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Application No. 15028 of 1999 IN THE MATTER of the Trade Marks Ordinance (Cap. 43)

AND

IN THE MATTER of an application by S.H. Kelkar & Co. Private Limited to register the mark

in Part B of the Register in Class 1

AND IN THE MATTER of an opposition by Sun Hung Kai & Co. Limited

DECISION OF

Ms. Fanny Shuk Fan Pang acting for the Registrar of Trade Marks after a hearing on 22 April 2005. Appearing : Mr. Gary Kwan instructed by Messrs. Vivien Chan & Co. for the applicant. Mr. Albert Xavier instructed by Messrs. Robert Wang Solicitors for the

opponent.

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Application for registration

1. On 21 October 1999 (“the application date”), S.H. Kelkar & Co. Private Limited (“the applicant”) applied to register, pursuant to the provisions of the Trade Marks Ordinance Cap. 43 (“the Ordinance”), in Part A of the register in Class 1, the trade mark, a representation of which appears below :

(“the suit mark”).

2. The goods intended to be covered by the registration were “aromatic chemicals; all included in Class 1” (“the specified goods”). The Registrar of Trade Marks (“the Registrar”) accepted the suit mark for registration in Part B of the register. The application was advertised in the Government of the Hong Kong Special Administrative Region Gazette on 18 August 2000.

Pleadings and Evidence

3. On 17 January 2001, Sun Hung Kai & Co. Limited (“the opponent”) filed notice of opposition to the application. The grounds of opposition state, inter alia, that the opponent is a limited liability company organised and existing under the laws of Hong Kong. The opponent and its subsidiary companies have since 1969 been carrying on business using the trade marks “SHK”, “新鴻基”, “SHK & logo” and “SUN HUNG KAI” (“the opponent’s marks”). It is asserted that the opponent and its subsidiary companies own and have used the opponent’s marks in relation to many types of goods and services including precious metals, diamonds, pearls and jades, corals, crystals, agates, precious stones and imitations thereof; gold bars; financial consulting services; agency for providing product (including gold) quotations, biddings, business information and notary services; financial services; sharebroking, foreign exchange and bullion trading; commodities broking; corporate financial services; unit trust and fund management; insurance broking, share margin, financing and money lending; personal loans and investment services and property investment activities in Hong Kong since 1969. The opponent further pleads that by reason of long, extensive and

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continuous usage and promotion, the opponent has acquired a worldwide reputation including Hong Kong in the opponent’s marks as a symbol of reputation for quality and reliability associated with the opponent. The opponent is the proprietor at common law of the opponent’s marks. It is the opponent’s case that the suit mark closely resembles the opponent’s marks as it comprises only the identical letters “SHK” and a device. It is visually, phonetically and conceptually similar to the opponent’s marks. As a result, the trade and public may perceive the suit mark as one newly coined in the opponent’s range of “SHK” marks for use on a new range of products, that is, aromatic chemicals. The grounds of opposition comprise sections 2, 9, 10, 12, 13 and 20 of the Ordinance.

4. In the applicant’s counter-statement, the applicant’s own application for registration of the suit mark is admitted. The applicant pleads that it has no knowledge of the matters pleaded in paragraphs 1, 3, 4, 5, 6, 7 and 9 of the grounds of opposition and the opponent is put to strict proof thereof. Each and every other allegation in the grounds of opposition is denied by the applicant. The applicant avers that the letters “SHK” are a representation of its corporate name and trading style, S.H. Kelkar & Co. Limited. The applicant and its predecessor, S.H. Kelkar & Co., have been in existence and dealing with goods in Class 1 since 1930. It has been using trade marks containing the letters “SHK” since 1970 and in Hong Kong since 1982. Furthermore, the opponent’s goods and services are completely different from the applicant’s goods in nature, use and trade channels.

5. The opponent’s Trade Marks Rule/s, Cap. 43, Sub. Leg. (“Rule/s”) 25 evidence consists of a statutory declaration dated 26 September 2001 from Wong Lam Chun, the company secretary of the opponent, together with exhibits (“Wong’s first statutory declaration”). The applicant’s evidence under Rule 26 comprises a statutory declaration dated 27 August 2002 from Govind Damodar Kelkar, the managing director of the applicant, together with exhibits (“Kelkar’s statutory declaration”). Pursuant to Rule 27, the opponent filed a statutory declaration dated 9 June 2003 from the same Wong Lam Chun, together with exhibits (“Wong’s second statutory declaration”).

Decision

6. Though, by 22 April 2005, the date the matter was heard, the Trade Marks Ordinance Cap. 559 had come into operation, by virtue of sections 10(1) and (2) of Schedule 5, oppositions to registrations still pending as of 4 April 2003 are to be determined under the provisions of the repealed Ordinance, Cap. 43.

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Under section 12(1) : likely to deceive

7. Before an opponent can invoke section 12(1), it must establish a certain degree of reputation in Hong Kong of its marks. As its very highest, it is a question of a substantial proportion of the interested public being aware of its marks, and at its very lowest, the question relates to the significance of the numbers in relation to the market for particular goods. In any event, the reputation of the opponent must be something more than de minimis (Re Da Vinci Trade Mark [1980] RPC 237).

8. Mr. Albert Xavier, counsel for the opponent, submitted that the issues in the present case are quite narrow. Does the opponent have a substantial reputation in its trade marks? What are its trade marks? He contended that the opponent has very substantial reputation in respect of the following marks :

(i) SHK (ii)

9. Assuming that the opponent is able to establish substantial reputation in respect of its marks, will the use of the suit mark on the specified goods cause confusion or deception? Mr. Xavier pointed out it is enough if somebody is caused to wonder. There is no need to be actually confused. It is trite law that the burden lies on the applicant to show there is no reasonable likelihood of deception or confusion. Mr. Xavier submitted that section 12(1) extends to cases where the opponent’s mark is unregistered, altogether or for some of the goods concerned; to cases where the mark has been used only upon goods of a different description from those for which registration is sought, and to cases where the confusion is not with an opponent’s mark but merely his name (Kerly’s Law of Trade Marks and Trade Names, 12th Edition, paragraph 10-03). It is interesting to note from the passage in Kerly’s that one is not restricted to a comparison between trade marks as section 12(1) extends to cases where the suit mark, if used, would lead to confusion with somebody’s name. It follows the section is designed not only to catch trade marks. It must also apply to a situation where the trade mark is used in a way that would suggest somebody else’s name.

