Daimler, dismissed...

Article  \  11 Sep 2015

The rub

Where trade marks cover the same or similar good or services, just because the marks exhibit similar features such as, in this case, a three pointed star and a circle device, it doesn't necessarily mean the marks are similar, or that the use of a mark will confuse consumers.

In a case brought by Daimler AG (Daimler) against Sany Group Co Ltd (Sany), the New Zealand Court of Appeal has found that more was needed in terms of the look of the marks to give rise to a finding of similarity.

The story

Daimler manufactures some of the world's most beautiful motor cars sold under the MERCEDES BENZ brand and world famous 'three pointed' star device. 

However, it came up stumps in a recent decision of the New Zealand Court of appeal on 8 September.

Daimler had been upset by Sany's adoption and proposed use of the following 'three pointed' star device  for a range of heavy industry goods including  buses, lorries and cars, excavators and diggers, both in New Zealand and elsewhere around the world.

Daimler had opposed Sany's New Zealand trade mark application for the combined word and star device, in the hope that it could prevent it from registering the mark in New Zealand, but Daimler was unsuccessful at every stage in the process.

Daimler's principal argument was that the marks were similar and use would cause consumers in the New Zealand market to be deceived or confused. Daimler also argued that consumers would be misled or deceived in breach of the Fair Trading Act, or that Sany was trying to pass off its products as those of Daimler by adopting its star device.

Unfortunately, but correctly in this commentator's view, Sany couldn't convince the intellectual property office, High Court or Court of Appeal of its case, and so it has probably received its final nail with Tuesday's decision.

The only area in which Daimler was notably successful, was in establishing that its star device was well-known in the New Zealand market, but this was never going to be enough to take the case further.

In essence, Daimler had argued  that Sany's star device and the goods covered by its trade mark application were the same as or similar to Daimler's undisputedly world-famous star device. There was no real question about the similarity of the goods. Daimler manufactures not only cars, but also a range of UNIMOG multipurpose heavy duty vehicles, trucks, buses, diesel engines, turbines and rail vehicles. These are essentially the same as or similar goods to those covered by Sany's application. It all came down in the end to whether the shape and configuration of the design of Sany's star device was similar to Daimler's.

In its primary grounds of appeal, Daimler was critical of the High Court's overall assessment of whether the marks were similar, and that use would be likely to cause confusion in the relevant market. Daimler argued that the Judge had misdirected himself in four key ways. Specifically, that the Judge had:

  • placed too much emphasis on the differences between the marks, even after finding that there were similarities in relation to their underlying concepts, being the three pointed star and a circle device;
  • incorrectly relied on the differences between the marks;
  • wrongly taken into account the use of the word SANY in the mark; and
  • placed too much emphasis on the discerning nature of potential purchasers, and that the relevant market extended beyond them, to all those who are aware of the well- known Daimler star device, and who may be exposed to Sany's goods. 

On appeal, the Court of Appeal considered each of these points but found that on the whole they weren't fairly based. Considering Daimler's points, the Court of Appeal concluded that:

  • The differences were significant. In particular, that the Sany star device was, unlike the Daimler device, suggestive of rotational movement or the potential for movement; and didn't have the symmetry and refined imagery of superior quality of the Daimler star device.
  • The High Court Judge's references to the similarities needed to be put in context. The Court of Appeal said that the High Court's comments that there were similarities between the marks weren't to be taken as sufficient for a finding of similarity. Rather, they were a precursor as part of the Judge's overall review of the marks. In other words, the High Court Judge was acknowledging in his analysis that while there were similarities, there were also differences and, on the whole, those differences were sufficient to support a finding that the marks weren't similar.
  • Daimler was correct in complaining that the Judge had been wrong to rely on the addition of the words SANY acting as a further distinguishing feature. The Court of Appeal considered that well-settled case law supported the view that in some cases the addition of a word may not be significant and that, in this case, the addition of the word SANY did not further distinguish the marks. However, the Court of Appeal said that even without this feature, there was no risk of confusing the two star devices.
  • The High Court was right to consider the discerning nature of the potential purchasers in assessing the likelihood of confusion, and reaffirmed one of the leading principles  applied when considering the question of confusion: that the relevant states of mind are of those who are the prospective or potential purchasers of the relevant goods (and others involved in the purchase transactions) covered by Sany's application. And, that it is the focus on the awareness of Daimler's star device in relation to the prospective purchasers of goods covered by Daimler's trade mark, and the individuals and entities involved in that trade, that matter.

After dismissing Daimler's arguments, the Court reaffirmed that the question of similarity is ultimately one of impression, and the marks are not similar:

'When we look at the Sany mark we do not think of the Daimler mark.'

Daimler raised a number of other grounds on appeal that were reliant on a positive finding in relation to the similarity of the marks, but all failed to pass muster given this dependency.

While the case doesn't break any new ground under New Zealand trade mark law, it does serve as a reminder to brand owners taking issue with competitors' trade marks that:

  • just because trade marks exhibit similar features such as, in this case, a three pointed element and a circle device, it doesn't necessarily follow that they are similar, or that consumers will be confused; and
  • establishing that two marks are similar will always be fundamental to preventing the registration of a trade mark application or proving that someone is trespassing on a brand owner's rights.