Re Gay Giano Co Ltd

HEADNOTE

Intellectual Property S. 48(1) Trade Marks Ordinance Cap. 43 - "person aggrieved" - who has locus standi.

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

MISCELLANEOUS PROCEEDINGS

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Coram: The Hon. Mr. Justice Leonard in Court

Date of Hearing: 1st February 1996

Date of Handing Down of Judgment: 13th February 1996

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JUDGMENT

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1. Gay Giano Company Limited ("the Applicant") the Applicant in this matter seeks an order that the Register of Trade Marks be rectified by expunging therefrom the whole entry relating to registered trade mark no. 05401 of 1995, "GAY GIANO" registered in Class 14 of the Register in respect of "watches, clocks, horological and chronometric instruments".

2. The Director of Intellectual Property, who keeps the Register, has chosen not to appear, taking the view that there are no issues of principle of public importance involved. The other Respondent, Tic Toc International Limited ("the Respondent") which caused the entry to be made in Class 14, opposes the application.

3. The Applicant failed to oppose in time the filing by the Respondent of its application to register the mark in Class 14 and the Registrar refused to extend time.

4. Section 48(1) of the Trade Marks Ordinance, Cap. 43 is in the following terms:

"Any person aggrieved"

5. The only issue raised by the Respondent is whether the Applicant is a "person aggrieved" for the purposes of s. 48. Mr. Ng for the Respondent contends that if this Applicant does not trade in the same class of goods as the Respondent, and has no intention of trading in that class of goods, then he does not have the requisite standing to apply for rectification of the register.

6. The Applicant is the proprietor of the trade mark. "Gay Giano" used by the Applicant and its predecessors in business in Hong Kong, the United Kingdom, Singapore, Japan, South Korea, Taiwan, the Peoples' Republic of China, Benelux countries, France and Germany since at least 1979, on and in relation to the products manufactured and marketed by the Applicant including, in particular, men's and ladies' wearing apparel.

7. The Applicant is the proprietor of the registered trade mark no. 82303 of 1993, "Gay Giano" registered in Class 25 of the register in respect of "men's and ladies' wearing apparel".

8. The Respondent sells, in certain countries other than Hong Kong, watches marked "Gay Giano". It intends to sell such watches in Hong Kong and for that purpose registered the mark in Class 14.

9. There is no evidence that the Applicant has any present intention of marketing timepieces under the trade mark "Gay Giano" in Hong Kong. Nevertheless, it claims that the use by the Respondent of the mark would be likely to deceive or would be disentitled to protection in a court of justice or would be contrary to law or morality.

10. Sec. 12(1) of the Trade Marks Ordinance provides that:

"It shall not be lawful to register as a trade mark or part of a trade mark any matter the use of which would be likely to deceive or would be disentitled to protection in a court of justice or would be contrary to law or morality, or any scandalous design."

11. The construction of the term 'person aggrieved' is discussed in Kerly's Law of Trade Marks and Trade Names, 12th edition at page 179 where in paragraph 11-07 it is said that

"This phrase has been very liberally construed, and except, perhaps, in the case of a mark consisting of a name, it would be difficult to find any person engaged in the trade concerned, or any allied or connected trade, who is prevented by the qualification which it requires from moving to rectify the register. The persons who are aggrieved are, it is held, all persons who are in some way or other substantially interested in having the mark removed - where it is a question of removal - from the register: including all persons who would be substantially damaged if the mark remained, and all trade rivals over whom an advantage was gained by a trader who was getting the benefit of a registered trade mark to which he was not entitled."

12. The question whether an applicant is "a person aggrieved" is a question of fact. The Respondent has cited a number of decisions in support of the proposition that one cannot be an aggrieved person if one does not trade in the same class of goods as a person who has registered a mark. They include: Powell v. Birmingham Vinegar Brewery [1894] A.C. 8; Lever Bros. v. Sunniwite Products [1949] 66 R.P.C. 84 and The Ritz Hotel Limited v. Charles of the Ritz Limited and Registrar of Trade Marks [1988] F.S.R. 549. The observations in those cases were made in the context of the issues then to be decided and the facts found. I do not accept that they justify the narrow interpretation which the Respondent seeks to put upon the term "person aggrieved". I am fortified in this conclusion by a number of decisions.

