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TRADE MARKS ORDINANCE (CAP. 559) APPLICATION FOR REVOCATION OF TRADE MARK 300219951 MARK :

CLASS :

3

APPLICANT :

LABORATOIRE NUXE

REGISTERED PROPRIETOR :

HEALTHCORP TRADING LIMITED

STATEMENT OF REASONS FOR DECISION

1. Laboratoire Nuxe (“the applicant”) applied to the Registrar of Trade Marks

on 22 September 2009 to revoke the registration of the trade mark “Bio-Beauty” in

class 3 under the Trade Marks Ordinance (Cap. 559) (“the Ordinance”) on the ground

of non-use (the “application”). The trade mark was registered, at the time the

application for revocation was filed, in the name of Healthcorp Trading Limited (“the

registered proprietor”).

2. The hearing of the application took place before me on 4 December 2012.

Mr. Dominic W.H. Pun, Counsel, instructed by Messrs. Woo Kwan Lee & Lo,

represented the applicant. Mr. Ling Chun Wai, Counsel, instructed by Messrs.

Cheung & Liu, represented the registered proprietor.

Ground for revoking the trade mark

3. The application for revocation is made under section 52(2)(a) of the

Ordinance on the ground that the trade mark has not been genuinely used in Hong

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Kong by the registered proprietor or with his consent, in relation to the goods for

which it is registered.

Three-year period of non-use

4. Under section 52(2)(a) of the Ordinance, the registration may be revoked if

the trade mark has not been used for a continuous period of at least three years. The

application filed on 22 September 2009 seeks revocation to take effect from 17

September 2008.

Registration

5. The registration that the applicant applies to revoke is the trade mark below:

(the “subject mark”) which has been registered with registration number 300219951 in

class 3 in respect of ‘cosmetics products; skin care, body care, hair care and face care

preparations; all included in Class 3’ (“the registered goods”). The filing date of the

application for registration of the subject mark, which is deemed to be also the date of

registration, is 24 May 2004.

Applicant’s evidence in support of the application

6. The applicant’s evidence in support of the application filed pursuant to Rule

36 of the Trade Marks Rules, Cap. 559A (the “Rules”) consists of a statutory

declaration of Man Chi Hung Edward declared on 18 September 2009. Man Chi Hung

is the Operation Manager of a private investigation company which received

instruction from Messrs. Cabinet Sueur & L’Helgoualch in Paris, France to conduct an

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investigation on the use or non-use of the subject mark. Man Chi Hung’s statutory

declaration sets out the process and results of the investigation.

7. What Man Chi Hung found out from his investigation, in essence, are the

following:-

(i) The registered proprietor was one of the associated companies of Hanison

Construction Holdings Limited (“Hanison”). Hanison was a construction

company providing building construction services, whereas the registered

proprietor was dealing with health food and drink products. Both of the

companies had office in the building of Sha Tin Industrial Centre, 5-7 Yuen

Shun Circuit, Sha Tin, New Territories, Hong Kong.

(ii) The said premises of the registered proprietor was its headquarter and all its

products were only being sold in the registered proprietor’s retail shops.

(iii) The retail shops were trading under the name “HealthPlus”, located in

various shopping arcades and Mass Transit Railway stations all over Hong

Kong, with the fleet shop located at St. Teresa’s Hospital where all of the

registered proprietor’s products were shown.

(iv) At the fleet shop located at St. Teresa’s Hospital, a set of “Bio-Beauty”

Facial Device which included a facial device machine, a case and a bottle of

aloe lotion was seen behind the display window, and which was priced

HK$640 per set. It was revealed by a saleslady there that the aloe lotion was

a free gift for the facial device and was not for sale separately. The saleslady

also revealed that customers could use other brands of lotion instead of the

aloe lotion with the “Bio-Beauty” Facial Device. No catalogue of the “Bio-

Beauty” Facial Device was available.

