence to satisfy the Court that there was a sufficient awareness in the New Zealand market of its MOTHER trade marks in relation to its products to meet the threshold requirement of reputation in the marks under s 17(1)(a). The Commissioner therefore did not consider the second stage of the s 17(1)(a) inquiry – the likelihood of deception or confusion.
[11] In relation to s 25(1)(b), the Commissioner found that there is sufficient similarity between some of the goods of Prolife Foods’ marks, namely the beverages, and the goods in respect of which Energy Beverages’ mark is registered to meet the requirement of similarity, but found the marks themselves were not sufficiently similar largely because of the overall concepts conveyed by the respective marks.
[12] Finally, in relation to s 25(1)(c), the Commissioner held that as the evidence was insufficient to meet the relatively low reputational threshold for the application of s 17(1)(a), it fell short of the higher threshold for a “well-known” mark in s 25(1)(c).
[13] The Commissioner accordingly directed that Prolife Foods’ trademarks proceed to registration, and awarded Prolife Foods costs on a scale basis.
5 Prolife Foods Ltd v Energy Beverages LLC, above n 1.
Approach to appeal
[14] Section 170 of the Act allows for any “person who is aggrieved by a decision of the Commissioner” under the Act the right to appeal to the High Court.6 Notice of an appeal must be filed in the Court and served on the Commissioner within 20 working days after the decision was given.7
[15] In hearing an appeal, s 172 provides:
(1) On appeal, the Court must hear the parties and the Commissioner.
(2) Appeals must be heard only on the materials stated by the Commissioner unless a party, either in the manner prescribed or by special leave of the Court, brings forward further material for the consideration of the Court.
(3) In the case of an appeal against the acceptance of an application or the registration of a trade mark,—
- (a) No further grounds of objection are permitted by the opponent or the Commissioner, other than those stated by the opponent, except by leave of the Court; and
- (b) if further grounds of objection are permitted, the applicant's application may be withdrawn without payment of the costs of the opponent on giving notice as prescribed.
[16] As no special leave to bring forward further material has been sought under s 172, the appeal must be heard only on the materials before the Commissioner. These are the statutory declarations by:
(a) Samantha Louise Carr in support of the oppositions.
(b) Kevin John Hawkes in support of registration.
(c) Rodney Cyril Sacks in support of the oppositions.
[17] In determining an appeal, s 173 of the Act provides that the Court may:
(a) confirm, modify, or reverse the Commissioner's decision or any part of it:
7 Section 171.
(b) exercise any of the powers that could have been exercised by the Commissioner in relation to the matter to which the appeal relates:
(c) in the case of an appeal against the registration of a trade mark, permit the trade mark proposed to be registered to be modified in any manner that does not substantially affect its identity. However, in any such case, the trade mark as so modified must be advertised in the prescribed manner before being registered.
[18] There is no presumptive level of respect or deference to the original decision- maker.8 As the Supreme Court noted in Austin, Nichols & Co v Stichting Lodestar:9
An appeal court makes no error in approach simply because it pays little explicit attention to the reasons of the court or tribunal appealed from, if it comes to a different reasoned result. On general appeal, the appeal court has the responsibility of arriving as its own assessment of the merits of the case.
This means that “the basis for and extent of respect afforded to factual findings or technical attributes of the decision-maker appealed from is an entirely context-specific assessment for the Judge on appeal.”10
[19] Once an application for trade mark registration is challenged, the onus is on the applicant – that is, Prolife Foods – to establish that the proposed marks do not offend against the pleaded grounds of opposition.11
Legal framework
[20] The relevant dates for determining whether an opposed mark should be registered is the date of filing of the applications, namely 12 August 2015 for the ‘FRUIT BITES’ mark, and 3 February 2016 for the ‘ON-THE-GO!’ mark. The assessment under each section is made on the balance of probabilities.
[21] The relevant sections for this appeal are ss 17(1)(a) and 25(1)(b) of the Act.
9 At [5].
10 Wistbray Ltd v Ferroro SpA HC Wellington CIV-2007-485-460, 11 December 2008 at [6].
11 New Zealand Milk Brands, above n 8, at [7], citing New Zealand Breweries Ltd v Heineken’s Bier Browerij Maatschappij NV [1964] NZLR 115 (CA).
17 Absolute grounds for not registering trade mark: general
(1) The Commissioner must not register as a trade mark or part of a trade mark any matter –
(a) the use of which would be likely to deceive or cause confusion; or
...
25 Registrability of identical or similar trade mark
(1) The Commissioner must not register a trade mark (trade mark A) in respect of any goods or services if –
...
(b) it is similar to a trade mark (trade mark C) that belongs to a different owner and that is registered, or has priority under section 34 or section 36, in respect of the same goods or services or goods or services that are similar to those goods or services, and its use is likely to deceive or confuse; or
...