13. In Eastman Photographic Materials Company Limited and another v. the John Griffiths Cycle Corporation Limited and the Kodak Cycle Company Limited [1898] 15 R.P.C. 105, the Plaintiffs used "Kodak" in connection with their goods, and especially for cameras. The Defendants made bicycles and obtained registration of the word "Kodak" as a trade mark in Class 22 (in which the Plaintiffs had no registered trade mark) for bicycles and other vehicles included in that class. It was held that the Defendant were trying to get the benefit of the reputation of the Plaintiffs and that the trade mark must be expunged as being calculated to deceive. Though the Plaintiffs did not trade in bicycles, the evidence showed a close connection between the bicycle and photographic trades. Romer J. said at page 110:

"... and it is obvious to me that the reason why the Defendant company registered the word "Kodak," and why it started and incorporated its co-Defendants under the name of The Kodak Cycle Company Limited was really to try and get a monopoly of the word "Kodak" as connected with cycles, and, in my opinion, it wanted to use the word "Kodak" and acquire a monopoly of it, as applied to cycles, in the hope and intention of, in some shape or other, identifying their company with the Plaintiff company whose "Kodaks" were so well-known in the market, to cause the public to suppose either that the Defendant company, under its own name or under the name of the Kodak Cycle Company Limited, was the Plaintiff company, or was, at any rate, connected with the Plaintiff company, or to lead the public to suppose that the goods which the Defendant company was going to sell were the goods of the Plaintiff company, and so to obtain the benefit of the large reputation, and the benefit also of the expenditure of the Plaintiff company."

14. One of the court's findings in the above case was that:

"... the evidence shows that between the two trades, the bicycle trade and the camera trade, there is an intimate connection. Many shops sell and deal in both bicycles and photographic cameras and materials. To a certain extent the Plaintiff company is identified with the name "Kodak" as connected with cycles, and so great is the connection between the two classes of business, that in all probability, I may say, the Plaintiff company may wish hereafter to manufacture and sell cycles specially adapted to carry their "Kodaks."

15. In the case of "Players" Trade Mark [1965] R.P.C. 363 the applicants applied to register the word "Players" in respect of confectionery intending to use it on "cigarettes" made of confectionery. This application was opposed by the owners of the same mark, registered in respect of tobacco, who had a considerable reputation in the mark. It was established that the applicants' and opponents' goods were sold through the same trade channels. It was held that, although the good were not goods of the same description, the applicants' use of the mark would be likely to lead to confusion. There was evidence that it was well known that confectionery goods and cigarettes were sold in a great majority of cases from the same shop or kiosk or even from the same counter in many shops.

16. In "Kodiak" [1987] R.P.C. 269 (C.A.), Balcombe L.J. was concerned with the question of the meaning of "any person aggrieved" in s. 26(1) of the Trade Marks Act 1938 and in s. 32 of the same Act which is similar to our s. 48. He said:

"Mr. Thorley for Kodak accepted that the construction of section 26(1) which was accepted by the learned judge involved reading into the sub-section, words to qualify the phrase 'any person aggrieved' by limiting the grievance to particular goods, covered by the registered mark in which the applicant traded or wished to trade. I know if no justification for qualifying the phrase in this way. Accepting as I do that the use of the words "any person aggrieved" in section 26(1) was intended to limit the right to apply under the section to persons who had a genuine grievance, so as to preclude applications by those who had no proper interest to be protected, I cannot agree with the very restricted interpretation put upon the phrase by the judge."

