Recent Decision Evidences Benefit of Registering Trade Marks

In Korea Ginseng Corp v Calvin Klein Trademark Trust [2022] NZIPOTM 1 the opponent successfully opposed an application that mainly covered services that are dissimilar to the goods that the opponent licences third parties to use its trade marks on.

Background:
In late 2018 Korea Ginseng applied for the mark CKJ in class 35 for retailing or wholesaling services relating to a wide range of goods that would fall within classes 3, 5, 29, 30, 32 and 33. This was opposed by Calvin Klein under the grounds of: likely to deceive or cause confusion (s 17(1)(a)); conflict with earlier similar registrations (s 25(1)(b)); conflict with well-known mark (s 25(1)(c)); and not the owner (s 32(1)). Calvin Klein has registrations in a wide variety of goods and services classes for the device mark shown here as well as a range of other device marks with a dominant CK element in classes 3 and 25. Calvin Klein also claimed use (by way of licensing) and reputation in marks including CK, CKJ and CALVIN KLEIN JEANS particularly in relation to apparel, sunglasses, cosmetics and fragrances.

Reputation:
The Assistant Commissioner found much of Calvin Klein’s evidence of use or reputation to be irrelevant on account of not relating specifically to the New Zealand market and in the absence of evidence linking overseas reputation to New Zealand declined to find that spill-over reputation had been established. Nonetheless, there was sufficient evidence for establishing reputation in the CK device marks in relation to apparel, sunglasses and fragrances. Further, two stores traded under the name CALVIN KLEIN JEANS and CKJ was used in product codes for jeans and sunglasses. However, while the Assistant Commissioner held that there was sufficient reputation for these marks in relation to the products they were used on to satisfy the initial onus on the opponent under section 17(1)(a), it was held that there was insufficient reputation for section 25(1)(c) purposes.

Likelihood of Confusion:
The Assistant Commissioner found that a likelihood of confusion under the section 17(1)(a) ground was only established in relation to the retailing or wholesaling of toiletries or cosmetics as the other services were in relation to goods that were too far removed from the Calvin Klein’s goods in which reputation had been established. While Calvin Klein had not established use of CKJ in relation to its class 3 goods, its positive finding under section 17(1)(a) in relation to those goods was assisted by it being perceived as having a family of CK marks for those goods.

Conflict with Earlier Similar Registrations:
The Assistant Commissioner noted that reputation is not relevant under section 25(1)(b) as the opponent’s registrations are assumed to be used in a normal and fair manner (and that is also the case for the applicant’s mark). It was also noted from precedent that in comparing goods and services, the following factors are relevant and that there is no fundamental reason why goods cannot be similar to services, and vice versa.

• The respective uses of the respective goods or services;
• The respective users of the respective goods or services;
• The physical nature of the goods or acts of service;
• The respective trade channels through which the goods or services reach the market;
• In the case of self-serve consumer items, where in practice they are respectively found or likely to be found.

The Assistant Commissioner found the most relevant Calvin Klein registrations in relation to the services covered by Korea Ginseng’s application to be the CK device marks for retail store and related services and for dried flowers and other device marks with a dominant CK element in class 3. Of these registrations the CK device marks were found to have a moderate level of similarity to CKJ, while the other device marks were found to have low or very low similarity. Given the unchallenged scope of Calvin Klein’s CK device mark for retail store and related services, it covers all the retail services of Korea Ginseng’s application and is similar to their wholesale services. That and the moderate level of similarity to the CKJ application led the Assistant Commissioner to conclude that Korea Ginseng had not discharged its onus of showing that there would not be a reasonable likelihood of deception or confusion among a substantial number of persons if CKJ was used in a normal and fair manner.

Korea Ginseng sought to evade the consequences of the finding under section 25(1)(b) by arguing honest concurrent use. Its strongest case for this was that in the 1940’s it adopted marks with the English transliteration “Cheong-Kwan-Jang”, and claimed that the abbreviation CKJ is recognised internationally as a trade mark of theirs. However, there was no evidence from prior to their application date to support the claim that the abbreviation CKJ has trade mark status and so the concurrent use argument was rejected.

Ownership:
This finding was also relevant to the ‘not the owner’ ground as the earliest date that Korea Ginseng could provide basis for ownership in the CKJ mark was the application date. In 1999 Calvin Klein applied for and obtained registrations for various marks consisting of or prominently containing CKJ in classes 25, 35 and 42 on a proposed to be used basis. However, these registrations were all allowed to expire in 2006. Given the proposed to be used basis of those applications and the absence of any evidence of use the Assistant Commissioner found that Calvin Klein’s rights in those marks did not survive the expiry of the registrations.

Consequently, given the identical or substantially identical mark criterion for claiming ownership, Calvin Klein’s best claim to ownership of the CKJ mark was from the use of that mark by its licensees through online retailing in relation to jeans, tee-shirts and eyewear. There was no evidence as to whether Calvin Klein had supplied those licensees through wholesaling of those goods. Yet, even if there had been such evidence those goods or a reasonable generalisation thereof are unrelated to any of the services covered by the opposed application and so the ground of not the owner was rejected.

Conclusion:
The opponent only had limited success on the likelihood of confusion ground and none on the not the owner ground (which has stricter criteria), but its registrations proved to be beneficial as the applicant was found to have not discharged the onus that the registrations placed on  them.

Author: Quinn Miller

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