10. Mr. Xavier contended that the opponent has acquired extremely substantial

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reputation in Hong Kong under the “SHK” name. The opponent’s extent of reputation can be gathered from the evidence produced in the exhibit marked “LCW-11” to Wong’s second statutory declaration. Exhibit “LCW-11” consists of a copy of a booklet entitled “Sun Hung Kai Securities – The First Decade 69-79”. It was the submission of Mr. Xavier that the letters “SHK” are used to refer to the opponent and he quoted the following passages from the booklet as an illustration :

“The past ten years have been marked by a sustained effort on SHK’s part to meet the fast changing needs of Hong Kong which has emerged during the period as an international financial centre. The decade has also represented SHK’s progressive diversification from its original stockbroking base into a multi-national finance organisation.

Throughout its development, SHK has never lost sight of certain key objectives : -

...……………………………………………………………………………………………………………………………………………………………………………………………………..

Looking back, if SHK’s first decade can be described as a success, I would be proud to admit that this has been possible because SHK has had a team of bright and hard working staff.”

11. Mr. Xavier went on to analyse the evidence produced in “LCW-11”. According to the financial charts on pages 16 and 17 of the booklet, Mr. Xavier submitted that the total assets of Sun Hung Kai Securities amounted to HK$1,900 million in 1979 which was a huge amount. As regards the gross revenue, it amounted to HK$220 million in 1979. Mr. Xavier contended that in the 1980’s, such an amount was very huge. One can imagine the exposure of the name “SHK” to the general public in Hong Kong was extremely substantial. He said the exposure is to all walks of life who have a hand in the stock market.

12. Mr. Xavier also drew my attention to the evidence in exhibit “LCW-6”. In essence, it was Mr. Xavier’s submission that the letters “SHK” have been used as a name of the opponent in relation to fund business, foreign exchange and a number of industries.

13. In reply, Mr. Gary Kwan, counsel for the applicant, submitted that the opponent’s evidence only shows that it has a limited reputation in the logo mark “ ” in respect of the restrictive class of providing financial and investment services as at the application date. The opponent has not adduced any evidence in support of the use of

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“SHK” as a trade mark. At best, the opponent has only shown use of “SHK” as the company names of the opponent and its subsidiaries in respect of financial and investment services.

14. Mr. Kwan said the opponent’s case is that its business was conducted through its subsidiaries which were in the field of financial and investment services (paragraph 5 of Wong’s first statutory declaration). The opponent’s evidence is either related to financial and investment services or simply irrelevant. In exhibit “LCW-1” (marked B3) which comprises an undated brochure, Sun Hung Kai & Co. Limited, the opponent, is described as “an investment house which provides a full range of financial services in Asia … The operations are managed in five principal areas – stock broking, foreign exchange; bullion and commodities; investment management; corporate finance, and insurance broking …”. The documents marked “B9.1” (SUN HUNG KAI INVESTMENT FOCUS), “B9.2” (1989 Economic & Investment Prospects …), “B9.3” (QUARTERLY STOCK MARKET OUTLOOK), “B9.10” (Insurance Information) and “C1” (SUN HUNG KAI INVESTMENT SERVICES LIMITED) in exhibit “LCW-1” which evidence the use of the logo mark “ ” are all in respect of financial investment and insurance services. Extracts from www.shkco.com (downloaded on 19/7/01) post-date the application and they referred to financial investments only. Extracts from www.shkonline.com (downloaded on 18/7/01) post-date the date of application and they referred to financial trading only. The remaining documents in “LCW-1” are all post-application date.

15. Some true samples or copies of advertising including the opponent’s marketing brochures from 1973 to 2001 were produced in “LCW-2”. Mr. Kwan pointed out that the advertisements shown were related to financial investments, and trading in gold and foreign currencies. Some advertisements only show the opponent’s congratulations to other entities (like Securities and Futures Commission, Stock Exchange Hong Kong Ltd, HKGCC and so on). Some of the advertisements are either undated or post-date the application.

16. Moving on to the exhibit marked “LCW-3” which is a copy of an article entitled “Sun Hung Kai & Co. Ltd – 30 years of experience with integrity” published in South China Morning Post on 16 December 1999, Mr. Kwan submitted that this piece of document is post-application date. In any case, in the article, the opponent is described as “… has been developing and expanding capabilities in the financial services industry. Today, Sun Hung Kai is a major securities house …”. The Chinese version of the article was placed in a local Chinese paper Hong Kong Economic Post on the same day and was produced as the exhibit marked “LCW-4”. Copies of a bundle of sample invoices for the

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years 1988 to 1992 were attached to exhibit “LCW-5”. Mr. Kwan contended that the invoices were in respect of trading in securities, warrants, gold, foreign currencies, futures or insurance brokerage. None of the documents was related to the specified goods. As regards the promotional documents in “LCW-6”, Mr. Kwan said that they were mainly related to unit trusts and fund management, a few of them being related to foreign exchange. All of them were confined to financial investments and some of the documents produced were undated. On page 72 of the booklet entitled “Sun Hung Kai Securities – The First Decade 69-79” in exhibit “LCW-10”, it is stated that “the new structure recognises that the two principal businesses of the existing SHK Securities Group – broking, trading and property interests on the one hand, and finance and related activities on the other hand – would have greater growth potential as separate entities rather than as components in the existing group” which again, Mr. Kwan submitted, only referred to financial and investment activities and was unrelated to the specified goods.

