Court of Appeal · Decided 29 November 2013

Staywell Hospitality Group Pty Ltd v Starwood Hotels & Resorts Worldwide, Inc and another and another appeal

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[2013] SGCA 65Case no. Civil Appeals Nos 147 and 148 of 2012

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Grounds of decision

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Sundaresh Menon CJ (delivering the judgment of the court):
Introduction
[1] These appeals arise from opposition proceedings commenced by Sheraton International, Inc (“Sheraton”) and Starwood Hotels & Resorts Worldwide, Inc (“Starwood”) (collectively, “the Opponents”). The Opponents opposed the application (“the Application”) made by Staywell Hospitality Group Pty Ltd (“Staywell”) to register a series of two marks (“the Applicant Mark”) in Singapore in respect of marketing and hospitality services. Civil Appeal No 148 of 2012 (“CA 148/2012”) is the Opponents’ appeal against the finding of the High Court Judge (“the Judge”) that there was no likelihood of confusion or sufficient indication of a connection damaging to the Opponents’ interests in order to ground an opposition to registration under ss 8(2)(b) and 8(4)(b)(i) of the Trade Marks Act (Cap 332, 2005 Rev Ed) (“the Act”); and against the Judge’s finding that there was no goodwill in the Opponents’ ST. REGIS Singapore hotel for the purpose of an opposition under s 8(7)(a) of the Act. Civil Appeal No 147 of 2012 (“CA 147/2012”) is Staywell’s cross-appeal against the Judge’s finding that the Applicant Mark was similar to the Opponents’ ST. REGIS registered trade mark (“the Opponent Mark”).
Background to the appeals
The parties
[2] The Opponents are hotel and leisure companies incorporated in the United States. They own and operate 32 St Regis hotels worldwide (17 at the time of the Application). In Singapore, Sheraton has been the registered proprietor of the word trade mark “ST. REGIS” in Classes 36 and 37 of the International Classification of Goods and Services (“ICGS”) since 2005 (relating to real estate and construction services respectively), and in Classes 41 (relating to entertainment services) and 42 (relating to hotel and hospitality services) since 1995. Class 42 is equivalent to Class 43 of the latest edition of the ICGS, and will be referred to hereafter as “Class 43”.
[3] Staywell is an Australian hotel operator. It currently owns and operates 27 hotels (24 at the time of the Application) under its two brands, Park Regis and Leisure Inn. These hotels are located mainly in Australia and New Zealand. The Application was Staywell’s first application for trade mark registration in Singapore.
Background facts
[4] Staywell filed the Application to register its series of two marks on 3 March 2008 in Singapore in Classes 35 and 43 of the ICGS. Class 35 relates to advertising and marketing services. Class 43 relates to hotel services, hospitality, food and beverage and related services. The Opponents’ ST. REGIS Singapore hotel opened on 20 April 2008, shortly after the filing of the Application. On 7 May 2008, the Application was accepted and published for opposition purposes. Staywell’s hotel, the Park Regis Singapore, only opened for business in November 2010.
[5] The Opponents filed their Notice of Opposition to the Application on 8 September 2008. They relied on absolute grounds of opposition under ss 7(4)(b) and 7(6) of the Act, and relative grounds of opposition under ss 8(2)(b), 8(4)(b) and 8(7)(a) of the Act. On 19 July 2011, the Principal Assistant Registrar (“the PAR”) allowed the opposition under ss 8(2)(b) and 8(4)(b)(i) of the Act, but rejected the opposition under ss 8(4)(b)(ii), 8(7)(a) and 7 of the Act. In relation to the relative grounds of opposition, she found that the competing marks and the parties’ services were similar, and that such similarity resulted in a likelihood that the public would be confused into thinking that the Park Regis Singapore was economically linked to the ST. REGIS Singapore. However, she refused the opposition under s 8(4)(b)(ii) of the Act because she found that the ST. REGIS mark was not “well known to the public at large in Singapore”. The opposition under s 8(7)(a) also failed because the Opponents were unable to show that goodwill attached to the ST. REGIS Singapore at the date of the Application.
[6] Staywell appealed against the PAR’s decision in relation to ss 8(2)(b) and 8(4)(b)(i) of the Act. The Opponents filed a cross-appeal against the PAR’s rejection of the opposition under s 8(7)(a) of the Act. The appeal and cross-appeal were heard by the Judge on 18 April 2012.
The decision below
[7] The Judge reversed the PAR’s decision under ss 8(2)(b) and 8(4)(b)(i) of the Act and affirmed the decision under s 8(7)(a) of the Act.
[8] The Judge’s findings in relation to the opposition under s 8(2)(b) of the Act can be summarised as follows:
(a) The Opponent Mark was inherently distinctive in relation to hotel services. On the whole, the marks were aurally and conceptually similar.
(b) The Class 35 and 43 services for which Staywell sought registration were undoubtedly similar to the Opponents’ services registered in Class 43. Staywell’s registration in Class 35 was merely complementary to its registration in Class 43.
(c) Considering the factors set out in The Polo/Lauren Co, LP v Shop In Department Store Pte Ltd [2006] 2 SLR(R) 690 (“Polo (CA)”), including the steps Staywell had taken to differentiate its services from that of the Opponents’, there was no likelihood of confusion resulting from the similarity of the competing marks and the similarity of their services.
[9] As regards the s 8(4)(b)(i) opposition, the Judge found as follows:
(a) The level of knowledge of the Opponent Mark in Singapore, as evidenced by the extensive advertising and the number of Singaporean patrons of ST. REGIS hotels worldwide, was sufficiently high to warrant a finding that the Opponent Mark is a well-known mark in Singapore.
(b) Following the finding that no likelihood of confusion resulted from the similarity of the marks, the use of the Applicant Mark would not indicate a confusing connection between the Park Regis Singapore and the Opponents.
(c) Even if a confusing connection existed, this would not cause damage to the Opponents. They had shown no intention of moving into the market segment in which the Park Regis Singapore operated.
[10] As regards the s 8(7)(a) opposition, the Judge found as follows:
(a) The Opponents’ pre-opening activity in Singapore, and the worldwide reputation in the ST. REGIS brand, was not sufficient to establish that goodwill attached to the ST. REGIS Singapore at the date of the Application.
[11] In the result, the Applicant Mark was allowed to proceed to registration. On 9 November 2012, the Opponents filed their Notice of Appeal in CA 148/2012 against the whole of the Judge’s decision. Staywell also filed its Notice of Appeal in CA 147/2012 challenging the Judge’s finding of aural and conceptual similarity between the Opponent and Applicant Marks.
Issues in the appeals
[12] The following issues and sub-issues arose for our consideration in the two appeals:
(a) Whether the Judge erred in disallowing the opposition under s 8(2)(b) of the Act; in particular:
(i) whether the Judge erred in finding that the competing marks were aurally and conceptually similar (“the marks-similarity inquiry”); and
(ii) whether a likelihood of confusion arose from the similarity between the competing marks and the parties’ services (“the confusion inquiry”);
(b) Whether the Judge erred in disallowing the opposition under s 8(4)(b)(i) of the Act; in particular:
(i) whether use of the Applicant Mark in relation to hotel services was likely to damage the Opponents’ interests; and
(c) Whether the Judge erred in disallowing the opposition under s 8(7)(a) of the Act; in particular:
(i) whether there was goodwill in the ST. REGIS Singapore as at the date of the Application.
Whether the Judge erred in disallowing the opposition under s 8(2)(b) of the Act
Were the marks aurally and conceptually similar?
[13] Staywell’s case in CA 147/2012 was that that the Judge came to the wrong conclusion as to the aural and conceptual similarity of the competing marks. In particular, it was argued that she fell into error when she dissected the marks and analysed their components discretely in considering their distinctiveness. The Opponents’ response was that the Judge did consider the marks holistically, but was entitled to focus on the dominant and distinctive components of each mark. As a preliminary point, the Opponents also argued that as long as a minimal level of marks-similarity was established, the court could and should go on to analyse the likelihood of confusion arising from the similarity of the marks and the goods or services in question.
