Apple loses battle for control of family of 'iMarks'

Australia
In Apple Inc v Wholesale Central Pty Ltd ([2010] ATMO 7, January 21 2010), a delegate of the registrar of trademarks has dismissed Apple Inc’s opposition to the registration of a device mark which consisted of a stylized representation of the word 'dopi'. Apple opposed the registration because 'dopi' is 'iPod' spelt backwards.
 
Apple’s commercial concerns were raised because the applicant’s DOPI-branded products include accessories specifically designed for use with Apple’s products, such as USB drives, cleaning products, laptop bags and, relevantly, covers and cases for iPod players.
 
Apple’s opposition required it to establish that DOPI is “deceptively similar” to IPOD. There was no real debate that the relevant products were sufficiently similar and, therefore, the only issue was the similarity of the marks themselves. The relevant law is relatively easy to state but sometimes difficult to apply, because the test has been expressed in terms that allow considerable scope for a range of subjective opinions - namely:
  • Is there a “real tangible danger” of deception or confusion occurring?
  • Is there a “real likelihood” that relevant consumers will be “caused to wonder” whether the two products in question come from the same source?
In applying these broad tests, the trademarks should not be compared side by side. Rather, the delegate attempted to assess the effect or impression produced on the mind of potential purchasers of the relevant products, who knew of Apple’s IPOD mark (and perhaps had an imperfect recollection of it), when they encountered the applicant’s DOPI-branded products.

It was also well settled that, when considering whether there was a likelihood of deception or confusion, all the surrounding circumstances had to be taken into consideration. These included:

  • the circumstances in which the marks would be used;
  • the circumstances in which the products would be bought and sold; and
  • the character of the probable purchasers of the products.
Fundamental to Apple’s argument was the fact that, in addition to the IPOD mark, it also owned several other trademarks which start with the letter 'I' (eg, ITUNES, IMAC, ILIFE, IWORK and IPHONE). This, Apple argued, indicated that it would be perceived as the owner of a 'family' of so-called 'iMarks' for products in Class 9 of the Nice Classification. In this regard, Apple cited the decision in McDonald's Corporation v Lubowski ([2004] ATMO 56), in which McDonald’s Corporation successfully opposed the registration of MCCHINA (see also McDonald’s Corporation v Bellamy ([2004] ATMO 26), where it was held that MCBABY would be likely to deceive or cause confusion because of the reputation of McDonald’s family of registered and unregistered ‘MC’ marks). In particular, Apple submitted that:
 
In the 'family' of trademark cases, the trademarks of an opponent have been found to have a common element, usually a prefix, which is so thoroughly associated with the opponent’s goods or services that the use by another person of a trademark incorporating that element would deceive or cause confusion.”
 
Apple argued that the particular colouring and orientation of the letter 'I' in DOPI resulted in it being the dominant and distinctive feature of the mark, because the consumer’s attention was immediately drawn to that particular part.
 
The delegate rejected Apple’s arguments and described them as “flawed”, even though it was not in dispute that the IPOD mark and iPod players are well known in Australia. The delegate admitted that "[his] own knowledge as a consumer suggests, and the evidence confirms, that both the [iPod] players and the IPOD trademark were very well known in Australia as at the priority date”.
 
However, the deciding factor (which will be of considerable concern to Apple) was the delegate’s finding (consistent with his own personal experience) that many third-party accessories and peripherals for iPod players on the market are sold under an 'I'-prefixed brand. The delegate referred to a number of examples:
  • parties other than Apple that own registrations for ISOFT, ISKIN, IBOX, IPORT, IJOG, IWAKE, IVISION, IDRIVE and ILISTEN; and
  • third-party accessories for iPod players which were advertised on Apple’s own website (eg, iSkin, iClear and iSee) and in Australian Macworld magazine (eg, iSkin, iTalk, iMic, i-Mate, iPaq, iRecord and iSnug).
In these circumstances, the delegate was not satisfied that a person of ordinary intelligence and memory would be caused to wonder, or be left in doubt, as to whether the applicant’s DOPI-branded products might be an Apple product, merely because DOPI ends in the letter 'I' (however that letter may be presented).
 
If further proof was required, the delegate also noted that Apple’s evidence was settled in about February 2008 - that is, about 12 months after the first use of DOPI - and yet the evidence contained no examples of any actual confusion or deception. Although the applicant raised this point in its evidence, Apple elected not to adduce any evidence in its reply. Of course, the true (commercial) test of deceptive similarity is the marketplace itself, and the absence of evidence of confusion or deception was therefore telling.
 
The irresistible conclusion based on this decision is that Apple has all but lost the battle for control of a broad 'family' of 'iMarks'. This is a recurring theme for Apple. The same issue first confronted the company over 25 years ago in connection with managing the plethora of 'Mac'-prefixed marks for software. There are many other 'iMarks' in Australia and around the world that are the subject of similar oppositions or disputes, including IPAD. This decision may thus have wider ramifications for Apple and those other parties. Having regard to the mark in question (and notwithstanding the applicant’s clever, and arguably cynical, reversal of the letters of 'iPod'), perhaps this was not the best case for Apple to allow to become a precedent.
 
Julian Gyngell, Kepdowrie Chambers, Wahroonga

Unlock unlimited access to all WTR content