|
|
[Home]
[Databases]
[WorldLII]
[Search]
[Feedback]
Federal Court of Australia |
COURT
IN THE FEDERAL COURT OF AUSTRALIACATCHWORDS
Trade Marks - Use of mark as trade mark - whether Court may take into account subjective purpose of user - whether sole test of trade mark use is that mark objectively indicates connection between goods and registered proprietor or registered user of mark.Trade Marks - Infringement - whether use of word by respondent use as trade mark - whether respondent used trade mark in good faith and as description of character or quality of respondent's goods.
Practice and Procedure - Admissibility and relevance of evidence - hearsay evidence - survey evidence of public as to knowledge and use of trade mark.
Trade Marks Act 1955: ss.23(1)(b), 58, 64(1)(b).
HEARING
SYDNEYCounsel and Solicitors for applicant: Dr J. McL Emmerson QC, Mr J.T. Gleeson and Mr I. Jackman instructed by Messrs Blake Dawson Waldron
Counsel and Solicitors for respondent: Mr W.H. Nicholas QC and Mr J.C. Allsop instructed by Messrs Michell Sillar McPhee Meyer
ORDER
The respondent's cross-claim be dismissed. The applicant bring in short minutes of order on a date to be fixed.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
DECISION
The applicant, Sterling Pharmaceuticals Pty Limited, is the registered proprietor of an Australian trade mark "Caplets", No A96,967 registered in Part A of the Register Class 5 in respect of medicated tablets for human use. That registration has been extant since 1958. The applicant claims that the respondent, Johnson and Johnson Australia Pty Ltd has infringed this mark by selling, offering for sale, advertising and promoting "Tylenol Caplets". Both parties are subsidiaries of multi-national companies and carry on the business throughout Australia of manufacturing and selling pharmaceutical products.2. The applicant claims that it has for a period of not less than three years ending on 20 September 1989, (that period being one month prior to the date of the amended cross-claim filed by the respondent), used in good faith the mark "Caplets" on products being paracetamol analgesics offered for sale and sold under the names "Panadol Caplets" and "Panadeine Caplets". The respondent claims on its part that although the applicant has in the relevant period used the word "Caplets" on its packaging and in advertising it has done so using the word not as a trade mark but, as the respondent would have it, as a "descriptor". Accordingly the respondent claims an order that the mark "Caplets" be expunged from the Register of Trade Marks pursuant to s.22 of the Trade Marks Act 1955 ("the Act").
3. The respondent also denies that it has by its advertising and sale of Tylenol Caplets infringed the applicant's mark. It says that it has not in its advertising or packaging used the word "Caplets" as a trade mark. Rather, it says it too has used the word as a "descriptor". It says further that if it has used the word "Caplets" as a mark so as otherwise to infringe the applicant's mark, it used the word in good faith and as a description of the character or quality of its own goods being Tylenol paracetamol analgesics so that by virtue of s.64(1)(b) of the Act, its use is not an infringement of the applicant's mark. In reply, the applicant challenges both that the respondent's use was in good faith and that it was a use as "a description of the character or quality" of the respondent's goods.
4. Thus are the battle lines drawn between the parties.
5. The issues that fall, therefore, for decision can be shortly stated by
reference to the statutory provisions:
1. Did the applicant in theThe Evidence relating to the applicant's use of the word "Caplets" prior to 1986
continuous period of three years ending
on 20 September 1989 use the trade mark
"Caplets" in relation to its own
products Panadol Caplets and Panadeine
Caplets? (s.23(1)(b)). If it did,
there was ultimately no issue between
the parties that its use was a use in
good faith. Success by the respondent
on this issue would result in its being
successful in its cross-claim and an
order being made under s.23(1) for the
removal of the mark from the register.
No discretionary grounds were advanced
by the applicant such as would result
in the Court not exercising its power
under s.23(1) to order removal: see Re
Carl Zeiss Pty Ltd's Application [1969] HCA 17; (1969)
122 CLR 1 at 5; Hunter Douglas
Australia Pty Ltd v Perma Blinds (1970)
122 CLR 4 at 58-9 and 61; Paragon
Shoes Pty Ltd v Paragini Distributors
(NSW) Pty Ltd (1988) AIPC 90- 531 at
38,597-8.
2. Putting to one side the provisions
of s.64(1)(b) of the Act, was the use
of the word "Caplets" by the respondent
in its advertising and on the packaging
of its Tylenol paracetamol product an
infringement by the respondent of the
applicant's registered mark "caplets"?
(s.58).
3. If there were otherwise an infringing
use by the respondent of the
applicant's registered mark "Caplets",
was that use a use by the respondent in
good faith of a description of the
character or quality of the
respondent's goods? s.64(1)(b).
6. Prior to the first appearance of the word "Caplets" on the applicant's paracetamol product, the word was used on three other products of the applicant. The first was a product called Betaplexin Caplets, a B group vitamin complex product in the form of capsule shaped tablets which were marketed from the late 1940's until the mid 1970's. That product was sold nationally to pharmacies, but was not promoted to any extent. The packaging in large letters in red contained the word "Betaplexin" and below in smaller letters in black the word "CAPLETS" with an asterisk after it. There followed in red the word "FORTE" and under that in black the words "100 CAPLETS". On the back the dosage for adults and children was shown. For example in the case of adults the dosage was said to be "Two Caplets a day or as prescribed by a physician". There followed a list of vitamins which each "caplet" was said to contain.
7. The second product was called "Monodral Caplets". This was an anti-cholinergic product again in the form of a capsule shaped tablet and was marketed from the late 1940's until the late 1960's. It would appear that the use of the word on the packaging was not greatly different from that described for Betaplexin. Mr Darke, the Group Product Manager of the applicant conceded that in each case the brand of the product was seen by the company to be the first name used on the product.
8. The third product Mytelase was a cholinergic drug supplied in "scored Caplets of 10 mg, bottles of 100" according to a publication produced by the applicant in 1968. The evidence revealed little about this product save that it has long since been discontinued. The label, a copy of which was tendered showed the product as Mytelase Caplets* and described the contents as consisting of 100 Capsule shaped tablets. The asterisk referred to a note that both "Mytelase" and "Caplets" are registered trade marks.
9. It would seem that for some time after these three products were
discontinued the word "Caplets" was not used in Australia in
connection with
any product of the applicant.
The Marketing of Panadol Caplets
10. Prior to 1986 the applicant marketed Panadol, a paracetamol preparation, in a number of forms including capsules and tablets. It also marketed a product containing paracetamol and codeine under the name "Panadeine" in various forms, including capsules and tablets.
11. In February 1986 the possibility of producing 500 mg paracetamol
capsule-shaped tablets under the Panadol brand arose for discussion.
Consideration was given to the get-up of a package of Tylenol caplets
presumably obtained from overseas as that product was not then
available in
Australia. The author of the proposal, a Mr P.W. Collins, wrote in a memo
that:
"Ideally, the size of the Tylenol caplet12. Up until that time the brand name "Panadol" had been the subject of some thirty years promotion. It was, and is a well recognised brand throughout Australia.
would be excellent. The printing as featured
on Tylenol is also considered a priority."
13. In early February 1986 considerable publicity was given in Australia to an event that occurred in the United States. There, a person died as a consequence of taking a capsule manufactured by the respondent's United States affiliated company. The capsule had been tampered with in that cyanide had been inserted into the capsule. That event attracted considerable interest in the pharmaceutical industry. Within days, the respondent's United States affiliate gave wide publicity to the fact that it was withdrawing its analgesic capsules from the market in the United States. Some part, at least, of the decision by the applicant to offer the public an alternative dosage form to capsules arose from the publicity concerning the tragedy in the United States. The applicant knew it had a registered trade mark for the word "Caplets" and found it opportune to use that word in conjunction with this alternative dosage form.
14. Following Mr Collins' memorandum, discussion ensued as to whether or not a capsule shaped tablet under the Panadol brand should be manufactured with a strength of 500 mg. There was at the time also internal correspondence dealing with the proposal which referred to the "Panadol Caplets Product" and which spoke of the possibility of caplets being manufactured. Generally, although certainly not invariably, the word "Caplets" was spelt in this correspondence with a capital letter although occasionally with a small letter and occasionally in the singular either as a noun or as an adjective. Mr Darke at this time was Marketing Manager of the applicant's Winthrop Division.
15. By about 10 April 1986 the decision had been taken to go ahead with the manufacture of capsule shaped tablets. The prospect of the use of the registered trade mark "Caplets" was considered and correspondence ensued with representatives of the American company which was affiliated with the applicant either as the parent company or as another subsidiary of a common parent. The evidence does not make clear the relationship but nothing turns upon this. The position overseas was apparently that the same "Caplets" had been registered in Australia, New Zealand, South Africa, United States, Great Britain and the Transkai. It seems that in the United States the applicant's affiliated company had while maintaining its registration decided "that the name had greater value used descriptively than as a trade mark". It was apparently considered that for this reason the applicant's American affiliate had been unable to stop the respondent's American parent or affiliated company from adopting the term caplets "also used describtively" there in 1984.
16. By June of 1986 two further incidents had occurred in the United States of tampering with capsules which emphasised the need to be prepared for an alternative dosage form to capsules. Some officers of the applicant's overseas affiliate were concerned at a possible outright ban on the sale of capsules.
17. By July 1986 the applicant was aware that the respondent intended "to introduce caplets" in Australia and New Zealand in the near future. A Linda Heilman noted in a telex to Mr John Baker dated 15 July 1986 that registration of the mark "Caplets" was "vulnerable to cancellation" and that the applicant "should make use of the mark if at all possible". An internal memorandum of the applicant dated 21 July 1986 noted that it had been rumoured that the respondent would "replace its Tylenol Capsules with Caplets in Queensland" and that they could be followed by other manufacturers using the caplet form in lieu of capsules. It was thus thought imperative to "market a product in caplet form" as soon as possible.
18. There then followed the question how to use the mark "Caplets" on packaging. A rough draft of a proposed packaging was prepared and attention was given to "the context" in which caplets should be referred to. It was thought that wherever possible, where the word "Caplets" appeared it should be followed by the common descriptive noun of the products e.g. "CAPLETS* BRAND OF PARACETAMOL". The asterisk was to be used with a footnote that it was a registered trade mark. Mr Darke was concerned that the word "Caplets" be given no descriptive function. He appreciated that the word lent itself very well to a descriptive function. Indeed, Mr Darke was aware that the word had been used not only by the respondent's affiliate in the United States as a "descriptor" i.e. a generic term, but also possibly by other companies.
19. Art work for the packaging was prepared and sent to the United States for approval. The original drafts were changed and ultimately the present form of packaging of the product "Panadol CAPLETS" was determined upon.
20. The present packaging must now be described. On the front of the package
the word "Panadol" appears in large red letters followed
by an asterisk.