8. The applicant did not file any additional evidence under Rule 38 of the Rules.

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Registered proprietor’s evidence

9. The registered proprietor’s evidence of use filed pursuant to Rule 37 of the

Rules consists of a statutory declaration of Chung Lai Ling (MaryAnne Chung)

declared on 22 March 2010 (“Chung’s statutory declaration”). Chung Lai Ling is the

General Manager of the registered proprietor, she held that position only from 1

January 2010, but before that, she had been the Senior Manager of Care and Health

Limited which, being the wholesale team of health division, was another company

within the Hanison group of companies primarily responsible for Hanison’s retail

operations, including those of the registered proprietor’s. She had free access to the

registered proprietor’s records, and made the statutory declaration under the

authorisation of the registered proprietor.

10. According to Ms. Chung, the Hanison group of companies had expanded

from the construction and construction related businesses in Hong Kong to the trading

of health products. The Hanison group commenced retail of health products in 2003,

selling health supplements, healthcare equipment and traditional Chinese medicine.

Exhibit “CLL-1” to Chung’s statutory declaration is a print-out of extracts from

Hanison’s corporate website including a group structure chart.

11. It is claimed that the registered proprietor’s business in Bio-Beauty products

commenced in or around 2004, and the Bio-Beauty mark had been used by the

registered proprietor as its brand for a combination box set consisting of the following

items:-

(a) a two piece box set bearing the Bio-Beauty brand;

(b) a facial massaging device bearing the Bio-Beauty brand;

(c) a separate cover for the device (in a different colour) bearing the Bio-Beauty

brand;

(d) a facial lotion for use with the device;

(e) a separate cloth carrying case for the device and lotion;

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(f) an instruction leaflet; and

(g) a warranty card.

Exhibit “CLL-2” to Chung’s statutory declaration is an original Bio-Beauty box set

which includes an Instruction Manual.

12. Ms. Chung emphasised that the Bio-Beauty product is always sold as a box

set consisting of the facial device and the lotion to be used with the device, and an

essential aspect of the device is that it must be used with a lotion. Ms Chung

acknowledged that there is no Bio-Beauty branded product sold as a device on its own,

and neither is there a Bio-Beauty product sold as a lotion on its own. It follows

therefore there is no sales record of any Bio-Beauty lotions alone, and neither is there

any advertising or promotion of any Bio-Beauty lotions alone.1

13. Chung’s statutory declaration provides a list of retail shops selling the Bio-

Beauty sets in Hong Kong, which includes the “Health Plus” outlet at St. Teresa’s

Hospital. Ms. Chung claimed that the registered proprietor has continuously sold the

Bio-Beauty sets since 2005 through its own retail outlets, and not through any third

party outlets.

14. Sales figures in Hong Kong for the Bio-Beauty sets from 2005 to 2009 were

given in Chung’s statutory declaration. Sales volume ranges from the highest of 349

sets in 206 to the lowest of 38 sets in 2009, the corresponding sales figures in Hong

Kong Dollars reveal that the price remained steady over the years at around HK$650

per set. Exhibit “CLL-3” to Chung’s statutory declaration contains copies of the

electronic versions of sales invoices in respect of the Bio-Beauty sets.

15. Ms. Chung further provided estimated amounts of annual expenditures for

2004 to 2009 on advertising and promotion in respect of the Bio-Beauty sets. Exhibit

“CLL-4” to Chung’s statutory declaration contains a promotional leaflet that the

registered proprietor has produced for the purpose of promoting the Bio-Beauty sets.

1 All these admissions or acknowledgements were made in paragraphs 4 to 6 of Chung’s statutory declaration.

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16. Exhibit “CLL-5” to Chung’s statutory declaration contains copies of sales

invoices in respect of supplies received from Tina Concept Company Limited, a

company from which the registered proprietor is said to have sourced its lotion

products for the Bio-Beauty sets.

17. The rest of Chung’s statutory declaration deal with matters in reply to Man

Chi Hung’s statutory declaration. I do not propose to summarize them here but may

deal with them in the latter parts of this decision as and when required by the context.

