TRADE MARKS ACT 1955

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS

Re:	Opposition by NEW BALANCE ATHLETIC SHOE, INC to Registration of Trade Mark Application Number 433493 in the Name of WORLD COMPANY LIMITED

		Application number 433493 was lodged on 18 September 1985 in the name of WORLD COMPANY LIMITED, a Japanese company of 8-1, 
6-Chome, Minatojimankamachi Chou-Ku, Kobe-City, Japan (the applicant).  It was for the trade mark BLANCE and was advertised accepted on 2 June 1988 for "All goods in this class", in Class 25.
		On 20 July 1988, notice of opposition was lodged in the name of NEW BALANCE ATHLETIC SHOE, INC of 38 Everett St, Boston, Massachusetts 02134, United States of America (the opponent).  The grounds of opposition set out in the notice are as follows:

	1.	THAT the applicant does not use or propose to use the trade mark (hereinafter referred to as "the said trade mark") the subject of the said application in respect of all the goods specified.

	2.	THAT the applicant is not the proprietor of the said trade mark and is not entitled to claim to be the proprietor thereof and the applicant is therefore not a person entitled under Section 40 of the Trade Marks Act to apply for registration.

	3.	THAT the said trade mark is an obvious imitation of a mark which is the property of the opponent and the present application constitutes an illicit attempt by the applicant to appropriate the valuable property of the opponent in the said trade mark.

	4.	THAT the opponent company is the registered proprietor in Australia of a trade mark consisting of the words NEW BALANCE in Class 25 under registration No. B304,739 in respect of athletic shoes, insoles, heel pads (hereinafter referred to as "the said registered trade mark") and is also the applicant for registration of the trade mark NEW BALANCE under Application No. 457,998 for goods in Class 25.

	5.	THAT the trade mark sought to be registered is substantially identical with or deceptively similar to the said registered trade mark and that the said trade mark is sought to be registered in respect of the same goods or 
		goods of the same description as the goods in respect of which the said registered trade mark is registered and registration thereof would be contrary to Section 33(1) of the Trade Marks Act 1955.

	6.	THAT the said registered trade mark has been used by the opponent company throughout Australia in respect of articles of clothing including footwear.

	7.	THAT by reason of this extensive use in Australia the said registered trade mark has achieved a valuable and substantial reputation as indicating the products of the opponent company exclusively.

	8.	THAT owing to the similarity between the said trade mark and the said registered trade mark and the extensive use and promotion of the said registered trade mark, any use by the applicant company of the said trade mark in respect of the goods for which registration is sought would inevitably cause deception or confusion in trade and in the public mind and encourage passing off.

	9.	THAT the said trade mark is not adapted to distinguish nor is it capable of distinguishing the applicant company's products for the aforementioned reasons.

    10.	THAT by reason of the said trade mark being one the use of which by the applicant company would be likely to deceive or cause confusion the registration thereof on this application is prohibited by the provisions of Section 28(a) of the Trade Marks Act.

    11.	THAT by reason of the said trade mark being one the use of which by the applicant company would be contrary to law the registration thereof on this application is prohibited by the provisions of Section 28(b) of the Trade Marks Act.

    12.	THAT by reason of the said trade mark being one which in the hands of the applicant company would not be entitled to protection in a Court of Justice the registration thereof on this application is prohibited by the provisions of Section 28(d) of the Trade Marks Act.

    13.	THAT the registration of the said trade mark upon this application would be prejudicial to the legitimate interests of the opponent company and the opponent would be aggrieved thereby.

    14.	THAT the onus is on the applicant company to show that it is entitled to registration upon this application and the applicant company has not discharged that onus nor can it discharge that onus.

    15.	THAT registration of the said trade mark on this applicant ought to be refused in the exercise of the Registrar's discretion, by reason of the conduct of the applicant company and/or the nature of the mark and/or of its use.
		Part of the opponent's evidence in support, consisting of a statutory declaration by David Paul Freni dated 6 October 1988 together with Exhibits A to G was served on the applicant on 19 October 1988, while the balance of the evidence, comprising a statutory declaration by Hugh Wallace-Mitchell dated 7 July 1989 together with Exhibits A to C was served on 13 July 1989.
		The applicant served part of its evidence in answer, consisting of a statutory declaration by Gerald Alfred Wilkes dated 12 June 1990 on the opponent on about 20 June 1990.  The balance of the evidence, comprising a statutory declaration by Masaji Manpou dated 20 December 1990 was served on the opponent on 7 January 1991.
		No evidence in reply was forthcoming and the opponent sought a hearing in the matter.  The matter was set down before me for hearing on 24 May 1991.  The opponent's attorney, Davies & Collison of Melbourne, advised by telephone on 20 May 1991 and later confirmed by facsimile on 22 May 1991 that it would rely upon written submissions.  The applicant, through its attorney Arthur S. Cave & Co of Sydney, advised by facsimile on 23 May 1991 that it also would not be represented at the hearing and enclosed written submissions on its behalf.
		With respect to the opponent's submissions, I consider the main points to be as follows:
	.	the opponent commenced use of the trade mark NEW BALANCE only on athletic shoes in Australia in June 1977, on clothing during the period 1980 to 1982 and this use extended to other wearing apparel during 1982 to 1987;