17. Balcombe L.J. cited with approval a passage from the judgment of Lord Herschell L.C. in Re Powell's Trade Mark [1894] 11 R.P.C.4. With reference to the question whether the respondents in that case were 'persons aggrieved' within the meaning of section 90 of the Patents Act of 1883, Lord Herschell said:

"My Lords, I should be very unwilling unduly to limit the construction to be placed upon these words; because, although they were no doubt inserted to prevent officious interference by those who had no interest at all in the Register being correct, and to exclude a mere common informer, it is undoubtedly of public interest that they should not be unduly limited, in as much as it is a public mischief that there should remain upon the register a Mark which ought not to be there, and by which many persons may be affected, who nevertheless would not be willing to enter upon the risk and expense of litigation."

18. Finally, there is the decision of Deputy Judge Le Pichon as she then was in Omega 1995 No. MP 43 (unreported). In that case, the company Omega S.A. which has a famous trade mark in relation to watches, was treated as an aggrieved person in relation to an application to register the mark "Omega" in Class 16 of Part A of the Register of Trade Marks in respect of "writing instruments, and refills and parts thereof", although Omega S.A. admitted that it had neither registered its marks in respect of writing instruments, refills and parts thereof nor sold such goods in Hong Kong. It had adduced evidence, however, to show that owners of famous trade marks tend to use them for a range of products including, in particular, watches and writing instruments.

19. In the present case, Mr. Shipp, who appears for the Plaintiff, has submitted that the fact that owners of famous trade marks in the fashion industry apply those marks to various fashion items such as clothing, handbags, footwear and watches is notorious, so that the court may take judicial notice of it. I do take notice of it. The Plaintiff claims that it has a well established trade mark in Hong Kong in connection with clothing sold in boutiques located in prominent positions in Hong Kong and it is aggrieved because the Respondent intends, in its view, to take advantage of the reputation which it has built up for its trade mark by selling watches bearing the words "Gay Giano".

20. I am satisfied that the Applicant is a "person aggrieved" for the purposes of s. 48 of the Trade Marks Ordinance.

21. So far as the merits of the Applicant's claim are concerned, its case is unopposed, in the sense that Mr. Ng who appears for the Respondent has chosen to confine his submissions entirely to the locus standi point. I have, however, taken account of the contents of the affidavits filed on behalf of the Respondent.

22. The Applicant contends that the mark in question would be likely to deceive and/or is disentitled to protection under s. 12(1) of the Trade Marks Ordinance.

"Likely to deceive"

23. The test to be applied here is whether there will be a "reasonable likelihood of deception or confusion among a substantial number of persons" if the Respondent sells its watches in Hong Kong bearing the trade mark which it has registered. See Smith Hayden [1946] 63 R.P.C. 97 at p. 101.

24. There is ample evidence of the Applicant's reputation. According to the affirmation of Chiu Che Chung Patrick filed on the 14th November 1995, he being the manager of Gay Giano Company Limited, the business under the name of Gay Giano Company started in about 1979 with the object of marketing ready-to-wear designer fashion in Hong Kong bearing its own label "Gay Giano" and the first retail outlet under the name of Gay Giano opened in the New World Centre on 15th October 1980. It was an instant success and the business grew. By the end of March 1986 the business had five shops all named Gay Giano which were located at New World Centre (two shops), Empire Centre, the Silvercord Centre (I assume that "Silvercourt" in the affirmation is a typographical error) and Sogo with a combined annual turnover of over $6m. The company was incorporated in 1985 with a paid-up captial of $1m. in order to manage the retail business of the boutiques and to take over the partnership business. On 1st June 1986 the Applicant started the Gay Giano Boutique at Parklane. In the 3 1/2 years from 1st June 1986 its turnover was $18,649,000.00. With effect from 1st July 1989 all Gay Giano Boutiques were operated by the Applicant.

25. As a result of success in Hong Kong, the Gay Giano label has been marketed in Asia, Europe and North America and has been especially successful in Japan, Taiwan, Singapore, Germany and Canada. All the boutiques are prominently marked "Gay Giano" and the boutiques are always situated in prime shopping areas where the label is exposed to the maximum pedestrian traffic. The company produces Gay Giano fashion catalogues and anniversary gifts in order to publicise the name. There are also direct mailings to announce the opening of new boutiques, the arrival of new collections and the bi-annual sales.