Under that in bold black letters appears the word "CAPLETS" again followed by
an asterisk. Underneath that appears
in smaller print the words "BRAND OF
PARACETAMOL". Under that in yet smaller print appears the words "Each tablet
contains Paracetamol
500 mg". There then appears in white against a green
background the logo "Winthrop" and underneath in large white letters the words
"For Pain Relief". At the bottom left of the front panel in white upon a red
circular background around the size of a one dollar
coin appears a
representation of two capsule shaped tablets, one showing the word embossed in
white "Panadol" and the other, the
reverse of the first, the letters and
numbers "WIN 182". On the bottom right of the front panel in white on a red
background are
the words "24 capsule shaped tablets". On the back panel
appears in bold red letters the word "Panadol" with an asterisk. Underneath
appears the following:
For the relief of pain and discomfort21. On the bottom and top flaps appear the words "Panadol Caplets" again with asterisks. In each case the print in which the word Panadol appears is larger than that in which the word "Caplets" is printed.
in rheumatic, muscular and neuralgic
conditions, headaches and colds and
following dental procedures. Reduces
fever.
"Dosage: Adults: One to two tablets
(maximum 8 tablets per day). Children
(7- 12 years): Half to one tablet
(maximum 4 tablets per day). Take with
water every 3-4 hours if necessary.
CAUTION: THIS PREPARATION IS FOR THE
RELIEF OF MINOR AND TEMPORARY AILMENTS
AND SHOULD BE USED STRICTLY AS
DIRECTED. PROLONGED USE WITHOUT MEDICAL
SUPERVISION COULD BE HARMFUL.
STORE BELOW 30DegreeC
USE ONLY IF FOIL SEAL OVER TABLET ISINTACT
*Panadol and Caplets are registered trademarks.
2649763 Reg Vic 21834
WINTHROP LABORATORIES
DIVISION OF STERLING PHARMACEUTICALS PTY LTD 75-89 ATKINS ROAD,
ERMINGTON, SYDNEY, AUSTRALIA"
22. It should be noted that the packaging here described is that of the box containing 24 capsule shaped tablets. The packaging of the Panadol box containing 48 capsule shaped tablets differs slightly from the packaging of the smaller box. These differences are however of no importance in the resolution of the issues in this case and need not be described.
23. Applications for Victorian registration of products including Panadol Caplets and Panadeine Caplets were forwarded to the Health Commission of Victoria in August 1986 for registration by the Proprietary Medicines Advisory Committee there.
24. Meanwhile it would seem that another pharmaceutical company in Australia, Reckitt and Colman made an application for registration of the name "Caplets" which application was filed on 10 July 1986. Subsequently the respondent made an application for removal of the mark "Caplets" from the register. Another smaller company, Herron Pharmaceuticals was warned by the applicant against infringing the mark "Caplets" by a product to be called "Paracetamol Caplets".
25. The applicant commenced selling its paracetamol product using the word "Caplets" by July or August of 1986. An original small batch was produced and sold. The precise quantity of the trial batch is unknown. Sales were in packets of 50 and 24 and were distributed to both pharmacies and supermarket outlets.
26. The main launch of the product as ultimately manufactured by the applicant (the initial trial batch or batches were manufactured by a contract manufacturer) was in January/February 1987. The product was in blister pack format in boxes of 24 tablets and boxes of 48 tablets, the latter for pharmacy sale only. In introducing the product line to the trade, the strategy, particularly for grocery outlets, was that the applicant would not accept deletions of existing products to get caplets accepted.
27. In a document headed "Sterling Sales Letter" intended for grocery
salesmen dated 6 January 1987, the applicant announced the
extension of "the
market's dosage forms" with the "introduction of Panadol Caplets in Blister
Packs". The announcement refers to
the release of a "caplet form product"
initially in August 1986. It explains that Panadol Caplets are
"Capsule-Shaped Tablets".
It also points out that "a proviso of Panadol
Caplets being accepted into any account is that no other Sterling Analgesic be
deleted
from that account". It concludes:
"Let's give the analgesic market another28. In pharmacies, the strategy was to ensure that the whole Panadol range of products was presented so that a customer would have a choice of the particular dosage form he or she desired.
choice in dosage forms and make it Panadol
Caplets."
29. Advertising was prepared, the thrust of which was to promote the name and image of Panadol and Panadeine and to refer to the extensive range available of tablets, capsules, caplets, soluble, elixir, drops and suppositories.
30. By way of example of advertising, a video of a recent commercial was shown. At the end of the commercial, which appears to concentrate on Panadol Tablets, there is superimposed the words: "Also available in Capsules, Caplets and soluble".
31. The Panadeine Caplet packaging used by the applicant since the
introduction of that product line to the market in January 1988
is identical
to that of the Panadol Caplet product save as to the colours used and the name
of Panadeine. The addition of codeine
to the product also required a minor
consequential alteration to its description on the packet. The Development of
Tylenol Caplets
and the
Marketing of this Product in Australia
32. The product Tylenol Caplets had for some years been sold in the United States by the respondent's affiliated company there. Again the precise relation of the United States company to the respondent was not explored but the United States affiliate was presumably either the parent company of the respondent or a company owned by the ultimate holding company of the respondent.
33. By March 1986 the respondent had determined to launch into the Australian market a capsule shaped paracetamol tablet. On 11 March 1986, Lyn Hope who was a Product Manager of the respondent in charge of Tylenol asked Anne Hodge who was the Patent Coordinator of the respondent to "check out the situation of the word 'Caplets' in Australia". If it was not registered the respondent wished to do so immediately. Search of the Trade Marks Register made it clear that the applicant had registered the mark but the possibility was noted that the mark may not have been used in Australia in the preceding three years so as to permit an application for removal to proceed. Some consideration was given to alternative names. Lyn Hope in an interoffice memo dated 5 December 1986 considered the evidence she then had as to the applicant's use of the mark "Caplets". She referred to the August trial marketing by the applicant which had resulted in the location of the Panadol Caplets product in three pharmacies in Adelaide and Perth. She was of the view that the chance of calling the respondent's product "Caplet" were "very slim if not negligible".
34. In an inter-office memo dated 2 December 1988 from Ms D. Kennedy who was
a marketing manager of the respondent to Mr Vermeer,
a director and Marketing
Sales Director of the respondent, Ms Kennedy wrote that:
"Ideally we would like to promote the genericMs Kennedy noted that a Mr Ryan, a United States attorney with the respondent's affiliate in the United States took the view that the applicant's registration of "Caplets" should not stop the respondent marketing a product referring to it as "Caplets". He recommended taking the risk of legal action by the applicant. He was, in the words of Dianne Kennedy "disconcertingly sure of himself". Mr Ryan in three communications of 22 November, 22 October and 14 January had made the following comments:
use of the word 'caplet'... to enhance
consumer acceptance and understanding (just
as 'tablets' are used today). This is also
International policy".
22 November (to C. Gladwin)35. Advice was taken by the respondent of an Australian patent attorney in private practice, Mr Lloyd, who was of the view that use by the respondent of the word "Caplets" in connection with the Tylenol product would infringe the applicant's registered mark. The situation was thus that in 1988 Mr McNair, the Managing Director of the respondent was aware that advice in Australia had been received to the effect that the word "Caplets" had not been used generically in Australia, in contradistinction to the situation in the United States but that the American attorneys held a contrary view. It was with this knowledge that Mr McNair went to Korea for a discussion with a Mr Kaufman, a member of the United States legal group whose position it was to coordinate all legal advice. Mr Kaufman was very forceful in his view based on conversations he had had with Mr Ryan that the respondent would succeed if any action were brought against the respondent by the applicant. It was Mr Kaufman's view that the respondent should proceed to market Tylenol Caplets. He referred to the United States experience where direct discussion with the applicant's affiliated company had resulted in the negotiated use of the term "Caplets" both within and outside the United States of America. Mr McNair discussed the effect of the Australian advice which was contrary to Mr Ryan's view.
"I have made it abundantly clear to you and
other marketing people in the Johnson and
Johnson companies throughout the world, we
will pursue a non-trademark usage of the term
'caplet' and essentially leave it to Sterling
to enforce whatever paper rights it has."
22 October (to C. Gladwin)
"I have, on more than one occasion, both with
your management, and with legal counsel,
argued that the presence of any registration
rights in the term of Sterling/Sterling
Winthrop is irrelevant to your use of the
term in a non-trademark sense. I continue to
regard this term as being free for use by
you..."
14 January (to W.S. Lloyd)
"For the sake of the Record I now wish to
place our local operating company on notice
that while it is their decision to forego use
of the term caplets on your advice, I am not
in agreement with any such negative decision."
36. Mr McNair decided to go ahead and take whatever consequences might arise.
In reply to a question from counsel for the applicant
that "...and in doing so
one thing you hoped you might be able to achieve was that even if the mark was
not generic at that stage
it would become generic if Johnson and Johnson used
it generically?", Mr McNair answered, "I believe that was part of the
strategy".
The outcome of the Korean discussions is reflected in an
inter-office memo dated 13 December 1988 from Dianne Kennedy to C. Gladwin,
a
patent co- ordinator, and J. Terry, an Australian patent attorney, copied
inter alia to Mr McNair which was in the following terms:
"Following international discussions between37. Mr Vermeer on 14 December 1988 wrote a memo to similar effect. He noted that "no further local legal advice should be obtained...". By 21 December 1988 the respondent was briefing its advertising agency to finalise research that was to be conducted in January. It was noted by Lyn Hope that the word "Caplet" was to be used, not capsule-shaped tablet, "except if necessary to describe the product".
Mr McNair and senior Johnson and Johnson
management, it has been decided that we will
follow the direction taken by the corporation
world-wide and market 'caplets' and 'gelcaps'
as descriptive terms, leaving the initiative
to Sterling to challenge our position.
The decision is timely as we can immediately
incorporate 'caplets' into our packaging
without incurring any cost."
38. In January 1989 application was made by the respondent to the Assistant Secretary of the Medical Devices and Dental Products Branch at the National Register of Therapeutic Goods in Canberra to market Tylenol in "capsule shaped tablet form" and for approval of packaging. The proposed packaging described the product as "capsule-shaped tablets". The application was approved by February of that year. However the effect of the decision made by Mr McNair was that new packaging had to be prepared using the word "Caplets" instead of "capsule-shaped tablets". Art work was revised and fresh applications for approval to market were made. Notwithstanding this, when eventually the Tylenol caplets were put on the market the foil inside did not refer to Tylenol caplets but rather to Tylenol capsule-shaped tablets.
39. On 21 March 1989 a Mr Gladwin who was Administrative Officer Patents and
Trade marks of the respondent wrote to Mr Crothers with
copies inter alia to
Mr McNair in the following terms:
"I am in receipt of your Copy Submission for40. In cross-examination of Mr McNair he was asked:
Approval forms requesting authorisation to
use the term 'Caplets'. Unfortunately I can
not approve the term because my
responsibility is to ensure that JJA complies
with the Trade Marks Act 1905 (sic) (i.e.
Federal Law) and we know that Caplets is a
registered trademark of Sterling-Winthrop;
thus leaving us open to legal action.
However, Senior Management and Corporate have
approved use of the term and therefore you
must use their approval and not mine.
I have no problem with the remaining text and
approve the rest of the copy."
"Was it then your position that you thought41. To this Mr McNair answered "Yes".
that the course proposed (i.e. to use the
word "caplets" in respect of the Tylenol
product) would involve infringement?"
42. He agreed that at the time he believed that in a subsequent dispute it would be possible to reach a commercial settlement with the applicant.
