Full Federal Court affirms approach to deceptive similarity 4 min read
Australian courts must often decide whether two trade marks are 'deceptively similar'. A recent Full Federal Court decision emphasises that this deceptive similarity must arise from the resemblance of the marks themselves — not from their actual use or reputation.
Key takeaways
- In Swancom Pty Ltd v The Jazz Corner Hotel Pty Ltd [2022] FCAFC 157, the Full Federal Court held that any distinctiveness acquired by a registered trade mark through actual use is irrelevant to the assessment of whether other marks are deceptively similar to (and therefore infringe) the first mark.
- This decision is consistent with Australian courts' usual reluctance to consider matters of reputation when assessing trade mark infringement.
- However, businesses can still leverage the reputation of their well-known trade marks in other ways, including under the Australian Consumer Law and the tort of passing off.
Background
Swancom Pty Ltd operates the Corner Hotel in Richmond. It holds the registered trade marks CORNER HOTEL, THE CORNER and CORNER in respect of live music and food/beverage services. The respondents use the marks JAZZ CORNER OF MELBOURNE, JAZZ CORNER OF THE WORLD, JAZZ CORNER HOTEL and JAZZ CORNER CAFÉ in respect of three venues in Melbourne. Swancom commenced proceedings for trade mark infringement.
There were two key issues for the Federal Court.
- The court disagreed with Swancom's claim the respondents had infringed its registered trade marks, finding that the respondents' marks were not deceptively similar to Swancom's registered trade marks (ie they were not likely to deceive or confuse the ordinary person).
- The respondents cross-claimed for Swancom's registered trade marks to be cancelled, on the basis that they were incapable of distinguishing Swancom's live music services. The Federal Court also dismissed this cross-claim, finding that while Swancom's trade marks were descriptive (and therefore not inherently distinctive), they had acquired distinctiveness through extensive use over several decades.
The Full Federal Court's decision
The key issue for the Full Federal Court was deceptive similarity.
Swancom contended that the acquired distinctiveness of its trade marks must be taken into account when assessing deceptive similarity. That is, when asking whether the respondents' marks are likely to deceive or confuse the ordinary person, that ordinary person must be assumed to be familiar with Swancom's registered trade marks.
The Full Federal Court unequivocally rejected Swancom's argument.
Justices Yates, Abraham and Rofe affirmed that all trade marks are treated equally when assessing deceptive similarity, regardless of whether they became registered through inherent distinctiveness, acquired distinctiveness or both. In reaching this conclusion, their Honours made several points.
- Under the Trade Marks Act 1995 (Cth), assessment of registrability (including acquired distinctiveness) is entirely separate from assessment of infringement (including deceptive similarity).
- The legislative definition of 'deceptively similar' makes clear that the deception or confusion must arise from the resemblance of the marks themselves — not the manner in which they are used.
- The well-established test for deceptive similarity is based on the ordinary person's imperfect recollection of the registered mark — but the ordinary consumer has never been credited with knowledge of the actual use or reputation of the registered mark.
Does reputation still have a role to play in trade mark enforcement?
The Full Federal Court's decision sits neatly with recent cases, which have often downplayed the relevance of reputation in the context of trade mark infringement. For example, we have previously reported on a decision in which the Full Federal Court held that the 'strong reputation' of a registered trade mark was generally irrelevant when assessing the deceptive similarity of allegedly infringing marks.
However, reputation still has a role to play when it comes to trade mark enforcement, for a few reasons.
- Australian courts have sometimes suggested that a trade mark's reputation may be relevant to deceptive similarity if it is so significant as to be a matter of notoriety. In those cases, however, the mark's reputation tends to be more harmful than helpful to its owner — the notoriety of the mark, in fact, makes it less likely that the ordinary person will recall the marks imperfectly, and therefore be deceived or confused. For example, in the Thorpedo case, which concerned swimmer Ian Thorpe's THORPEDO trade mark and a TORPEDOS logo, Justice Bennett considered that the reputation of the former would reduce the risk of consumers being deceived or confused as between the two marks.
- More commonly, reputation is critical for claims of passing off and misleading or deceptive conduct under the Australian Consumer Law, both of which are routinely asserted alongside trade mark infringement.
- Finally, owners of well-known trade marks can enforce their trade marks in relation to a broader range of goods and services. A trade mark is usually only infringed when used in relation to certain goods or services: those in respect of which the trade mark is registered, closely related goods or services, or goods or services of the same description. However, well-known trade marks can be infringed by use in relation to any goods or services, if that use is likely to indicate a connection between the goods or services and the owner of the registered trade mark.