17. I see the merit in Mr. Xavier’s contention that section 12(1) extends to cases where the confusion is not with an opponent’s mark but merely his name and to cases where the mark has been used only upon goods or services of a different description from those for which the registration is sought. In my judgment, it is clear from those pre-application date evidence in “LCW-1”, “LCW-2”, “LCW-5” and “LCW-10” that the logo mark “ ” always appears in conjunction with the opponent’s name in English “Sun Hung Kai and Co. Limited” and/or in Chinese “新鴻基有限公司” or the opponent’s subsidiaries’ names in English or Chinese, for example, “Sun Hung Kai Securities Limited” and “新鴻基證劵有限

公司”. In exhibit “LCW-6”, the evidence shows that “SHK” was used, for most of the time, together with the logo mark “ ” and/or the English and Chinese names of the opponent or its subsidiaries. There is also evidence showing the use of the letters “SHK” to stand for or refer to “Sung Hung Kai” being a trade name of a provider of financial and investment services known by a substantial number of Hong Kong people. For example, the front page of the booklet exhibited in “LCW-11”, the logo mark “ ” was shown in the four corners of the page together with the name “Sung Hung Kai Securities”. In the text of the booklet, the letters “SHK” are used to refer to “Sun Hung Kai”.

18. In my view, in the light of the evidence produced, the opponent has acquired substantial reputation in respect of its logo mark “ ” and its trade mark or name “SHK” at the application date. However, I accept the submissions of Mr. Kwan based on his detailed analysis of the opponent’s evidence that the substantial reputation is in respect of financial and investment services only, not in respect of the specified goods. That said, it is well-settled that the reputation, for the purpose of section 12(1), does not need to be in

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respect of the specified goods. The opponent is thus able to overcome the threshold question to ground an opposition based on section 12(1) by reason of the substantial reputation in respect of its marks/name in the field of financial and investment services. The fact that reputation is not in respect of the same goods as those of the suit mark is a factor to be taken into account in assessing the likelihood of confusion or deception. The onus then shifts to the applicant to show there is no reasonable likelihood of deception or confusion.

19. It was Mr. Xavier’s contention that the suit mark is a composite mark comprising three letters “SHK” and a device. The device is a very simple one : a black oval enclosing two white triangles. In between the triangles, the three letters “SHK” appear. Regarding how composite marks should be compared to word only marks, Mr. Xavier referred me to Audio Pro’s Trade Mark (unreported decision of Mr. Kripas dated 6 March 2003). At paragraphs 50 and 51 of the decision, the Registrar said :

“50. Although marks should be compared as a whole, composite marks, meaning those that incorporate a device element together with words, can present a difficulty when compared to word only marks. It is trite law that words are more readily recalled than devices. A device comprising a pictorial representation of the word element may reinforce the word. The device of a scallop shell above the word “Shell” as a trade mark for the Shell Oil Company is a good example. Other devices may be more allusionary but may combine with the words to create a complementary impression. The device of a stone rampart used with the name of a life insurance company combine to create a lasting impression of security. These devices will generally be recalled as part of the trade mark. The problem arises when the device is either so lacking in eye appeal that it is immediately forgotten, or so abstract as to be incapable of mental classification and therefore, again, immediately forgotten. In my view the device element of the suit mark falls into the latter category.

51. … It seems to me that there is no natural way that the device can enter into any oral or written reference to the suit mark. It does not qualify, add to, or combine with the words “audio pro” in any way so as to produce, in speech, a concept other than “audio pro” simpliciter. There is no evidence at all of what the device does or might signify to the purchasing public. I have borrowed here from the language used in GRANADA Trade Mark [1979] RPC 303 at 310 line 40. In my view the device will not be memorised or recalled. The suit mark in writing or in speech will be recalled as “audio pro” not “a audio pro” or “something audio pro” and I believe, realistically, it is on that basis that the comparison between the competing marks should be undertaken.”

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20. Applying the same reasoning in the present case, Mr. Xavier submitted that if one is to look at the suit mark, the device in it would not be memorised or referred to in speech or in writing in actual life since it is not a device that actually suggests something, for example, a tiger device. Phonetic resemblance is also a very important factor. The goods can be traded by way of telephone orders. In that case, Mr. Xavier contended the suit mark would simply be referred to as “SHK”. Similar to the Audio Pro case, the device part of the suit mark would not be a feature. What is recalled by the general public is “SHK” simpliciter.

21. Turning to the opponent’s marks, Mr. Xavier submitted that the letters “SHK” were either used alone or together with the logo “ ” by the opponent. He argued that a lot of companies use more than one trade marks which are all distinctive. It is the opponent’s case that both the letters “SHK” and the logo “ ” are used to identify the opponent. The logo “ ” would be recognised and recalled by the public as “Sun Hung Kai” or “SHK”.

22. As regards the difference in field between the applicant and the opponent, while Mr. Xavier agreed that the closer the field of activities, the easier to establish the reasonable likelihood to deceive or confuse, he submitted it is not necessary to prove that the fields of activities are similar before the reasonable likelihood can be established. One must bear in mind the fact that somebody is caused to wonder would be enough. Mr. Xavier said that the opponent has exceptional reputation in its marks/name “SHK” and “ ” which amount to household names although it might be in the field of financial investment services. Having taken into account the principle of imperfect recollection, the suit mark is virtually identical with the opponent’s marks “SHK” and “ ” when used orally or in writing.