Is the threshold of marks similarity a low one?
[14] We begin with the preliminary point. The Opponents rely on the decision of Lindsay J in esure Insurance v Direct Line Insurance plc [2008] RPC 6 (“esure Insurance”) for the proposition that the similarity of marks is subject to a “low threshold test”. They contend that the competing marks more than satisfied this low threshold test. We take this opportunity to restate a number of principles relevant to the marks-similarity inquiry.
[15] To the extent that the Opponents’ argument treated the similarity of competing marks as a threshold requirement that had to be satisfied before the confusion inquiry is undertaken, we agree. It is clear from the plain words of ss 8 as well as 27 of the Act that the only relevant type of confusion for the purpose of grounding an opposition or an infringement action, is that which is brought about by the similarity between the competing marks and between the goods and services in relation to which the marks are used. Since this court’s decision in Polo (CA), our courts have given effect to this statutory wording by applying what is now known as the “step-by-step” approach, as opposed to the competing “global appreciation approach” applied in Europe after Sabel BV v Puma AG, Rudolf Dassler Sport [1998] RPC 199 (“Sabel v Puma”). Under the step-by-step approach, the three requirements of similarity of marks, similarity of goods or services, and likelihood of confusion arising from the two similarities, are assessed systematically. The first two elements are assessed individually before the final element which is assessed in the round. Under the global appreciation approach the elements of similarity between marks and goods or services, whilst still necessary ingredients in the confusion inquiry, are elided with other factors going towards the ultimate question of whether there is a likelihood of confusion (see Sabel v Puma at 223–224, and Canon Kabushiki Kaisha v Metro-Goldwyn-Mayer Inc [1999] RPC 117 (“Canon”) at 132). Whilst there have been suggestions that the two approaches might be distinct without being different, we maintain this dichotomy and endorse the step-by-step approach as being conceptually neater and more systematic and, importantly, as being more aligned with the requirements imposed under our statute (see Polo (CA)) at [8]).
[16] However we do not agree with the Opponents’ approach to the extent that it suggests that any particularly or notably low threshold of marks-similarity applies. For one thing, such an approach finds no support in the case law. The English Court of Appeal disapproved of Lindsay J’s “low threshold test” when esure Insurance went on appeal in esure Insurance Ltd v Direct Line Insurance PLC [2008] EWCA Civ 842. Arden LJ there stated that “no useful purpose” was served by holding that there was a minimal level of similarity that had to be shown; and she went on to hold that such an approach was unsupported by European jurisprudence (at [49]). Nor does our own case law lend any support to such an approach.
[17] More fundamentally, the minimal threshold approach is inconsistent with the reality that the similarity of marks is ultimately and inevitably a matter of impression rather than one that can be resolved as a quantitative or mechanistic exercise (see Polo (CA) at [35] and Wagamama Ltd v City Centre Restaurants Plc [1995] FSR 713 at 732). The learned Amicus, Prof Ng-Loy Wee Loon submitted that while the court should consider each of the three established aspects of similarity, viz, visual, aural or conceptual similarity, as long as it found that there was some degree of similarity in any one of these three aspects, no matter how weak, the marks-similarity requirement should be considered to have been met and the court would then be obliged to proceed to the next stage of the inquiry which will generally be the likelihood of confusion. We respectfully disagree. The court must ultimately conclude whether the marks, when observed in their totality, are similar rather than dissimilar. The three aspects of similarity are meant to guide the court’s inquiry but it is not helpful to convert this into a checkbox exercise in which a tick, however faint it might be, in any one box must compel the court to find that the marks are similar when a sensible appraisal of the marks as a whole would show otherwise.
[18] We observed this in Hai Tong Co (Pte) Ltd v Ventree Singapore Pte Ltd [2013] SGCA 26 (“Hai Tong”) at [40(a)]. Congruously, there is no prescribed requirement that all three aspects of similarity must be made out before the marks can be found to be similar: MediaCorp News Pte Ltd v Astro All Asia Networks plc [2009] 4 SLR(R) 496 (“MediaCorp”) at [32] and Sarika Connoisseur Café Pte Ltd v Ferrero SpA [2013] 1 SLR 531 (“Sarika”) at [16]. In short, the criteria of visual, aural and conceptual similarities do not invite a formulaic consideration; rather, they are signposts towards answering the question of whether the marks are similar. Trade-offs can occur between the three aspects of similarity in the marks-similarity inquiry: Ozone Community Corp v Advance Magazine Publishers Inc [2010] 2 SLR 459 (“Ozone”), see also Bently and Sherman, Intellectual Property Law (Oxford University Press, 3rd Ed, 2009) ("Bently & Sherman") at p 864.
[19] A further problem with adopting an approach in which any modicum of similarity would compel the court to make a finding of marks-similarity is that this would backload much of the court’s assessment to the confusion inquiry stage. We are wary of this and, in any event, do not view it as being faithful to the scheme of our statutory framework. A productive and appropriate application of the step-by-step approach necessitates that the court reach a meaningful conclusion at each stage of the inquiry.
[20] Finally, on this issue, we reiterate that the assessment of marks similarity is mark-for-mark without consideration of any external matter: see Mediacorp at [33], Sarika at [17] and Hai Tong at [40(b)]. This means that at the marks similarity stage this even extends to not considering the relative weight and importance of each aspect of similarity having regard to the goods. This does not mean that the court ignores the reality that the relative importance of each aspect of similarity might vary from case to case and will in fact depend on all the circumstances including the nature of the goods and the types of marks, as we observed at [40(b)] of Hai Tong. Rather, such considerations are properly reserved for the confusion stage of the inquiry, because that is when the court is called upon to assess the effect of objective similarity between the marks, on the perception of consumers. We recognise that this reflects a slight departure from the approach taken by the High Court in Festina Lotus SA v Romanson Co Ltd [2010] 4 SLR 552 at [55]–[56], and by this court in Sarika at [38]. We think that this is conceptually clearer because it recognises that the issue of resemblance between the competing marks is distinct from the question of the effect of such resemblance. A practical application of this approach can be found in European jurisprudence: see Mystery drinks GmbH v OHIM, T 99/01 [2004] ETMR (18) 217 and Phillips-Van Heusen Corp v OHIM [2004] ETMR 60. In these cases the court considered, respectively, the particular significance of aural similarity in relation to beverages normally sold by oral order, and visual similarity in relation to clothing normally sold based on the consumer’s direct perception, both for the specific purpose of determining whether consumer confusion was likely to arise.
Whether the Judge erred in finding that the marks were aurally and conceptually similar, having regard to their distinctiveness
[21] We turn to consider the Judge’s finding that the competing marks in this case were similar. Staywell’s case was that the Judge wrongly focussed on the “REGIS” element of both marks, instead of considering the aural and conceptual similarity of the marks as a whole. In particular, Staywell contended that the Judge erred in treating “REGIS” as distinctive when in fact the Opponents had never used the word “Regis” on its own, but always as part of the composite word “St Regis”.
[22] Before turning to the particular facts before us, we first distinguish between two different aspects of “distinctiveness” in trade mark law. This was articulated by Lord Walker in BUD And Budweiser Budbräu Trade Marks [2003] RPC 25 at [39], as follows:
