Evidential requirements cause Unilever to stumble on the CATWALK

When asserting reputation or cognisance in a brand in New Zealand, it pays to heed recent trends. In short, parties must ensure that they are capable of meeting the evidential demands well in advance of launching proceedings. 

Over the last year, the Intellectual Property Office of New Zealand has become increasingly stringent in its assessment of evidence - a position recently affirmed by the High Court of New Zealand in Unilever PLC v McPherson's Consumer Products Pty Limited ([2013] NZHC 1458, June 12 2013).

In 2010 McPherson’s Consumer Products Pty Limited applied to register the trademark CATWALK for various goods in Classes 8, 21 and 26 of the Nice Classification, including hair and beauty products.

Unilever Plc asserted that it had used the CATWALK trademark in New Zealand for the same or similar goods over many years, and also claimed a significant international reputation in the CATWALK mark. Unfortunately, obtaining registered protection in New Zealand had been overlooked. Unilever therefore alleged that McPherson’s application would be likely to deceive or cause confusion contrary to Section 17(1)(a) of the Trademarks Act 2002. 

Unilever also alleged registration of the CATWALK mark by McPherson’s would:

• breach Section 17(1)(b) of the act (being contrary to law);
• breach its rights under Section 25(1)(c) of the act as the owner of a well-known mark;
• amount to passing off; and/or
• breach the Fair Trading Act 1986.   

However, in the absence of registered rights, the first hurdle Unilever had to meet was to establish “an awareness of its trademark in the New Zealand market”. To do this, Unilever had to:

• identify the relevant market; and
• provide evidence showing that a substantial number of persons in that market had an awareness, cognisance or knowledge of Unilever’s CATWALK mark.

The threshold for establishing awareness of a mark in New Zealand is low, but what amounts to a “substantial number of persons” depends on the nature and size of the market. 

The first evidential pitfall Unilever faced was its failure to provide evidence concerning the relevant market, leaving it to the assistant commissioner to make this determination. In itself, this oversight was not fatal - but it did not bode well.

The fatal blow came from Unilever’s failure to provide sufficient factual basis evidencing the many assertions made in its evidence. In particular:

• Unilever provided a list of stockists, but no evidence concerning the total number of potential stockists or percentage market share in New Zealand.
• Its photographic evidence did not clearly identify relevant time periods or show how the CATWALK mark was being used by Unilever at the relevant date.
• Prior to 2009, Unilever’s CATWALK branded hair care products were sold via a distributor, which had since ceased to carry on business. Unilever had limited knowledge of sales of the distributor and no evidence was filed on behalf of the distributor.
• Unilever’s sales information (approximately $167,000 per annum) was considered “infinitesimal given the size of the market”.
• Information on promotions, online sales, etc before the relevant date was not provided.

As Unilever was to find out, a low threshold can still trip. 

Overall, the High Court held that Unilever’s primary evidence was “long on assertion and generalisation, but short on specific evidence in detail” (Paragraph 53). Unilever had not established that, at the relevant date, there was an awareness of the CATWALK trademark in the relevant market. Having failed at the lowest threshold, it was unnecessary for the High Court to consider the remaining grounds of the opposition.

Going forward, this decision highlights the risk that owners take when electing to forgo registered protection. The decision is also a further lesson to avoid making assumptions in evidence. The facts and figures of website hits, market share, internet usage, customer base, quantities, volume, promotions and time frames, etc must be set out clearly in black and white. Parties should focus on the specifics and allow the evidence to speak for itself.

Sarah Harrison, James & Wells Intellectual Property, Auckland