Puma loses fight against ‘CAT’ brand

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Caterpillar Inc. (caterpillar), the world’s largest heavy equipment manufacturer, has successfully appealed the Registrar of Trademarks’ decision to dismiss its opposition to Puma SE (Puma) PROCAT mark (no. 1803303) (PROCAT brand). In Caterpillar Inc vs. Puma SE [2021] FCA 1014, Federal Court Judge O’Bryan, sitting alone, allowed Caterpillar’s appeal and denied registration of the PROCAT mark on the basis that Caterpillar successfully asserted two grounds of opposition pursuant to ss. 44 and 60 of the Trade Marks Act 1995. Her Honor disregarded a third ground advanced by Caterpillar, namely section 42(b) of the Act, on the grounds that Caterpillar merely relied on her submissions and evidence regarding section 60 , but did not present additional evidence regarding section 42(b).

Take away key

This case provides an illuminating illustration of the interactions between the grounds of opposition under sections 44 and 60 of the Act, and how these interactions play out in the context of the apparel, footwear and accessories industry, in a dispute between two marks where the earlier mark is entirely contained in the later mark.

Fund

On October 21, 2016, Puma filed its trademark application PROCAT as a lowercase novelty mark with a sans serif font, in classes 18 and 25 for clothing, footwear, headgear, bags and accessories. Puma’s application was opposed by Caterpillar, owner of the following trademarks:

  1. word marks for CAT in classes 18 (no. 567670) and 25 (no. 318732 and 1246277) (Word mark CAT); and

  2. figurative mark comprising the word CAT overlapping a prominent triangular device (no. 502760) in class 18 (CAT device brand)

(collectively, cat marks).

Caterpillar’s opposition to the PROCAT mark was dismissed by the Registrar of Trademarks. On appeal to the Federal Court, Caterpillar advanced three grounds of objection, namely:

  1. under Section 44 of the Act, the PROCAT mark was deceptively similar to the CAT marks;

  2. under section 60, the CAT marks had acquired a reputation for the goods covered by the PROCAT mark before the priority date of that mark and, because of this reputation, the use of the PROCAT mark would be likely to mislead or cause confusion; and

  3. under Section 42(b), use of the PROCAT mark would be unlawful as it would violate Sections 18 and 29(1)(g) and (h) of the Australian Consumer Law.

Issues in Dispute

It was undisputed that the PROCAT mark and the CAT marks covered similar goods. The main issues in dispute concerned the degree of similarity between the PROCAT mark and the CAT marks, as well as the extent of the reputation of the CAT marks.

Justice O’Bryan’s findings

Section 44

AT [90]-[96] Justice O’Bryan set out a useful summary of the principles applicable to the determination of deceptive similarity for the purposes of section 44 of the Act. It is important to note that His Honor told [90] that the relevant comparison to be made between the marks assumes “normal and fair use of the mark applied for for all goods and services covered by the application”, rather than “the idiosyncratic manner in which the alleged infringer uses the mark”. His Honor said that the considerations of the trade or business in question, the way the goods were sold and the character of the likely consumers were all relevant to this assessment.

In assessing normal and fair use, His Honor gave weight to evidence of Puma’s use of the PROCAT mark in the United States and Canada (since Puma had not used this mark in Australia ) with respect to products such as football boots, sports bags and backpacks. The PROCAT mark on these products featured lowercase letters and had different colors for the letters PRO and CAT. There was also evidence of marketing material referring to the brand as “ProCat” with the letters P and C capitalized. Interestingly, His Honor gave no weight to Puma’s assertion that traders, including himself, tended to use multiple trademarks or brand elements on or in connection with clothing, footwear and accessories sold in the lifestyle and workwear market segments. In His Honor’s view, such considerations were irrelevant in determining normal and fair use, as the Court must ignore other indicia which may distinguish one product from another.

In concluding that the PROCAT mark was deceptively similar to the CAT marks, His Honor observed that the PROCAT mark contained the entire CAT word mark and one of the two components of the CAT design mark. Earlier in the judgment, His Honor mentioned Crazy Ron’s Communications Pty Ltd v Mobileworld Communications Pty Ltd [2004] FCAFC 196 in which the Full Federal Court ruled at [79] that where two marks share a common element, particularly if the common element is an “essential feature” of both marks, this would increase the likelihood that the later mark would be considered deceptively similar to the earlier mark. Further, His Honor accepted Caterpillar’s argument that ordinary consumers were likely to read, understand and pronounce the PROCAT mark as a combination of the words PRO and CAT (rather than a made-up, meaningless word that would rhyme with “pocket”), on the basis that the words PRO and CAT are commonly used in Australian English and that consumers would more naturally refer to PROCAT in a way that gives it meaning. To this end, consumers would probably understand PRO as an abbreviation of “professional” or a Latin word meaning “for” (being the antonym of “against”). This would be the case whether or not the PROCAT mark had a lowercase sans serif font of the same color (as shown in Puma’s application), or was rendered in a manner similar to that used in the United States. and in Canada. His Honor also took into account the “common experience” that in the lifestyle and workwear market segments, clothing, shoes and bags generally had very similar styles from brand to brand. the other. In light of the foregoing, His Honor has concluded that [111] that there was

a real and tangible risk that a significant number of consumers, who knew but had only an imperfect recollection of the CAT mark, would be confused as to whether products labeled with the PROCAT mark were linked in trade commercial with CAT branded products, be a “professional” or high performance or otherwise special line of CAT products.

Section 60

AT [119], O’Bryan J. helpfully set out a summary of the principles applicable to a s. 60 assessment. relevant to be made under Article 60 lies between the actual use of the earlier mark and the theoretically normal and fair use of the later mark, so that the principles relating to normal and fair use under section 44, as stated above, would apply. Second, even if the relevant comparison is not constrained by the notion of misleading similarity (as is the case under Article 44), the degree of similarity between the two marks at issue remains relevant for the assessment . Third, the test for determining confusion or deception is the same for both sections – it suffices that “consumers might wonder whether the respective products might be related in business life” or “consumers might think that the product bearing the contested mark is a variant or linked to an existing mark” (à [119(g)]). Along the same lines, the test for likelihood of confusion or deception is also the same – it suffices to establish a “real and tangible danger of confusion or deception”, or that an “ordinary person harbors a doubt reasonable” (at [119(h)]).

In concluding that Caterpillar had successfully asserted a ground for opposition under Section 60, His Honor accepted Caterpillar’s argument that it had acquired a substantial and valuable reputation in Australia for both the word mark CAT and the CAT design mark, in relation to clothing, footwear, bags and accessories in the lifestyle and workwear market segments, due to the use and promotion of the CAT marks in Australia. For the same reasons given in relation to section 44, His Honor considered that because of the reputation of CAT marks in Australia, the use of the PROCAT mark would also be likely to cause confusion in the minds of a large number of consumers. Importantly, His Honor rejected Puma’s argument that the CAT marks enjoyed such a good reputation in Australia and that consumers were so familiar with the CAT marks that confusion with the PROCAT mark would be unlikely. While the CAT brands had acquired a strong reputation in Australia, they could not be described as so famous that their reputation would militate against any risk of confusion in the market.

You can access the full text of the Court’s decision here.

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