26. The name "Gay Giano" has been registered as a registered trade mark since 1981 in Part A of the Register in respect of "men's and ladies' wearing apparel".

27. The Respondent applied to register the mark "Gay Giano" on 9th March 1993 in Class 14 of the Register as I have said.

28. It is argued by the Applicant that by reason of the Applicant's goodwill and reputation in relation to the trade mark the directors and officers of the Respondent must have known of the Applicant and its trade mark. The Respondent's registered trade mark is identical to that of the Applicant phonetically and also visually to the extent that it consists of the same two words although the type face is not the same. It is the Applicant's belief that the Respondent's intention must have been to ride upon the goodwill and reputation subsisting in the name "Gay Giano" which had been built up by the Applicant over the years.

29. It is contended that any use of the mark by the Respondent on goods would be likely to deceive customers into thinking that those goods originated from the Applicant, the more so when most reputable fashion labels sell watches bearing their particular names. In respect of local fashion labels which sell watches bearing an "own-brand" name, the deponent mentions Guy Laroche and Charles Jordan. For foreign labels, he mentions Gucci, Dunhill and Chanel.

30. Mr. Shipp says, correctly in my judgment, that the Respondent has never denied that it knew of the Applicant's mark and it has never offered - any explanation for choosing the words "Gay Giano" to put on its watches. Mr. Shipp submits that the only reasonable inference is that it seeks to trade on the Applicant's goodwill. He says that the situation is similar to that in Slazenger and Sons v. Feltham & Co. (2) [1889] 6 R.P.C. 531. That was a case where Slazenger and Sons had a racket with a trade mark including the words "The Demon" and the Defendant marketed rackets exactly like those of the Plaintiff with the word "Demotic" stamped where the Plaintiff stamped "The Demon". It was held that the Defendant ought to be restrained from using the word "Demotic" in such a way as to represent its goods as the goods of the Plaintiff's. At page 538 of the report Kekewich, J., said

"One must exercise one's common sense, and, if you are driven to the conclusion that what is intended to be done is to deceive if possible, I do not think it is stretching the imagination very much to credit the man with occasional success or possible success. Why should we be astute to say that he cannot succeed in doing that which he is straining every nerve to do?"

31. The Plaintiff has carried out a market survey, the results of which had been exhibited and they show that substantial reputation and goodwill subsist in the trade mark "Gay Giano" in relation to clothing.

32. I am satisfied that any use of the trade mark "Gay Giano" by the Respondent on watches in Hong Kong would cause confusion among the public who would think that the watches were connected with the Applicant. Mr. Shipp has rightly pointed out that s. 12 has as an object the protection of the public.

"Disentitled to protection"

33. The Respondent's registration would be no bar to an action for passing-off. It is submitted that the marketing by the Respondent of watches in Hong Kong bearing the mark "Gay Giano" would constitute passing-off. In support of that argument, Mr. Shipp cited the cases of Reckitt and Coleman v. Borden (A.L.) [1990] R.P.C. 341, Nike (Ireland) Limited v. Network Management Limited [1994] 12 E.I.P.R. D-319 and thirdly the case of Omega (Supra). Mr. Ng for the Respondent has not seen fit to argue to the contrary. I find that Mr. Shipp is correct in his contention and the use of the trade mark would be disentitled to protection in a court of justice in circumstances where the Respondent was passing-off its watches as bearing the mark of the Applicant.

34. There will therefore be the following orders:

1. That the Register of Trade Marks be rectified by expunging therefrom the whole entry relating to registered trade mark no. 05401 of 1995, "GAY GIANO" registered in Class 14 of the Register in respect of "watches, clocks, horological and chronometric instruments".

2. An order nisi that the Applicant's costs of and incidental to this application be taxed if not agreed and paid by the Respondent.

Representation:

Mr. Colin Shipp instructed by Messrs. King & Co. for the Plaintiff.

Mr. Lawrence Ng instructed by Messrs. Hui & Lam for the Respondent.