	.	the opponent has made prominent use of the word BALANCE by itself on footwear and clothing;
	.	the opponent enjoys a reputation in Australia in the mark NEW BALANCE in relation to footwear and items of clothing.  It is common for athletic footwear manufacturers to market a wide range of sportswear and casual clothing;
	.	as the applicant's evidence makes no reference to the use of the mark BLANCE in Australia, it is reasonable to conclude that no such use has occurred.  The applicant's evidence emphasizes the meanings of the words NEW BALANCE and BLANCE but omits to distinguish the marks by the fundamental tests for deception or confusion - that of by sight and by sound;
	.	the four grounds of the opposition are:
		-	section 28(a), (b) and (d),
		-	section 33(1),
		-	the failure by the applicant of discharging its onus to show it is entitled to registration of its application,
		-	that the mark's registration ought to be refused in exercise of the Registrar's discretion.
	.	with respect to s.28, the following submissions apply:
		-	the evidence submitted by the opponent shows it enjoys a substantial reputation in relation to footwear and clothing;
		-	the basic test under s.28 is that the Registrar must be satisfied that, following normal and fair use, deception and confusion will not occur;

		-	given the lack of evidence of use of the mark BLANCE in Australia and the reputation established by the opponent in its mark on goods which will be covered by the subject mark, there will be a likelihood of confusion;
		-	the marks are visually and phonetically similar;
		-	attention is drawn to the decision of the full High Court in the New South Wales Dairy Corporation v Murray Goulburn Co-Operative Co Ltd (1991) AIPC 90-276 and certain judges' statements in relation to the interpretation of s.28 where they referred to registered trade marks and not applications.  Therefore it is sufficient to show that a number of persons will be caused to wonder regarding the ownership of the applicant's and opponent's marks;
		-	in relation to the probability of deception, all surrounding circumstances should be taken into account, including the conditions of display in retail outlets of footwear and clothing, where close inspection is not always possible;
		-	use of the mark BLANCE on clothing will give rise to passing off and thus the mark is not registrable under sub-section 28(b) as being contrary to law.  It is also not entitled to protection in a court of law and thus offends sub-section 28(d);
	.	with respect to s.33, the following submissions apply:
		-	this section deals with statutory rights and it does not matter whether purchasers are deceived or not;

