Well known - yes, similar - no: Daimler finds no joy on appeal (again)

In Daimler AG v Sany Group Company Limited ([2015] NZCA 418), the Court of Appeal has confirmed an earlier decision by the High Court to accept Sany’s logo mark, depicted below, for registration.

Sany is a Chinese company focused on the manufacture, leasing, importing and exporting of building, road and hoist machinery, vehicles and network communication equipment. Daimler is a German automobile manufacturer, and has been using its three-pointed star marks, depicted below, on vehicles internationally since 1909, and in New Zealand since 1911:

In August 2006 Sany applied to the Intellectual Property Office of New Zealand to register its SANY logo mark, in respect of goods in Classes 7 and 12 of the Nice Classification.

Daimler opposed the application, in essence on the basis that Sany’s mark was confusingly similar to Daimler’s three-pointed star marks. The assistant commissioner held that, due to the overall visual and conceptual differences between the marks, they were not confusingly similar. 

Daimler also argued that Sany’s mark, or an essential element of it, was identical or similar to Daimler’s well-known marks and, as such, registration of Sany’s mark should be refused (as per Section 25(1)(c) of the Trademarks Act 2002). This is on the basis that use of Sany’s mark would be taken as indicating a connection in the course of trade between Sany and Daimler, and this would be likely to prejudice Daimler’s interests.

Here the assistant commissioner held that Daimler’s evidence did not support a finding that Daimler’s marks were well known in New Zealand and, as such, Daimler did not succeed on this ground of opposition.

Accordingly, Daimler’s opposition failed.

Daimler appealed to the High Court, who found that the assistant commissioner was wrong to conclude that Daimler’s trademarks were not well known in New Zealand. Even so, the court held that the assistant commissioner was correct in finding that the marks were not confusingly similar and, as such, Daimler’s appeal was dismissed.

Daimler appealed to the Court of Appeal, arguing that, in considering the similarity of the marks, the High Court had placed too much emphasis on the differences between the marks. 

Relying on the “essential element” component of Section 25(1)(c), Daimler argued that the three-pointed star within the circle is the essential element and dominant feature of their marks. As the High Court found there were similarities between the marks in relation to their dominant concepts, sufficient similarity was established. Any differences between the marks were not enough to overcome this similarity. 

Daimler also relied on the decisions of Crocodile International Pte Ltd v Lacoste and Carabao Tawandang Co Ltd v Red Bull GmbH to argue that invented words with no meaning will not make a significant impact on the distinctiveness of a mark, and given it is common in the motor industry to use names alongside logos (eg, Toyota Corolla and Fiat Punto), the High Court had placed too much emphasis on the inclusion of the word 'Sany' in Sany’s mark. 

Daimler argued that the essential element of their marks, namely the three-pointed star within a circle, had been reproduced by Sany. Thus, given Daimler’s extensive reputation, it submitted that Section 25(1)(c) should apply in this case.

The Court of Appeal agreed with the High Court’s findings that the marks are not similar, stating that “when we look at the Sany mark, we do not think of the Daimler marks”.  The court relied on the High Court’s summary of the marks:

"The Daimler marks are clearly a representation of a star and symbolise superior quality. The simplicity of the Daimler marks is one of their striking features. On the other hand, the Sany mark looks like a spinning rotor. It is a complicated device, the meaning of which is hard to discern by looking at the mark. Purchasers in the relevant markets could not confuse the Sany mark with Daimler’s three-pointed star within a circle. The device elements in the Sany and Daimler marks are not visually or conceptually similar."

The Court of Appeal also held that the inclusion of the word 'Sany' did further distinguish the marks in this case, but even if it were not included, the marks are sufficiently distinguishable.

In considering Section 25(1)(c), the court set out the approach put forth in NV Sumatra Tobacco Trading Co v New Zealand Milk Brands Ltd ([2011] NZCA 264):

(a) Is the Sany mark identical or similar to one of the Daimler marks which is well known, or is an essential element of the Sany mark identical or similar to that which is well known?

(b) Are Sany’s goods and services the same as, or similar to, the goods and services of Daimler?

(c) If not, would use of the Sany mark be taken as indicating a connection in the course of trade with Daimler?

(d) If the answer to issue (b) or (c) is yes, would use of the Sany mark be likely to prejudice the interests of Daimler?

The court held that the first limb of the test was not satisfied because the marks are not similar and nor is the Sany device inside the circle identical or similar to Daimler’s three-pointed star mark.

The decision is in line with the English court’s approach in Daimler AG v Sany Group Co Ltd ([2009] EWHC 2581 (Ch)), which found there was no relevant link (“a bringing to mind”) to be made by consumers between the two marks.  

The appeal was dismissed.

This case goes to show that the similarity between marks is the fundamental threshold inquiry in any opposition case. If you cannot establish similarity between the marks in question, then you ultimately have no case.

Carrick Robinson and Katy Stove, James & Wells, Auckland