43. In re-examination, counsel for the respondent asked Mr McNair what he
understood by the word "infringement". His first answer,
hardly addressed to
the question put, was as follows:
"We have to bear in mind, in answering this, that IWhen the question was restated he said:
had two sets of advice. The advice I chose to use,
made it clear to me that where equivalent positions
existed in other countries, in spite of the advice I
had locally, it had not led to the circumstances we
not find ourselves in. I was, therefore, of the
opinion that in spite of the advice I had locally
and, if you like, the term, 'infringement', that it
had not led and somehow it had been voidable to have
that react in the way it has. So that was my
understanding of the situation. I did not believe
that the advice I was getting would lead to this
situation."
"Well, I would have to put that in the44. It is now necessary to describe the respondent's Tylenol package as finally settled upon, the marketing of which commenced on a trial basis in South Australia around September 1989 and which resulted in the applicant commencing the present proceedings. The Court granted an interlocutory injunction restraining the sale or promotion of the product containing the word "Caplets" with the result that the Tylenol range has not since then been marketed using the word "Caplets".
context of the advice coming from John Terry
and that is that our going ahead would
involve an infringement. I mean, if you mean
by the term, 'infringement', we have got to
be talking about, in simplest possible terms,
I suppose, the use by us of, in this case a
trademark registered by somebody else, I
cannot really see how it could mean much else."
45. On the front panel of the packet appear the words "NEW from Johnson and Johnson". Underneath these words are followed in large bold red letters is the word "TYLENOL" followed by an asterisk.
46. On the top right hand corner of the panel are the words and numbers "24 CAPLETS".
47. The word "Caplets" is in capital letters of size marginally larger although thinner than the name Johnson and Johnson. These words, like the name of the respondent are printed in blue.
48. Below across the front panel in black type appear the following words
superimposed on a yellow background:
"For pain relief...without aspirin.At the far right of that line are illustrations of two capsule-shaped tablets in white on the yellow background. Underneath at the bottom of the packet in small blue print appear the words:
Easy to swallow."
"Each caplet contains PARACETAMOL 500 mg"The word "Paracetamol" predominates.
49. On the back appears printed in small print the following copy:
"JOHNSON and JOHNSON TYLENOL Caplets50. The words "Johnson and Johnson Tylenol" appear in larger print as does the warning not to take more than the specified dosage for adults and children.
provide temporary relief of pain and
discomfort associated with headaches,
muscular aches, rheumatism, arthritis,
neuralgia, menstruation and temporary
relief of symptoms associated with
colds, flu and many viral infections.
Reduces fever
JOHNSON and JOHNSON TYLENOL
Paracetamol Caplets:
*Contain no aspirin
*Will not cause gastric irritation
and may be used by most persons with
peptic ulcer, when taken as directed
for recommended conditions.
*Are not likely to cause a
reaction in those who are allergic to
aspirin and are therefore especially
well suited for such persons.
*Are easier to swallow than
Tablets because they are specially
shaped.
DOSE: Adults: 1-2 Caplets, every
4-6 hours. NOT MORE THAN 8 CAPLETS
SHOULD BE TAKEN IN 24 HOURS.
Children: 10-12 years - 1 Caplet,
every 4-6 hours. NOT MORE THAN 4 DOSES
SHOULD BE TAKEN IN 24 HOURS.
STORE BELOW 30degreesC.
CAUTION: DO NOT USE IF BLISTER
UNIT IS BROKEN. This preparation is
for the relief of minor and temporary
ailments and should be used strictly as
directed. Prolonged use without medical
supervision could be harmful."
51. On each of the side panels appear the words:
"Johnson and Johnson52. The word "Tylenol" is in red bold print and the word caplets is in smaller, although large print. The top flap contains the words:
TYLENOL PARACETAMOL 500 mg 24 CAPLETS"
"Johnson and Johnson53. The name Tylenol appears in prominent bold red print. The word "Caplets" is in smaller blue print of the same size as "Paracetamol 500 mg".
TYLENOL
PARACETAMOL 500 mg
CAPLETS
54. Through another division, the respondent had for some time marketed a
product called "dispersalloy caplets". This product was
for use by dentists
in filling teeth. It consisted of a durable round plastic pouch on the
outside and inside mercury and a dispersalloy
tablet. However else one might
describe the product it was clearly not a capsule shaped tablet. It was not,
of course, suggested
that this product infringed the applicant's trade mark,
it being not within class 5 nor a medicated tablet for human use. It was
about half the size of a one cent coin.
Marketing of the Respondent's Product
55. As has been pointed out, the respondent commenced a marketing launch for
Tylenol in the form of tablets and capsule-shaped tablets
in South Australia
in September 1989. A number of other promotional materials were prepared by
the respondent, all bearing the word
"Caplets" including paper bags, notepads,
keys, detailer boxes and postcards. These promotional materials were
distributed to a large
number of pharmacists and medical practitioners in
South Australia and can be described as follows:
(a) The Paper Bags
56. The paper bags are printed on both sides with advertisements for Tylenol
"caplets" and "tablets" respectively. The "caplets"
advertisement depicts a
rectangle bordered in blue within which are the words "Johnson and Johnson" in
blue print at the top above
the trade mark "TYLENOL" in capitals and bold red
print. In the top right hand corner appear the words "24 CAPLETS" in red and
blue
print respectively. Underneath in blue, highlighted by a yellow strip are
the words "For pain relief...without aspirin. Easy to swallow."
Next to these
words near the blue border are two representations of capsule-shaped tablets
in white. Underneath, still within the
rectangle lie the words "Each caplet
contains PARACETAMOL 500mg". Outside the blue border at the bottom of the bag
are the following
words in large blue print - "Effective Pain Relief From
Johnson and Johnson" and in red print across from these words are the words
"Also available in tablets". The advertisement for Tylenol tablets on the
other side of the bag contains, in a similar position
and in red print the
words "Also available in new, easy to swallow caplets".
(b) The Notepad
57. The notepad bears the name "Johnson and Johnson" in small blue print at
the top of the page. Underneath lies the word "TYLENOL"
in red bold capital
letters and beneath "TYLENOL" are the words "Paracetamol 500 mg Tablets and
Caplets" in small blue print. At
the bottom of the page in white letters
highlighted in blue are the words "For pain relief...without aspirin".
(c) The Key
58. The key is bordered on both sides in blue. On one side in the top left
corner in blue print are the words "Product knowledge
is the key to successful
selling". On the right hand side of the key are the words "Johnson and
Johnson" in blue above the mark
"TYLENOL" in bold red capital letters.
Underneath lie the words in white "For pain relief...without aspirin"
highlighted in blue.
On the other side of the key, this time on the left
side, this same formation of words appear. On the right hand side appear the
following words, in each case after a red highlighted box:
"Paracetamol 500 mg.59. At one end of the key, a lock has been inserted bearing the words "Johnson and Johnson" in blue above "TYLENOL" in bold red capitals.
Available in both tablets and easy-to-swallow
caplets.
Effective relief of pain and fever.
Gentle enough even for ulcer sufferers."
60. The front panel of the box contains the following word formation; "Johnson and Johnson" in blue print above the word "TYLENOL" in bold red capitals. Beneath "TYLENOL" are the words "Paracetamol 500 mg Tablets and Caplets". Below these words in large blue print highlighted in yellow are the words "Pure, effective and gentle." At the bottom of the panel in blue are the words "What else would you expect from Johnson and Johnson".
61. On the back panel the words "Johnson and Johnson" and TYLENOL" are
similarly depicted. Underneath again in large blue letters
highlighted in
yellow are the words "For pain relief...without aspirin." Beneath this in each
case after a highlighted red box appear
the following words
"Johnson and Johnson has long been a leader in62. On both sides of the box the words "Johnson and Johnson TYLENOL" are depicted with one such side containing the words -
personal care products. Now, we've extended
our range to Over The Counter pharmaceutical
preparations.
We intend to provide the same level of
quality, safety and consistency for these
products.
The first is TYLENOL* paracetamol 500mg.
Suitable for treating all sorts of common
aches and pains, such as headache, toothache,
backache, and for the reduction of fever.
Because it is gentle to the stomach it can be
used by ulcer sufferers and patients on low-
dose aspirin therapy.
TYLENOL* paracetamol is available in both
tablets and new, easy-to-swallow caplets.
TYLENOL* paracetamol tablets and caplets are
packed in child-resistant blister platforms.
The tablets are presented in packs of 12, 24
and 48, the caplets in 12 and 24.
The new caplets are capsule-shaped tablets,
specially designed for those patients who
find tablets difficult to swallow but who
also dislike the aftertaste associated with
gelatin capsules.
TYLENOL* paracetamol. For effective relief
of common aches and pains."
"Johnson and Johnsonat the bottom.
AUSTRALIA PTY LTD
154 Pacific Highway, St Leonards, NSW 2065"
63. The postcards were of two types, both depicting in substance the rectangular presentation located on the Tylenol paper bags.
64. The respondent also caused to be prepared a 30 second television
advertisement to be televised in South Australia in order to
advertise the
Tylenol brand of products.
The Evidence of Pharmacists
65. A succession of pharmacists gave evidence on affidavit and were cross-examined as to their knowledge of the word "Caplets", their understanding of what it means, how they came across the word, whether customers ever asked for "Caplets" by that name and whether they did so in relation to the products Panadol or Panadeine.
66. Although there were marginal differences in this evidence, the substance of it was to the effect that the word was generally understood to refer to a capsule shaped tablet. Most of the pharmacists had been introduced to the word with the launch of the applicant's product. They recognised it as involving a new dosage form of the Panadol range. Many had seen the word only in connection with the applicant's product and some could not recall any products with the word "Caplets" upon them. Most were unaware of the respondent's product prior to giving evidence in the case.
67. Generally it can be said that the understanding as to the word "Caplets"
being capsule shaped tablets related to the applicant's
product. Two
pharmacists deposed that the word had been explained to them. It would seem
rare for a customer to ask for "Caplets"
as a product although in isolated
cases customers had done so, albeit by reference to the applicant's product.
Evidence of Persons in Grocery Industry
68. Evidence was given from persons in the grocery industry. Of this evidence
it suffices to say that the word "Caplets" was generally
understood as
referring to a capsule shaped tablet being a "dosage form". A number of
witnesses associated the word with the applicant's
products. One witness had
seen the word in connection with a product Ester C, a vitamin preparation
which had been sold in health
food stores for a short time.
Survey Evidence
69. Evidence was given under objection of surveys conducted of people in the
pharmaceutical industry, the grocery industry and the
general public. Two of
the surveys were performed by companies carrying on the business of conducting
marketing surveys. One was
conducted by the solicitor for the applicant.
Each involved the asking of three questions:
1. Have you seen or heard the word70. In putting the last question the interviewer was urged to ask probing questions. I accept the evidence given by a number of the professional interviewers who conducted the first two surveys that the "probe questions" were not asked in a leading form but rather were expressed neutrally. No such evidence was given by the solicitor, Mr Willis who conducted the third survey. He was not cross-examined.
"Caplets" before?
(If answered "yes")
2. Can you remember where you have
seen or heard the word "Caplets"
before?
(If answered "yes")
3. Where have you seen or heard the
word "Caplets" before?
71. The evidence in relation to the surveys of people in the pharmaceutical trade and the grocery trade and of the general public was subjected to two main attacks. First it was said that the evidence was inadmissible as hearsay evidence. Second it was attacked on the ground of unreliability having regard to the techniques employed in collecting it. The latter criticism went rather to weight than to admissibility.
