Omega Sa (Omega Ag) (Omega Ltd) v Guru Denim Inc.

JurisdictionNew Zealand
CourtCourt of Appeal
JudgeAsher J
Judgment Date27 March 2017
Neutral Citation[2017] NZCA 81
Date27 March 2017
Docket NumberCA218/2015

[2017] NZCA 81

IN THE COURT OF APPEAL OF NEW ZEALAND

Court:

Asher, Simon France and Peters JJ

CA218/2015

BETWEEN
Omega SA (Omega AG) (Omega Limited)
Appellant
and
Guru Denim Inc
Respondent
Counsel:

M D Johns and T A Huthwaite for Appellant

E C Gray and J N Simpson for Respondent

Appeal against the decision of the High Court (HC) upholding the decision of the Assistant Commissioner of Trade Marks, that the respondent was entitled to registration of its trade mark in Class 14 (watches and jewellery) — the appellant was a Swiss watchmaking corporation and had a longstanding trade mark, which was the Greek letter for Omega with the word Omega below it — the respondent's mark was not accompanied by words — the appellant relied primarily on 17(1)(a) (use … likely to deceive or cause confusion), Trade Marks Act 2002 — the HC said that there would be no confusion because the Omega symbol would be recognised as the Greek character, there was little possibility of confusion — whether the Omega symbol and the Guru mark had a similar shape overall — whether that there was sufficient familiarity with the appellant's word and symbol mark as a whole so that the use of they symbol alone could cause deception or confusion — whether the Judge erred by focussing on the alleged public awareness of the Greek Omega symbol.

The issues were: whether the Omega symbol and the Guru mark had a similar shape overall; whether that there was sufficient familiarity with the word and symbol mark as a whole so that the use of they symbol aloe could cause deception or confusion; and whether the Judge erred by focussing on the alleged public awareness of the Greek Omega symbol.

Held: In Crocodile International Pte Ltd v Lacoste the Supreme Court stated that in New Zealand an appellate court was obliged to consider the Commissioner's view, but had to then decide what weight was to be given to it. If it considered that the Commissioner's view was wrong, the Court had to act on its own view. The Court was not obliged to defer to the assessment of the Commissioner.

Fr the purposes of s 17(1)(a), nothing turned on the fact that the Omega symbol mark was registered after the relevant date. Section 17(1)(a) was concerned with the protection of the public rather than the proprietary interests of traders. A likelihood of deception or confusion could arise in respect of an unregistered trade mark.

The starting point of the enquiry under s 17(1)(a) was to assess whether, at the relevant date, Omega's marks had a sufficient reputation in New Zealand. The relevant market was those members of the New Zealand public who bought watches, in particular, high quality watches. No other significant market was established on the evidence. The risk of confusion was properly measured by reference to this group. The risk of confusion might be higher where the goods of Guru and Omega were the same or similar.

However, s 17(1)(a) was not confined to such cases. It was concerned with public deception or confusion resulting from the use of Guru's mark for the specified items in class 14, and this did not turn on the exact use and nature of the items. There could be confusion even if the products were different, and a different Guru product was thought to be an Omega product. There was in fact no detail before the Court of any existing use or proposed future use by Guru.

There was no doubt that the Omega word and symbol mark was well known in the New Zealand market for watches on the relevant date. It was clear that, at the relevant date, a significant portion of New Zealand watch purchasers would had been exposed to the Omega word and symbol mark. Guru had not contested this conclusion.

The position in respect of Omega's symbol mark was more complex. Omega had not adduced evidence of sales and marketing of products in New Zealand bearing the symbol mark alone. The evidence that was provided demonstrated that when the symbol appeared, it was almost always accompanied by the word “OMEGA”. However this was not fatal to Omega's ability to establish the potential for deception or confusion.

Even in the absence of evidence of use of the symbol mark alone, it could still be shown that there was sufficient familiarity with the word and symbol mark as a whole that the use of a component of that mark by a competitor could cause deception or confusion ( Sexwax Incorporated v Zoggs International Ltd). It was clear that the Omega symbol was an essential feature of the Omega word and symbol mark. It was “a significant part of the reputation generated from the mark itself” ( Sexwax).

Therefore, it had to be considered whether the use of the Guru mark could lead to confusion with the Omega word and symbol, an essential feature of which was the symbol.