[22] The purpose of s 17(1)(a) is the protection of the public from deception or confusion.12 The relevant test is well-established and requires the Court to consider whether, having regard to the reputation acquired by Energy Beverages for its marks, the Court is satisfied that Prolife Foods’ marks, if used in a normal and fair manner in connection with any goods covered by the registrations proposed, will not be reasonably likely to cause deception or confusion amongst a substantial number of persons.13
[23] It is common ground that s 25(1)(b) has three requirements, to be addressed in the following order:14
14 N V Sumatra Tobacco, above n 12, at [32].
[24] There is substantial overlap between s 17(1)(a) and s 25(1)(b).15 The principal difference is that the comparison under s 17(1)(a) is between the actual use of Energy Beverages’ registered marks and the fair and notional use of Prolife Foods’ marks.16 This is in contrast to s 25(1)(b), where the comparison is the fair and notional use of both marks.17
Grounds of appeal
[25] Energy Beverages appeals the Commissioner’s decision that Energy Beverages:
(a) failed to establish the necessary level of awareness of its mark in the New Zealand market under s 17(1)(a); and
(b) failed to show that the marks are sufficiently similar under s 25(1)(b).
Issues
[26] There are two issues for determination on appeal:
(a) whether the use of Prolife Foods’ trademarks would be likely to deceive or cause confusion under s 17(1)(a); and
(b) whether Prolife Foods’ marks are similar to Energy Beverages’ marks, apply to similar goods, and their use is likely to deceive or confuse under s 25(1)(b).
15 New Zealand Milk Brands, above n 8.
16 Anheuser-Busch Inc v Budweiser Budvar National Corporation [2002] NZCA 264; [2003] 1 NZLR 472 (CA) at [74].
17 At [30].
Issue One: section 17(1)(a)
[27] The Court of Appeal in Sexwax Inc v Zoggs International Ltd has recently outlined a two-stage inquiry for the Commissioner to approach the assessment under s 17(1)(a):18
(a) First, inquire into whether Energy Beverages’ mark has a reputation in New Zealand at the relevant date. Such reputation need not be widespread; it all depends on the nature of the marks and the goods to which it is applied.
(b) Second, assess the likelihood of deception or confusion. This is a fact- specific inquiry, requiring consideration of all the surrounding circumstances such as the relevant market for Prolife Foods’ goods and the degree of similarity of the marks. Prolife Foods must prove that registration will not cause deception or confusion amongst a “substantial number of persons”.
The reputational threshold – the awareness of Energy Beverages’ marks
[28] The Commissioner observed, and both parties accept, the reputational threshold for the awareness of Energy Beverages’ marks is a relatively low one.19 Energy Beverages, as the opponent, need only demonstrate “awareness, cognisance or knowledge” of the mark in the New Zealand market.20 This, as the Court of Appeal held in NV Sumatra Tobacco Trading Company v British American Tobacco (Brands) Inc,21 requires Energy Beverages to identify the relevant market and point to evidence that a substantial number of persons in that market have such awareness, cognisance or knowledge of its marks at the relevant dates, namely, 12 August 2015 and 3 February 2016, when Prolife Foods filed its applications for registration of their marks.
[29] Energy Beverages’ evidence of reputation comprised:
18 Sexwax Inc v Zoggs International Ltd [2014] NZCA 311, [2015] 2 NZLR 1 at [48]–[49].
19 Prolife Foods Ltd v Energy Beverages LLC, above n 1, at [13].
21 N V Sumatra, above n 20.
(a) the registration of its marks in New Zealand since 2009;22
(b) a printout from the website of Coca-Cola Amatil (NZ) Ltd, the New Zealand distributor of Energy Beverages’ MOTHER branded energy drinks, showing a can of MOTHER branded drink with a description, its ingredients, and a product warning;
(c) an article dated 9 April 2014, written by Damien Venuto from a website called StopPress.co.nz entitled “Energy boost for Ogilvy with Lift Plus and Mother accounts – UPDATED”;
(d) reply evidence from Mr Sacks, the Chief Executive Officer of Energy Beverages, which included “representative photographs of the opponent’s MOTHER products being offered for sale in various [Auckland area] retailers in New Zealand” and an undated printout from a Fresh Choice supermarket website, showing a MOTHER branded product being offered for sale; and
(e) Mr Sacks’ statement that based on information and records available to him, Energy Beverages’ products have been sold under the MOTHER brand in New Zealand as early as 2009.
[30] In advancing its appeal, Energy Beverages submits that the Commissioner erred in four ways, by:
(a) placing any weight on the date of the StopPress article, which predated the relevant dates by 16 months;
(b) giving insufficient or no weight to Mr Sacks’ statement that Energy Beverages’ products have been sold under the MOTHER brand in New Zealand supermarkets and other retail outlets since 2009;
22 N V Sumatra, above n 20, at [80].
(c) putting any weight on the fact that evidence of advertising expenditure or sales figures were not provided; and
(d) finding that Energy Beverages failed to establish the necessary level of awareness of its mark in the New Zealand market, and consequently finding that the second stage of the s 17(1)(a) inquiry did not need to be undertaken.