72. The development of sophisticated methods of collecting and analysing survey data has brought with it a challenge to the law to reconcile the admissibility of such evidence with the constraints of the hearsay rule. That rule had, as at least one of its bases the objection that evidence so given could not be the subject of cross-examination. Survey evidence was rejected by Bray CJ in Hoban's Glynde Pty Ltd and Ors v Firle Hotel Pty Ltd (1973) 4 SASR 503 at 506-10 and by Franki J in McDonald's System of Australia Pty Ltd v McWilliams Wines Pty Ltd (1979) 28 ALR 236 and by King J in Mobil Oil Corporation v Registrar of Trade Marks (1983) 51 ALR 735.
73. On the other hand it is well established that evidence of an extra curial statement of existing intention is admissible to prove the existence of that intention, for in such cases that evidence is not hearsay but is better regarded as direct evidence of one aspect of conduct which throws light upon the underlying state of mind: Dobson v Morris (1986) 4 NSWLR 681, at 681.8; Re Plumbers v Gasfitters (1987) 72 ALR 415 at 433-5 per Wilcox J and see generally Walton v The Queen [1989] HCA 9; (1989) 63 ALJR 226. Thus it can broadly be said that evidence of a person's response to a question may be admitted if to establish a state of mind of that person (if that be a matter material to be proved) or otherwise if to establish not the truth of the statement made but the fact that it was made.
74. In Shoshana Pty Ltd v 10th Cantanae Pty Ltd (1987) 79 ALR 279 in the
context of proceedings brought under ss.52 and 53(c) of the Trade Practices
Act Burchett J considered the admissibility of
survey evidence showing the
ranking of a television personality, Sue Smith, in a survey of television
personalities. After considering
the above authorities and also what had been
said by Mahon J in Customglass Boats Ltd v Salthouse Brothers Ltd (1976) RPC
589, and in Lego System Aktieselskab v Lego M Lemelstrich Ltd (1983) FSR 155
at 173 (per Falconer J) and Noel Leeming Television Ltd v Noel's Appliance
Centre Ltd (1985) 51 IPR 249 his Honour noted that where not defective, survey
evidence was commonly received in England. His Honour said at 294:
"For myself, I think there is a distinction75. His Honour concluded, that if the survey material had been obtained specifically for the purposes of the applicant's case the evidence would not have been admissible. However I do not understand his Honour to have rejected the possibility of admitting survey evidence obtained specifically for the purposes of the hearing if otherwise admissible.
to be drawn, from that point of view, between
survey evidence obtained specifically for a
case, where the risk of the introduction of
biased questions and methods is greater,
demanding meticulous care if the results are
to be convincing, and the use of survey
evidence (such as is involved in the present
case) obtained for purposes having nothing to
do with the immediate dispute between the
parties to the litigation..."
76. More recently in Ritz Hotel v Charles of the Ritz (1988) 15 NSWLR 158
McLelland J at 178 reviewed the authorities in Australia and elsewhere
relevant to survey evidence. His Honour concluded:
"There is a substantial preponderance of77. His Honour further said at 179 that "evidence of an out-of-court statement by a person is always admissible to show his contemporaneous state of mind or feelings where that is a relevant fact".
authority in support of the proposition that
survey evidence, and expert evidence in
relation thereto, are admissible to prove the
state of mind of the public or a section of
the public on some particular matter, when
that is an issue. However two distinct bases
emerge from the cases in justification of the
admissibility of such evidence. The first is
that although out-of-court statements by
persons interviewed in the course of a survey
as to their impressions or opinions are of a
hearsay nature, the admission of such
statements as evidence of the existence of
those impressions or opinions falls within a
recognised exception to the hearsay rule.
...The second basis is that such statement
are to be treated not as hearsay, but as
original data providing a foundation for
expert evidence as to the state of public
opinion on the matter in question."
78. What was there said was followed by Beaumont J in Trade Practices Commission v Arnotts Ltd (unreported 1 September 1989) where his Honour expressed the view that evidence of the state of mind of a significant section of the public with respect to their future buying habits of biscuits, snack foods, bread and confectionary was relevant to the matter before his Honour and that such evidence could be given by the person conducting the interview.
79. It follows that the present state of the law would confine the admissibility of survey evidence to surveys which show a contemporaneous state of mind or feeling ,subject, of course, to the relevance of that state of mind or feeling to a matter in issue in the case.
80. In my view the state of mind of the public or a substantial section of it as to familiarity with the word "Caplets" does have some relevance to the issues in the case as defined by the pleadings so that regarding the responses to the first question posed, I would be prepared to admit the evidence of interviewers as to the responses given by those surveyed. The third question stands however, in my view, in a different position. It appears to have been designed with a view to determining whether the interviewee had encountered the word "Caplets" (the second question is but consequential). However evidence of where the interviewee had encountered the word "Caplets" goes not to the interviewee's state of mind at all. Rather, if it be relevant at all, it would be evidence of the truth of what the interviewees said, rather than the fact that they had said it. Cf. Walton v. The Queen [1989] HCA 9; (1989) 63 ALJR 226 at 233.
81. While I note the caution of Mason CJ and Deane J in Walton at 229 and 236 that the hearsay rule should not be applied inflexibly, it is for the High Court and not a judge at first instance to set the boundaries of the cases that will or will not fall within it. There is much to be said however for the view that in the twentieth century where important commercial and political considerations are made by reference to market or other surveys conducted in rigidly controlled circumstances, evidence obtained from surveys similarly conducted and for the express purpose of obtaining evidence for the proceedings should be admissible if relevant to a matter in issue. This is particularly so where statistical analysis can confirm that to a specified degree of probability and subject to a specified error rate, the result can be projected to the whole or a defined section of the population. The community might rightly regard evidence from such surveys as more inherently likely to be reliable than evidence which is subjected to cross-examination. They may well regard the rejection of that evidence as, to use the words of Deane J in Walton at 236, confounding justice or common sense and producing "the consequence that the law was unattuned to the circumstances of the society which it exists to serve."
82. The first survey was conducted by an organisation called Research International Australia Pty Limited. Mr Weissenberg, a research director of that company gave evidence and was subjected to considerable cross-examination. He holds graduate and postgraduate degrees in commerce from South African universities, as well as a post graduate diploma in market research and advertising. He is currently a member of the Market Research Society of Australia and has been a member for four years. The company employing him is, he said, part of an international organisation offering custom designed research services.
83. This survey involved a sample of 200 interviewees conducted in 20 different areas of members of the public. One person per household only was to be interviewed. Interviewees were selected from 20 different areas with 10 interviews to be conducted in each area.
84. Mr Weissenberg's evidence was that only 15 per cent of interviewees showed awareness of the word "Caplets". He said in an affidavit that from the results of the randomly selected sample it could be hypothesised that there was a 95 per cent probability that between 10 and 20 per cent of the total population of Sydney aged between 18 and 65 at designated periods could remember having seen or heard the word "Caplets" before. Only 19 of the 200 interviewees stated that they could remember where they had seen the word before.
85. For the respondent, evidence was given by Dr O'Toole, a research psychologist with a Doctorate of Philosophy in Psychology and a Master's Degree of Public Health in Epidemiology, both from the University of Sydney. Dr O'Toole is presently lecturer in epidemiology in the Department of Community Medicine at Sydney University based at Westmead Hospital. Dr O'Toole has worked as a professional survey statistician since 1979 carrying out surveys in government, hospital and academic health matters and has published articles on survey methods. His credentials are impeccable.
86. Dr O'Toole's first criticism of the survey evidence went to the sampling
techniques involved. In his view it was only if a "probability
sample" were
used that useful predictions could be made from survey data. A probability
sample is one in which there is a "known
non-zero chance of selection of
subjects" from those who would be eligible. The method used by Mr Weissenberg
which Mr Weissenberg
referred to as quota sampling did not involve probability
sampling. In his affidavit Dr O'Toole said:
"Interviewers were permitted to draw theirThe matters set out above were elaborated upon by Dr O'Toole in his oral evidence.
own areas and their own start points for
doorknocking, quotas were required and no
response rates appear to have been reported.
This survey therefore violates probability
sampling and statistical inference methods
therefore are strictly inapplicable to the
responses. In particular it is important to
know how the areas were selected, how the
start point within the area was selected, how
many households were selected and approached,
how many households did not respond, how an
individual was selected from within a
household, how many individuals did not
respond to the survey. I disagree with the
deponent's statement at paragraph 10 that the
'sampling procedure was designed to produce
an unbiased sample of the population of
Sydney' and believe that the survey is of
unknown and unknowable bias. Again, rather
than interviewers not exercising 'their own
discretion as to whether to approach a
certain household' (para 12), the entire
sample was at the discretion of the
interviewers and as such represents merely a
sample of convenience."
87. Mr Weissenberg did not agree with Dr O'Toole's analysis. In his view, use of the sampling technique he adopted permitted him to be confident within the range suggested that the kind of answers obtained reflected the views of the wider community of the population 18 to 65 residing in Sydney.
88. Similar criticisms were made by Dr O'Toole of the evidence of Kathryn Elizabeth Adams, who conducted the grocery survey. Ms Adams adopted a view similar to Mr Weissenberg.
89. A second criticism made by Dr O'Toole went to the discretion given to interviewers to select substituted interviewees in the event of a refusal to be interviewed or not being otherwise available or in the case of businesses, if the businesses chosen for interview had closed. This too was, I accept, a matter going to the statistical accuracy of prediction.
90. It seems that many commercial surveys undertaken and upon which decisions of a marketing kind are made are not conducted with the strictness of which Dr O'Toole would approve. No doubt as Dr O'Toole observed, it is not statistically possible to quantify the percentage error involved once there is a departure from strict probability samples although I doubt if the result of this is to say that no useful purpose is gained from such surveys.
91. I am satisfied that some, although limited use could be made of the survey material as indicating, certainly not with strict mathematical accuracy, that a relatively small number of persons in the three categories sampled, the consumer, the pharmaceutical and grocery industries had come across the word "Caplets" at all in New South Wales.
92. However, it does not seem to me that this evidence is of great assistance in the resolution of the three issues before me. It could have been relevant to the argument under s.56 of the Act abandoned by the respondent and be seen to have supported the applicant's case under this section. But having regard to the concession made by the respondent in withdrawing this argument viz. "no submission is put that there has been sufficient use of the word in Australia by persons other than the applicant in relation to goods of the same description for the purposes of the application of s.56", I do not find it necessary to rely upon the survey evidence adduced in reaching the conclusions ultimately to be drawn on the three remaining issues.
93. The evidence of Ms Adams can be therefore shortly dealt with so far as it relates to the first question.
94. Ms Adams is a Project Director employed by Reark Research Pty Limited, a company specialising in research. She holds a Bachelor of Commerce (Marketing) from the University of New South Wales and is a member of the Market Research Society of Australia as well as being a member of the Marketing Graduates Association of the University of New South Wales.
95. According to the research conducted by her organisation, of the persons involved in the grocery trade surveyed, only 18 per cent reported awareness of the word "Caplets". There were 111 persons sampled. She concludes that there is a 95 per cent probability that between 74 per cent and 90 per cent of all grocery and supermarket managers or duty managers or owners in Sydney between 19 April and 23 April 1990 would not have seen or heard the word "Caplets" before.