[23] Distinctiveness in the ordinary and non-technical sense simply refers to what is outstanding and memorable about the mark. Such components tend to draw the consumer’s attention, bearing in mind the imperfect recollection of the average customer. This reflects the reality that the average consumer “only rarely has the chance to make a direct comparison between the different marks and must place his trust in the imperfect picture of them that he has in his mind” (Lloyd Schuhfabrik Meyer v Klijsen Handel BV, Case C-342/97 [1999] 2 CMLR 1343 (“Lloyd”) at 1358 and Ozone Community Corp v Advance Magazine Publishers Inc [2010] 2 SLR 459 (“Ozone Community”) at [50]). The distinctive (in the non-technical sense) and memorable components of the mark are those that tend to stand out in the consumer’s imperfect recollection. That is why the court is entitled to have special regard to the distinctive or dominant components of a mark, even while it assesses the similarity of the two marks as composite wholes.
[24] Distinctiveness in the technical sense on the other hand, usually stands in contradistinction to descriptiveness. Where the latter connotes words that describe the goods or services in question, or of some quality or aspect thereof, the former refers to the capacity of a mark to function as a badge of origin. Distinctiveness can be inherent, usually where the words comprising the mark are meaningless and can say nothing about the goods or services; or acquired, where words that do have a meaning and might well say something about the good or services, yet come to acquire the capacity to act as a badge of origin through long-standing or widespread use (see Windsurfing Chiemsee Produktion und Vertriebs GmbH v Boot und Segelzubehor Walter Huber and Franz Attenberger [1999] ETMR 585 (ECJ), Love & Co Pte Ltd v The Carat Club Pte Ltd [2009] 1 SLR(R) 561 at [98]–[100] and Hai Tong at [32]–[33]).
[25] Technical distinctiveness is an integral factor in the marks-similarity inquiry (see Sarika at [20], Ozone Community at [47] and Polo (CA) at [36]); a mark which has greater technical distinctiveness enjoys a high threshold before a competing sign will be considered dissimilar to it (Sarika at [36]). While the components of a mark may be inherently technically distinctive, ultimately the ability of the mark to function as a strong badge of origin must be assessed by looking at the mark as a whole. Conversely, the components of a mark may not be inherently distinctive, but the sum of its parts may have sufficient technical distinctiveness. We examined this in Hai Tong in relation to the composite phrase “Lady Rose”, and there stated (at [35]):
[26] When speaking of the assessment of a mark as a whole, it may be noted that the cases have consistently stated that the “visual, aural or conceptual similarity of the marks in question, must be based on the overall impression given by the marks, bearing in mind, in particular, their distinctive and dominant components” (Sabel v Puma at 224, Matratzen Concord GmBH v OHIM, Case T-6/01 [2002] ECR II-4335 (“Matratzen”), Doctor's Associates Inc v Lim Eng Wah (trading as SUBWAY NICHE) [2012] 3 SLR 193 (“Subway Niche”) at [19] and Bently & Sherman at p 864).
[27] In Matratzen the European Court of First Instance dismissed the contention that a consideration of the dominant and distinctive components of a mark would mean a failure to consider the mark as a whole. After stating that the similarity between two marks must be assessed globally, but in light of their distinctive and dominant components, the court said (at [34]):
This was endorsed by the European Court of Justice (“ECJ”) on appeal in Matratzen Concord GmBH v OHIM (C-3/03 P) at [31]–[32]. More recently in 32Red Plc v WHG (International) Ltd [2012] RPC 2012 the English Court of Appeal dismissed the argument that the judge below had erred in de-constructing the competing composite word marks (viz, “32RED” and “32vegas”) and finding “32” to be the dominant component (at [85] and [89]). Our courts have taken the same approach in cases involving competing marks with a common denominator, such as in The Polo/Lauren Co, LP v Shop In Department Store Pte Ltd [2005] 4 SLR(R) 816 (“Polo (HC)”) at [25] and Richemont International SA v Goldlion Enterprise (Singapore) Pte Ltd [2006] 1 SLR(R) 401 at [12] (“Richemont”). The question in those cases was whether the common element of the competing marks was so dominant as to render the different elements ineffective to obscure the similarity between the marks.
[28] It follows from this that it is not wrong for a court to find that a component of a mark is inherently technically distinctive – for example if it is a non-descriptive word or an elaborate and inventive graphic device. Where a particular element or component has a high degree of technical distinctiveness, this can have a bearing on whether as a result of this, that component or element is found to be the dominant and distinctive element of the mark in the non-technical sense.
[29] The finding of distinctiveness of the separate components of the mark must ultimately be related back to the impression given by the mark as a whole. The distinctiveness of a particular component of a mark is but one factor feeding into the ultimate question of whether the mark, in the form it is registered and/or used, has strength as an indicator of origin to the exclusion of other trade sources. This latter question clearly must be considered by looking at the mark as a whole, because it is the entire mark, and not only a component of it, that must function as the badge of origin.
[30] We turn to examine whether the Judge applied these principles correctly in the instant case. Perhaps for ease of analysis the Judge approached the inquiry in a two-stage process as was done in Ozone Community (see the Judge’s Grounds of Decision (“GD”) at [14]). We reiterate, as was held in Sarika (at [20]) and in Hai Tong (at [26]), that distinctiveness (in both its technical and non-technical senses) is a factor integrated into the visual, aural and conceptual analysis as to whether the competing marks are similar. It is not a separate step within the marks-similarity inquiry.
Aural similarity
[31] At [21], [24] and [27] of the GD, the Judge considered the word “REGIS” to be the dominant and distinctive component of both marks when each is read out. In our view, she was perfectly entitled to come to this view. Staywell’s argument that the Judge erred in considering the dominance of “REGIS” because the Opponents had never used or registered the component “REGIS” alone was misconceived simply because, as we have pointed above, a component can clearly be dominant even if it is part of the mark as a whole and is not and has never been used on its own. In fairness to the Judge, it should be noted that she specifically considered that the “ST.” and “Park” portions of the competing marks, though not as dominant as the “Regis” portion, were not to be ignored. Staywell’s argument that any distinctiveness of the Opponent’s mark lay in “ST. REGIS” as a whole rather than in “REGIS” overlooked the permissibility of examining the distinctive components of the competing marks in both the technical and non-technical senses. At least in relation to hotels and hospitality services, “REGIS” enjoys a substantial degree of technical distinctiveness. In relation to both the competing marks “REGIS” is the element that is distinctive in the non-technical sense because it is what will stand out in the imperfect recollection of the consumer. The Judge was therefore entitled to find this the common dominant element of both marks in assessing the question of whether the competing marks as a whole were similar. The Judge found on this basis that the marks were aurally similar and we agree.
[32] An alternative approach which does not involve considering the dominant components of the marks would have been simply to undertake a quantitative assessment as to whether the competing marks have more syllables in common than not. This was the approach taken in Ozone Community at [55]. Even on this approach it is clear that the two marks, each taken as a unified whole, have more syllables in common than not.
[33] We therefore see no reason to disturb the Judge’s finding that the marks had aural similarity. In fact we find that there is a high degree of aural similarity between the competing marks because of the distinctiveness of the common “REGIS” component in both the technical and non-technical senses.
Conceptual similarity
[34] Turning to the conceptual analysis, there are a few aspects of the Judge’s decision with which we find ourselves, with respect, in disagreement.