[31] Prolife Foods challenged the admissibility of the StopPress article under s 18 of the Evidence Act 2006, submitting the article is hearsay evidence; does not provide reasonable assurance that the statement is reliable; and the maker of the statement, if he was a representative or staff member of Energy Beverages, would have been available to give evidence of its market share. This, Prolife Foods says, would not have caused undue expense or delay. Energy Beverages simply failed to do so.
[32] Although the Commissioner did not deal with Prolife Foods’ hearsay objection, there are four reasons why I consider the Commissioner’s decision should be upheld. Those reasons are:
(a) the timing of the assessment of reputation;
(b) the StopPress article is hearsay;
(c) there is no supporting evidence of sales; and
(d) there is no supporting material.
[33] First, the assessment of reputation must be undertaken at the relevant dates, August 2015 and February 2016. The photographs annexed to Mr Sacks’ evidence are undated. The Internet printout showing images of the MOTHER branded drinks in Ms Carr’s evidence is dated 23 February 2017, and the Fresh Choice website with Energy Beverages’ MOTHER drinks in Mr Sacks’ evidence is dated 17 April 2018. The latter dates may well reflect the dates of download from the websites for the purposes of the declaration, but they postdate the relevant dates.
[34] The declaration of Mr Sacks, who attaches “the representative photos” of the MOTHER products for sale in New Zealand retail outlets, is tellingly silent about the dates the photographs were taken.
[35] I accept Prolife Foods’ submission that Mr Sacks’ use of the present continuous tense in his declaration “the ... MOTHER products being offered for sale” suggests the photographs and the screenshot were taken at or around the time Mr Sacks was preparing his declaration, namely, in May 2018.
[36] Second, the StopPress article, dated 9 April 2014, was published 16 months before the earliest of the relevant dates and is a “marketing, advertising and media intelligence report”, written by Damien Venuto. There is no evidence as to what position Damien Venuto held or whether he was qualified to write about the New Zealand market share of energy drinks and give percentages of the energy drink market that Lift Plus and MOTHER products holds in New Zealand.
[37] The identity and occupation of Mr Venuto was unknown to counsel for Energy Beverages, and there is no evidence of steps taken to identify him or obtain his evidence. The test of his availability to give evidence, as required under s 18 of the Evidence Act, was therefore not engaged. I consider that this article is hearsay and cannot be relied on for the truth of its content.
[38] Third, there is no supporting evidence of sales. Mr Sacks, the Chief Executive of Energy Beverages, in his reply declaration states baldly that “based on information and records available to me” Energy Beverages’ products have been sold under or by reference to the MOTHER brand in New Zealand supermarkets and other retail outlets since at least as early as 2009, but gives no details, such as advertising or sales data in New Zealand, which would enable either the Commissioner or this Court to assess the level of market awareness, even if low, for the MOTHER brand on the relevant dates. The undated photographs do not assist.
[39] Fourth, the printout from the Fresh Choice website has the date of 17 April 2018, two years after the later of the relevant dates, and there is no supporting material
or indication as to the sales figures or the number of views of the website. As the Commissioner noted in her decision,23 evidence of this kind is not difficult to access.
[40] In this case, the Commissioner observed that evidence of reputation will generally be provided in the form of advertising expenditure or sales figures.24 Energy Beverages submits that the Commissioner erred in putting any weight on the fact that evidence of advertising expenditure or sales figures were not provided because this is not an evidentiary requirement. However, the Commissioner made her observation in the absence of any corroborative evidence concerning the relevant date period, and did not say she put any weight on that fact. I note that the Commissioner, in any event, had completed her reasoning on the issue of reputational awareness of the Energy Beverages’ marks or brand before making her observation, which is therefore obiter dictum in any event.
[41] I am in agreement with the Commissioner’s conclusion that Mr Sacks’ statement as to the sale of MOTHER branded products in New Zealand since “at least as early as 2009” does not shed any light on the issue of customer awareness of the brand.
[42] I am satisfied that the basis on which the Commissioner reached her finding that Energy Beverages has failed to establish the necessary level of awareness of its mark in the New Zealand market is correct. Although the threshold requirement for market awareness is low,25 the evidence adduced by Energy Beverages at the relevant dates was not sufficiently robust or reliable, in my view, to justify an alternative finding.