96. As I have already indicated, the statistical basis of this conclusion having regard to the methodology adopted was severely criticised by Dr O'Toole and I accept his criticisms if what is required is to be able to say with certainty within defined limits the statistical probability of such an outcome. Nevertheless, as I have already indicated, I am satisfied that some limited uses for purposes of prediction could still be made of this evidence if ultimately it proved to be relevant to an issue in the case. At the end of the day I have not found it of assistance or relied upon it.
97. Finally there is the evidence of Mr Willis. Mr Willis was a solicitor and not a person qualified to conduct market surveys. It does not seem to me that because a survey is conducted by an unqualified person that it is for that reason alone inadmissible. The weight if any to be given to it having regard to the methodology used is, of course, another matter.
98. Mr Willis approached 50 persons employed in the pharmaceutical industry. Ten refused to be surveyed and of the 40 who accepted 26 had heard of the word "Caplets". Mr Willis did not otherwise seek to draw statistical conclusions. Since the methodology adopted by Mr Willis is far from clear I do not think that much, if any, weight could be placed on the results of the survey he conducted.
99. I have, I fear, dealt rather briefly and perhaps inadequately, with the
survey evidence. The evidence of Dr O'Toole, whose criticisms
were more
extensive and detailed than the above outline suggests and the evidence of Mr
Weissenberg and Ms Adams occupied a considerable
amount of the time taken up
by the trial. I have done far from justice to Dr O'Toole or for that matter
Mr Weissenberg and Ms Adams
in the methodological argument involved. Those
matters may well in another case be of critical significance. But since at
the end
of the day little attention in argument was given to the relevance of
the survey evidence and since the issues seem to me not to
be affected one way
or the other by it, it need not detain us further.
The Veterinary Evidence
100. Evidence was given by persons in the veterinary pharmaceutical industry,
including a Miss K Hedberg who was a veterinary surgeon.
It seems that a
number of veterinary products are produced in the form of capsule shaped
tablets. Trizine 480, an antibiotic, is
a product which uses the word
"Caplets" although as the product is not for human use, this use of the word
would not infringe the
applicant's mark. That product has been on the market
six to eight years. Miss Hedberg was aware of no other capsule shaped tablet
in connection with which the word "Caplets" was used. When she dispensed the
product she referred in her instructions to clients
to it by brand name e.g.
Trizine and by dosage rate, the expression of which she abbreviated from
"tablets" to "tabs". The label
she attaches to the product given to the
client contains the words "For animal use only". Apparently there is some
illegal use in
the country of Trizine 480 whereby the product is dispensed for
human use but the respondent placed no reliance on this.
Evidence of Use of the Word "Caplets" in Literature
101. Evidence was given for the respondent, subject to objection by the applicant, of use of the word "Caplets" in overseas data bases capable of access in Australia although it was agreed that no evidence was advanced that persons in Australia actually access that word. To the extent that this evidence illustrates that the word "Caplets" is capable of being used in a descriptive way, it is in my view admissible. So much was in any event admitted by the applicant so the evidence adds nothing to the admission. To the extent that this evidence was adduced to establish the usage of the word in Australia I would have rejected it. Even if strictly admissible on the basis I have suggested, this evidence does not in my view prove anything about the usage or meaning of the word in Australia. The word is admittedly a made up word. It appears in no standard dictionary of English or Australian usage. If it be the fact that the word is understood generically in the United States as would seem to be the case that tells us nothing about the meaning, if any, of the word in Australia. Many words, generally brand names have meanings in one country which differ in another. It was common in Australia once to refer to a brand of adhesive tape by its brand name. The word used had quite another connotation in the United States]
102. The same can be said of the tender, subject to objection, of a range of products available in the United States on which the word "Caplets" appears. To the extent that the packaging of these products shows the capacity of the word "Caplets" to be used in a descriptive sense it is admissible and I do not reject the tender. It however does not, for the reasons I have indicated, prove the usage of the word in Australia nor does it assist in the resolution of the issue whether both the applicant and the respondent have in the sale and advertising in Australia of their respective products of paracetamol used the word "Caplets" as a trade mark.
103. It is interesting to note that in Westinghouse Electric Corporation v Thermopart Pty Ltd (1968) WAR 39 Wolff CJ of the Supreme Court of Western Australia in considering whether the word "Laundromat" had achieved any generic significance in Australia expressly refused to take into account the situation in the United States of America where the evidence apparently suggested that the word might be on its way into the language, but concentrated on the Australian evidence which showed with the word "Laundromat" what the evidence in the present case of Australian usage also shows viz, that some persons may use the word in a general sense but that the word has not achieved anything like a generic meaning.
104. Evidence was also tendered by the respondent on the use of the word
"Caplets" in a number of situations including medical publications,
particularly catalogues of available medicines and the use by the applicant in
order forms where the word "Caplets" appeared after
the name Panadol or
Panadeine as the case may be, suggesting so it was said "a dosage form".
There was evidence also of usage in
articles where the word was used to
suggest a form of tablet rather than necessarily the applicant's product when
that was being
described. I find it unnecessary to set out here details of
this evidence. Much of it was equivocal. It shows, as is accepted,
that the
word is one capable of being used to describe a particular shaped dosage form.
It does not, however, assist in the resolution
of the first and second issues
which I have defined and as will be seen, does not conclude the resolution of
the third issue. In
the submissions of counsel, little or no use was sought
to be made of this material save as suggesting that the word "Caplets" was
"descriptive". To the relevance of that I will return. The Law
Whether the Applicant has used the Mark "Caplets" in the Continuous Period of
Three Years ending on 20 September 1989
105. At issue between the parties was not whether the word "Caplets" has been used as such by the applicant during the relevant period. Rather the respondent submitted that the applicant had not used the word "Caplets" as a trade mark in that period.
106. It was common ground between the parties that when s.23(1)(b) referred to the use of the trade mark that use had to be use of the mark as a trade mark: W D and H O Wills (Australia) Pty Ltd v Rothmans Ltd [1956] HCA 15; (1956) 94 CLR 182 at 191; New South Wales Dairy Corporation v Murray Goulburn Co-operative Company Ltd (1989) 14 IPR 26 at 44 (per Gummow J at first instance and not disturbed on appeal in Murray Goulburn Co-operative Company Ltd v New South Wales Dairy Corporation (unreported) Full Federal Court 12 February 1990. This being accepted therefore, the issue between the parties is whether the applicant's use of the word "Caplets" in the relevant period was a use as a trade mark.
107. Section 23(1) provides relevantly:
"(1) Subject to this section and to section108. The respondent concedes that, if the relevant use was as a trade mark, it was used in good faith by the applicant.
93, a prescribed court or the Registrar may,
on application by a person aggrieved, order a
trade mark to be removed from the Register in
respect of any of the goods or services in
respect of which it is registered, on the
ground -
(a)...
(b) that, up to 1 month before
the date of the application, a
continuous period of not less than
3 years had elapsed during which
the trade mark was a registered
trade mark and during which there
was no use in good faith of the
trade mark in relation to those
goods or services by the
registered proprietor or a
registered user of the trade mark
for the time being."
109. The expression "trade mark" is defined in s.6(1) of the Act to mean
relevantly:
(a) ... a mark used or proposed to be used110. In turn, the expression "mark" is defined as including:
in relation to goods ...for the purpose
of indicating, or so as to indicate, a
connection in the course of trade
between the goods ...and a person who
has the right, either as proprietor or
as registered user, to use the mark,
whether with or without an indication
of the identity of the person; ..."
"a device, brand, heading, label,111. In the Shell Co v Esso Standard Oil (Australia) Ltd [1963] HCA 66; (1961) 109 CLR 407, the plaintiff was the proprietor of trade marks being a caricature of a man formed from the representation of a drop of fluid, that mark being registered in respect of products for lubricating, heating and illuminating and power generation purposes. The defendant in the course of its advertising its oil products produced films in which appeared an animation of an oil droplet as a cartoon character. The plaintiff took proceedings against the defendant for infringement. In the Full Court Kitto J, with whose reasons Dixon CJ and Owen J agreed, found there to be no infringement. It would seem that Taylor J may also have agreed with the reasons of Kitto J.
ticket, name, signature, work, letter
or numeral, or any combination thereof;"
112. At 422 his Honour said:
"A use of a mark in an advertisement of113. Later in the judgment at 425 his Honour said:
goods is a use in the course of trade,
and is of course a use in relation to
the goods advertised... But in my
opinion it is implied both in s.58(1)
and in s.62(1) that the use which is
there referred to is limited to a use
of a mark as a trade mark."
With the aid of the definition of114. In considering this question his Honour paid particular regard on the facts of the case to the purpose of the use of the animated figure to convey a message about the qualities of Shell petrol. In his Honour's opinion a viewer of the film would never infer that every one of the forms which the figure took was a mark "chosen to serve the specific purpose of branding petrol in reference to its origin."
'trade mark' in s.6 of the Act, the
adverbial expression may be expanded so
that the question becomes whether, in
the setting in which the particular
pictures referred to were presented,
they would have appeared to the
television viewer as possessing the
character of devices, or brands, which
the appellant was using or proposing to
use in relation to petrol for the
purpose of indicating, or so as to
indicate, a connexion in the course of
trade between the petrol and the
appellant. Did they appear to be
thrown on to the screen as being marks
for distinguishing Shell petrol from
other petrol in the course of trade?"
115. It is clear from his Honour's judgment that an important factor in concluding that the animated character was not used as a mark was the context in which the figure appeared in the film. It was this that permitted conclusions to be drawn as to the "purpose and nature of the use" of the figure being to convey a message that the chemical composition of Shell petrol gave it advantages over its rivals.
116. Strong reliance was placed by the respondent on this judgment. It was submitted that particular attention must be given to the context in which the word "Caplets" appears on the products in question. The test was said to be whether the use of the word in its context would appear to a person looking at it to be use for the purpose of distinguishing or so as to distinguish the applicant's analgesics from other analgesics in the course of trade. The fact that the word "Caplets" was not well known or used in ordinary language in Australia was not determinative of whether it was used as a trade mark. It was pointed out that the applicant did not use the word "Caplets" alone but rather has always used the word in a sense that was descriptive. It was said that the applicant's use of the word in combination with the brand name "Panadol" or "Panadeine" rendered it effectively impossible or at least unlikely for the word to acquire a distinctiveness of its own.
117. It was further submitted that evidence of usage of the word "Caplets"
both within and outside Australia and evidence of witnesses
as to their
understanding of what the word means either divorced from context or in the
context of the applicant's packaging assists
in the question whether the word
as used by the applicant was used as a trade mark. It was said that this
evidence was relevant
to the resolution of the question whether the respondent
had used the word "Caplets" as a trade mark. This evidence established,
so it
was submitted:
(a) That the word is capable of118. As a matter of principle, if the word "Caplets" were an ordinary English word it is difficult to see why evidence of its meaning should be any more admissible than would evidence of the meaning of an ordinary English word to aid statutory construction: Marquis Camden v Commissioners of Inland Revenue (1914) 1 KB 641; Australian Gas Light Co v The Valuer General (1940) 40 SR 126 at 137 but see NSW Associated Blue Metal Quarries Ltd v Federal Commissioner of Taxation (1956) 94 CLR 509 where evidence of the meaning of the word "mining" was admitted. Evidence of trade usage, is of course another matter: Unwin v Hanson (1891) 2 QB 115; General Accident Fire and Life Assurance Corporation Ltd v Commissioner of Pay-Roll Tax (NSW) (1982) 2 NSWLR 52; Herbert Adams Pty Ltd v Federal Commissioner of Taxation [1932] HCA 27; (1932) 47 CLR 222.
conveying some meaning.