It was erroneous for the HC to focus on the fact that the symbol was the Greek letter. The Judge assumed that the relevant public would know that was a Greek letter and that the risk of an observer of the Guru mark thinking that the Guru mark represented the Greek letter was small. This might be so if such a member of the public was conversant with the Greek alphabet. The assumption was entirely unsupported. While a fact-finder was entitled to take into account his or her own experience and reaction as a member of the public, this was not an adequate basis for the far-reaching conclusion that there was any significant number of New Zealanders who knew or assumed that that the symbol was a Greek letter. The fact that the symbol represented a Greek letter was irrelevant.

The test in Smith Hayden v Co Ltd's Application for considering deception or confusion should be adopted:

Assuming use by [Omega] of its trade mark in a normal and fair manner for [the specified class 14 goods] was the [Court] satisfied that there would be no reasonable likelihood of deception or confusion among a substantial number of persons if [Guru] used its mark in a normal and fair manner also for [the specified class 14 goods]?

The relevant part of the Guru application related to a range of items in class 14. Of these, watches were the most important. The relevant section of the public was purchasers of quality watches. In this case, given the lack of use of the Guru mark in this country, the Court had to compare the actual use of Omega's marks with the notional use of Guru's mark, notional being use in a normal and fair manner. The comparison was between the marks as a whole, having regard to their essential features. It was a not a side-by-side comparison, and allowance had to be made for imperfect recollection.

The symbols did not share a similar shape overall. While there were the broad similarities of curved lines that had an open end, with short protuberances at those ends, there were marked differences including their orientation and line shape and thickness. The overall impression of the Omega mark was of a bottom opening oval, the Guru mark of a stylised ‘U’ shape.

Even if the marks were rotated to had the same orientation, they did not become similar. This was for two reasons. First, Omega's marks appear predominantly on watches. Watch faces had a fixed orientation. That eliminated the possibility of confusion as to the original orientation of a mark applied to a watch face. When applied to watch faces the Omega symbol was overwhelmingly accompanied by the word “OMEGA” underneath, which clearly signalled the intended orientation of the symbol.

There was little danger of confusion arising from different orientations of the marks in relation to watches. Omega also sold other products, such as cufflinks, which had no natural orientation. However, these products were minor and ancillary to Omega's primary business as a watchmaker. Weight should not be placed on them.

Second, even when the orientations of the symbols were aligned, the differences in their appearances were such that there would still be no danger of deception or confusion. In the unlikely event of any confusion, for example if the goods were viewed from a distance, that uncertainty would be momentary, as any close-up view would reveal major differences, and cure any false impression of similarity. The risk of this momentary uncertainty was insufficient to meet the test of confusion as being “caused to wonder” in Pioneer Hi-Bred Corn Company v Hy-Line Chicks Pty Ltd.

Failure under s 17(1)(a) had to mean failure under s 17(1)(b) (committing the tort of passing off and breach of the Fair Trading Act 1986) which had a higher standard of proof.

Omega accepted that if the marks were not sufficiently similar for the purposes of s 17(1)(a), it could not succeed under s25. The symbols were not similar, and no likelihood of customer confusion had been shown. Therefore, there was no prejudice to Omega if the registration proceeded.

JUDGMENT OF THE COURT
  • A The appeal is dismissed.

  • B Costs must follow the event on a standard appeal on a band A basis, and we certify for two counsel.

REASONS OF THE COURT

(Given by Asher J)

Introduction
1

The Omega brand has a distinguished history for watchmaking going back to the nineteenth century, and has an international reputation. The appellant Omega SA (Omega) is a Swiss corporation that owns the Omega intellectual property and has a longstanding trade mark, first registered in New Zealand in 1905. It consists of the Omega symbol with the word “OMEGA” in this format:.We will refer to this as the word and symbol mark.

2

The respondent Guru Denim Inc (Guru) is a United States corporation which specialises in the supply and sale of clothing and lifestyle products. It has applied in New Zealand for registration of a trade mark in this design: in classes 3, 9, 14, 18 and 25, with a wide description of goods specified in each class. We will refer to this mark as the Guru mark.

3

Omega opposes the proposed Guru registration in class 14, which is the class that includes watches and jewellery. Its...

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