[43] I find this appeal ground fails. The Commissioner did not err in finding that Energy Beverages failed to establish the “necessary level” of awareness of its mark in the New Zealand market.26
23 Prolife Foods Ltd v Energy Beverages LLC, above n 1, at [21].
24 At [21].
25 N V Sumatra, above n 20, at [77]–[80].
26 Prolife Foods Ltd v Energy Beverages LCC, above n 1, at [22].
Likelihood of deception or confusion
[44] In the event that I am wrong to uphold the Commissioner’s finding on reputation, for completeness, I go on to consider the s 17(1)(a) inquiry into the likelihood of deception or confusion.
[45] If Energy Beverages had established its reputation, the onus of establishing that there is no likelihood of deception or confusion in the registration of its marks shifts to Prolife Foods. Under s 17(1)(a) of the Act, the likelihood of deception or confusion arising must be assessed against the actual use of Energy Beverages’ marks and any notional and fair use of Prolife Foods’ proposed marks.27
[46] Causing “confusion” may go no further than perplexing or mixing up the minds of the purchasing public.28 It is not necessary that all persons in the market are likely to be deceived or confused, but rather it is that a significant or considerable section of the public is likely to be confused.29 All the surrounding circumstances are important in assessing whether the use of the applied-for marks are likely to deceive or confuse, such as the similarities between the marks and the goods for which they are classified.30 The relevant perspective is of the average consumer in the relevant market.
[47] I consider the likelihood of deception or confusion under three sections:
(a) the similarity of the goods;
(b) the similarity of the marks; and
(c) any other circumstance relevant to the likelihood of deception or confusion.
28 Pioneer Hi-Bred, above n 13.
29 Paul Sumpter Trade Marks in Practice (4th ed, LexisNexis, Wellington, 2018) at 99.
[48] In British Sugar plc v James Robertson & Sons Ltd, a number of factors were identified to assist in determining whether there is similarity between goods:31
- (a) the respective uses of the goods;
(b) the respective users of the goods;
(c) the physical nature of the goods;
(d) the respective trade channels through which the goods reach the market;
(e) in the case of self-service consumer items, where in practice they are respectively found or likely to be found in supermarkets and in particular whether they are, or are likely to be, found on the same or different shelves; and
(f) the extent to which the respective goods are competitive.
[49] The question of similarity in goods or services is one of fact to be determined on a case-by-case basis, and the approach taken is a practical one, looking at the goods from a business and commercial point of view.32
[50] Although Prolife Foods’ marks relate to goods in classes 29 and 30 compared with Energy Beverages’ marks involving goods in class 32 (drinks of various kinds) and class 5 (including energy drinks),33 the Commissioner considered that there was sufficient similarity between some of Prolife Goods’ marks, namely those beverages included in class 30, and beverages covered by Energy Beverages’ specifications. In particular, the Commissioner considered the chocolate and cocoa-based beverages in Prolife Foods’ application are sufficiently similar to the beverages covered by Energy
31 British Sugar plc v James Robertson & Sons Ltd [1996] RPC 281 (Ch) at 296-297.
32 New Zealand Milk Brands, above n 8, at [33], citing J Lyons and Co Ltd’s Application [1959] RPC 120 at 128 and Gutta-Percha & Rubber Manufacturing Co (Toronto) Limited’s Application (1909) 26 RPC 84.
33 Appendix I contains the details of Energy Beverages’ registered marks and Appendix II details Prolife Foods’ proposed marks.
Beverages’ drinks.34 She also accepted Energy Beverages’ submission that the parties’ respective goods are likely to be available at the same retail outlets.35
[51] During the hearing, Prolife Foods submitted that while both specifications of goods contained beverages, the nature of the beverages is distinct. It sought to overrule the Commissioner’s finding that there was sufficient similarity between the beverages in Prolife Foods’ application to meet the requirement of similarity.36 This is despite the fact that in its submissions, Prolife Foods accepted the Commissioner’s finding of “sufficient similarity” between the beverages, and explicitly noted there was no cross-appeal on this point.
[52] Ms McHaffie for Energy Beverages objected to the late challenge, submitting that this was effectively a cross-appeal by Prolife Foods, without notice and without giving Energy Beverages an opportunity to respond. Ms McHaffie asked that if the Court was minded to reverse the Commissioner’s finding in this respect, she reserved the right to make further submissions on the point.
[53] The basis of a hearing on appeal is prescribed under s 172 of the Act. Appeals must be heard only on the material stated by the Commissioner, unless special leave is given by the Court to consider further material on appeal.37 Although this section focuses on further grounds of objection or further material for the Court’s consideration, I consider its design is to ensure that parties are not taken by surprise on appeal and that the appeal focuses on the considerations undertaken by the Commissioner on the material and grounds of objection at the first instance hearing. In this case, Mr Aymeric’s submission for Prolife Foods amounts to a cross-appeal and it should have been brought in accordance with the High Court Rules 2016. In any event, the issue is not determinative.
