Tomtom Communications Ltd v Tomtom International B.v

• Jurisdiction: New Zealand
• Judge: Woodhouse J
• Judgment Date: 18 December 2015
• Neutral Citation: [2015] NZHC 3333
• Docket Number: CIV-2015-404-948
• Court: High Court
• Date: 18 December 2015

Under the Trade Marks Act 2002

In the Matter of an appeal from the decision of the Assistant Commissioner of Trade Marks dated 27 March 2015

And in the Matter of New Zealand Trade Mark Applications Nos. 848087 and 848088

BETWEEN

Tomtom Communications Limited and Gaylene Ruth Hosking

Appellants

and

Tomtom International B.V.

Respondent

[2015] NZHC 3333

CIV-2015-404-948

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

Appeal from a decision of the Assistant Commissioner of Trade Marks allowing the respondent to register “TOMTOM” — the appellant was the owner of the registered trade mark “TOM TOM” — the appellant's business was a communications consultancy — the respondent was a multinational company, which specialised in computer satellite navigation systems — it had sought to register the marks previously but withdrawn after opposition from the appellant — whether the mark would be contrary to s17 Trade Marks Act 2002 (TMA) (absolute grounds for not registering trade mark: general — likely to deceive or cause confusion) — whether in cases where there was evidence of actual confusion or deception, the Smith Hayden test did not apply — whether the Assistant Commissioner had been incorrect to conclude that “wrong way round” deception or confusion was not sufficient to meet an objection pursuant to s17(1)(a) TMA (use would be likely to deceive or cause confusion) — whether registration would be contrary to s17(1)(b) TMA (would amount to passing off and breach of the Fair Trading Act 1986) — whether under s17(2) TMA the trade mark had been applied for in bad faith.

Appearances:

E C Gray and K E Tidbury for the Appellants

G C Williams and T C Kirk for the Respondent

JUDGMENT OF Woodhouse J

Introduction

1 The respondent applied to register two trade marks – “TOMTOM” and

Full particulars of the applications are in appendix 1 to this judgment.

2 The application was opposed by the appellants. The appellant Gaylene Ruth Hosking is the owner of the registered trade mark “TOM TOM”. Full particulars of the registrations, in three classes, are contained in appendix 2. The appellant company, TomTom Communications Ltd, uses the marks under licence from Ms Hosking.

3 The respondent's applications were granted. 1 The opponents have appealed against that decision.

Grounds of opposition

4 In their opposition the opponents relied on five provisions of the Trade Marks Act 2002 (the Act). The opponents maintain these grounds on the appeal.

5 The grounds of opposition were conveniently summarised by the Assistant Commissioner as follows:

Ground no.	Summary of the allegations	Act reference
1	Use of the opposed marks would be likely to deceive or cause confusion.	Section 17(1)(a)
2	Use of the opposed marks is contrary to New Zealand law because it would amount to passing off and breach of the Fair Trading Act 1986.	Section 17(1)(b)
3	The applications were made in bad faith.	Section 17(2)
4	The opposed marks are similar to the opponents’ trade marks, which are registered in respect of the same or similar goods, and use of the opposed marks is likely to deceive or confuse.	Section 25(1)(b)
5	The opposed marks are similar to the opponents’ trade marks, which are registered in respect of the same or similar goods, and use of the opposed marks is likely to deceive or confuse.	Section 25(1)(b)

Relevant date

6 The relevant date for determining whether the opposed marks should be registered is 23 August 2011.

The nature of this appeal and the onus

7 This is a general appeal by way of rehearing. 2 I am bound to come to my own conclusion, and the weight to be given to the Assistant Commissioner's decision, and her reasons for particular decisions, are matters for my judgment. 3

8 On the appeal the onus is on the appellants to satisfy this Court that it should differ from the Assistant Commissioner's decision. But the general onus, on the merits, was and is on the respondent to establish that its applications are eligible for registration.

The appellants

9 Ms Hosking started trading under the name TomTom in 1998. She made the three applications to register the trade mark Tom Tom on 12 May 1998. The marks were registered on 9 March 2000.