Decision

18. Revocation of the registration of a trade mark is provided for under section

52 of the Ordinance. In particular, section 52(2)(a) provides that the registration of a

trade mark may be revoked where “the trade mark has not been genuinely used in

Hong Kong by the owner or with his consent, in relation to the goods or services for

which it is registered, for a continuous period of at least 3 years, and there are no valid

reasons for non-use”.

19. Section 52(8) provides that for the purposes of subsection (2)(a), the 3-year

period may begin at any time on or after the actual date on which particulars of the

trade mark were entered in the register under section 47(1), i.e., the actual date of

registration of the trade mark.

20. In the present case, the actual date of registration of the subject mark is 24

May 2004. The application filed on 22 September 2009 seeks revocation to take effect

from 17 September 2008, which is the date when Man Chi Hung visited the outlet at

Teresa’s Hospital. For the purposes of the present proceedings, I need to look at the

three-year period beginning on 17 September 2005 to ascertain whether or not the

subject mark has been “genuinely” used in Hong Kong.

21. Section 82(1) of the Ordinance states : ‘if in any civil proceedings under this

Ordinance in which the owner of a registered trade mark is a party, a question arises as

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to the use to which the trade mark has been put, the burden of proving that use shall lie

with the owner’. The result is that in an application to revoke for non-use, the onus of

proof of use is on the owner, which in the present context is the registered proprietor.

There is no dispute between the parties on that.

Use of the subject mark in Hong Kong

22. I have summarised the evidence filed by both parties in paragraphs 6 to 17

above. The applicant’s evidence, comprising only the statutory declaration of Man

Chi Hung, simply contains matters gathered from investigations conducted by

professional agents whose source of instructions ultimately rested with the applicant.

Whilst what had been raised in Man Chi Hung’s statutory declaration constitutes a

preliminary case to require the registered proprietor to prove use of the subject mark,

what really matters in this proceedings, as decreed by sections 52(2)(a), 52(8) and

82(1) of the Ordinance, is whether the registered proprietor has adduced sufficient

evidence to show that the subject mark had been genuinely used in Hong Kong during

the three-year period counting from 17 September 2005. I therefore do not intend to

delve deeply into the applicant’s evidence.

23. As far as the registered proprietor’s evidence is concerned, Chung’s statutory

declaration and the exhibits thereto are challenged on two fronts. The first front is that

the sales evidence tendered by the registered proprietor is insufficient to show that the

subject mark had been genuinely used by the registered proprietor or with its consent

in Hong Kong during the three-year period. The second front is that, even if the first

front failed, which means that the subject mark can be taken to have been genuinely

used by the registered proprietor or with its consent on certain goods of the registered

proprietor, it is nevertheless not the case that the subject mark had been used on the

registered goods.

24. On the first front, Mr. Dominic Pun, counsel for the applicant, pointed out

that of the 6 invoices adduced in Exhibit “CCL-3”, only 2 were issued within the

three-year period beginning on 17 September 2005, and that the invoices were all

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issued by a RetailCorp Limited, rather than by the registered proprietor. I will deal

with the second point first.

25. It is true that in Chung’s statutory declaration, the sales invoices in Exhibit

“CCL-3” are alleged to be in respect of “Healthcorp sales of the Bio-Beauty Sets” but

there was no explanation for the anomaly that they were issued by RetailCorp Limited

instead of the registered proprietor, and indeed RetailCorp Limited was not mentioned

by Ms. Chung at all in her statutory declaration. At the hearing, Mr. Ling Chun Wai,

counsel for the registered proprietor, drew my attention to the case Einstein Trade

Mark [2007] R.P.C. 23, a decision of the Appointed Person,2 to argue that there was

implied consent of the registered proprietor for the sales of the Bio-Beauty sets, which

bear the subject mark, by RetailCorp Limited.