[54] Energy Beverages did not direct its submissions to this potential challenge by Prolife Foods, and I decline to interfere with the Commissioner’s finding on this point, which is confined to the similarity of beverages in each of the parties’ respective
34 Prolife Foods Ltd v Energy Beverages LLC, above n 1, at [29].
35 At [29].
36 Relying on the Trade Marks Act 2002, s 173(a).
37 Section 172(2).
goods. I therefore uphold the Commissioner’s finding that the beverages are sufficiently similar. I go on to consider whether the remaining goods are similar.
[55] Energy Beverages submits the goods are similar because they are both everyday items which one might expect to find in a supermarket, petrol station or convenience store. The users of the respective goods are members of the general purchasing public, and both goods include ready to eat, snack and convenience foods. Prolife Foods submits the goods are dissimilar. I deal with each of the factors identified above at [48] to assess similarity.
[56] In terms of the respective uses of the goods, Energy Beverages’ goods are energy drinks which appeal to a younger audience. Prolife Foods’ goods, on the other hand, are targeted at families and parents who want to buy a healthy nutritional product for their children.
[57] In terms of the respective users, Energy Beverages’ goods are very high in caffeine, described in advertising as delivering “full potency”. Energy Beverages warns that its products are not recommended for children, pregnant or lactating women, and individuals sensitive to caffeine. In contrast, Prolife Foods’ goods are primarily aimed at families with children who are conscious of the importance of healthy eating but like the convenience of packaged products. These purchasers will typically take the time to read the packaging of products and make a considered decision to purchase a healthier product.
[58] Turning to the physical nature of the goods, I have accepted the beverages are sufficiently similar. In terms of the remaining goods, the classifications are very wide. There is undoubtedly some overlap in the physical nature of the remaining goods of both parties.
[59] From the limited evidence provided, it appears that Energy Beverages’ products are primarily sold in petrol stations, not supermarkets. In contrast, Prolife Foods’ goods are sold primarily in supermarkets. In Mr Hawke’s evidence, he declares that in the financial year to 2018, only 1.5 per cent of MOTHER EARTH branded products were sold in petrol stations, with the vast majority of MOTHER EARTH
products, which would include the two proposed marks, being sold in supermarkets across New Zealand. I also note his evidence that in his nine years with Prolife Foods, there has been no confusion of which he is aware between MOTHER EARTH products and MOTHER energy beverages. I accept Prolife Foods’ submission that even if a small percentage of Prolife Foods’ goods are sold in petrol stations, they are for the most part placed in different trade channels from Energy Beverages’ goods.
[60] Finally, I consider the respective goods are not competitive. Energy drinks are in a wholly different market from the food, chocolate or cocoa-based products that Prolife Foods’ goods cover, and I accept Prolife Foods’ submission that it is unlikely that a person wishing to purchase an energy drink would find Prolife Foods’ healthy snacks an acceptable substitute.
[61] This leads me to conclude that the respective goods, apart from the beverages, are not similar for the purposes of s 17(1)(a) of the Act.
(b) The similarity of the marks
[62] The test for whether the trademarks are similar was defined in New Zealand Breweries:38
The rules for comparison of word marks have been summarised as follow [sic]: 1. You must take the two words and judge of them both by their look and by their sound; 2. You must consider the goods to which they are to be applied and the nature and kind of customer who is likely to buy these goods; and 3. You must consider all the surrounding circumstances and what is likely to happen if each of the marks is used in a normal way as a trade mark for the goods of the respective owners of the marks.
[63] Often, this comes down to a consideration of the visual, aural, and conceptual similarities of the marks.39 It is the similarities that are important, not the differences.40
38 New Zealand Breweries, above n 11, at 139. I note this case and many of the others referred to are dealing with s 25(1)(b) or its equivalent, however the same analysis applies to the similarity of the marks under s 17(1)(a).
39 New Zealand Milk Brands, above n 8, at [14].
40 At [28].
Further, consumers’ imperfect recollection must be allowed for.41 The relevant perspective is of the average consumer in the relevant market.42
[64]
Visually, Energy Beverages’ marks are registered in plain block capitals, with no additional distinctive material or font, as follows: MOTHERLAND; and MOTHER. Prolife Foods’ marks are:43
[65] Although not clear from these images, both Prolife Foods’ marks contain the logo ‘MOTHER EARTH’ in the top left-hand corner, with the tagline ‘NATURE AT ITS MOST DELICIOUS’ directly beneath. All MOTHER EARTH products use the same distinctive font and have the name ‘MOTHER EARTH’ in a circle with a leaf graphic above the word ‘MOTHER’.
[66] Where one trade mark incorporates the essential distinguishing or memorable feature of another trade mark, confusion may still be likely despite the addition of other material in the trade marks.44 Energy Beverages submits the word ‘MOTHER’ is the essential distinguishing or memorable features of both marks. It says the additional material in Prolife Foods’ marks is non-distinctive and commonplace, describing qualities or properties of their goods. It is the feature ‘MOTHER’ which is non-descriptive and notable when used in relation to food or beverage products by which consumers will identify the marks.