(b) That the word in the context in
question is capable of conveying some
meaning.
(c) That some people in Australia
understood what the word means.
(d) That some people in Australia
understood what the word in the context
in question means.
(e) The ease with which an
understanding of the word is gained.
(f) The ease with which
understanding of the word in the
context in question is gained.
119. In the present case it is not contended that the word "Caplets" has yet passed into the English language. It appears in no dictionary and in so far as it may be relevant the word had no meaning at all to me prior to the commencement of the case. If pressed, I would, inaccurately so the respondent would say, have drawn to mind a small capsule, rather than a capsule shaped tablet.
120. Where, as here, it is the case of the respondent that both the applicant and the respondent use the word "Caplets" not as a mark but "descriptively" that is to say as describing a tablet having a special shape being that of a capsule, evidence of usage of the word, at least in Australia, whether by the applicant or others would be relevant on the question whether the word is capable of being used descriptively. This is so even if such evidence is not strictly admissible to the ordinary English meaning of the word if there be one. To this extent it seems to me that this evidence was relevant and admissible.
121. In my view, however, evidence of witnesses, whether those witnesses are members of the public or persons in the grocery or pharmaceutical trade as to whether a use, be it by the applicant or the respondent of the word "Caplets" on particular packaging is descriptive, is not admissible. In cross-examination I permitted, subject to an objection as to relevance, counsel for the respondent to ask a number of pharmacists who were shown the respective packaging of the applicant's or the respondent's products whether the word "Caplets" was used on that packaging as indicating a dosage form of the particular product. Some witnesses were shown a Tylenol packet and asked what they understood the word "Caplets" on the label to refer to.
122. This evidence contains two related vices, namely that it asks the witness to interpret and thus give his or her understanding of the label on the packaging, and further, that it requires the witnesses to give their opinion on the very matter that the court must decide. Accordingly, I would reject the answers given by Mr R. Rollings, Mr R. Austec, Mr J. Bryant, Mr R. Stenlake, Mr P. Sinclair, Mrs Bainbridge, Mr Wilson, Mr Hill and Mr Lowe to question posed by reference to particular packaging.
123. On the other hand, evidence of witnesses as to their understanding of the meaning of the word "Caplets" without reference to the particular packaging is of some, albeit limited assistance in coming to a conclusion as to whether the word, as used by the applicant or the respondent is used as a trade mark.
124. For the respondent it was submitted that the whole of the evidence of
the kind to which I have already referred is admissible.
The decision of
Dixon CJ in Mark Foy's Ltd v Davies Coop and Co Ltd [1956] HCA 41; (1956) 95 CLR 190 at 195
was cited in support. In that case the relevant mark was "Tub happy". The
submission was that the words meant "washable",
a meaning which his Honour
thought it was necessary to suggest and not one that sprang unaided to the
mind. His Honour said:
"But if the claim is that the words125. In J B Stone and Co Ltd v Steelace Manufacturing Co Ltd (1929) 46 RPC 406 (the "alligator pattern" case) evidence was adduced from trade witnesses, presumably as to the understanding in the trade of the meaning of the words "alligator pattern". In F H Faulding and Co Ltd v Imperial Chemical Industries of Australia and New Zealand Ltd [1965] HCA 72; (1964-5) 112 CLR 537 evidence of extracts of medical works and articles was adduced to show that readers with no technical training understood the words "barrier cream" to relate to a class of protective cream. Evidence of a dermatological expert to the same effect was also relied upon. I note from the judgment of McTiernan J at 545 that at least three witnesses were shown the package and asked to describe it as if ordering. That however may be different from asking the witness about his or her understanding of the use of a word on a particular packet. Evidence was also given by pharmacists to the effect that the words "barrier cream" did not connote the plaintiff's product but simply a particular type of protective cream. That evidence was, it would seem, not evidence relating to the use of the words on a particular product but the meaning and use of the words generally. Evidence of the meaning of the words "barrier cream" in the trade was also accepted (see at 548). In Saville Perfumery Ltd v June Perfect Ltd (1941) 58 RPC 147 evidence was admitted from persons engaged in the perfumery and toiletry trades that the word "June" when applied to perfumes and face powders and the like indicated an article made by the plaintiffs. In De Cordova v Vick Chemical Co (1951) 68 RPC 103 the evidence adverted to by the Privy Council was of trade and public usage of the expression "Vicks Vapo Rub" as indicating the salve or ointment made by the plaintiff.
possess a meaning which courts might
not be expected to know, it would have
been easy enough to adduce evidence of
the meaning;"
126. These cases make it quite clear that evidence of the kind here tendered with the exception of that related to the construction of the packaging itself, is admissible and can be relevant. I propose accordingly to admit it, except as otherwise stated in the judgment.
127. It seems to me that the issue of whether the applicant has used the word
"Caplets" as a trade mark, like the corresponding issue
of whether the
respondent's use of the word was as a trade mark is a matter upon which the
Judge must make up his or her own mind
and which, in the language of Lord
Evershed MR in Electrolux Ltd v Electrix Ltd and Anor (1953) 71 RPC 23 at 31
(albeit in the context of the issue of confusion):
"...he and he alone, must decide. He cannot,128. The evidence of usage does establish that:
as it is said, abdicate the decision in that
matter to witnesses before him. On the other
hand, equally it
is true that he must be guided in all these
matters by the evidence before him."
1. The word "Caplets" is capable of129. The evidence establishes also that, among persons who have encountered the word, usually in connection with the applicant's product, the word may thereafter be used in a sense that describes the shape of a tablet, a use which the word clearly and admittedly is capable of possessing.
conveying some meaning at least to
those who have once encountered it;
2. Some people in Australia
understood what the word meant;
3. That understanding of the word is
easily gained;
4. The word has not, however, passed
into the language as a generic term and
indeed has no settled meaning.
130. Turning now to the first issue, it will have been observed that the definition of "trade mark" refers to the mark being used in relation to goods for a particular purpose or so as to indicate a particular connection. That raises an issue as to whether the court can take into account the subjective purpose of the applicant or whether the sole test of whether a mark is a trade mark is the fact that it does indicate the relevant connection between the goods and the owner of the mark or registered user. If subjective purpose be relevant there is no doubt on the evidence and I so find that the applicant had, at least in the relevant three year period coinciding with the launch of Panadol Caplets on the market under the present label, the subjective purpose of using the word "Caplets" as a trade mark as illustrated by the particular care they went about in ensuring that the word was not used generically.
131. The present definition of "trade mark" in s.6(1) arose, it would seem, from the amendment to the corresponding definition in s.3(1) of the Trade Marks Act 1905 (UK) following the decision of the House of Lords in Bass Ratcliff and Gretton Ltd v Nicholson and Sons Ltd (1932) AC 130. In that case the respondent applied for registration of a mark representing a triangle with the letter "N" which was granted. The appellant had registered a trade mark consisting of the word "Triangle" also in respect of beer. The appellant opposed the respondent's application and the respondent sought to have the appellant's mark expunged.
132. The 1905 United Kingdom Act defined "trade mark" as meaning a mark "used or proposed to be used upon or in connexion with goods for the purpose of indicating that they are the goods of the proprietor of such trade mark by virtue of manufacture, selection, certification, dealing with or offering for sale." (emphasis added)
133. It was argued, inter alia, that the mark was not used for the purpose of
indicating the proprietorship of the owners of the
mark. It was said that
something more than a purpose in the use of the mark was required to establish
it as a trade mark. This
"extra" requirement, it was submitted, was
ordinarily the mark's acceptance by the public. Lord Buckmaster concluded at
139 that
the purpose mentioned in the statute could be shown independently of
evidence that it was so accepted by the public although such
evidence would
naturally be of assistance in establishing the purpose. Lord Warrington at
144 said:
"The appellants contend that the only134. Lord Russell said at 151:
purpose in the minds of the brewers was
to indicate the quality of the beer
supplied in the barrels... In fact,
however, the mark as used did indicate
that the beer contained in the barrels
on which it was marked was beer brewed
by Messrs Nicholson, and in my opinion
it makes no difference that it further
indicated that it was their beer of a
particular quality."
"But a quality mark which is peculiar135. Lord Macmillan at 155 said:
to one manufacturer (as is the case
here) necessarily denotes a particular
quality of the goods of that particular
manufacturer, and therefore necessarily
denotes origin, and is therefore
necessarily used upon or in connection
with goods not only as a quality mark
but also for the purpose of indicating
that the goods are the goods of the
proprietor of the mark."
"When the Act requires that a mark toFrom the objective facts of the case his Lordship concluded that the mark was used for the relevant purpose.
be qualified for registration as a
trade mark must have been used 'for the
purpose of indicating' the origin of
the goods in connection with which it
is used, I do not think that any
deliberate resolution to that effect on
the part of the user of the mark is
contemplated. It is enough if in
practice the mark has been so used as
to denote the origin of the goods. I do
not think that it is essential to prove
in addition, as Lord Esher suggests,
that the market has accepted it as a
distinguishing mark...although such
evidence may be valuable in fortification."
136. It will be seen from the above extracts that as the law then stood, the proper test to be applied to determine purpose was unclear. Some of the above comments would support the view that subjective purpose was relevant to the issue. Some of the statements are capable of supporting the view that evidence of actual use as a trade mark allows purpose to be inferred. The distinction between "purpose", subjective and objective and motive is discussed in a somewhat different context in Magna Alloys and Research Pty Ltd v Federal Commissioner of Taxation [1980] FCA 150; (1980) 33 ALR 213 at 222-5.
137. The Goschen Departmental Committee in 1934 in its report recommended that the definition be amended to the present formulation in the alternative of purpose or actual effect of the use. Prima facie, such a formulation would suggest that there were two alternative ways that a mark could be shown to have been used as a trade mark. First where actual purpose is shown and second where objectively the mark is used as a mark irrespective of purpose. While on the whole that construction would appear correct, I would wish to reserve for further consideration the case where a person had a subjective purpose to use a mark so as to indicate the requisite connection but failed so to do. The present is not such a case.
138. The evidence in the present case of the intricate care taken by the applicant to draft the label so as to avoid the use of the word "Caplets" in a purely descriptive or generic sense makes it clear as a matter of fact that the applicant had a subjective purpose to use the mark "Caplets" in such a way as to indicate the requisite connection between its analgesic tablets and itself, so that if subjective purpose alone be enough the applicant should succeed.
139. However, I am of the view that the applicant has succeeded in its purpose and has so used the word as to indicate the necessary connection. That connection can, in the language of the cases be summarised in the words of Viscount Maugham, with whom Lord Russell of Killowen and Lord Romer agreed, in Saville Perfumery Ltd v. June Perfect Ltd (1941) 58 RPC 147 at 174 as "indicating any origin". See too the judgment in the Yeast-Vite case - Irvings' Yeast-Vite Ltd v F A Horsenail (1934) 51 RPC 110 at 115, quoted with approval by Williams J in Mark Foy's Ltd v Davies Coop and Co Ltd [1956] HCA 41; (1956) 95 CLR 190 at 203.
