Daimler Ag v Sany Group Company Ltd

JurisdictionNew Zealand
CourtCourt of Appeal
JudgeEllen France P
Judgment Date08 September 2015
Neutral Citation[2015] NZCA 418
Docket NumberCA227/2014
Date08 September 2015

[2015] NZCA 418

IN THE COURT OF APPEAL OF NEW ZEALAND

Court:

Ellen France P, White and Winkelmann JJ

CA227/2014

Between
Daimler Ag
Appellant
and
Sany Group Co Limited
Respondent
Counsel:

P D M Johns and T A Huthwaite for Appellant

M T Lennard for Respondent

Appeal against the High Court's (HC) decision that the respondent's mark was not identical or similar to any of the appellant's marks — both parties were motor vehicle manufacturers whose marks were a round circle with an internal design — the design inside the circle of the appellant's mark was a three point star and the respondent's was the number 1 three repeated three times but in a similar orientation to appellant's mark — the respondent's name was included in its mark — whether the Judge placed too much emphasis on the differences between the marks when these did not neutralise the similarity between their dominant concepts; whether the inclusion of the respondent's name should not have been taken into account as it conveyed not information about the origin of the goods — whether the emphasis on the discerning nature of potential purchasers limited the analysis to a small portion of the general public — what was required to show a connection in the course of trade under s25(1)(c) Trade Marks Act 2002 (indicating a connection in the course of trade).

Held: (1) Section 17(1)(a): the purpose of the section was to protect the public rather than the proprietary rights of traders, as stated by the HC. There was no question in this case that Daimler had a substantial reputation. The question of similarity was ultimately one of impression. Applying that approach, the marks were not similar. In particular, the Sany mark did not make the Court think of the Daimler marks. The HC was correct in stating that overall the impression of the Sany mark was “suggestive of rotational movement or the potential for such movement; and [Sany's] device appeared not to have the symmetry of [Daimler's] device”.

The HC Judge's references to the similarities relied on by Daimler, when put in context, were an attempt to articulate why he formed the impression he did. That exercise required identifying similarities as a precursor to explaining why, as a matter of overall impression, the marks were not viewed as similar. The Judge had not found that the marks were similar in their essential elements.

The authorities did not support a proposition that a word without meaning was necessarily irrelevant as a part of the mark. Rather, they made the point that in some cases the addition of a word might not be significant. In this case, the inclusion of the word “Sany” did further distinguish the marks, but even without its inclusion there was no risk of confusion because of the lack of visual similarity.

The likelihood of confusion was further reduced by the fact, as the Assistant Commissioner found, purchasers or prospective purchasers of the goods were likely to be both discerning and reasonably knowledgeable given that the goods in both classes were high-involvement because they were likely to be expensive and are likely to involve technical information. Daimler submitted that confusion could occur where composite pieces of construction machinery, for example, a truck-mounted concrete mixer, have a Sany and a Daimler component. There was evidence that the relevant consumers were alive to this practice and that Daimler had worked with Sany in China since at least 2003. In light of the industry practice and the significant cost of this type of equipment, confusion and deception were unlikely.

It was not wrong to attach weight to the sophistication of prospective purchasers in assessing the likelihood of confusion. The persons whose states of mind were material to confusion were the prospective or potential purchasers of goods of the kind to which the applicant could apply its mark and others involved in the purchase transactions ( Pioneer Hi-Bred Corn Co v Hy-Line Chicks Pty Ltd).

The lack of similarity between the marks means deception or confusion was not likely. The Judge was right to conclude that s 17(1)(a) did not apply. That conclusion was reinforced by the fact the relevant purchasers or prospective purchasers were discerning.

(2) Section 17(1)(b)): Daimler's submission on this section was dependent on accepting that the Judge was wrong in his conclusions on s17(1)(a). As the decision on that subsection was upheld. It followed that this ground of appeal also failed.

(3) Section 25(1)(b): Following the inquiry set out in NV Sumatra Tobacco Trading Co v New Zealand Milk Brands Ltd the notional use of the Daimler marks did not alter the conclusion that the Sany mark was not similar to the Daimler marks and use of the Sany mark was not likely to deceive or confuse. It was relevant that there was still nothing to suggest that Daimler and Sany would find themselves competing in a market where the purchasers or prospective purchasers were not discerning.

(4) Section 25(1) (c): there was no challenge to the finding that the Daimler marks were well known. Nonetheless, s25(1)(c) was not engaged in this case. That was because the marks were not similar and nor was the Sany device inside the circle identical or similar to Daimler's three-pointed star. Section 25(1)(c) was not engaged even if the word Sany was not taken into account.