[67] Because of this, Energy Beverages submits Prolife Foods’ marks are similar to Energy Beverages’ marks, and the Commissioner erred in finding that Prolife Foods’ use of the word ‘MOTHER’ as part of its ‘MOTHER EARTH’ brand and in conjunction with the tagline ‘NATURE AT ITS MOST DELICIOUS’ is sufficient to differentiate Prolife Foods marks from Energy Beverages’ marks. Energy Beverages
42 At [23].
43 See Appendix II for enlarged images.
44 Eau De Cologne’s Application (1990) 17 IPR 540 at 542; and Re Application by Coles Myer Ltd
(1993) 26 IPR 577 at 579.
also submit the Commissioner erred in failing to conduct a separate inquiry in relation to each of Energy Beverages’ registered marks.
[68] Prolife Foods submits that the only visual and aural similarity between the parties’ marks is that they contain the word ‘MOTHER’. The dominant elements of Prolife Foods’ marks are ‘FRUIT BITES’ and ‘ON-THE-GO!’ respectively. ‘FRUIT BITES’ and ‘ON-THE-GO!’ are featured prominently in a much larger font than any other word in Prolife Foods’ marks, and these words ought to be the most important words for comparison. Further, it submits the word ‘MOTHER’ in Prolife Foods’ marks is always used in conjunction with the word ‘EARTH’ in the same font of the same size, making it a phrase. In contrast, it says, in Energy Beverages’ marks the word ‘MOTHER’ is very prominently featured.
[69] I find that the marks are not visually or aurally similar. I accept Prolife Foods’ submission that ‘FRUIT BITES’ and ‘ON-THE-GO!’ respectively are the most prominent visual aspect of Prolife Foods’ marks, and the phrase ‘MOTHER EARTH’ is likely to be read by the average consumer in the relevant market as a prefix to either ‘FRUIT BITES’ or ‘ON-THE-GO!’. It is the phrases ‘MOTHER EARTH FRUIT BITES’ and ‘MOTHER EARTH ON-THE-GO!’ that must be compared against the phrase(s) ‘MOTHER” and ‘MOTHERLAND’ from Energy Beverages’ marks, not simply the phrase ‘MOTHER EARTH’. It is incorrect to take a portion of a word or phrase and say that, because that portion is the same as another mark, they must be similar in their entirety.45
[70] Both visually and aurally then, the phrases are distinct, with the only similarity being ‘MOTHER’. I accept Mr Aymeric’s submission that Energy Beverages is in effect trying to claim a monopoly over the word ‘MOTHER’ in relation to any everyday food or beverage item available in retail outlets such as supermarkets. Such a claim is inappropriate and beyond the scope of the Act.
[71] Finally, the conceptual comparison confirms my view that the marks, overall, are not similar for the purposes of s 17(1)(a). The idea conveyed by the marks is
45 Bailey (William) Ltd’s Application [1935] RPC 136 (CH) at 151.
significant in assessing how they will be recalled.46 The idea of a mark is often more likely to be recalled than its precise details.47
[72] It is clear that Prolife Foods’ marks evoke nutritional, healthy and natural food, coming from “mother earth”. This is shown through the brand ‘MOTHER EARTH’ and the use of the tagline ‘NATURE AT ITS MOST DELICIOUS’. Further, the ingredients are sourced from “ethical suppliers”, are GM free and contain no artificial colours or flavours. This idea of a natural product is reinforced by the logo Prolife Foods has been using since 2015, as described above containing an image of a leaf, and the packaging used on Prolife Foods’ goods which are all predominantly green, denoting the earthly nature of the goods.
[73] This is in contrast to Energy Beverages’ energy drink products which contain artificial and other ingredients such as caffeine, food acids, preservatives and flavours. The marks ‘MOTHER’ and ‘MOTHERLAND’, even on their own, and with the packaging and font that is predominantly used in conjunction with the marks as revealed in the evidence provided by Energy Beverages does not denote the same natural and earthly concept. It has a somewhat gothic connotation, which is completely in contrast to the wholesome family-oriented connotation that the ‘MOTHER EARTH’ products are attempting to portray.
[74] For these reasons, I agree with the Commissioner’s finding that the marks are not similar for the purposes of s 17(1)(a).