		-	the respective goods of the present marks and of registration B304739 (NEW BALANCE) owned by the opponent are the same or of the same description;
		-	the Hearing Officer is referred to the statement of Windeyer J in Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd, 1961 109 CLR 407 at 414-415 regarding marks being substantially identical or deceptively similar;
		-	the basic test for assessing deception and/or confusion under s.33 requires an assumption of fair user of the opponent's and applicant's marks with no reasonable likelihood of deception or confusion;
		-	the word NEW should be largely disregarded for purposes of making an comparisons between the respective marks.  (A list of several cases was cited here in support.)
		-	the marks BLANCE and BALANCE, when compared side by side, are visually and phonetically similar;
		-	deception between products marked BLANCE and NEW BALANCE is likely to occur given the concept of imperfect recollection as outlined in Rysta Ltd's Application 60 RPC 87 at 108;
		-	reference is made to the declaration of Masaji Manpou which refers to a Korean decision on similarity of the marks.  This should not be relied upon as the factors are different in the present case.
		-	there is an onus upon the applicant to justify registration of its mark and the applicant has failed to discharge this onus in its evidence;
		-	the application should be refused and costs awarded against the applicant.
		With respect to the applicant's submissions, I consider the main points to be:
	.	Onus
		-	the Senior Assistant Registrar in Hermes SA v E.T. Swift & Co Pty Ltd (1984) 2 IPR 432 at 435 and 436 said that, when an opposition is based upon use of a conflicting mark with respect to objections under s.28, then there is an initial onus upon the opponent to show a sufficient reputation upon which to found these objections.  This is despite the considerable onus already upon the applicant to satisfy the Registrar that there is no reasonable likelihood that the trade mark will deceive or cause confusion;
		-	the opponent's evidence of use of the mark NEW BALANCE does not substantiate the grounds of opposition under s.28 nor most of the other grounds relied upon.  Despite some reputation in that mark, it is so distinguishable from the present mark that there is no real conflict between the marks and no likelihood of deception or confusion.
	.	The opponent's evidence
		-	despite raising 15 grounds of opposition the opponent's evidence goes essentially to use of the mark NEW BALANCE, and does not substantiate those grounds except for ground 6 and possibly ground 7.  
The evidence may be relevant to grounds 2, 3, 8 and 
			10 in that it shows some reputation in NEW BALANCE but the said grounds are not made out in full;
		-	the opponent's evidence does not contain declarations from independent persons in the trade to show that the marks have been confused, that it would be likely or even possible.  The declaration by Hugh Wallace-Mitchell states that he received enquiries regarding a connection between the mark BALANCE and the opponent's mark.  However, the applicant's mark is BLANCE and therefore these statements do not apply.  There may be some confusion here with other opposition proceedings by the opponent against the mark A434527 (BALANCE and LOGO).
	.	Comparison between the marks
		-	although determination of whether marks are substantially identical or deceptively similar is largely a question of fact, rules have been established for comparing marks as in the Pianotist case, supra.  The ideas suggested by the marks are also relevant, the marks should be considered in their entireties and regard should be had to "imperfect recollection" by customers;
		-	in a declaration by Professor G.A. Wilkes, who is a Professor of English Literature, he stated that it is difficult to make any connection between the marks.  He drew attention to the dictionary meanings of the words NEW and BALANCE.  The meaning of BALANCE, where it referred to athletic pursuits, was reinforced in some of the opponent's advertising included in their evidence;
		-	in contrast to the opponent's mark, the applicant's mark consists of only one word, has no dictionary meaning and is an invented word.  Masaji Manpou of the applicant company states in his declaration that the mark was derived from the French word BLANC meaning WHITE.  Professor Wilkes in his declaration states that the associations suggested in the mark are with the French word BLANC reflected in English in BLANCH, meaning whiten or turn place;
		-	with reference to the doctrine of "imperfect recollection" as noted in Rysta Ltd's application, supra, it is unlikely that customers would be confused between the marks but, if they did not exactly recall the marks, the impression they would take with them would be influenced by the meanings suggested by the trade marks.  Thus, an idea of "whiteness" would be suggested by the applicant's mark and "balance" by the opponent's mark, the word NEW in the latter further distinguishing the marks;
		-	the declaration of Mr Wallace-Mitchell for the opponent states that the word BALANCE has been used on its own since 1984.  However, there was little evidence to support this;
		-	when considering the marks in their entireties, the chances of confusion between them by the public are so remote as to be disregarded;

		-	the opponent's mark was not cited against the present mark during examination because the marks are distinguishable.  The decision to accept the mark was correct and nothing in the opponent's evidence justifies an alteration of that decision.
	.	Co-existence of the marks in South Korea
		-	Mr Manpou's declaration states that both marks co-exist on the South Korean Register;
		-	although the Korean registrations cover sets of goods which are demarcated and the Australian marks cover overlapping statements of goods, this does not matter as the marks are distinguishable and thus unlikely to be confused.
	.	The Registrar's Discretion
		-	although the Registrar has a discretion to refuse registration in opposition proceedings, there is nothing in the present case to justify this.  It is clearly against the public interest to refuse the present application as the opponent would gain a monopoly, not only in NEW BALANCE, but in other distinguishable marks;
		-	in Standard Woven Fabric Company's Appl'n (1918) 35 RPC 53 at 57 it was asserted that the Registrar's discretion should be exercised "upon judicial principles and affected neither by caprice or over-caution".  In the present case, the marks are distinguishable and therefore unlikely to cause confusion in the marketplace.  Thus the application 
should be allowed with costs awarded to the applicant.
		In determining this matter, I have taken into account the opponent's submission that it relies upon the four grounds of opposition previously listed, viz:
	.	section 28(a), (b) and (d),
	.	section 33(1),
	.	failure of the applicant to discharge its onus regarding entitlement to registration,
	.	the Registrar's discretion to refuse registration.
I shall deal with each of these grounds in turn.
Section 28
		Section 28 states:
		A mark -

		(a)	the use of which would be likely to cause confusion;

		(b)	the use of which would be contrary to law;