The question of what was necessary to show a connection in the course of trade for the purpose of the inquiry as to whether the use of the Sany mark would be taken as indicating a connection in the course of trade with Daimler, had not been finally resolved in New Zealand. But it did appear to require more than a “tenuous association” with limited similarity of names ( Wistbray Ltd v Ferrero SPA). In any event, in the present case the only evidence as to common usage suggested that no connection would be made.

Appeal dismissed.

JUDGMENT OF THE COURT

A The appeal is dismissed.

B The appellant must pay the respondent costs for a standard appeal on a band A basis and usual disbursements.

REASONS OF THE COURT

(Given by Ellen France P)

Table of Contents

Para No

Introduction

[1]

Background

[5]

Decision of the Assistant Commissioner

[8]

High Court decision

[9]

Is there a likelihood of confusion (s 17(1)(a))?

[11]

The relevant principles

[13]

Daimler's case

[18]

Our approach

[24]

Is use of the Sany mark contrary to New Zealand law (s 17(1)(b))?

[39]

Impact of consideration of fair and notional use (s 25(1)(b))

[44]

Effect of the Daimler mark being well known (s 25(1)(c))

[49]

Result

[55]

Introduction
1

Daimler AG (Daimler), 1 the appellant, began to use its three-pointed star mark on vehicles it manufactured internationally in 1909 and in New Zealand in 1911. Daimler has registered a number of trade marks reflecting that use in New Zealand (the Daimler marks), namely:

2

The respondent, Sany Group Co Ltd (Sany), applied on 31 August 2006 to register the following trade mark (the Sany mark), namely:

3

Daimler opposed registration of the Sany mark on a number of grounds including that Sany's mark was likely to deceive or cause confusion because of its similarity to the Daimler marks 2 and that Sany's mark was not registrable under s 25(1)(c) of the Trade Marks Act 2002 (the Act) dealing with the adverse effect of similarity to a well known mark. The Assistant Commissioner of Trade

Marks (Assistant Commissioner) approved Sany's application. 3 Daimler's appeal to the High Court was unsuccessful. 4 Daimler now appeals to this Court. 5
4

The issues on appeal reflect the grounds of opposition and are as follows:

  • (a) Whether use of the Sany mark would be likely to deceive or cause confusion (s 17(1)(a));

  • (b) Whether use of the Sany mark is contrary to New Zealand law (s 17(1)(b));

  • (c) Whether the Sany mark is similar to the Daimler marks, in respect of the same or similar goods and services, and its use is likely to deceive or confuse (s 25(1)(b)); and

  • (d) Whether the Sany mark, or an essential element of it, is similar to Daimler's well known marks; whether Sany's goods and services are the same as or similar to Daimler's goods and services; whether the use of the Sany mark would be taken as indicating a connection in the course of trade with Daimler; and whether use of the Sany mark would be likely to prejudice the interests of Daimler (s 25(1)(c)).

Background
5

There is no dispute over the relevant facts. Sany was incorporated in China in 1989. Its business focus is on the manufacture, leasing, importing and exporting of “building machinery … road machinery … hoist machinery … vehicle[s] … new materials … [and] network communication equipment …”. 6 Sany first applied to register its mark in China in 1989 in relation to welding materials. 7 Sany's mark has

been registered in China subsequently in relation to all classes of the Ninth Edition of the International Trademark Classification System (ITMCS) adopted as part of the Nice Agreement. 8
6

Sany's application in New Zealand is in relation to goods in class 7 and class 12 of the ITMCS. Those classes relate to the following goods:

Class 7

Road rollers; excavators; diggers (machines); hydraulic pumps; concrete pumps; trailers and truck-mounted concrete pumps; elevating apparatus; mixing machines; concrete mixers (machines); bulldozers; motor graders; asphalt pavers; horizontal directional drilling machines; cranes; asphalt mixing plants; concrete mixing plants; rotary pile drills; milling machines; mining machines; pumps (machines); extractors for mines; mine borers; drilling machines; mine-working machines; rail-laying machines; railroad constructing machines; power shovels; road making machines; pumps (parts of machines, engines or motors); belt conveyors; hydraulic controls for machines, motors and engines; hydraulic...

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1 cases
  • Pharmazen Ltd v Anagenix IP Ltd
    • New Zealand
    • Court of Appeal
    • 23 July 2020
    ...Ltd 37 in support of the proposition that actual trade mark use is relevant. Reliance was also placed on this Court's decision in Daimler AG v Sany Group Co Ltd, in particular upon the following passage: 38 The notional use of the Daimler marks does not alter the conclusion that the Sany ma......

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