26. In my view, the Einstein Trade Mark case, which examined and analysed the

legislative history leading to the adoption and application of the concept of use “by the

proprietor or with his consent” in the context of section 46(1) of the Trade Marks Act

1994, is just as applicable to the same concept in section 52(2) of the Ordinance, and

hence could assist Mr. Ling in the following respect – that the proprietor of a trade

mark could defeat an application for revocation on the ground of non-use by relying

on the fact that goods had been sold under his trade mark by a person (such as a

licensee) with whom he was “economically linked” and could do so without showing

that he had exercised control over the goods in question. It follows that what the

applicant needs to show in order to prove the required consent in the present case, is

just that goods had been sold under the subject mark by RetailCorp Limited with

which the registered proprietor was “economically linked”.

27. Mr Ling relied on the following to show that the registered proprietor and

RetailCorp Limited are economically linked:-

(i) the group structure chart of Hanison in Exhibit “CLL-1” which shows

RetailCorp Limited and the registered proprietor are both hundred percent

2 The “Appointed Person” is a person appointed by the Lord Chancellor to hear and decide appeals from the UK Trade Marks Registry’s Tribunal.

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owned by the Health Products Business of and within the Hanison group of

companies;

(ii) the address and fax number printed on the invoices are the same address and

fax number as appearing in the warranty card which is in the name of the

registered proprietor and included in the Bio-Beauty box set; and

(iii) the registered proprietor is obviously in a position to produce sales figures

and the invoices in question from the company’s records in relation to the

use of the subject mark.

There is no contrary evidence to hint that the relationship between the registered

proprietor and RetailCorp Limited might be anything otherwise.

28. As far as the above evidence goes, the registered proprietor and RetailCorp

Limited can be regarded as “economically linked” entities, and in the absence of

cross-examination or evidence to the contrary, following the principle of the Einstein

Trade Mark case, this is sufficient to prove the required consent. I hold that

RetailCorp Limited used the subject mark with the consent of the registered proprietor

in relation to the Bio-Beauty box sets.

29. I now come back to the first point, which essentially asks whether the

evidence filed by the registered proprietor can sufficiently show that the subject mark

had been genuinely used with the registered proprietor’s consent in Hong Kong within

the three-year period beginning on 17 September 2005.

30. Of the 6 invoices adduced in Exhibit “CCL-3”, only 2 fall within the three-

year period. The two falling within the period are dated 8 May 2008 and 24 July

2008, whereas those outside the period are all dated within the first half of 2009. Mr

Ling submitted that the reason for including the latter is to cater for all eventualities,

including the case where section 52(4) and 52(5) of the Ordinance were to be invoked.

In gist, the combined effect of section 52(4) and 52(5) is that registration of a trade

mark shall not be revoked on the non-use ground if the use of the mark in question is

commenced or resumed after the expiry of the 3-year period and before the application

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for revocation is made, but disregarding any use commenced or resumed after the

expiry of the 3-year period but within the period of 3 months before the making of the

application for revocation. In the present case, the three-year period end on 16

September 2008 and the subject application for revocation was made on 22 September

2009; the 4 invoices, which all dated within the first half of 2009, just fall within the

interim period in between.

31. Nonetheless, I will first see whether the 2 invoices falling within the three-

year period are sufficient to prove for genuine use. It is not in dispute that genuine use

does not subsist in merely putting the mark on a few goods and importing them for a

non-commercial purpose, and it is imperative to examine with care that the use is

neither private nor just for internal use by the undertaking concerned, but has as its

essential aim the preservation or creation of market share for the goods that it protects

(see for example La Mer Technology Inc v Laboratoratoires Goemar SA [2004] FSR

38).3

32. As far as the 2 invoices dated in 2008 are concerned, they are sufficient, in

my view, to show that real commercial transactions involving “Bio-Beauty” Facial

Device were carried out. Each invoice evidences sale of just one set of “Bio Beauty

Device”, the customers were one “Walk-In Customer at CEN” and one named

individual. The two devices sold were both shown to be originally priced at

HK$1,280, but after discount one was sold at HK$640 and the other at HK$608. All

this has no conflict with, if not corroborative of, what Man Chi Hung has found out

from his investigation, viz., “Bio-Beauty” Facial Device can be bought at around

HK$640 per set at certain retail shops in Hong Kong around the time he made a visit

to the fleet shop located at St. Teresa’s Hospital, which was on 17 September 2008.