[35] First, the Judge gave weight to the Opponents’ argument that the competing marks shared the underlying connotation of royalty, since the “REGIS” component of the marks was dominant. As we have already noted, the Judge was entitled to conclude that “REGIS” was the distinctive component from an aural perspective. However, we do not agree that “REGIS” was a dominant component on a conceptual analysis. Unlike the aural analysis, which involves the utterance of the syllables without exploring the composite meaning embodied by the words, the conceptual analysis seeks to uncover the ideas that lie behind and inform the understanding of the mark as a whole (Bently & Sherman at p 866). Greater care is therefore needed in considering what the conceptually dominant component of a composite mark is, because the idea connoted by each component might be very different from the sum of its parts. The case of Vedial SA v OHIM — France Distribution (HUBERT), Case C-106/103 P [2004] ECR I-9573 is illustrative. There, the European Court of Justice upheld the Court of First Instance’s finding that the mark for which registration was sought was visually, aurally and conceptually dissimilar to the earlier word trade mark “SAINT-HUBERT 41”. At [57] the Court of First Instance in Vedial SA v OHIM — France Distribution (HUBERT), Case T-110/01 [2002] ECR II-5275 stated that:
[36] In the present case, while the term “REGIS” might, perhaps reasonably, be said to connote royalty, in our view this connotation becomes secondary once the prefixes of “Park” and “ST.” are introduced. As the Judge noted at [26] of the GD, the composite mark connotes a geographical location, while the composite phrase “ST. REGIS” connotes a saintly character. If any connotation of royalty attaches at all, it is far more significant in the “Park Regis” mark, considering the inclusion of the fleur-de-lis device. In this connection we note that the Judge erred in treating the Opponents’ device as a reinforcement of the concept of royalty. The device was not part of the Opponent Mark, and the authorities are clear that marks-similarity must be assessed without regard to “external added matter or circumstances” (Hai Tong at [40(b)]). In light of these considerations, we find that the concept of a geographical location perhaps bearing some class and prestige as connoted by the inclusion of the fleur-de-lis device in the Applicant Mark, is quite different from the concept of a Catholic saint that is connoted by the Opponent Mark.
[37] However, we find that there is some conceptual similarity between the marks but for a different reason. There is some strength in the Opponents’ argument that both the Applicant and Opponent Marks evoke the idea of a place or location. Although the ST. REGIS mark might conjure the image of a saintly person, in Singapore by far the most common manifestation of saintly names is in relation to places ranging from schools (St Joseph’s Institution, St Margaret’s School), roads (St George’s Road, St Martins Lane), hospitals (St Luke’s Hospital) and condominiums (St Nicholas View, St Patrick’s Court), to an assortment of other public places (St Michael’s flatted factory, St James Power Station (bar), Le Saint Julien (restaurant)), many of which have no particular association whatsoever with the saintly character whose name they have adopted. Similarly, the word “Park”, as noted by the Judge, connotes the idea of a geographical location though not necessarily of any particular type (see [26] of the GD). Therefore, in the Singapore context, the marks share a tendency to connote a place or location or building which, as between the competing marks in question, are linked by the common reference to “Regis”.
Conclusion on similarity of the competing marks
[38] Based on the foregoing analysis, we find that the marks have a substantial degree of aural similarity and a fair degree of conceptual similarity. The PAR’s finding that the marks were visually dissimilar was not appealed. On the whole, and based on what we have set out above, we have no difficulty finding that the marks were similar. On this basis, we dismiss CA 147/2013.
Was there similarity between the parties’ services?
[39] The parties did not appeal the Judge’s finding that the services in relation to which their respective marks were used or for which registration was sought, were similar. However, we take this opportunity to clarify certain aspects of the Judge’s reasoning.
[40] The comparison before us was between the services falling under Staywell’s intended Class 35 and 43 registrations, and the Opponents’ existing Class 43 registration. In relation to the Class 43 registration, we agree with the Judge’s observation that the fact that the parties’ hotel services were branded for different market segments did not render the services dissimilar. Following the dictum of Lai Kew Chai J in Polo (HC) at [33], the Judge stated that registration in the same category establishes a prima facie case for similarity. This invites some clarification. We think that what Lai J was referring to was registration in the same specification. We would go further to say that registration in the same specification within a class establishes a prima facie case for identity. This is because it is not within the scheme of the classification system to make distinctions within a specification based on whether the particular product is targeted at one or another market segment.
[41] Hotel services are hotel services, whether these concern a luxury hotel or a more modest one. We adopt the view that while “trade mark registrations should not be allowed such a liberal interpretation that their limits become fuzzy and imprecise… [w]here words or phrases in their ordinary and natural meaning are apt to cover the category of goods in question, there is equally no justification for straining the language unnaturally so as to produce a narrow meaning which does not cover the goods in question.” (per Floyd J in YouView TV Ltd v Total Ltd [2012] EWHC 3158 (Ch) (“YouView”) at [12]; see also Omega Engineering Inc v Omega SA [2013] FSR 25 at [33]). Where a good or service in relation to which registration is sought falls within the ambit of the specification in which the incumbent mark is registered, the competing goods or services would be regarded as identical (see Gerard Meric v OHIM, Case T-133/05 at [29]).
[42] In this case there was a precise overlap between Staywell’s Class 43 hotel, food and beverage services, and the Opponents’ Class 43 hotel, food and beverage services. We do not think that there was any qualitative difference between the parties’ services that displaced the prima facie case for identity where registration was sought in the same specification within Class 43. Therefore the requirement of similarity or identity between services under s 8(2)(b) is satisfied in this case. Given that the services in question are identical, there is no further need to consider whether they are similar or the extent of their similarity (see Hai Tong at [22] and Susanna Leong, Intellectual Property Law of Singapore (Academy Publishing, 2012) (“Susanna Leong”) at paras 28.354 and 28.358).
[43] In relation to its Class 35 registration, the Judge accepted the PAR’s finding that Staywell’s advertising, marketing and business management services were adjunct to and inseparable from its primary services under Class 43, and therefore similar to the Opponent’s Class 43 services (GD at [32]– [33]). We agree with the Judge’s reasoning to the extent that Staywell’s Class 35 services are closely related and indeed inseparable from its Class 43 hotel and restaurant services. This is not to say that Staywell’s application for registration under the two classes was to be considered and compared collectively as against the Opponents’ Class 43 services. Rather, the real question is whether Staywell’s services that were sought to be registered under Class 35 are similar to the Opponents’ services under Class 43, having regard to all relevant factors relating to the services themselves. Some of the factors set out in British Sugar Plc v James Robertson & Sons Ltd [1996] RPC 281 (“British Sugar”) at 296 would be relevant at the goods-similarity stage of the inquiry, in particular the consideration of the uses and the end-users of the services. The question is how the services are regarded, as a practical matter, for the purposes of trade. Applying this approach, we agree with the PAR’s findings at [63] of the PAR’s GD. There is an overlap between the uses and users of Staywell’s Class 35 business management and administration services, and its Class 43 service of providing hotel venues for business conferences and receptions. As for the advertising and marketing services under Class 35, these relate to the promotion of the hotel and restaurant services under Class 43. Therefore we agree that there is similarity between Staywell’s services in Class 35 and the Opponents’ services in Class 43.
Was there a likelihood of confusion?