140. The submission of the respondent that the word "Caplets" is used "as a descriptor" contains within it the hidden premise that a mark cannot be used as a trade mark if it is also used in a descriptive way. That premise is incorrect both as a matter of construction of the Act and as a matter of authority.
141. The Act indeed assumes by s.64(1)(b) that a mark which is "a description of the character or quality" of a trader's goods may be an infringement of a trade mark under s.58 of the Act but nevertheless is deemed, notwithstanding s.58, not to constitute an infringement by force of s.64(1)(b). There would be no point to s.64(1)(b) if the use of a descriptor were not use of a mark as a trade mark.
142. The word "Caplets", like the word "Vapo Rub" considered by the Privy Council in De Cordova v Vick Chemical Co (1951) 68 RPC 103 at 107, clearly has a descriptive element. It is obviously an amalgam of two ordinary English words, "capsule" and "tablet", and was no doubt chosen for the purpose of suggesting to the reader the characteristics of the tablets contained in the applicant's packaged products.
143. It is true that the word has a capacity to pass into the language as a generic word, but it has not so far done so. Indeed one might infer that both the applicant and the respondent placed drawings of a capsule shaped tablet on their packaging so as to aid the understanding of the reader as to what was to be found in the packet. However, a person seeing the applicant's packet and the drawing upon it would, in my opinion understand the word "Caplets" to refer to the capsule shaped tablets in the box that is to say the product manufactured by Winthrop Laboratories, a division of the applicant: cf Westinghouse Electric Corporation v Thermopart Pty Ltd (1968) WAR 39 at 51.
144. Nor does it assist the respondent to refer to the word "Caplets" as indicating a particular dosage form of paracetamol. That is self evident but it does not prevent the applicant's use of word being a trade mark use. A comparison of the packaging of the applicant's Panadol Tablets, Panadol Capsules and Panadol Caplets, all approximately the same shape and on each of which (albeit in different colour combinations) the words Tablets, Capsules and Caplets* appear in the same position and in the same size black print, lends superficial assistance to the respondent's submission. However the word "Caplets" still signifies to the objective observer that there is a connection between the word "Caplets", the goods in the package and the trade origin of these goods, the applicant. It is, in my opinion, use of the word as a trade mark.
145. It follows that I would find for the applicant on the first issue.
2. Whether the Respondent's use of the Word "Caplets" is an infringing
use (save for Section 64(1)(b)
146. Section 58(1) of the Act provides that a registered trade mark if valid
(there is no issue as to the validity of the applicant's
trade mark) confers
upon the registered proprietor of that mark:
"the right to the exclusive use of the147. Section 62(1) of the Act explains what is meant by infringement. It provides:
trade mark in relation to the goods or
services in respect of which the trade
mark is registered and to obtain relief
in respect of infringement of the trade
mark..."
"A registered trade mark is infringed148. We are not in the present case concerned with the body of law in which the question whether a particular use of a mark is substantially identical with or deceptively similar to another mark has been considered. Here the respondent's use of the mark on its packaging and in its promotional literature is the use of the same word "Caplets" although the word is also used in the singular.
by a person who, not being the
registered proprietor of the mark or a
registered user ...uses a mark which is
substantially identical with, or
deceptively similar to, the trade mark,
in the course of trade, in relation to
goods or services in respect of which
the trade mark is registered."
149. It will be observed that for there to be an infringement it will not be sufficient that the respondent has used the word "Caplets" in the course of trade, even in relation to goods. It is necessary that the use to be an infringement be use of the word as a trade mark: Mark Foy's Ltd v Davies Coop and Co Ltd [1956] HCA 41; (1956) 95 CLR 190 at 202, 204; The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (supra) at 414, 422 ff.
150. So much was common ground. Thus the second issue that arises for decision may be reduced to the question whether the respondent on its packaging or advertising or both used the word "Caplets" as a trade mark, that is to say as signifying a connection between the relevant goods, the respondent's Tylenol capsule shaped tablets and the respondent.
151. Much that I have already said is as relevant to this second issue as it is to the first. In particular, it can be said that the fact that the respondent has used the word "Caplets" as "a descriptor" will not be determinative of the issue.
152. To the extent that subjective purpose be relevant to the issue, it may be inferred that the respondent hoped that its use would not be use as a mark although it is clear enough that that decision to use the word was made with knowledge of the registration of the applicant's mark and through the advice of the Australian patent attorney with an awareness of the strength of the applicant's position and with a preparedness to take the consequences whatever they may have ultimately turned out to be. It is, however, the actual use of the mark which at the end of the day is determinative of the issue. This in my opinion can best be determined by considering the package of the respondent's Tylenol product.
153. The question is more difficult to resolve than the question whether the applicant's use on its packaging was as a trade mark for the reason that the respondent has sought by means of the language on the packet to make it appear that the word "Caplets", particularly in the singular is used descriptively.
154. The words and figures "24 caplets" appearing on the front and side panels seem however to me to perform the same work for the product inside the box as those words perform in relation to the applicant's product. They identify the word "Caplets" with the product on the box and with the manufacturer Johnson and Johnson. It is true that on the front cover, for example, in small print appear the words "Each caplet contains Paracetamol 500 mg". This, the respondent submitted, showed the word in the singular used as a noun and as descriptive of the dosage form. The same comments were made in respect of the material on the back of the packet.
155. I accept without question the respondent's submission that the whole of the packet must be examined, as all of it is relevant to the respondent's use and as showing the "context" of that use. I have taken the whole packet into account. However I am left with the clear view that the word "caplets" or "caplet" as used by the respondent does indicate a connection between the relevant goods, i.e. the respondent's tablet in the package and the respondent as manufacturer of them and as named on the package.
156. Such use is use as a trade mark.
157. I should here note two submissions made in the course of argument.
First, the applicant submitted that once it is shown that
the applicant is the
registered proprietor of the mark "Caplets" and that there has been use of the
mark by the respondent to refer
to their own goods there will be an infringing
use. Put in another way proof of use of a mark on packaging to refer to the
contents
of a packet establishes prima facie an infringing use. Absent a
finding that the word is a generic word (and it clearly has not
become so in
Australia) there is nothing to displace this prima facie infringement. Later
in the applicant's written submissions
this proposition was stated even more
baldly in the following terms:
"It is submitted that if a trader158. It was of course not in dispute that the mere fact that the mark Tylenol appeared before the word "Caplets" had no effect on the outcome; cf per Williams J in Mark Foy's Ltd v Davies Coop and Co Ltd [1956] HCA 41; (1956) 95 CLR 190 at 205.
refers to his goods simply by the
registered trade mark of another trader
then he infringes the trade mark."
159. The applicant's submission in my opinion may overstate the position in its favour. Leaving to one side the question of shifting onus as used in a tactical sense, the applicant bears the burden of showing that there has been an infringement in the statutory sense. To show infringement it must be shown that the mark is used in the sense already discussed as a trade mark. Ordinarily, no issue of onus as such will be involved in this issue. It will be but a matter of examining the respondent's use of the mark to determine whether that use is use as a trade mark. Such use will be established where it can be seen that the mark as used establishes the necessary connection between the respondent's goods and the respondent. Use of a mark to refer to a particular product which is identified as the respondent's product would usually provide the requisite connection and does do so in the present case. However I do not find it necessary to adopt such a general proposition as that advanced by the applicant to resolve the present case.
160. The second submission to which I should make reference was one advanced by the respondent. It was submitted that the issue of infringement should be approached by asking whether the word "Caplets" in its context would appear to a person looking at it to be: "use for the purpose of distinguishing or so as to distinguish J and J analgesics from other analgesics in the course of trade".
161. In support of this submission reference was made to the Shell case
(supra) at 425 where Kitto J, referring to the animated character
conveying a
message about the qualities of Shell petrol said:
"This fact makes it, I think, quite162. While no doubt it will be relevant to the question whether a mark is used as a trade mark that it distinguishes the product of the user from that of others in that use of a trade mark involves branding the goods as having a trade origin with the manufacturer, it does not follow as was in fact pointed out in later submission that for there to be an infringement by the respondent, the respondent's use of the word "Caplets" must "necessarily" evoke in any section of the public a connection between the word and Panadol or its maker. On the evidence it would seem that no person seeing the respondent's packaging or advertising would draw a connection between the Tylenol product and the Panadol product and this is not surprising since each was clearly marked with the name Tylenol or Panadol/Panadeine as the case may be with the name of the respective manufacturer, Johnson and Johnson or Winthrop.
certain that no viewer would ever pick
out any of the individual scenes in
which the man resembles the
respondent's trade marks... and say to
himself: 'There I see something that
the Shell people are showing me as
being a mark by which I may know that
any petrol in relation to which I see
it used is theirs.'"
163. Such a matter would no doubt be relevant to a cause of action in passing off or under s.52 of the Trade Practices Act 1974 but the applicant disavowed any such cause of action.
164. The cases make clear that there is no necessary relationship between an action for infringement of a trade mark and an action in passing off: J B Stone and Co Ltd v Steelace Manufacturing Co Ltd (the alligator pattern case) (supra) at 412 per Lord Hanworth MR, at 416 per Lawrence LJ; Saville Perfumery Ltd v June Perfect Ltd (1941) 58 RPC 147 at 161-2 per Sir Wilfrid Greene MR, and at 174 per Viscount Maugham.
165. In Mark Foy's Ltd v Davies Coop and Co Ltd (supra) at 205, Williams J,
although not referring directly to the law of passing
off, referred to the
statement of Lord Greene MR in Saville Perfumery Ltd v June Perfect Ltd (1941)
58 RPC 147 at 161 that:
"In an infringement action, once it is166. Put shortly, as Williams J observed at 205: "Needless to say, if the defendant uses the words of the plaintiff's trade mark as indicating origin it is still an infringement notwithstanding that the defendant always adds his own name." See too in this context Caterpillar Loader Hire (Holdings) Pty Ltd v Caterpillar Tractor Co [1983] FCA 145; (1983) 1 IPR 265 at 267-8 per Franki J.
found that the defendant's mark is used
as a trade mark, the fact that he makes
it clear that the commercial origin of
the goods indicated by the trade mark
is some business other than that of the
plaintiff avails him nothing, since
infringement consists in using the mark
as a trade mark, that is, as indicating
origin."
167. In J B Stone and Co Ltd v Steelace Manufacturing Co (supra) (the
alligator pattern case) Lawrence LJ expressed the legislative
purpose of s.44
of the Trade Marks Act 1905 (the equivalent to s.64(1)(b) of the Australian
Act) as being:
"...to safeguard traders in cases where168. It had been argued that the reference to "Alligator Pattern" merely indicated a type of goods which were to be brought upon the market and accordingly the equivalent section to s.64(1)(b) had the consequence that there was no infringement. In rejecting this argument Slesser LJ remarked at 420:
the registered trade mark consisted of
more or less descriptive words forming
part of the ordinary English language,
without the use of which other traders
would find some difficulty in
describing certain qualities of their
goods; but was never intended and does
not operate to enable a trader to make
use of a rival trader's registered
trade mark consisting of a fancy word
having no reference to the character
and quality of the goods in order more
readily to sell his own goods." (at
417) (emphasis added)
"Here admittedly, on the face of it,169. Somewhat similar comments could fairly be applied in the present case to the use of the word "Caplets".
the word "Alligator" is a peculiar
artificial word used to describe the
Plaintiff's goods. I am impressed by
this fact, if the contention...were
right, that the gradual growth of the
use of a descriptive name of that sort,
not a name of general description but
an artificial description, were to
produce such a generality as to destroy
a Trade Mark, the owner of every
registered Trade Mark would be in this
peril, that the more popular and the
more frequent became the use of his
goods, and consequently his Trade Mark,
the easier it would be for somebody
else, by applying the word 'type' or
'pattern' to say that by the very
celebrity of his goods the value of his
Trade Mark had been destroyed."
