Meat trade marks deceptively similar

What you need to know

• The initialism “AMG” was found to be deceptively similar (but not substantially identical) to the registered trade mark “AMH” in relation to meat products in class 29.
• A combination word and device mark for AMG against a stylised map of Australia was found to be deceptively similar to a combination word and device mark for AMH against a stylised map of Australia in relation to meat products in class 29.
• Expert phonetic and phonological evidence on the pronunciation of initialisms was not found to be helpful in the real world context of the case.  The Court declined to award additional damages for infringement.

What you need to do

• All businesses should take care in the choice of trade marks that are similar to others in the market.
• Small differences between marks are unlikely to prevent a finding of deceptive similarity if there is a non-trivial danger that a number of consumers in the relevant market will be caused to wonder or left in doubt about the origin of products bearing the (infringing) mark. The prospect for confusion to arise from the imperfect recollection of marks by consumers needs to be borne in mind in ensuring that a new mark is sufficiently different from prior marks on the Register or being used in the marketplace.
• Care needs to be taken in adducing expert evidence in trade mark cases about the meaning and pronunciation of trademarks to the Australian consumer. For such expert evidence to be useful, it must be specifically contextual, rather than abstract and acontextual.

Background

JBS is the owner of Australian Trade Mark No. 515268 (depicted above on the left) registered for “meat and meat products including boneless meat, chilled bone-in meat, frozen boneless meat, frozen bone-in meat” in class 29.

JBS is also the owner of Australian Trade Mark No. 1719465 for the word mark, AMH, registered for (among other things) “meat; prepared meat; meat products; meat jellies; meat extracts; and offal” in class 29.

The Court found that JBS and its predecessors in business had made extensive use of the trade marks over many years. Justice Greenwood observed that:

“It is a rare case indeed where a trade mark owner… is able to demonstrate use of a trade mark … on 251.598  million items of packaging (in this case plastic packaging) and 94.563 million items of other packaging (in this case cardboard packaging) in connection with products… generating sales of $6.559 billion and $10.585 billion, respectively, in sales of goods the subject of (in this case) each registration of the trade marks in suit.”

Australian Meat Group Pty Ltd (AMG) used the mark “AMG” (depicted above on the right) in relation to meat and meat products it sold in Australia and to export markets.

JBS alleged that the use by AMG of the mark “AMG” and the AMG device mark infringed JBS’s trade mark registrations. JBS asserted that the AMG marks were substantially identical to and deceptively similar with the JBS marks. AMG denied those allegations, and in relation to deceptive similarity, raised a defence based on Mars Australia Pty Ltd v Sweet Rewards Pty Ltd [2009] FCAFC 174 (the MALTESERS / Malt Balls case) that because JBS’s marks were so well known in the industry, there was no prospect that relevant consumers would be caused to wonder that products bearing the AMG marks came from JBS.

Key outcomes

The Court considered detailed evidence about the business operations of each of JBS and AMG and about how each business thought various segments of the wholesale and retail meat industry in Australia worked. An important finding was that while participants in the wholesale meat market were knowledgeable, orders were often placed and taken in busy environments, often multiple times a day. Justice Greenwood characterised meat trading as a “hurly burly of oral commercial transactions”.

Taking an orthodox approach to the assessment of substantial identity and deceptive similarity, Justice Greenwood held that:

• on a side by side comparison, AMG’s marks were not substantially identical to JBS’s marks. The conventional approach taken by his Honour led to a conclusion which conforms to the traditional understanding of substantial identity under Australian law (in comparison, say, to the approach and outcome in Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd [2017] FCAFC 83 discussed in our June 2017 IP @ Ashurst(in which, curiously, Justice Greenwood was the presiding judge in the Full Court))
• AMG’s marks were deceptively similar to JBS’s marks. Justice Greenwood applied the established principles for assessment of deceptively similarity to reach this conclusion. The key question for consideration on an assessment of deceptive similarity is whether an (allegedly) infringing mark so nearly resembles a registered trade mark such that the impugned mark is likely to deceive or cause confusion. Justice Greenwood adopted Justice French’s (as he then was) restatement of the essential elements of deceptive similarity in Registrar of Trade Marks v Woolworths Ltd (1999) 93 FCR 365, and in particular noted this statement of Justice French:

“ The judgment of the likelihood of deception or confusion is a very practical one…. It requires assessment of the effect of the challenged mark upon the minds of potential consumers. Impression or recollection taken away from the point at which the challenged mark is observed will be the basis of any belief about a connection between the new and the old marks. … The question ultimately is not susceptible of much discussion.” [emphasis added]

The “hurly burly of oral commercial transactions” appeared to make an impression on Justice Greenwood in his assessment of deceptively similarity. His Honour noted those circumstances bore on whether participants in the market would be caused to wonder or left in doubt about whether it might not be the case that the meat products of AMG are those of the owner (JBS) of the AMH trade marks. His Honour also held that notwithstanding JBS’s very considerable reputation in its trade marks, that reputation was not such that no “imperfect recollection” of the AMH marks would be brought to any engagement with the AMG marks by participants in the market. Put another way, his Honour held that JBS’s reputation was not so overwhelming that in the circumstances of the hurly burly of meat trading, the imperfect recollection of market participants would be displaced. The so-called “Maltesers” defence failed for this reason.

Justice Greenwood did not find expert evidence adduced by AMG about the pronunciation of the initialisms comprising the word marks of each of JBS and AMG helpful. Justice Greenwood held that the expert phonetics and phonology evidence was cast at too high a level of abstraction to bear on the real world circumstances of the meat trading market. His Honour said:

“[T]he theoretical differentiation in pronunciation of the final syllable in AMG and AMH might well lose its structurally deconstructed abstracted integrity in the context of the cut and thrust of ordinary commercial arrangements by ordinary commercial people pronouncing AM something and AM something else in the sale and purchase of meat products, having regard to what is ordinary in that sense on the evidence.”

JBS sought an order that AMG pay additional damages for its infringements of JBS’s marks. However, Justice Greenwood declined to grant that relief. His Honour held that the explanation of the steps taken by AMG in choosing its marks was reasonable and not tainted with a desire to misappropriate JBS’s marks or its reputation in them.

What's next?

AMG has appealed Justice Greenwood’s decision to the Full Federal Court. It is expected that the appeal will be heard sometime in 2018.

Author: Peter Chalk, Partner.