		(c)	which comprises or contains scandalous matter; or
		
		(d)	which would otherwise be not entitled to protection in a court of justice,

		shall not be registered as a trade mark.
Section 28 has been the subject of recent consideration by the Courts and, in particular, by the High Court in New South Wales Dairy Corporation v Murray Goulburn Co-operative Company Ltd 18 IPR 385 (the Moo case).  In that case the Court held, by a majority, that the operation of para 28(a) is limited by a requirement of blameworthy conduct on the part of the proprietor of the mark, that is, that the likelihood of deception and confusion has been brought about by the actions of the proprietor himself.  This is so whether as a result of reading para 28(a) conjunctively with para 28(d) or of construing 28(a) in the context of the Act as a whole together with general policy considerations.  The Federal Court had earlier reached the same conclusion in Riv-Oland Marble Co (Vic) Pty Ltd v Settef SpA, (1988) 12 IPR 321 also a majority decision.
		The opponent's attorney seeks to distinguish the Moo case on the grounds that:

		"In seeking to rely on the provisions of Section 28(a), we refer the Hearing Officer to the following statements by the judges in the full High Court decision New South Wales Dairy Corporation -v- Murray Goulburn Co-Operative Co Ltd (1991) AIPC 90-726 - according to the decision of Brennan, J at page 37,045 "paragraph (a) of Section 28 prohibits the original registration of a mark the use of which would be likely to deceive or cause confusion ... after registration paragraph (a) operates in a different regime".  According to Dean, J at page 37,050 paragraphs (a), (b), (c) and (d) of Section 28 are clearly disjunctive ... (and at page 37,051) "there remains no reason why the words of Section 28(a) should be given other than their ordinary meaning and effect, that is to say, as precluding the actual registration of a mark the use of which would be likely to deceive or cause confusion.

		The Hearing Officer is also referred to the statements by McHugh, J at page 37,068 where he stated that "nor can I accept the conclusion that the word "otherwise" in paragraph (d) requires that paragraph (d) be read as limiting the operation of paragraphs (a) to (c)".

		In the light of these statements and bearing in mind that the decision in that case (and in the case of Rivoland Marble Co (Vic) -v- Settef SpA) relate primarily to the status of a registered trade mark and not an application for a trade mark subject to opposition, it is submitted that the Hearing Officer can properly apply the provisions of sub-section (a) of Section 28 to the present case."
		The question of whether section 28 should be read conjunctively with respect to applications was decided in the affirmative by Hearing Officer Homann in The Titan Manufacturing Co Pty Ltd v Coyne (1991) AIPC 90-808.  His reasons for so finding are listed in that decision.  There would appear to be no reason in the present instance to find differently.

		There is no doubt that the opponent enjoys a considerable reputation in relation to the use of the mark NEW BALANCE on sports shoes and clothing.  This is apparent from the evidence lodged.  However, not only does the opponent's evidence show a reputation in NEW BALANCE, it also shows that major user of the mark is in that form, i.e. the words used together or, if the word BALANCE is used, solus, then it is always accompanied by the letters NB, or the letter N as part of the design of the shoes which are included in the opponent's mark's goods.  Additionally, the letters N and B at the start of each word of the mark are always shown in either upper or lower case together in use in the examples shown.  Thus the marks of concern are the applicant's BLANCE on one hand and the opponent's NEW BALANCE on the other.  The opponent's mark is advertised as NEW BALANCE, and referred to by the public as such and it is, in my opinion, unlikely that deception or confusion would occur in the market place.  Additionally, the goods being purchased, particularly those covered by the opponent's mark, are not inexpensive, causing a purchaser to give a higher degree of attention to his or her purchase.  These are not 'bag of sweets' items but sports shoes and clothing not normally offered for sale in discount stores.  It is my experience that such items are purchased in specialty sports stores or sports departments where display is clear and selection unhurried.  I must therefore find that the objection under paragraph 28(a) fails.  Given the foregoing, I cannot agree that the co-existence of the marks will lead to instances of passing off or to breaches of the Trade Practices Act.  There has been no evidence put forward aof any wrong doing on behalf of the applicant and nothing to indicate that the word BLANCE is not otherwise entitled to protection in a court of justice.  The objections under paragraphs 28(b) and (d) are also, therefore, not successful.  I consequently find that the grounds of the opposition are not established in respect of the whole of section 28.
Section 33
		Sub-section 33(1) of the Act provides as follows:

		33.(1) Subject to this Act, a trade mark is not capable of registration by a person in respect of goods if it is substantially identical with or deceptively similar to a trade mark which is registered, or is the subject of an application for registration, by another person in respect of the same goods, of goods of the same description as those goods or of services that are closely related to those goods, unless the date of registration of the first-mentioned trade mark is, or will be, earlier than the date of registration of the second-mentioned trade mark.
		That the goods covered by both the opponent's and applicant's marks are those of the same description is obvious.  The applicant's mark has been applied for to cover "all goods in this class", in Class 25.  The opponent's mark is registered in respect of "athletic shoes, insoles, heel pads" also in Class 25.  Thus there is a clear overlap of the statements of goods.  The question then is whether the applicant's mark is substantially identical or deceptively similar to that of the opponent.  The opponent's attorney has argued that the word NEW should be largely disregarded when making comparisons between the marks.  As previously stated, the evidence of the opponent's mark in use overwhelmingly shows the words NEW and BALANCE used together.  There is minimal use of the word BALANCE on its own, e.g. LIFE IN THE BALANCE but this is always used in close proximity to the whole mark or with the NB logo, and it can be inferred that the word NEW is not used in a descriptive sense but as an integral part of the whole.  I have been referred by the opponent's attorney to the criteria formulated in Pianotist's application, supra.  I have already said that I consider the opponent's mark, as a whole, is NEW BALANCE.  I do not think that a buyer would request, or look for, a pair of BALANCE shoes or clothing but NEW BALANCE.  However, even if the words BALANCE and BLANCE were to be compared in isolation, there is a very discernible difference.  The word BALANCE has two syllables and the word BLANCE only one.  The emphasis is placed on the first syllable of the word BALANCE, and even the most careless of speakers would not usually pronounce the words in a similar fashion.  To achieve a similar sound, the speaker would need to emphasize the last syllable of BALANCE, something alien to Australians' normal speech patterns.  Additionally, the word BALANCE has a dictionary meaning and BLANCE has not.  Visually, the latter word is shorter by one letter and, although all the letters in BLANCE are contained in BALANCE, the proximity of the word NEW is enough, I feel, to differentiate the marks in the printed form.  The cases quoted by the attorney to support his contention that the word NEW should be disregarded have all been considered but, in most instances, the common elements of words being compared were found in both.  In this case, the part of BLANCE found in BALANCE is -LANCE and it is my opinion that the emphasised syllable BAL is enough to differentiate the marks.
		With respect to the concept of "imperfect recollection", I have already discussed Australians' pronunciation and found that the marks would not be considered phonetically similar.  I am of the opinion that the dictionary meaning of BALANCE would remain in the purchaser's and shop assistant's memories.  The applicant has argued here that the mark was derived from the French word BLANC meaning WHITE and the mark BLANCE would leave an impression of "whiteness" in consumers' minds.  I cannot agree with this reasoning as the word would be pronounced as in (B)LANCE, not B(LONK).  Additionally, outside Wimbledon I do not think today's consumers expect sports shoes and clothing to be always white. I am therefore of the opinion that the public would see the word as meaningless.   Nonetheless, the recollection of a dictionary definable mark on one hand and a made up word on the other is sufficient in my mind to preclude the possibility of wrongful recollection of the marks.
		The opponent's attorney has submitted that a decision regarding the co-existence of the two marks in question on the Korean Register should be disregarded as the circumstances were different in that case.  However, I have not placed any weight on this aspect of the applicant's argument as the decision is of interest value only and has no bearing in the Australian context.  I have therefore not taken that finding into account in coming to a decision in the present matter.
Onus on the applicant
		I am satisfied that the applicant has discharged the onus upon it to show that there is no reasonable likelihood that the subject trade mark will deceive or cause confusion.  The opponent's attorney has relied upon Dunns case 1908 7 RPC at 315-316 where, according to that decision, if there is any question of doubt, then as a necessary consequence, the application should be disallowed.  However, as I have previously found that confusion is highly unlikely between the marks in the mind of the public, then that doubt does not exist.
		It follows, therefore, that it would not be a proper exercise of the Registrar's discretion to refuse the application as the likelihood of confusion and/or deception is extremely low.

Conclusion
		In the result, then, I find that proper and fair use of the two marks for their respective sets of goods would be unlikely to lead to deception or confusion among a substantial number of persons.  I also find that the marks are not substantially identical or deceptively similar.  The applicant has, to my satisfaction, discharged the onus upon it to show that there is no likelihood of deception or confusion if the the mark is registered and that it would not be a proper exercise of the Registrar's discretion to refuse the case in the present instance.  It follows therefore that the opposition fails on all of the grounds relied upon and subject to any appeal from this decision, the mark should proceed to registration.
		I have further considered the question of costs and see no reason why costs should not follow the event.  I therefore award costs to the applicant to be taxed, allowed and certified by an officer of the Trade Marks Office appointed by the Registrar for that purpose.

(I.M. FORNO)
Senior Examiner
18 July 1991