23. To discharge its onus to prove that there is no reasonable likelihood of confusion or deception, Mr. Xavier argued that the applicant must produce clear evidence that the people would not be caused to wonder or confused when they look at the suit mark. It is not enough for the applicant to argue that no confusion or deception would be caused simply on the ground that the specified goods are different from the opponent’s line of business. As an authority for his argument, Mr. Xavier referred me to George Angus & Co Ltd’s Appln. (1943) 60 RPC 29 at 35 where Bennett J said :

“But the difficulty which I have in this case is in seeing how the trade in which the Appellant’s goods are sold and in which the Respondent’s goods are sold, is carried on. It seems to me to be impossible for a Court to determine whether the use of these two trade

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marks is likely to lead to confusion unless the Court is informed by evidence as to the way in which the goods of Appellants and of the Respondent are sold. I do not know (and there is no evidence which informs me) as to whether goods made by the Appellants and goods by the Respondent are in the hands of third persons with a view to being sold by those third persons to persons who want to buy them. If that is the case, of course, there is a possibility of confusion; and if orders for goods are given over the telephone it is, no doubt, possible for mistake to be something called “Gaco” or something called “Stayco”. But until you know how the trade is carried on, you are not really in a position to form any judgment upon the question of fact as to whether there is likely to be any confusion in the trade.”

24. Mr. Xavier pointed out that the learned judge in that case refused the application as the applicant failed to discharged its onus. He contended that in the absence of evidence, the Registrar should not simply substitute herself into the position. It is for the applicant to submit evidence as to how the applicant’s goods will be sold. If the applicant fails to submit evidence, it fails to discharge the burden to prove that if the suit mark is used in a notional and fair manner, no confusion or deception will be caused with the opponent’s marks. It is not a correct approach for the applicant to say that since the specified goods and the opponent’s services are different, there must be no confusion or deception. As the applicant has failed to satisfy me by clear evidence that the suit mark applied for is not reasonably likely to deceive or cause confusion, Mr. Xavier submitted, I should entertain a doubt and must therefore refuse the application.

25. In reply, Mr. Kwan contended that the parties’ respective marks are not identical or nearly resembling. The opponent’s mark in actual use is to be considered. The opponent has used the mark “ ” as its logo in conjunction with other company names; “SUN HUNG KAI” and “新鴻基” were used as its abbreviated name or part of its name; and “SHK” was used as part of the name of its related investment companies (“LCW-1”; “LCW-2”; “LCW-5” and “LCW-6).

26. It was the submission of Mr. Kwan that the composite suit mark and the opponent’s mark/names are visually different. The suit mark consists of the letters “SHK” which are arranged horizontally and enclosed in an oval shaped logo with two blank equilateral triangles located above and beneath such letters respectively. The opponent’s logo “ ” is marked by the “S” device which is represented in the shape of a winding road separating the letters “H” and “K”. The said logo is surrounded by a square box whereas the suit mark is surrounded by an oval-shaped logo enclosing two blank equilateral triangles. The “S” device looks more like a road than a letter. The order of arrangement of

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the letters is very different from that of the suit mark. Instead of appearing as the first letter, the “S” device is being put in the middle of “H” and “K” (and a reader may also think that “K” is the first letter because it is put in the upper right hand corner of a square box). The opponent’s said logo “ ”had been used together with the names of itself or its related investment companies (and those documents referred to in paragraph 9a of Wong’s second statutory declaration post-date the date of application).

27. Mr. Kwan contended that the sound of the parties’ respective marks is very different. The suit mark will be likely to be referred to as the “SHK oval-shaped logo”. As for the opponent’s logo “ ”, the logo itself has no particular aural reference. The order of arrangement of the letters does not indicate which of these letters will be read first. “S” is presented as a winding road rather than as a letter. As the said logo had been used in conjunction with the full names of the opponent and its related investment companies, it is unlikely that the said logo will be referred to as “SHK” as opposed to “新鴻基” in Chinese by the local public.

28. Mr. Kwan further argued that the idea of the parties’ respective marks is also significantly different. The opponent’s mark “ ” will convey the image of a winding road (and “SUN HUNG KAI”, “SHK” and “新鴻基” are part of the full names of the opponent and its related investment companies; they are irrelevant and do not convey any particular idea). The suit mark gives the readers the impression of an oval-shaped logo with the two blank equilateral triangles resembling the northern and southern hemispheres.

29. Mr. Kwan went on to submit that comparison of the marks is not the only relevant factor. It is well settled that the extent of the reputation of the opponent’s mark and the goods for which it has achieved are factors in determining whether there is a sufficient likelihood of deception or confusion to refuse the applicant’s registration under section 12(1). (Carefree Trade Mark, unreported decision of Mrs. Teresa Grant dated 17 August 2004, at paragraphs 38-46 and JNC & Diamond Device, unreported decision of Mrs. Teresa Grant dated 26 March 2004, at paragraphs 17-18). Mr. Kwan submitted that the fact that reputation is not in respect of the same goods as those of the suit mark is a factor to be taken into account in assessing confusion. Here, the question is, can it be said that the opponent’s limited reputation in Hong Kong for the alleged financial and investment services which were provided to the confined circle of investment-interested end users has “spilled-over” to the extent that a substantial number of customers of aromatic chemicals on seeing the suit mark being applied to the said products, would be caused to wonder whether such products were those of the opponent?

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30. Mr. Kwan submitted that the nature of the applicant’s specified goods and the opponent and its related investment companies’ services are entirely different. The applicant is applying for registration of the suit mark in respect of “aromatic chemicals” in Class 1. These are aroma products for personal and domestic use and/or aromatherapy. The said goods are totally unconnected with the opponent’s alleged financial and investment services. On the evidence, the opponent’s alleged financial and investment services relate to securities, foreign currencies, gold, unit trusts, insurance, futures and margin trading. Such services relate to profit-making through investments and they are not related to aromatic products for personal use.

31. Mr. Kwan further pointed out that the applicant’s specified goods and the opponent and its related investment companies’ services are not of the same use. The applicant’s specified products are for the benefit of having aroma and aromatherapy. The opponent’s alleged services are for the purpose of investments and profit-making.

32. Turning to the trade channels, Mr. Kwan contended that the trade channels for the applicant’s specified goods and the opponent’s alleged services are entirely different. The applicant’s specified products would normally be marketed in the beauty shops, department stores or other retail outlets like Mannings. Such retail shops would not provide the opponent’s alleged investment services. The opponent’s alleged services had to be provided by specialised entities licensed by the Securities and Futures Commission, Cap. 571, ss. 114-118, Schedules 1 & 5. Such institutes are unconnected with those retail outlets selling the applicant’s specified products. The applicant’s specified products are not in competition with the opponent’s alleged investment services. They would not meet each other in the same market.