[44] We come to one of the key areas of dispute in CA 148/2012. The question was whether, having found that the competing marks and services were similar or identical as the case may be, the Judge erred in her assessment of whether this gave rise to a likelihood of confusion for the purpose of s 8(2)(b) of the Act, or a confusing connection under s 8(4)(b)(i) of the Act. In concluding that such a likelihood did not exist, the Judge considered factors external to the marks and services themselves, taking into account the actual circumstances of the uses to which Staywell had put its mark prior to the Application. Her considerations extended to the parties’ marketing and website design, the modes in which hotel bookings are usually made, and the star-ratings of the parties’ hotels. Two issues arose in relation to the Judge’s approach. First, whether there is a difference between the approach to the confusion inquiry in opposition as opposed to infringement proceedings. Second, whether factors which are extraneous to the competing marks themselves and to the products in relation to which the marks are used (“extraneous factors”), are relevant to the confusion inquiry, and if so whether there are any applicable limits to this.
[45] We will address each of these issues in turn.
Difference in approach to the confusion inquiry as between opposition and infringement proceedings
[46] The starting point must be the Act itself. The language used in each of ss 8(2) and s 27(2) of the Act is similar. There is no indication within the Act itself that these sections should be interpreted differently, and we have previously observed in passing that the approach to determining confusion for the purpose of opposition to registration is no different than that in an infringement action (see Hai Tong at [84(b)] and [85(a)], Valentino Globe BV v Pacific Rim Industries Inc [2010] 2 SLR 1203 (“Valentino”) at [16] and Polo (CA) at [29]). However, the present appeal presents the opportunity to examine the question in greater detail.
[47] In Europe and the UK, the courts have drawn a distinction between the conduct of the confusion inquiry in opposition and in infringement proceedings. In the latter, the court assesses the likelihood of confusion in relation to the defendant’s actual and allegedly infringing use of his sign. On the other hand, in the former context, ie, in opposition proceedings, the assessment is conducted by considering the notional fair use of the applicant mark across the scope of the specification of goods and services in respect of which registration is sought. Such a test is obviously more stringent and offers a greater degree of protection to the incumbent than one that examines only the actual and allegedly infringing use of the later mark.
[48] The leading European case is O2 Holdings Ltd v Hutchison 3G UK Ltd, Case C-533/06 [2008] ECR I-4231 (“O2 (ECJ)”). A question concerning the interpretation of Art 5(1) of the European First Council Directive 89/104 of 21 December 1988 (“the Directive”) was referred to the ECJ pursuant to infringement proceedings commenced under ss 10(2) and (3) of the Trade Marks Act 1994 (c 26) (UK) (“the UK Act”). The dispute involved the defendant’s use of a sign similar to the claimant’s UK trade mark in its comparative advertisement campaign. Of relevance to the present case is the ECJ’s statement at [63]–[67] where it clearly articulates the point:
[49] The English High Court followed this approach in Och-Ziff Management Europe Ltd v Och Capital LLP [2008] RPC 33 (“Och-Ziff”). Arnold J there stated at [76] that:
[50] O2 (ECJ) and Och-Ziff both concerned infringement proceedings, and the distinction drawn there has been endorsed in other infringement decisions (see Red Bull GMBH v Sun Mark Ltd [2012] EWHC 1929 (Ch) (“Red Bull”) at [75] and Datacard Corp v Eagle Technologies Ltd [2011] RPC 17 at [275]). In addition, the English court considers the notional fair use of the incumbent mark when assessing for confusion in infringement proceedings, thereby illustrating the breadth of the proprietary rights which the court protects once a mark is on the register. In Compass Publishing BV v Compass Logistics Ltd [2004] RPC 41 (“Compass Publishing”) the High Court stated as follows (at [22] and [26]):
[51] There are also other English cases in which the notional fair use approach has been applied when assessing the likelihood of confusion in the opposition context. Some of these cases were decided under s 11 of the now-repealed Trade Marks Act 1938 (c 22) (UK). While the wording of that section differed from s 8 of the Act, it did require the court to refuse registration upon finding that the use of the later mark is “likely to deceive or cause confusion”. In that context it has been held that the question is whether the mark, “if used in a normal and fair manner in connection with any of the goods covered by the registration proposed, will not be reasonably likely to cause deception and confusion amongst a substantial number of persons” (see re Smith Hayden & Co's Application (1945) 63 RPC 97, Berlei (UK) Ltd v Bali Brassiere Co Inc (No.1) [1969] 1 WLR 1306 (“Bali Trade Mark”), Gymboree Corp's Trade Mark Application (No.1577166) (1999) 22(6) IPD 2205, OPEN COUNTRY Trade Mark [2000] RPC 477 (“Open Country”)). In Bali Trade Mark, where there had been actual use of the applicant mark, Lord Morris noted as follows (at 1314):
[52] Lord Morris’ observations demonstrate that the court had its eye on both the evidence of actual use of the marks on current products and also the potential uses to which the marks could fairly be put in the future in relation to the class of goods in question. In Open Country, the Court of Appeal stated that the approach in Bali Trade Mark was applicable whether the applicant had used his mark or not. However where there was actual use, such use would be considered as one instance of the normal and fair uses of the mark unless the opponent submitted otherwise. In this regard Aldous LJ stated (at 482) that:
[53] The notional fair use approach is also applied to opposition cases under the current UK Act. The cases show that the notional fair use of the mark is the basis for the analysis not only at the confusion stage (see Advanced Perimeter Systems Ltd v Keycorp Ltd [2012] RPC 14 at [36] and [65]–[66]) but also when assessing whether the mark has distinctive character in relation to the products for which it is sought to be used (see Bongrain SA's Trade Mark Application (No 2134604) [2003] EWHC 531 (Ch) at [14]). In YouView the court stated in relation to opposition proceedings that (at [7]):
[54] The English approach to the confusion inquiry in opposition proceedings is therefore to consider the notional fair use to which each mark can be put, though regard will also be had to the applicant’s actual use of the mark if there has been any. We set out this comparative position by way of background only because it is necessary, ultimately, to interpret and apply our Act in our own context.
[55] Under our law, the two threshold requirements for successfully opposing a proposed registration, or establishing liability for infringement, are similarity or identity of the marks and similarity and identity of the services. Once these threshold criteria have been met, the issue of the likelihood of confusion arises and this in our view directs the court to look at (a) how similar the marks are (b) how similar the services are and (c) given this, how likely the relevant segment of the public will be confused. In Hai Tong we said (at [85(c)]):
[56] Against that background we turn to the question posed in this section of our analysis. On reflection we are satisfied there is a difference between the approach to the confusion inquiry in opposition and infringement proceedings, although there are considerable overlaps as well. If it seems surprising that different outcomes may ensue from the interpretation of essentially the same text, it is because of the context in which each provision is to be applied.
[57] In opposition proceedings, the contest is between the holder of an existing registered trade mark who opposes the proposed application, and the applicant who is seeking to register a new mark. The opponent enjoys certain monopoly rights associated with the use of its mark and it opposes the registration of the applicant’s mark on the grounds that such registration would entail an unwarranted interference with those monopoly rights, whether or not these are already being exercised. The applicant on the other hand, wishes not just to use the mark in a particular way but to have the associated monopoly rights that would enable it to prevent others from using their own marks which would then threaten to dilute or affect the applicant’s desired monopoly.
