Nobody Puts Trade Marks in the Corner

What you need to know 

• Swancom Pty Ltd (Swancom) has been unsuccessful in its infringement claim concerning a suite of trade marks used in relation to live music services which had as the common feature the slogan 'JAZZ CORNER' as it failed to establish that the JAZZ CORNER marks were deceptively similar to Swancom's own registered marks which feature the words CORNER HOTEL.
• The First Respondent Jazz Corner Hotel Pty Ltd (JCH) was also unsuccessful in seeking to invalidate two of Swancom's trade mark registrations based on the argument that the marks had no capacity to distinguish Swancom's services, with the validity of other Swancom marks not decided at this stage
• This case demonstrates how evidence of use of a trade mark before it is filed can overcome an attack on the registration based on a distinctiveness objection. However, evidence of use must correlate to all of the goods and services for which the mark is registered especially when using common industry terms.
• This case also illustrates how using a mark solely composed of widely used words, even if the words are only commonly used for goods or services outside of those in the specific registered class in issue, can make it difficult to establish deceptive similarity with another mark that has some additional elements. Any distinguishing element in the alleged infringing mark alongside the shared common words will likely be sufficient to differentiate the marks enough to defeat the possibility of confusion.

What you need to do

• Exercise caution before adopting trade marks that feature words that are commonly used or could be considered descriptive of a particular aspect of your goods, services or industry.
• Comprehensive clearance searches should be conducted before adopting any new trade marks.
• If you wish to register a mark containing such words, it is likely you will need to extensively use the trade mark for all intended goods and services prior to filing an application to register the mark to assist in overcoming a descriptiveness objection. Even if the mark is registered without objection, evidence of such use may be required later in time to save the mark from cancellation – so save an archive with old examples of use!
• Be strategic and consider the risks and consequences (and prepare in advance) when contemplating infringement proceedings, as proceedings open up your own trade marks to attack in cross-claims as was the situation here.

Background

Both parties were either the owner of, or associated with, live music venues in Melbourne.

The applicant, Swancom, has owned the well-known live music venue in Richmond 'the Corner Hotel' since 1995. Its marks registered in classes 41 and 43 for live music, entertainment and hospitality services are CORNER HOTEL, CORNER, CORNER PRESENTS and THE CORNER (Swancom Marks).

The five respondents included three associated companies with common ownership and directors and involved the businesses 'The Jazz Corner Hotel', 'Jazz Corner Café' and a Jazz music venue entitled 'Bird's Basement'.

The marks of the respondents that were relevant to this proceeding were those that JCH and Bird's Basement were found to have used as trade marks for live music services. These were JAZZ CORNER OF MELBOURNE (and an additional mark including the definite article THE) and JAZZ CORNER HOTEL (and two in addition with the definite article THE or no spaces between the words respectively) (JAZZ CORNER Marks).

Swancom alleged infringement of its trade marks on the basis that the terms JAZZ CORNER and CORNER HOTEL and/or CORNER were deceptively similar. The respondents disputed this and JCH sought the cancellation of Swancom's marks on the basis that Swancom's marks are not capable of distinguishing Swancom's services and that their use is liable to deceive and cause confusion.

Validity of Swancom's Marks

Were the words associated with the services?

Justice O'Bryan questioned the association between the words CORNER HOTEL and live music on the basis that the words are akin to the words 'arena' or 'concert hall'. He noted that CORNER HOTEL could indicate a certain category and location of venue for a music performance (essentially, it could be taken to describe a gig in a pub located on a street corner where the audience size might be limited and alcohol will be served). However, Justice O'Bryan did not need to determine the case on this basis as he accepted the mark had become distinctive of Swancom's services due to use prior to the date the trade mark application was filed, and was therefore validly registered.

The words were factually distinctive

Swancom relied upon the significant reputation its business held as a professional live music venue, and its use of the CORNER marks in relation to its services from a date starting well before its trade mark applications were filed. Some of the more creative evidence considered included the venue's place in music lore of being the location at which the riff for 'Seven Nation Army' (by White Stripes) was composed. However, importantly this evidence of use was limited to live music services. As the two CORNER HOTEL marks were only registered in relation to live music services and hotel services, the evidence was sufficient to establish prior reputation and so the marks were found to be valid. However the validity of two other marks registered for services such as amusement services and booking services remained unresolved in this decision.

The allegation raised by the respondents that use of the CORNER marks was likely to deceive or cause confusion was dismissed due to the use of the marks by Swancom and their distinctive reputation.

Infringement claims

Had all respondents used the JAZZ CORNER marks in live music?

Despite JCH operating as a provider of hotel accommodation, it was found to have used the JAZZ CORNER marks in relation to live music. This was due to the fact JCH promoted the jazz venue in advertisements affixed with the JAZZ CORNER marks. This gave the impression it was either the company responsible for the jazz performances or was in some other way intrinsically associated to such other company in a corporate relationship.

Were the JAZZ CORNER marks deceptively similar to Swancom's CORNER and CORNER HOTEL marks?

The JAZZ CORNER marks would only infringe the CORNER HOTEL marks if they were found to be deceptively similar. This requires a consideration of the marks themselves and reputation is irrelevant. Two matters regarding Swancom's marks were of particular importance for the determination of the issue of deceptive similarity:

• The question of whether the words 'corner' or 'hotel' held a particular association to live music. Justice O'Bryan considered they did not; and
• Whether the words 'corner hotel' were prevalent in trading names of businesses in the hospitality industry. It was noteworthy that Justice O'Bryan rejected Swancom's submission that broader use of the words for services other than live music services should not be considered.

The above factors meant in considering deceptive similarity, people would understand the words were not in any way exclusive to Swancom's live music services and were associated with many businesses in the hospitality industry, and thus could be distinguished by the addition of other words.

Justice O'Bryan considered that in light of this, as a matter of principle, adding an additional word to such common words would shift the overall impression of the marks, and remove the possibility of confusion. He found that upon viewing JAZZ CORNER, an individual was drawn to the arresting element which was JAZZ, not the more commonplace word 'corner'. This differentiated how the mark sounded when read, and also meant that it conjured the specific allusion to jazz music in a reader's mind. As such, there was no real possibility of confusion between the marks.

Appeals

Swancom filed an appeal against its loss on the infringement claims on 6 May 2021, and JCH filed notice of contention in respect of the finding that Swancom's marks are valid on 27 May 2021. Watch this space for an encore performance at the Full Federal Court.

Authors: Oscar Doupe-Watt, Graduate and Kellech Smith, Partner.