33. Indeed, what Chung Lai Ling alleged in her statutory declaration about the

mode of operation of the “Bio-Beauty” Facial Device business and what Man Chi

3 Further guidance as to the meaning of genuine use can be found in Ansul BV v Ajax Brandeveiliging BV [2003] RPC 40 and La Mer Technology Inc v Laboratoratoires Goemar SA [2004] FSR 38 (referred to below as “La Mer”), and judgments of the European Court of Justice (“ECJ”) which have been considered and applied by the Court of Appeal of England and Wales in Laboratoire De La Mer [2006] FSR 5.

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Hung found out from his visits to the registered proprietor’s office and shop virtually

coincide; in particular, the photographs exhibited as “MCHE-6” to Man Chi Hung’s

statutory declaration show that the facial device set clearly depicts the brand name,

namely, “Bio-Beauty” on the front of the package, and the set is composed of the

facial device and a lotion – this apparently is the same as the original Bio-Beauty box

set shown in Exhibit “CLL-2” to Chung’s statutory declaration, which I reproduce

below:-

34. Mr. ling emphasized that the applicant did not file any additional evidence

under Rule 38 of the Rules to challenge the evidence given by Ms. Chung, and he

drew my attention to the case Pan World Brands Ltd v Tripp Ltd (Extreme Trade

Mark) [2008] R.P.C. 2, also a decision of the Appointed Person, to counter Mr. Pun’s

challenge on the probative value of Ms. Chung’s evidence.

35. In gist, Mr. Pun’s criticisms of Ms. Chung’s evidence, apart from the second

front of challenge that I will deal with later, are mostly of two types. The first type

alleges the scarcity or insufficiency of evidence showing when, how and where the

“Bio-Beauty” products, as depicted in Exhibit “CLL-2” to Chung’s statutory

declaration, were marketed and advertised. The second type alleges that what had

been said in Chung’s statutory declaration in relation to the advertising, promotion and

sale of the Bio-Beauty box sets in Hong Kong, were merely assertions without

corroborative evidence.

36. I think Mr. Ling has rightly pointed to the relevant passages in Pan World

Brands case to keep these criticisms of Mr. Pun in perspective. Mr. Pun cited another

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Appointed Person case Advanced Perimeter Systems Ltd v Keycorp Ltd (Multisys

Trade Mark) [2012] R.P.C. 14 to press for his point that the less extensive the

evidence of use relied on is, the more solid it must be. I do not find the Pan World

Brands case and the Advanced Perimeter Systems case essentially differ as far as the

principles of evaluating evidence of use are concerned, and given that the latter case is

about evaluation of evidence of use in the context of goodwill and misrepresentation,

whereas the former is exactly on revocation for non-use, I will focus on the Pan World

Brands case. The following is extract of the relevant passages of the case:-

“26 Basing herself upon the last sentence of this passage, counsel for the proprietor

submitted that, if a proprietor filed evidence under rule 31(3) [similar to Rule 37(2) & (4) of

the Rules] which established an arguable case of use of the trade mark and the applicant for

revocation did not file any evidence under rule 31A(1) [similar to Rule 38(1) of the Rules],

then it would be very difficult for the application to succeed. In my judgment this

submission goes too far: as I believe Kitchin J. makes clear, the fact that the proprietor's

evidence establishes an arguable defence to the application does not necessarily mean that

the defence will succeed if the evidence is unchallenged.