170. Some guidance to the application of s.64(1)(b) is given by the decision of McTiernan J at first instance in F H Faulding and Co Ltd v Imperial Chemical Industries [1965] HCA 72; (1965) 112 CLR 537. Nothing said by the Full Court on appeal (where s.64(1)(b) was not in issue) detracts from his Honour's comments.
171. It was argued in that case that the defendant's use of the words
"barrier cream" fell within s.64(1)(b). McTiernan J held that
on the facts of
the case s.64(1)(b) had no application because the word "BARRIER" in its
setting on the defendant's package was not
used "purely for the purpose of
description". (emphasis added) At 543-4 his Honour said:
"Lord Herschell said in Eastman172. His Honour was of the view that in describing its cream as a "Barrier Cream", the defendant was using the word "Barrier" as a reference to the character or quality of its cream and that the word "Barrier" could be regarded as a correct description of the cream. The reason that his Honour concluded that the word was not used purely for the purpose of description was that the get up of the product was such that "the ordinary customer might be confused into thinking that the product was the plaintiff's "Barrier Cream". As such there was ground to find objectively that the defendant had utilised the name to exploit confusion between the two products.
Photographic Materials Company Ltd v
Comptroller-General of Patents, Designs
and Trade Marks (The Solio case) (1898)
AC 571: '...it would obviously have
been out of the question to permit a
person by registering a trade-mark in
respect of a particular class of goods
to obtain a monopoly of the use of a
word having reference to the character
or quality of those goods. The
vocabulary of the English language is
common property: it belongs alike to
all; and no one ought to be permitted
to prevent the other members of the
community from using for purposes of
description a word which has reference
to the character of quality of goods'.
...I think that these observations are
apposite to the policy inspiring a
provision of the nature of s.64(1)(b).
What this provision protects is
the use of a mark that is genuinely
descriptive of the character or quality
of goods in connexion with which it is
used, where the use is purely for the
purposes of description. 'The object
of this section (s.53A) is not to
afford a guide as to whether a word is
adapted to distinguish the goods of the
proprietor of the trade mark from those
of other persons. It is intended only
to protect traders in the bona fide use
of a word which has been registered and
must be treated as adapted to
distinguish such goods': Eclipse Sleep
Products Inc v The Registrar of Trade
Marks [1957] HCA 86; (1957) 99 CLR 300 at 323). This
statement applies, in my opinion, to
s.64(1)(b)."
173. The corresponding section of the Trade Marks Act 1905 (s.53A) was
considered in Mark Foy's Ltd v Davies Coop and Co Ltd [1956] HCA 41; (1956) 95 CLR 190 where
Williams J (with whose judgment Dixon CJ at 195 agreed) said at 202 that the
section:
"...protects the use by any person of174. Some consideration was also given to s.64(1)(b) (or rather its predecessor, s.53A) in Thomson v B Seppelt and Sons Ltd [1925] HCA 40; (1925) 37 CLR 305 (the "Great Western case"); in Angoves Pty Ltd v Johnson (1982) 43 ALR 349 (the "St Agnes case") and in Caterpillar Loader Hire (Holdings) Pty Ltd v Caterpillar Tractor Co [1983] FCA 145; (1983) 1 IPR 265 at 268- 70.
any bona fide description of the
character or quality of his goods. But
that means a description and not a mere
suggestion in fanciful language. It
does not protect an attempt by the
defendants to usurp a metaphorical
phrase like "Tub Happy" however
magnetic the force of its public appeal
may be."
175. In none of these cases has a broad construction been given to s.64(1)(b). In the present context, for the respondent to succeed in its defence it must show more than that the word "Caplets" was used in a sense that may be broadly said to be descriptive. It is consistent with the policy underlying the section that the mark said to be used bona fide as a description of the character or quality of the goods be a word that has passed into the English language. The Act was not intended to "enclose and appropriate as private property certain little strips of the great open common of the English language"; see Mark Foy's Ltd (supra) at 201. The evidence in this case falls considerably short of establishing that the word "Caplets" is part of the ordinary English language in Australia whatever the situation may be in the United States. It is implicit in the Steelace case that the descriptive use to which the section refers must be such that it can be said that without the use of the infringing word there would be some difficulty in describing the relevant quality or character of the goods.
176. The evidence in the present case makes it clear that it is quite possible without use of the word "Caplets" to describe the tablet contained in the packages manufactured and distinguished by the respondent. The applicant's package describes them as "capsule shaped tablets". The respondent itself produced a package in which it described the product in question as "capsule shaped tablets". The application of January 1989 made by the respondent to the Medical Devices and Dental Products Branch of the National Register of Therapeutic Goods in Canberra was to market "capsule-shaped tablets". It is no doubt true that the word "Caplets" if truly descriptive of the characteristic of the tablet would be a more convenient (i.e. shorter) description of the form of the tablet in the box, but that is not determinative.
177. During the course of argument I raised the hypothetical example of a product with an invented name "wapet", being a registered trade mark in respect of a tissue product produced by manufacturer A. Use of the word could grow as persons became acquainted with the fact that the contents of the tissue pack were "wapets". The word could become quite a convenient description of a paper tissue, but s.64(1)(b) would not operate as a defence to a respondent infringing the trade mark. Although the "wapet" example is an extreme one, it differs from the present only in one important respect which is that the word "Caplets", while an invented word, is more easily adapted to a descriptive use having regard to its compound origin. In my opinion however, that difference is one of degree alone.
178. It follows in my view that the respondent is not entitled to avail itself of the defence contained in s.64(1)(b).
179. While it is not necessary for me to express an opinion on whether the respondent's use was in the relevant sense "bona fide", it is possible that the case may go further in which event it is appropriate that I make findings relevant to the issue.
180. I approach the question on the basis that while the onus is on the respondent to show that its use was in good faith, the Court should be slow to make a finding of bad faith and that while the normal civil standard of proof applies, regard should be had to the consequences of such a finding: Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336.
181. It was submitted for the respondent that a finding of want of good faith required a finding that "in effect the respondent, by the use of the mark, was intending to make a false representation i.e. knowingly to deceive or to use the goodwill (if any) acquired by the applicant in the term." If that is what is required then I would find that the respondent's use of the word "Caplets" was a use in good faith and that, had the use been purely descriptive, the defence under s.64(1)(b) would have been made out.
182. However, while a use which is intended to deceive or cause confusion would not be a use in good faith as a description of the character or quality of goods (cf F H Faulding and Co Ltd supra) I am far from convinced that that is the only situation contemplated as not being in good faith.
183. In Angoves Pty Ltd v Johnson (supra) Fitzgerald J addressed the issue of
"good faith" in the following terms at 378:
"The authorities, which are in the184. It is true that, as his Honour points out, many of the English authorities relate the test of good faith to whether or not the user's motives involved either deception or confusion but there has been no case which has held that the expression must be so confined. All that can be said is that underlying the notion of good faith in the present case is that the use must be an honest use as a description. Relevant to that question as was pointed out by Buckley J in Steiner Products Ltd v Willy Steiner Ltd (1964) RPC 356 will be the defendant's knowledge of the existence of the plaintiff's registered trade mark, although that fact alone is not determinative of the issue. What is involved is an investigation of the motives for the user of the mark, as well as the probable and actual consequences of the user. As Fitzgerald J said at 383: "Beyond that, the question of 'good faith' is one of fact and degree."
trade mark context principally
concerned with the equivalent phrase
'bona fide' in the English legislation,
focus attention upon the honesty of the
motives of the person who must act in
good faith. 'The words 'in good faith'
are often used in statutes but rarely
defined. ... the judges have to work
out for themselves the meaning of it,
doing the best they can to interpret
the will of the legislature in regard
to it. ...To my mind, under this
statute (The English Leasehold Reform
Act 1967) a claim is made 'in good
faith' when it is made honestly and
with no ulterior motive.' per Lord
Denning MR in Central Estates
(Belgravia) Ltd v Woolgar (1972) 1 QB
48, 55; (1971) 3 All ER 651. What is
an ulterior motive will in any given
context be decided by the subject matter."
185. In the present case the decision by the respondent to use the word "Caplets" in connection with its paracetamol product was made not only with full knowledge of the applicant's registration of the mark but also with advice from reputable patent attorneys in Australia that to use the mark as intended would be an infringement of the applicant's mark. I accept, however, that there was room for another view (that held in the United States) that the respondent's use would not be an infringing use. Mere use of a mark as a "descriptor" would not be a use in bad faith if all that was shown was that there was doubt about whether such use would be an infringing use. However, it seems to me that the present case goes beyond that.
186. The evidence establishes, in my opinion, that Mr McNair's decision to use the word "Caplets" on the Tylenol product was prompted by an international strategy to make the word into a generic word to the detriment of the applicant, if it turned out to be the case that otherwise there would be an infringing use. In my opinion that is a use of the mark for an ulterior purpose, that is to say a purpose beyond the mere use of the word as describing the character or quality of the goods. Such a use is not a purely descriptive use, to paraphrase McTiernan J in the Barrier Cream case or to put it another way, is not a use in good faith.
187. It was submitted by the applicant that the respondent's use was not in good faith for the further reason that the respondent desired to force the applicant to reach a commercial agreement which would allow the respondent to use the word "Caplets" in Australia. In my view this submission confuses the purpose of the use (which must be "bona fide" as a description) with the probable outcome should the applicant take proceedings to prevent it. Mr McNair believed, or certainly hoped, that a commercial settlement would follow the use by the respondent of the mark. But that is to say no more than that the respondent was aware of the applicant's registration of the mark and could conceive of a number of outcomes both legal and commercial. It is not evidence in support of bad faith.
188. I should say that it was submitted that Mr McNair always understood that the term "Caplets" was descriptive and by inference that he did not believe that the use by the respondent of the word would involve infringement. It is true that Mr McNair did say that he understood that the word "Caplets" was descriptive, that understanding being derived from the advice he received from the United States that it was descriptive in that country. However he immediately thereafter acknowledged that this was contrary to the Australian advice he received. Further, a few pages later in the transcript he agreed that he believed that the course of adopting the use of the word "Caplets" on the respondent's goods involved an infringement of the mark. Accepting that the word "infringement" may ultimately be a legal word not used with precision by a lay person I am of the view, having observed Mr McNair in the witness box, that he was perfectly aware that the word "Caplets" was not used descriptively in Australia with the consequence that there was a very real probability that use of the word would infringe the applicant's registered trade mark.
189. It follows that I am of the view that the respondent has not made out its defence under s.64(1)(b).
190. In the result I would make permanent the injunction granted on an interlocutory basis against the respondent restraining it from using the mark. I would dismiss the respondent's cross-claim. I will hear counsel as to the appropriate orders and for this purpose I direct the applicant to bring in short minutes of order on a date to be fixed.
AustLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.austlii.edu.au/au/cases/cth/FCA/1990/199.html