(c) Any other circumstances relevant to the likelihood of deception or confusion
[75] Energy Beverages submits that consumers who are aware of its ‘MOTHER’ mark and ‘MOTHER’-formative marks, and those who may be exposed to the goods covered by Prolife Foods’ applications, essentially overlap and comprise the general purchasing public. For instance, foot traffic through a petrol station will likely be the same foot traffic through supermarkets and other food retail outlets. Energy Beverages submits that consumers encountering Prolife Foods’ marks would be likely to be
46 Anheuser-Busch, above n 16, at 75.
47 Hannaford & Burton Ltd v Polaroid Corporation [1976] UKPC 9; [1976] 2 NZLR 14 (PC), cited recently in
Intellectual Reserve Ltd v Sintes, above n 39, at [16(iii)].
deceived or confused as to the source of the goods bearing Prolife Foods’ marks, particularly in the case of beverage products. These kinds of convenience products are not considered purchases, and the potential for confusion is greater in a more casual, potentially hurried, purchasing environment.
[76] With the exception of beverages included in Prolife Foods’ class specification, the majority of the goods are not similar. Further, the marks are not similar, and the concepts portrayed by the two brands are distinct. I consider there is no likelihood that a substantial number of people in the relevant market would be deceived or confused as to the origin of Prolife Foods’ goods. To go beyond those conclusions, however, Prolife Foods gave evidence that its MOTHER EARTH trade mark, including the MOTHER EARTH logo has been in use continuously in New Zealand since the early 1990s. While that logo has been modified slightly since then, it is still today very close to what it was in the early 1990s.
[77] By contrast, and viewing the evidence at its highest, Energy Beverages has been using its MOTHER mark in New Zealand only since 2009. I accept Prolife Foods’ submission that the strength of the reputation of Prolife Foods’ marks, which precede any reputation acquired by Energy Beverages in New Zealand, is a circumstance that significantly decreases the likelihood of confusion among potential purchasers of energy drinks bearing the Energy Beverages’ marks.
[78] As is evident, the critical factor in this case is that the products are targeted at different markets and will therefore be sold in different locations. They have wholly distinct conceptual meanings behind the use of the word “MOTHER”, and do not sound or look similar despite both using the word “MOTHER” in their respective phrases. In these circumstances, the likelihood of deception or confusion, comparing the actual use of Energy Beverages products against the notional use of Prolife Foods’ products, is extremely minimal and highly unlikely.
Conclusion under s 17(1)(a) of the Act
[79] If Energy Beverages had established the reputational threshold required of them, I find that Prolife Foods has satisfied its onus of proving, on the balance of
probabilities, that the use of its applied-for marks would not be likely to deceive or cause confusion under s 17(1)(a), nevertheless.
Issue Two: section 25(1)(b)
[80] As mentioned, s 25(1)(b) has three requirements to be addressed in the following order:48
(a) Are the goods similar?
(b) If so, are the marks similar?
(c) If so, is the use of Prolife Foods’ proposed marks likely to deceive or confuse?
[81] As noted above, the comparison and assessment under s 25(1)(b) of the Act is an entirely notional one. It compares the use of the opponent’s marks, MOTHER and MOTHERLAND, and those of Prolife Foods, in a normal and fair manner in relation to any of the goods covered by the registration.
[82] Although this overlaps with my assessment under s 17(1)(a), the Commissioner found that the goods in respect of which the marks are registered or applied for are similar only in the limited sense that there was similarity with the beverages listed in class 30 in Prolife Foods’ goods specification. There has been no cross-appeal on this point and I do not disturb the Commissioner’s conclusion on this aspect.
[83] However, I accept the submission that the remainder of Prolife Foods’ goods are not the same or similar to the goods covered by Energy Beverages’ registered marks. I am also satisfied that there is unlikely to be any overlap between the prospective or potential purchasers of Energy Beverages’ goods and the prospective or potential purchasers of Prolife Foods’ goods.
48 N V Sumatra Tobacco, above n 12, at [32].
[84] Second, I find that the marks are not similar, for the reasons I have canvassed under s 17(1)(a).49 The only similarity is the use of the word “MOTHER” in the respective trade marks under consideration. However, the way in which the word is used by Energy Beverages is markedly different from the use by Prolife Foods, which has MOTHER EARTH in combination on its registered trade marks and in the proposed trade marks. As the European Court of Justice held in Sabel BV v Puma AG, the visual, aural, or conceptual similarity of the marks must be assessed by reference to the overall impression given by the marks, the perception of marks in the mind of the average consumer of the type of goods or services in question, and the fact that the average consumer normally perceives a mark as a whole and does not analyse its various details.50
[85] I concur with the Commissioner’s finding under s 25(1)(b). I am satisfied there is no similarity between the proposed marks and the Energy Beverages’ marks.
[86] Finally, I am satisfied that there is no likelihood of deception or confusion in the notional use of both sets of trade marks of the respective parties. The minor degree of similarity in the marks, namely the use of the word “MOTHER”, the lack of visual, aural, and conceptual similarity between the two respective sets of marks, and the limited similarity of goods in respect of the specification of beverages only, satisfies me that there is no likelihood of deception or confusion if Prolife Foods’ proposed trade marks are registered. In these circumstances, I do not consider the relevant consumers will likely be deceived or confused.