[58] It is useful to note that under s 26 of the Act, registration confers the exclusive right on the proprietor to use the mark “in relation to the goods or services for which the mark is registered”. The proprietor also acquires immunity from infringement liability in his use of the mark in respect of all goods and services falling under the registered specification, by virtue of s 28(3) of the Act. This means that once the applicant has registered his trade mark, he acquires the exclusive right to use the mark not only for the goods and services which he might have actually contemplated at the time registration was granted, but for the whole spectrum of goods and services within the specification for which the mark is registered. The proprietor is entitled to sue for infringement if anyone uses an identical or similar sign on goods which are identical or similar to goods or services falling within the specification for which his mark is registered, even if he does not actually supply that good or service at the material time (see Sarika at [46]–[47], see also Compass Publishing at [22] extracted at [50] supra). The principle is well put in George Wei, Some Thoughts on Intellectual Property Rights in Singapore: A Monograph for Gerald Dworkin (2009) at para 3.204:
[59] It follows from the foregoing that a party that applies for registration of a mark is seeking to establish a monopoly over the right to use that mark for the immediately intended purpose as well as for a penumbra of notional fair uses.
[60] Accordingly in opposition proceedings the inquiry must take into account the full range of the competing monopoly rights that are already enjoyed on the one hand, namely the actual and notional fair uses to which the incumbent proprietor has or might fairly put his registered trade mark, and compare this against the full range of such rights sought by the applicant by reference to any actual use by the applicant (assuming there has been prior use) as well as notional fair uses to which the applicant may put his mark should registration be granted. This is the setting in which the question of whether there is a likelihood of confusion is assessed. In this regard we agree with the views of Prof Ng-Loy and those of Professor David Llewelyn in his article Is There Confusion in the Law of Trade Marks in Singapore? (2013) 25 SAcLJ 339 at paras 11–12:
[61] In infringement proceedings on the other hand, there is no question of the alleged infringer seeking to establish any monopoly rights. The only question is whether the actual use of a similar or identical sign by the infringer encroaches on the registered proprietor’s monopoly rights under s 26 of the Act, to use the mark in relation to goods and services for which he is already using it as well as the penumbra of fair uses for which he might want to use it. There is therefore no need to examine any notional fair use by the alleged infringer because he is not seeking to acquire or assert any rights in respect of such penumbral uses.
[62] How is the foregoing analysis affected where the applicant in opposition proceedings has been using his mark prior to the filing of his registration application? To the extent that the applicant is already using the mark the allegation by the opponent must be that this actual use is to be treated as a putative infringement, so it can be assessed from that perspective. But we do not think the inquiry ends there. If we hold in such a case that there is no putative infringement based on the actual use, it does not mean that the opposition fails and the application for registration must succeed. It would still be necessary to consider the wider question of whether the notional fair uses that the applicant might put the mark to could conflict with the notional fair uses to which the proprietor of the registered mark could put his mark to. As we have noted, this latter inquiry sets a higher threshold for the applicant than an inquiry that focuses only on whether the actual use is infringing, and it follows that as a practical matter, in opposition proceedings, the applicant will have to meet that higher threshold regardless of whether there has already been actual use. In essence, in such proceedings, he will be required to establish that the notional fair use of his mark would not infringe the notional fair use rights of the registered proprietor; whereas in infringement proceedings the only question is whether the actual use by the alleged infringer infringes the notional fair use rights of the registered proprietor of the mark. As a result, in certain cases it may be that opposition and infringement proceedings yield different outcomes. As noted in Kerly’s Law of Trade Marks and Trade Names (Sweet & Maxwell, 15th Ed, 2011) (“Kerly”) at para 9-030:
Whether extraneous factors are relevant to the confusion inquiry
[63] A related issue which arose in the course of submissions is whether the court should, in assessing the likelihood of confusion, consider factors which are external to the similarity between the competing marks and the similarity between the competing goods or services. We have previously referred to such factors as “extraneous factors” (see Polo (CA) at [32] and Sarika at [60]) because they are extraneous or, perhaps, more accurately external to the marks and the services in question. Such factors have traditionally included steps taken by the parties to differentiate their goods and services (“differentiating steps”) so as to reduce the likelihood of confusion. The question arose in this case because the Judge, at [36]–[48] of the GD, applied this court’s approach to extraneous factors as laid down in Polo (CA) at [28] and on this basis placed weight on extraneous factors such as the distinct branding of the hotels as 4-star and 6-star respectively, and how the perceptions of customers making purchases would be affected by the trade channels used by the parties to market their hotel services.
[64] We approach this question again from the starting point of the Act. Once similarity between the competing marks and goods or services has been established, the impact of these similarities on the relevant consumers’ ability to understand where those goods and services originate from falls to be considered. The only relevant confusion is that which results from the similarity between marks and goods or services. Our courts have consistently recognised this since Lai Kew Chai J articulated it in Polo (HC) at [15]. Equally however, the plain words of ss 8(2) and 27(2) do not have the effect of making a finding of confusion automatic upon the establishment of similarity of marks and goods or services. If that was what was intended, as observed in Polo (CA) at [25] and in Sarika at [60], Parliament would have provided that once such similarity is found the matter ends there without any need to examine whether there is a likelihood of confusion as a result. However, we reiterate that the statute requires that any likelihood of confusion must arise from the similarity of marks and goods or services.
[65] If the marks or the goods or services in question are not similar, and confusion stems from other factors, an action might lie in the tort of passing-off but not in trade mark infringement. The similarity of marks and that of the goods or services are threshold questions but they are not determinative questions; in short these are necessary but not sufficient conditions. In our judgment, the plain words and the scheme of s 8(2) of the Act (as well as s 27(2) of the Act), as we have set it out above do not preclude the court’s discretion to consider extraneous factors to the extent that these inform the assessment of the effect of the required similarity on consumer perception, but as we explain below, there are significant limits, more than we may previously have acknowledged as to the extraneous factors that may be considered.
[66] We have hitherto considered extraneous factors in the confusion inquiry in the context of both infringement and opposition proceedings (see City Chain Stores (S) Pte Ltd v Louis Vuitton Malletier [2010] 1 SLR 382, Sarika and Valentino). In the course of the arguments in this case, we were referred to a line of English and European cases which ostensibly endorsed the exclusion of extraneous factors from the confusion inquiry. The first of these cases is Perfumery Ld v June Perfect Ld and F W Woolworth & Co Ld (1941) 58 RPC 147 (“June Perfect”), where Sir Wilfred Greene MR observed that “once a mark is shown to offend, the user of it cannot escape by showing that by something outside the actual mark itself he has distinguished his goods from those of the registered proprietor” (at 161). We explained in Hai Tong (at [89]–[91]) that this statement was made in the context of the marks-similarity stage of the inquiry and, in this regard, we have reiterated above that the inquiry is to be conducted mark-for-mark without added material. In Julius Sämaan Ltd v Tetrosyl Ltd [2006] FSR 42 (“Julius Sämaan”) however, the English High Court expressly excluded extraneous factors from the confusion inquiry, stating that the court must consider the likelihood of confusion arising from the defendant’s use of the offending sign, discounting added matter or circumstances (at 872).