33. It follows from Mr. Kwan’s aforesaid submissions that the parties’ respective goods and services appeal to different target groups of customers. The applicants’ specified products are for either trade customers who would use the applicant’s aromatic chemicals for producing aromatic products or ultimate consumers who would use the said products for personal grooming and domestic purposes. The opponent’s alleged services are for those customers who intend to earn profits through investments.

34. In the present case, Mr. Kwan contended, as can be seen from the evidence, that the opponent has not established any reputation or goodwill in the applicant’s specified goods in Hong Kong (whether by reference to “ ” or otherwise). Neither has the opponent adduced any evidence to show that any traders in the specialised field of providing

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the opponent’s alleged financial and investment services have ever extended to the field of providing those goods for which the applicant applies to register the suit mark. In the circumstances, and having regard to the differences in the parties’ respective fields of activities, the opponent’s allegation that the reputation and goodwill of its services extends to the applicant’s specified goods and therefore the use of the suit mark in relation to the specified goods will create the impression that the applicant’s said goods are connected in trade with the opponent is purely imaginary and absolutely unsubstantiated.

35. In addition, it is the applicant’s case that the suit mark was used in Hong Kong in respect of the specified goods before the application date. Mr. Kwan submitted that the applicant’s predecessor, S. H. Kelkar & Co, was established in 1922 and had been dealing in fragrances and raw materials. Later, its business became incorporated and has been conducted by the applicant (paragraphs 4 and 5 of Kelkar’s statutory declaration; exhibits “1”, “2” and “3”). As a result, the applicant has made substantial sales of the specified goods under and by reference to the suit mark in Hong Kong since 1982 (paragraph 7 of Kelkar’s statutory declaration). The applicant has acquired a substantial reputation in the suit mark in relation to the specified goods in Hong Kong (paragraph 8 of Kelkar’s statutory decalaration). Mr. Kwan also pointed out despite the fact that the applicant has been selling and supplying the specified goods under and by reference to the suit mark in Hong Kong since early 1980’s, there has been no instance of confusion whatsoever. The opponent has not commenced any proceedings against the applicant in Hong Kong even after the filing of the present application.

36. Having taken into account all the above, Mr. Kwan concluded that the applicant has discharged its onus to prove that there will be no reasonable likelihood to cause deception and confusion if the suit mark is used in a normal and fair manner in respect of the specified goods.

37. As regards the applicant’s alleged use of the suit mark in Hong Kong before the application date, Mr. Xavier submitted that the use is absolutely unclear. For the invoices dated before October 1990 as produced in exhibit 3 to Kelkar’s statutory declaration bearing the suit mark next to the applicant’s name on the head of the invoices, they evidence the sale of the applicant’s specified goods to one company in Hong Kong only, Messrs. Karani Associates. One does not know where the goods ultimately went. To take an example, they may not be actually sold in Hong Kong but transshipped to somewhere else from Hong Kong.

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38. There was also no evidence showing that the suit mark was used in relation to the goods as particularised on the invoices. It appears that the suit mark was only used on the invoices before October 1990. Regarding all the remaining invoices between 1991 and 1998 produced in exhibit 3, the suit mark was not featured in any one of them. The applicant explains in paragraph 7 of Kelkar’s statutory declaration that “the invoices since 1991 do not bear the opposed mark (suit mark) because the applicant is required to use invoices confirming [sic] to the format set by the Reserve Bank of India and the Customs Department of India. However, the opposed mark (suit mark) continued to be used in commerce by the applicant”. Mr. Xavier pointed out that there was no evidence in support but a mere bold assertion. For example, a relevant regulation from the bank was not produced. Even if the suit mark could not be used on invoices, Mr. Xavier submitted that there are many other contractual documents such as packing lists where the applicant could have used the suit mark. The applicant has not produced even one single piece of other evidence. Furthermore, apart from invoices, the suit mark can actually be used on the goods for sale. Again, Mr. Xavier argued that there was no evidence to show use of the suit mark on the goods sold. Neither was there evidence of advertising of the suit mark in Hong Kong. To conclude, Mr. Xavier contended that the so-called explanation given by Mr. Kelkar was just an excuse to explain why the applicant has not used the suit mark in Hong Kong since 1991, long before the application date. The explanation is on the whole not credible.

39. It is well established that the test to be used in applying section 12(1) is that stated by Evershed J. in Smith Hayden & Co’s Application (1946) 63 RPC 97 at 101. The test under section 12(1), adapted to this application, is as follows : -

“Having regard to the reputation of the opponents’ marks/name “ ” and “SHK” in respect of financial and investment services, is the Registrar satisfied that the suit mark, if used in a normal and fair manner in respect of the specified goods will not be reasonably likely to cause deception and confusion amongst a substantial number of persons? May a number of people be caused to wonder whether the goods and services under the respective marks come from the same source? Is there a real tangible danger of confusion if the applied for mark is put on the Register?”

40. I shall first deal with the similarities between the suit mark and the opponent’s logo mark “ ”. On the whole, I accept the submissions of Mr. Kwan that the respective marks are visually different. Even if the principle of imperfect recollection is taken into account, to me, the visual impact given by the suit mark and the opponent’s logo mark is clearly different.

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41. In terms of aural resemblance, I see the force in Mr. Xavier’s contention that the suit mark would simply be referred to as “SHK”. As for the opponent’s logo, I think that if one just looks at the logo itself and tries to pronounce it, one would refer it as “KH” or “HK”. However, as the evidence shows that the logo had invariably been used in conjunction with the full English and Chinese names of the opponent and its related investment companies, it is likely that the said logo will be referred to as “Sun Hung Kai” or “新鴻基” by the local general public instead of “SHK”. I therefore conclude that the suit mark and the opponent’s logo are not confusingly similar aurally.