Findings
[87] I uphold the Commissioner’s finding that Energy Beverages failed in its grounds of opposition, both under ss 17(1)(a) and 25(1)(b), to Prolife Foods’ applications to register their two marks. Accordingly, I direct that the trade mark application numbers 1025443 and 1036561 proceed to registration.
[88] The costs award by the Intellectual Property Office is upheld.
49 See [62]–[79] of this judgment.
50 Sabel, above n 30, at [224].
Results
[89] The appeal is dismissed.
[90] Costs are awarded to Prolife Foods on a 2B basis, with reasonable disbursements to be approved by the Registrar.
Cull J
AJ Park Law, Wellington for the Appellant
James & Wells Solicitors, Auckland for the Respondent
Appendix I – details of Energy Beverages’ registrations
|
Mark
|
Goods
|
Date of registration in New
Zealand
|
|
|
754009
|
 |
Class 32: drinking waters, flavoured waters, mineral and aerated waters;
and other non-alcoholic beverages, namely soft drinks, energy
drinks and sports
drinks; fruit drinks and juices; syrups, concentrates and powders for making
flavoured waters, mineral and aerated
waters, soft drinks, energy drinks, sports
drinks, fruit drinks
and juices.
|
13 March 2008
|
|
757331
|
 |
Class 32: same as above.
|
13
December 2007
|
|
802420
|
|
Class 32: same as above.
|
13 August 2009
|
|
811177
|
MOTHER OF A MIXER
|
Class 32: same as above.
|
18 February 2010
|
|
811318
|
MOTHER SMALL BOTTLE, BIG KICK
|
Class 5:
pharmaceutical and veterinary
preparations; sanitary preparations for medical purposes; dietary
supplements; energy drinks; dietetic substances adapted
for medical use,
food for babies; plasters, materials for dressings; material
for stopping teeth, dental wax; disinfectants;
preparations for
destroying vermin; fungicides,
herbicides
Class 32: same as above.
|
25 February 2010
|
|
812664
|
 |
Class 5: same as above.
Class 32: same as above.
|
18 March 2010
|
|
819516
|
MOTHERLAND
|
Class 32: same as above.
Class 33: alcoholic beverages, namely, distilled spirits,
liquors and wines
Class 41: education; providing of training; entertainment; sporting and
cultural
activities
|
12 August 2010
|
|
848942
|
MOTHER OF AN ENERGY HIT
|
Class 32: same as above.
|
8 March 2012
|
|
849633
|
MOTHER ENDURE
|
Class 5: same as above.
Class 32: same as above.
|
21 March 2012
|
|
981386
|
 |
Class 32: same as above.
|
28 January 2014
|
|
998655
|
MOTHER
|
Class 32: same as above.
|
29 May 2014
|
Appendix II – details of Prolife Foods’ registrations
|
Application number
|
Mark
|
Goods
|
Date of application
|
|
1025443
|
Class 29: Preserved, dried and cooked fruits and vegetables; jellies, jams;
preserves; nuts; edible nuts; food products made from
nuts; prepared nuts; nut
blends; spreads in this class; peanut butter; dried fruit and dried fruit
blends.
Class 30: Coffee, tea, cocoa, sugar, rice, tapioca, sago; flour and
preparations made from cereals, bread, pastry and confectionery;
honey, treacle;
yeast, baking powder; salt, mustard; vinegar, sauces (except salad dressings);
spices; chocolates; snack foods in
this class; cereal based snack foods; snack
foods made from cereal, grain, sugar, fruit, chocolate and yoghurt; muesli
bars;
breakfast cereals; cakes;
|
12 August 2015
|
|
|
|
|
cake-mixes; pastry; muffins; muffin-mixes; pasta; cookies; biscuits;
chocolate-coated biscuits; crispbreads; wafers;
confectionery bars; chocolate-coated
confectionery; candy; chewing gum; popcorn; desserts in this class;
mousses; frozen confectionery; ice cream; ice
confections;
confectionery ices; frozen yoghurt; sorbets (ices); sherbets (ices); beverages
in this class including chocolate-based
beverages and cocoa- based beverages;
drinking powders in this class including chocolate and cocoa drinking
powders; cocoa;
condiments; spreads in this class; chocolate spread;
salad dressings; mayonnaise; fruit cake snacks; bread casings filled
with
fruit; fruit pastries; fruit pies; pastries containing fruit; snack bars
containing a
mixture of grains, nuts
|
|
|
|
|
and dried fruit (confectionery); snack bars containing dried fruits
(confectionery); nut confectionery; snack bars containing nuts;
snack bars made
predominantly
of nuts.
|
|
|
1036561
|
 |
Class 29: same as above.
Class 30: same as above.
|
3 February 2016
|
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