[67] As against this, the European and more recent English cases appear less restrictive. The ECJ’s approach is set out in Sabel, in terms which are now replicated to some degree throughout European and English jurisprudence (at 223–224, [22]–[23] of the court’s Judgment) :
[68] We pause to note that the ECJ’s definition of “all factors relevant to the circumstances of the case” is not without limitation. The factors listed at [22] show that emphasis remains on the elements associated with the marks themselves, although other factors are not excluded from consideration. There is also express focus on the perception of the average consumer, in accordance with the wording of Art 4(1)(b) of the Directive (at [23]). A particular outworking of the focus on consumer perception is in the weighting of each element of mark-similarity in the course of the confusion inquiry. As explained in Lloyd (at 1352 and 1358):
[69] We agree that it is permissible at the confusion-stage of the inquiry to have regard to the importance to be attached to the different elements of similarity taking into account the type of the goods and services in question and how purchases of such goods and services are typically made. We reiterate here the observation made above at [20].
[70] It may be that the more recent English cases have taken their cue from the ECJ and moved away from the strictly restrictive stance taken in Julius Sämaan. In O2 (ECJ), the ECJ endorsed the English High Court’s approach of analysing the likelihood of confusion within the “context in which the sign similar to the [plaintiff’s] bubbles trade mark was used by [the defendant]” (O2 (ECJ) at [64]). Both the English High Court (in O2 Holdings Ltd (formerly 02 Ltd) v Hutchinson 3G [2006] EWHC 534 (Ch) (“O2 (UKHC)) and the ECJ concluded that the advertisement in which the defendant applied its impugned sign “as a whole, was not misleading, and in particular, did not suggest that there was any form of commercial link between [the plaintiff and the defendant]” (O2 (ECJ) at [63], emphasis added). It is evident that the courts considered the use of the sign within the context of the advertisement “as a whole” in arriving in at its conclusion on confusion. O2 (ECJ) has been seen as reflecting a more “holistic” approach on the part of the ECJ towards assessing confusion by focussing on the element of use, at least in the infringement context (see Ilanah Simon Fhima, “Trade mark infringement in comparative advertising situations” 2008 EIPR 30(10) 420 at p 425).
[71] Later cases have followed O2 (ECJ) and take into account the “actual context and circumstances of use of the sign itself” (Och-Ziff at [76]–[78]) and Red Bull at [78]). While “actual context” in those cases was stated as a “limitation” on the court’s range of considerations (see Och-Ziff at [77] and Red Bull at [78]), the court quite clearly said this to draw out the distinction between the context and the use-specific inquiry in infringement proceedings, and the broader inquiry in opposition proceedings where notional uses and acontextual applications of the mark are considered. In Och-Ziff, the court’s “contextual assessment” also included factors extraneous to the marks themselves but existing within the context of the parties’ use of the marks (see [76]). The claimants there claimed inter alia that the defendant’s use of a number of signs (OCH, OCH CAPITAL, ochcapital, Och Capital and OCH Capital) in respect of his financial advisory and fund management business, infringed their trade marks “OCH-ZIFF” and “OCH” which were registered in Class 36 (financial services). In elaborating on what the “contextual assessment” of likelihood of confusion entailed, Arnold J first cited [63]–[67] of O2 (ECJ) (see above at [48]) on the distinction between infringement and opposition proceedings. He then went on to ask (at [77]–[78]):
[72] What emerges from this reasoning is that at least in infringement proceedings, the whole of the actual context of use will be relevant to the confusion inquiry. Neither party in Och-Ziff even attempted arguing that the inquiry could entail jettisoning factors other than the marks and goods themselves. The court then went on to apply principle to fact. One of the defendant’s arguments was that its use of the impugned signs was not confusing because “OCH”, “Och” and “och” were all meant to be read as an acronym, ie, “Oh-See-Aitch”, while the registered mark was meant to be pronounced as “Ock-Ziff”. The court rejected the argument based on the following considerations (at [119] and [121]):
[73] In its application of the contextual assessment the court therefore considered external factors (or in that case, the lack thereof) which would have informed the consumer as to how the sign and mark were to be read. It is noted that these factors, though undoubtedly external to the marks, were closely related to and considered for the specific purpose of assessing how the marks would be perceived or read by the average customer.
[74] The latest instalment in the EU/UK caselaw is Specsavers International Healthcare Ltd v Asda Stores Ltd [2012] FSR 19 (“Specsavers (UKCA)”) and Specsavers International Healthcare v Asda Stores Ltd, Case C-252/12 (“Specsavers (ECJ)”). The plaintiff there registered Community trade marks with the word “SPECSAVERS”. The defendant ran an advertising campaign for its in-store opticians that made use of a logo similar to that of the plaintiff’s graphic mark and of posters bearing the straplines “Be a real spec saver at Asda” and “Spec savings at Asda”. The plaintiff claimed that among other things, the defendant’s advertising campaign was likely to cause confusion under Art 9(1)(b) of Community Regulation 207/2009 (“the Regulation”), which corresponds to s 27(2) of our Act. The claim was dismissed in both the English High Court ([2010] EWHC 2035 (Ch) (“Specsavers (UKHC)”) and the Court of Appeal. In particular, it was found that the defendant’s use of the term “spec saver” in its straplines, although similar to the plaintiff’s “SPECSAVERS”, was not likely to create origin-based-confusion. Mann J in the High Court stated that “context is all important” and that considering the reference to “Asda” and the play on the word “spec saver”, the public would know that the advertisement was for the defendant and not the plaintiff (Specsavers (UKHC) at [145]). The plaintiff’s contention that Mann J erred in considering the context of the advertisement and the extraneous word “Asda”, was rejected by the Court of Appeal.
[75] Delivering the judgment of the Court of Appeal, Kitchin LJ traced the English court’s restrictive approach toward extraneous factors taken in cases such as June Perfect (though as we have observed, we consider this related to the mark-similarity stage of the inquiry) and Julius Samann, but then went on to note that “the [ECJ] was not constrained in the same way” and had “in a number of cases…indicated that the court must take account of the specific circumstances of the use of the offending sign” (at [78]). He then turned his focus to the ECJ’s restatement of the “contextual” approach in O2 (ECJ), and what he saw to be the importation of this approach to England in Och-Ziff. His conclusion on the question of how the confusion inquiry ought to be conducted at least in an infringement setting, was as follows (at [87]):
[76] The English Court of Appeal’s decision confirmed that “in assessing infringement of a trade mark the full context of use must be considered, including the advertising campaign as a whole, not just a comparison of the mark to sign” (see casenote in EIPR 2012, 34(5), 354–357).
[77] Therefore, the latest European and English cases suggest an emphasis on the “context” and this includes the milieu in which the mark is used. While we do not, with respect, think the position in England or Europe is quite as “clear” as Kitchin LJ suggested in Specsavers (UKCA), we also think it far from correct to say that the English and European cases now eschew the consideration of extraneous factors in the confusion inquiry altogether. In the final analysis, having taken note of developments elsewhere, we must of course come to a conclusion by reference to our statute and the way in which it has been understood by our courts. Our statutory regime after all has been applied over a number of years. In this regard, we are satisfied that there must be, and is, some room for the consideration of external factors. We begin with what we said in Hai Tong at [85(c)]:
[78] It cannot be gainsaid that the court’s consideration of such factors in the confusion inquiry must be conducted in accordance with the structure of the Act and consistent with the legislative purpose of the trade mark registration regime. To this end the inclusion of extraneous factors must be managed so as to strike a balance between the competing goals of the trade mark registration regime. In Sarika we recognised (at [61]) that the competing policy concerns were those of preventing confusion on the one hand and promoting business certainty on the other. We concluded that the primary concern was to prevent confusion. Indeed, the plain words of ss 8(2) and 27(2) direct the court to ultimately assess the likelihood of inaccurate consumer perception as to the source of goods, ie, confusion. At the same time, we are concerned that the registration regime remains robust and effective to protect the value of the trade mark itself as a badge of origin and to vindicate the exclusive and proprietary rights of the owner.
[79] In light of these considerations, in Hai Tong at [87] we said:
[80] In this regard we were following the approach initially applied in Polo (HC). We reiterate these principles but with some significant refinements and previous case law on the admissibility of extraneous factors should be understood in the light of what we set out below. In our judgment, the following principles apply to the three stages of the inquiry under both ss 8(2)(b) and 27(2) of the Act but subject to the qualifications noted below.
[81] On similarity of marks – the marks are to be considered without regard to any added or extraneous matter, as is well-established in case law (see [20] above).
[82] On similarity of goods or services – extraneous factors may be relevant to establish the degree of similarity as between goods and services that are not identical in infringement cases and in opposition proceedings where the applicant’s and proprietor’s goods and services are registered or to be registered in different classes or specifications. Such extraneous factors are some of those identified in British Sugar, in particular the uses and the users of the goods and services in question, their inherent nature and the extent to which they are competitive. Extraneous factors are not to be considered if the goods and services are identical, because there will be no need to determine how similar they are (see [42] above). Goods and services will be regarded as identical where they are registered or to be registered in the same class and specification in opposition proceedings, while in the infringement context it will be permissible to have regard to the classification in which the allegedly infringing item or service would have been inserted had the alleged infringer sought registration of his mark.
[83] On the effect of the foregoing on the relevant segment of the public – extraneous factors may be considered to the extent that they inform the court as to how the similarity of marks and goods will likely affect the consumer’s perception as to the source of the goods. This however, is subject to some important qualifications which we will now elaborate upon.
[84] First, in opposition proceedings, it will generally not be relevant to consider extraneous factors that relate to the actual and particular circumstances and ways in which the mark was used on the goods in question. While it will be necessary to consider the notional or fair uses to which each of the marks could be put, for instance in terms of what types of goods or services are within the contemplated uses for which the mark has been registered, it will not be relevant to have regard to the particular way in which the goods or services have been affixed with the mark and are then being marketed. This would thus exclude consideration of such factors as differences in the intended market segments, trading strategies employed, websites used or the trader’s chosen limitations as to his use of the mark. In opposition proceedings, it is the overlap between the notional fair uses of the registered mark on the one hand, and of the applicant mark on the other, that is in issue. It would denude of significance the critical distinction that we have drawn between infringement and opposition proceedings if the confusion inquiry were diverted into a consideration rooted in the details of the actual circumstances in which the goods or services affixed with the mark are being marketed.
[85] Second, even in infringement proceedings, there is a need to be vigilant to the very purpose for which the step-by-step approach was devised and has been applied. To the extent extraneous factors are advanced in the attempt to negate a finding of likely confusion on the grounds that the marks are being deployed in such a way as to target different types of consumers or to notionally differentiate the goods in question, this must be avoided. Once the goods are found to be similar or identical at the second stage of this inquiry, it becomes irrelevant to consider such factors again at the confusion-inquiry stage.
[86] To put it another way, if the competing marks and goods are found to be sufficiently similar such that, having regard to the characteristics of the likely consumer, the court concludes there would be a likelihood of confusion, then it would not be permissible to have regard to yet further extraneous considerations that might have the effect of diminishing the likelihood of confusion. In the same way that confusion stemming from sources other than the similarity of marks and goods is outside the reach of trade mark protection (see [64] above) so too must such factors be irrelevant to displace a finding of likely confusion if the property rights represented in the trade mark are to be meaningfully upheld.
[87] Extraneous factors have been adduced in general in order to show:
(a) that even if on a mark-for-mark comparison the marks are similar, then having regard to extraneous material they are not confusingly so; or
(b) in relation to the goods, even if they are similar or for that matter identical, then having regard to extraneous material they are not confusingly so.
[88] In our judgment, this seems to be wrong in principle. In relation to the analysis of the marks, it denudes of any force the principle that the marks-similarity inquiry is to be conducted without recourse to external material, if such material were then permitted at the confusion stage of the inquiry.
[89] For the same reason, while external factors of the sort we have identified at [82] above may be considered at the goods-similarity stage of the inquiry where the goods are not identical (that is to say they do not or would not fall within the same specification on the register), once the determination is made that they are similar, then it would be wrong in principle at the confusion stage of the inquiry to examine whether the trader by means of his superficial trading choices has differentiated his goods in some way from those of the owner of the incumbent mark even though in substance the goods are similar or even identical for the purposes of trade mark law.
[90] This seems to us to be sound in principle if adequate regard is to be had to the proprietary rights of the owner of a trade mark. Otherwise a subsequent trader would be able to enter the market using a trade mark that was very similar to the senior mark, applied to similar if not identical goods and yet avoid liability by means either of an express disclaimer, or by using cheaper materials and selling his goods at a much lower price and saying that because of these steps, there is no likelihood of confusion notwithstanding the high degree of similarity or even of identity having been found at the antecedent stages of the inquiry.
[91] Such a notion was rejected in Rolex Internet Auction [2005] ETMR 25 where the defendant hosted a website on which imitation or replica watches were auctioned. The court observed that:
[92] In our judgment, this is sensible for the reason put forward by Prof Ng-Loy in her chapter “Developments in Singapore Trade Mark Law 2005-2011: Confusion-based Protection and Beyond” in Developments in Singapore Law between 2005 and 2011: Trends and Perspectives (Academy Publishing pp 349–373) at p 357, where she wrote that the admission of extraneous factors:

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Staywell Hospitality Group Pty Ltd v Starwood Hotels & Resorts Worldwide, Inc and another and another appeal

Grounds of decision

Introduction

Background to the appeals

The parties

Background facts

The decision below

Issues in the appeals

Whether the Judge erred in disallowing the opposition under s 8(2)(b) of the Act

Were the marks aurally and conceptually similar?

Is the threshold of marks similarity a low one?

Aural similarity

Conceptual similarity

Conclusion on similarity of the competing marks

Was there similarity between the parties’ services?

Was there a likelihood of confusion?

Difference in approach to the confusion inquiry as between opposition and infringement proceedings

Whether extraneous factors are relevant to the confusion inquiry