10 TomTom Communications was incorporated in September 2001. It has used the mark since then. Ms Hosking is its sole director. TomTom Communications is a Wellington-based communications consultancy. It provides a range of services

including public relations, communications, marketing, promotion, brand development, website development and critique, media strategies, training, advertising, research and analysis, lobbying and reputation management services

11 Further particulars are outlined later when discussing the application of s 17(1)(a).

The respondent

12 Background facts relating to the respondent were summarised by the Assistant Commissioner as follows:

• 17. The applicant is a multinational company, with its head office in the Netherlands. It has over 3600 employees in 35 countries, and it is the global leader in navigation and mapping products and services.

• 18. The applicant was founded in 1991 as Palmtop Software, and changed its name to TomTom International B.V. in 2001. It first applied to register TOMTOM as a trade mark in Benelux Registry on 27 January 2000. The mark is now registered all over the world.

• 19. Since 2004, the applicant has sold over 70 million portable navigation devices (PNDs), and it provides a real-time traffic information service in 36 countries. Its maps cover 114 countries.

• 20. The applicant officially launched its PNDs in New Zealand in September 2007. The New Zealand launch comprised the TOMTOM ONE (third edition), which at the time was the applicant's entry-level PND and the world's top-selling PND, and also the applicant's larger PND, the TOMTOM ONE XL. In addition, the purchasers of these products were given access to TOMTOM HOME, a software application for managing content on any TOMTOM PND.

• 21. Since 2007, the range of goods and services sold in New Zealand has expanded beyond PNDs and now includes GPS-enabled sports watches, real-time traffic information services, and fleet management products and services.

13 Further evidence concerning the respondent's products, activities and reputation in New Zealand, which does not appear to have been contested in any material respect, and taken from submissions for the respondent, are as follows:

[The respondent] has received significant recognition for its products and services in the New Zealand media and publications that are available in New Zealand. Its range of TOMTOM trade mark goods and services sold in New Zealand has expanded beyond the core PNDs and now includes GPS-enabled sports watches, real-time traffic information services, and fleet management products and services. Its products are distributed in New Zealand by Ingram Micro New Zealand, which company supplies them to Noel Leeming, Harvey Norman, Dick Smith, The Warehouse, and JB Hi-Fi. Its products are also advertised for sale and sold from websites of independent retailers such as Mighty Ape, Fishpond and PriceMe. It is one of the largest suppliers of PNDs in the New Zealand market with a 39.3% market share. It has sold over 155,834 PNDs in New Zealand having a value of over NZ$38.7M. It spent over NZ$5.97m on marketing its products and services in New Zealand in the period 2007 to 2013. “Very significant” numbers of people with New Zealand IP addresses have visited the respondent's website. 4 The website has a “Contact us” page with contact information for the applicant.

Section 17(1)(a)

The legal framework

14 Section 17(1)(a) provides:

The Commissioner must not register as a trade mark or part of a trade mark any matter … the use of which would be likely to deceive or cause confusion.

15 In New Zealand for many years the assessment under s 17(1)(a), where an application has been opposed by the owner of another mark (in contrast to issues of deception or confusion arising from something intrinsic in the mark) has involved a two-stage process. The first stage – often referred to as the threshold test – places an evidential burden on the opponent to establish some reputation for, or awareness of, the opponent's mark. If such is established the second stage arises. This involves the main enquiry as to whether, having regard to the reputation acquired by the opponent, use of the mark sought to be registered would be likely to deceive or cause confusion, with the onus on the applicant to establish the negative. The appellant contended on this appeal that the full scope of this two-stage approach is not required on the facts of this case; in essence because there is actual evidence of deception or at least confusion. Given this argument it will assist to set out statements of principle of the Court of Appeal on the approach to s 17(1)(a).

16 In Sexwax Inc v Zoggs International Ltd, the Court of Appeal said: 5

The correct approach to s 17(1)(a)

48 To shed light on how this section should be approached, we make the following comments. When applying this section, the Commissioner begins by inquiring whether the opponent's 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. Where marks are used in respect of goods with only a very narrow or specialised use or purpose, the mark may be known only to a small number of people. 6 Pioneer Hi-Bred is a good example: the opponent to registration sold hatching eggs and breeding poultry, goods purchased only by those in the poultry breeding industry. It was only those in that industry who were aware of...