42. I now move on to consider whether the suit mark in notional and fair use and the opponent’s trade name or mark “SHK” in actual use are confusingly similar. As I found in the previous paragraph, there is substance in Mr. Xavier’s submission that there is no natural way that the device in the suit mark can enter into any oral or written reference to the suit mark. What is memorised and recalled by the general public is “SHK” simpliciter. With regard to the opponent’s trade name or mark “SHK”, in use, it is for most of the time used together with the opponent’s logo mark and/or the English and Chinese names of the opponent or its subsidiaries. I think that would substantially help to reduce the likelihood of deception or confusion caused by the use of the same letters “SHK” in the suit mark and the opponent’s mark or name.

43. I must next consider the goods and services to which the respective marks are to be applied. It is not in dispute by Mr. Kwan and Xavier that the services in respect of which the opponent has made use of its logo mark “ ” and trade name or mark “SHK” and in respect of which the opponent enjoys its reputation is different from the goods in respect of which the applicant seeks to register its mark. The question for me is whether a trader or purchaser of aromatic chemicals, having a familiarity with the opponent’s logo mark “ ” and trade mark or name “SHK” used in relation to financial and investment services, would upon seeing the suit mark applied to aromatic chemicals, conjure up an association with the opponent so as to wonder whether the goods and services might come from the same source.

44. In Re OMEGA [1995] 2HKC 473, where the respondent’s attempt to register a composite OMEGA mark in respect of “writing instruments” was disallowed in view of the appellant’s registrations and user of a practically identical mark in respect of “horological instruments”, Deputy Judge Le Pichon (as she then was) noted, at p. 476 :

“Whilst the opponent admits that it has neither registered its marks in respect of writing

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instruments, refills and parts thereof nor sold such goods in Hong Kong, it has adduced evidence to show that owners of famous trade marks tend to use them for a range of products including, in particular, watches and writing instruments. Examples of famous trade marks being used in relation to watches and writing instruments include ‘ST Dupont’, ‘Cartier’, ‘Dunhill’, ‘Christian Dior’, ‘Guy Laroche’, ‘Tiffany’, ‘Corum’, ‘Chaumet’, ‘Philippe Charriol’ and ‘Caran d’ Ache’.” (my emphasis)

45. The decision in OMEGA shows that it is not the reputation of the opponent’s mark per se that extends the reputation to apparently dissimilar goods but that it must also be shown by evidence that there is likely to be a perception of association, in the trade, between the respective goods and services. This is the common thread running through all the other decisions in The Eastman Photographic Materials Co. Ltd. and another v The John Giffiths Cycle Corporation Ltd. and The Kodak Cycle Co. Ltd. (1898) 15 RPC 105 at 110, Edward Hack’s Appn. (1941) 58 RPC 91 at 105, PLAYERS Trade Mark [1965] RPC 363 and WOODIES Trade Mark [1965] RPC 366.

46. Turning to the present case, the opponent has not adduced any evidence to show that there is likely to be a perception of association, in the trade, between aromatic chemicals and financial and investment services. There is also no evidence of what the ordinary purchasers in Hong Kong might think if they encounter the aromatic chemicals provided with reference to the suit mark. In the absence of such evidence, I must substitute myself as one who might be a potential purchaser of aromatic chemicals. It was the submission of Mr. Xavier that the applicant must produce clear evidence that the people would not be caused to wonder or confused when they look at the suit mark. In the absence of evidence, Mr. Xavier said the Registrar should not simply substitute herself into the position. He relied on the case of George Angus & Co. Ltd.’s Application (supra) as the authority for his argument. To my mind, the facts of that case can clearly be distinguished from those of the present case. That case is not an opposition case but a rectification case to apply to remove the registration of the subject mark from the register on the grounds that the subject mark was likely to deceive or cause confusion, in the course of trade, with the applicant for rectification’s registered mark. In a rectification case, the onus rests upon the applicant for rectification to satisfy the Registrar that there is a reasonable prospect of confusion if the mark attacked is allowed to remain on the register. It was held in that case that as the applicant for rectification had not adduced evidence as to the manner of trading under the respective marks, it was not possible for the court to decide whether confusion was likely to occur.

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47. The specified goods in the present case are aromatic chemicals in Class 1 which covers chemicals used in industry. In my view, it is apparent from the applicant’s evidence that the aromatic chemicals are raw materials for the production of fragrances and flavours in perfumery industry. Judging from the nature of the specified goods, they are for trade customers and manufacturers who would trade or use the aromatic chemicals for producing aromatic products, fragrance, perfumes and other aroma related products. That being the case, I do not think that the trade customers and manufacturers seeing the aromatic chemicals bearing the suit mark would be confused into thinking that they have anything to do with the opponent that is specialised in financial and investment services. It goes without saying that the nature and trade channels of the respective goods and services are also different.

48. Both Mr. Kwan and Mr. Xavier have made submissions in relation to the applicant’s use of the suit mark in Hong Kong before the application date. It is not a pre-requisite for the applicant to show use of the suit mark in Hong Kong before the application date in defending the section 12(1) opposition. However, if the applicant can show some use in Hong Kong at the application date and despite that, there is no actual instance of confusion with the opponent’s marks, it may help to shed light on the likelihood to cause deception and confusion if the suit mark is put on the register. Taking a fair appraisal of the evidence of use adduced by the applicant and counsel’s submissions, I find that the applicant is only able to prove limited use of the suit mark in Hong Kong before 1990 (just use on invoices and goods sold to one company only), long before the application date. Therefore, I do not think that the applicant’s limited extent of use of the suit mark in Hong Kong well before the application date helps to throw light on the issue of likelihood to cause deception and confusion.

49. The onus is upon the applicant to satisfy me that, on the facts and evidence presented, there is no reasonable likelihood of confusion and deception if the suit mark was to proceed to registration. Having taken into account all the circumstances outlined above, I find that the applicant has discharged its onus and accordingly find that the opposition under the “likely to deceive” leg of section 12(1) of the Ordinance fails.

Under section 12(1) : disentitled to protection

50. Mr. Xavier submitted that the disentitlement to protection ground is an additional ground of objection under section 12(1). Registration has the effect of protecting the owner of the mark from passing-off actions because registration legitimizes the owner’s

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use of the mark. If the user would in all probability constitute passing-off, such user should not be protected through registration (Re Omega (supra) at 480). He contended that a passing-off action would in all probability succeed in the present case were the applicant to market and sell the aromatic chemicals in Hong Kong bearing the suit mark even though aromatic chemicals are not part of the opponent’s business and there are no plans that they should be (Nike (Ireland) Ltd. & Anor v Network Management Ltd [1994] 12 EIPR D-319). Therefore, the application should be refused on the ground that the use of the suit mark would be disentitled to protection in a court of justice.

51. In reply, Mr. Kwan said that in Re OMEGA, the judge’s finding that a passing-off action would in all probability succeed was made on the basis that there was evidence of extension of reputation from watches to writing instruments. The opponent in that case has adduced evidence to show that owners of famous trade marks tend to use them for a range of products including, in particular watches and writing instruments (see paragraph 44 above). Deputy Judge Le Pichon (as she then was) was satisfied on the evidence and in the light of other factors that the use by the applicant of the subject mark in a normal and fair way would lead to deception and confusion. Regarding the Nike decision, it was also decided “on the fact that it was clear on the evidence that the marketing and sale of the defendants’ products would lead to actual deception of the public. There was affidavit evidence that “most members of the public would be deceived as to source by the use of the plaintiffs’ trade mark on dissimilar goods. There was also some evidence that the defendants intended to trade off the plaintiffs’ reputation”. Such evidence, Mr. Kwan said, is not present in these proceedings.

52. Whilst I accept the submission of Mr. Xavier that the disentitlement to protection ground is an additional ground of objection under section 12(1) of the Ordinance and if the user of the suit mark would in all probability constitute passing-off, such user should not be protected through registration, I do not find that the marketing and sale of the aromatic chemicals in Hong Kong bearing the suit mark by the applicant would in all probability constitute passing-off. I see the force of Mr. Kwan’s submission that the findings of passing-off action in both Re Omega and Nike decisions were made on the basis that there was actual evidence that the use by the applicants of the suit marks in those cases in a normal and fair way would lead to deception and confusion. Turning to the present case, there is no such evidence and I have found in paragraph 49 above that there can be no confusion between the respective marks among the customers for the respective goods and services. It follows that use by the applicant of the suit mark upon the specified goods is unlikely to give rise to an action for passing-off. I do not accept that use of the suit mark on

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aromatic chemicals could amount to a misrepresentation leading or likely to lead the public to believe that the goods of the applicant are goods of the opponent. The applicant has therefore defeated the opposition under the limb of disentitlement to protection under section 12(1) of the Ordinance.

Under section 13(1)

53. Section 13(1) provides :

“Any person claiming to be entitled to be registered as the proprietor of a trade mark used or proposed to be used by him who is desirous of registering it must apply in writing to the Registrar in the prescribed manner for registration either in Part A or Part B of the register.”

54. An opponent, to successfully mount an opposition under section 13(1), must establish that it, rather than the applicant, is the proprietor of that trade mark, or a mark virtually identical to it, in respect of identical goods. This principle was clearly established in Re Wowi & Device Trade Mark [1998] 3 HKC 221.

55. For the purposes of the opposition under this section, Mr. Xavier indicated that the opponent would only rely on its trade mark or name “SHK, and not the logo mark “ ”. Mr. Xavier submitted that when one considers section 13(1), one has to look at the entirety of the mark. The device part of the suit mark in this case is a commonplace device which consists of a simple geometric shape that cannot be described orally. It would quickly be forgotten by the customer and thus should not be taken into account in considering whether the suit mark and the opponent’s trade name or mark “SHK” are virtually identical.

56. It was the contention of Mr. Kwan that the marks have to be compared side by side under section 13(1). The parties’ respective marks are not identical or virtually identical. He contended that the device, configuration and arrangement of the suit mark is sufficiently different from the opponent’s trade name or mark “SHK” as to entitle the applicant to claim to be the proprietor of the suit mark. The objection under section 13(1), he argued, is misconceived.

57. The test that should be applied by me in determining whether the two marks are virtually identical can be found on page 229 of Re Wowi & Device Trade Mark (supra) :

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“However, for the question of proprietorship to arise at all the parties must be claiming the same mark or at least marks which are so nearly identical as to be virtually the same mark : Kendall Co v. Mulsyn Paint and Chemicals (1963) 109 CLR 300; Tavefar Pty Ltd v Life Savers (Australia) Ltd (1988) 12 IPR 159. The question is not whether the marks are so alike as to be deceptively similar, which is obviously a relevant consideration under sections 28 and 33. In deciding whether the marks are substantially identical I think I am entitled to compare the marks side by side. This would seem to follow from what the High Court has said in relation to the question whether conflicting marks are substantially identical in terms of section 33 : Shell Co (Aust) Ltd v Esso Standard Oil (Aust) Ltd (1963) 109 CLR 407. I think it is clear when the applicant’s and opponent’s marks are compared side by side that there are very obvious differences to the extent that it cannot be said that they are the same mark or so similar as to be in effect the same mark.”

58. In Vamuta Property Limited (t/a Sogo Jewellers) v. Sogo Co. Ltd. AIPO 557, the opponent filed a notice of opposition to acceptance of an application made by Sogo Co. Ltd., the applicant, to register a mark which combined the word “Sogo” with a logo. It was held that issues of proprietorship only arise when the marks in question are either identical or so similar as to be virtually the same marks. The composite mark which combined the word “Sogo” and the device of a triangle or an inverted hourglass within a circle was held to be sufficiently different from the mark “Sogo” used by the opponent as to entitle the applicant to claim to be the author of it.

59. Having made a side by side comparison and applied the reasoning of SOGO case to the present case, I am of the opinion that the suit mark which is a composite mark comprising the letters “SHK” and an oval device enclosing two triangles are sufficiently different from the trade mark or name “SHK” used by the opponent. It is clear when the respective marks are compared side by side, there are differences that it cannot be said they are in effect the same mark. Ownership of one should not preclude a claim to ownership of another.

60. I find that the opponent’s mark is not virtually identical to the suit mark. It follows that the opposition under section 13(1) is defeated.

Under section 2(1)

61. Whilst Mr. Xavier pointed out that the making of application itself is to be

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regarded as prima facie evidence of intention to use, he argued that the prima facie case is rebutted here as it appears from the evidence that since 1991, the applicant has not used the suit mark in Hong Kong but used another trade mark “Cobra Brand” (exhibit “3” to Kelkar’s statutory declaration). In reply, Mr. Kwan contended that the applicant has filed evidence in support of its use of the suit mark in relation to the specified goods (exhibits “1”, “2” and 3” to Kelkar’s statutory declaration). It is also seeking to register the suit mark which was derived from the name of its predecessor (paragraph 4 of Kelkar’s statutory declaration). The opponent’s allegation that the applicant has not used or does not intend to use the suit mark for the purpose of indicating a connection in the course of trade between the applicant and its specified goods is unfounded.

62. In my judgment, section 2(1) of the Ordinance defines a “trade mark relating to goods” to mean, inter alia, a mark used or proposed to be used in relation to goods for the purpose of indicating, or so as to indicate, a connection in the course of trade between the goods and the proprietor. The objection raised by the opponent is that the suit mark is not used or proposed to be used in relation to the specified goods by the applicant. I agree with Mr. Xavier that the making of the application itself by the applicant is to be regarded as prima facie evidence of intention to use in the light of Aston v. Harlee Manufacturing Co. (1960) 103 CLR 391 where Fullagar J. said at 401 :

“The making of the application itself is, I think, to be regarded as prima facie evidence of intention to use. I cannot think that the Registrar is called upon to institute an inquiry as to the intention of any applicant, and I think that, on an opposition or on a motion to expunge, the burden must rest on the opponent or the person aggrieved, of proving the absence of intention.”

63. I do not think that the opponent has discharged the burden of proving the absence of intention in this case. The evidence referred to by Mr. Xavier in his submission does not indicate that the suit mark was not intended to be used by the applicant at the date of application. The prima facie intention to use the mark is not rebutted and I therefore reject the opponent’s argument under this section.

Under section 13(2)

64. The opponent has asked me to exercise my overriding discretion to refuse registration. The discretion arises when the opponent has failed in its objection under

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sections 2, 12 and 13(1) of the Ordinance and the suit mark is registrable under either section 9 or 10 of the Ordinance.

65. Mr. Xavier contended that in the light of the reputation of the opponent, when the applicant made the subject application, the applicant must have heard of the opponent as a household name. By merely adding some common geometric shapes to the opponent’s “SHK” trade name or mark to form the suit mark, the applicant is not able to avoid confusion from registering the mark.

66. Mr. Kwan argued that if the opponent’s reputation has not spread over to the applicant’s field, there is nothing wrongful for the applicant to apply for the registration of the suit mark. In support of his argument, he referred me to Laura Ashley Trade Mark [1990] RPC 539. The learned Hearing Officer Mr. Alasdair Hume observed at 544-5 :

“The whole basis of current trade marks law relies on it being acceptable to register even an identical mark in different ownership providing the same goods or same description of goods are not involved. “Penguin” for example is registered in quite separate ownership for, on the one hand, “biscuits” and on the other “books”. “BARRATT” is registered for dwelling houses in class 19 and at the same time in class 25 there is an unrelated registration of “BARRATTS” for shoes. “BURTON” is well known in the high street for menswear but so too is “BURTON’s” for biscuits. Most people will, I suspect, have heard of these – they are well known names as indeed is WIMPY for hamburgers but no-one is likely to assume a connection with WIMPEY the builders. I cannot accept, therefore than [sic] in relation to the “Laura Ashley” logo anybody seeing it on goods of a type sold through normal High Street stores would necessarily assume the goods to be associated with the applicants. It would, I think, depend very much on the goods.”

67. Mr. Kwan submitted the fact that the applicant has used the suit mark at the application date added strength to the applicant’s case. The applicant has all along acted bona fide and there is no particular evidence of dishonesty on the part of the applicant. There is no question of the copying of the opponent’s mark by the applicant. The residual discretion has to be exercised judicially. Mr. Kwan contended there are no circumstances in the present case that would justify the exercise of the discretion against the grant of the registration of the suit mark.

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68. In my opinion, the opponent has challenged the applicant’s honesty in the selection of the suit mark. Mr. Kelkar explains in paragraphs four to seven of his statutory declaration how the suit mark was derived from the applicant’s company name and how the suit mark was first used in India in 1970 and in Hong Kong in 1982 with supporting evidence (see the copy Application for Registration of Copyright and the invoices in exhibit “2” to Kelkar’s statutory declaration). I find nothing in this explanation from which I could infer, irresistibly, that the applicant was dishonest. In the circumstances, I agree with Mr. Kwan that there is no question of the copying of the opponent’s mark by the applicant. There being no other reason advanced, I do not exercise my discretion adversely to the applicant.

Costs

69. The applicant has sought costs and there is nothing in the circumstances or conduct of this case which would warrant a departure from the general rule that the successful party is entitled to his costs. I accordingly order that the opponent pays the costs of these proceedings.

70. Subject to any representations as to the amount of costs or calling for special treatment, which either party makes within one month from the date of this decision, costs will be calculated with reference to the usual scale in Part 1 of the First Schedule to Order 62 of the Rules of the High Court (Cap. 4) as applied to trade mark matters, with one counsel certified, unless otherwise agreed between the parties.

(Ms Fanny S. F. Pang) p. Registrar of Trade Marks

24 June 2005