27 On the other hand, I consider that counsel for the proprietor was right to emphasise that

the procedure gives the applicant the opportunity to investigate and challenge the

proprietor's rule 31(3) evidence. Furthermore, where, as in the present case, the proprietor

files a further round of evidence under rule 31A(3) , the applicant has a second opportunity

to investigate and challenge the proprietor's evidence. Still further, even if the applicant

chooses not to file any evidence in response, it has the opportunity in an appropriate case to

crossexamine the proprietor's witness(es) at the hearing.

28 I would add that I regard this procedure as consistent with my analysis of the burden of

proof in paragraph 24 above, and in particular as confirming that the evidential burden may

shift during the course of the proceedings and that deciding whether or not there has been

genuine use purely on the basis of the burden of proof should be the counsel of last resort.

…….

What constitutes evidence of use?

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31 Basing himself upon the first three sentences of the passage I have quoted from MOO

JUICE, counsel for the applicant submitted (1) that a mere assertion of use of a trade mark

by a witness did not constitute evidence of use sufficient to defeat an application [for

revocation] for non-use, and (2) it followed that mere testimony from a representative of the

proprietor was not enough and such testimony had to be supported either by documentary

records or corroborated by an external witness. I accept submission (1) but not submission

(2). Kitchin J.'s statement that “bare assertion” would not suffice must be read in its context,

which was that it had been submitted to him that it was sufficient for the proprietor to give

evidence stating “I have made genuine use of the trade mark”. A statement by a witness with

knowledge of the facts setting out in narrative form when, where, in what manner and in

relation to what goods or services the trade mark has been used would not in my view

constitute bare assertion. As counsel for the applicant accepted, it might not be possible for a

trade mark proprietor to produce documentary evidence: for example all the records might

have been destroyed in a fire. In such circumstances I do not see anything in either the

Directive, the 1994 Act or the 2000 Rules which would require the proprietor to adduce

evidence from an external witness (which is not to say that it might not be advisable for the

proprietor to do so).

……

Unchallenged evidence

…….

35 In my judgment the learned editors of Phipson are correct to say that the rule [referring

to the general rule that requires challenge in cross-examination] is not an inflexible one.

There are at least two well-established exceptions to it. The first is that, as the speech of

Lord Herschell L.C. in Browne v Dunn makes clear, it may not be necessary to cross-

examine on a point if the witness has been given full notice of it before making his

statement. As I pointed out in BRUTT Trade Marks [2007] R.P.C. 19 at [23], this may be

significant in registry proceedings where evidence is given sequentially. The second is that a

court is not obliged to accept a witness's evidence in the absence of cross-examination if it is

obviously incredible: see National Westminster Bank plc v Daniel [1993] 1 WLR 1453.

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36 Where, however, evidence is given in a witness statement filed on behalf of a party to

registry proceedings which is not obviously incredible and the opposing party has neither

given the witness advance notice that his evidence is to be challenged nor challenged his

evidence in cross-examination nor adduced evidence to contradict the witness's evidence

despite having had the opportunity to do so, then I consider that the rule in Brown v Dunn

applies and it is not open to the opposing party to invite the tribunal to disbelieve the

witness's evidence.”

37. I would say that many of the above discussed scenarios are vaguely

reminiscent of the present proceedings, in particular, the state of the unchallenged

evidence in the present case convince me that the rule in Brown v Dunn should apply:

it is not open to the applicant to invite this tribunal to disbelieve the factual part of Ms

Chung’s evidence which, after all, is not obviously incredible and as I have indicated

above (see paragraph 32), consistent with, if not corroborated by, what Man Chi Hung

found out from his visits to the registered proprietor’s office and retail shop. The

alleged absence of real evidence showing the particulars as to when, how and where

the “Bio-Beauty” products were marketed and advertised has to be looked at in

context. If, which I agree, what Ms Chung said in her statutory declaration is not

obviously incredible, the particulars had virtually been covered in paragraphs 3 to 11

of Chung’s statutory declaration by the statements and figures therein. I do not find

them to constitute bare assertions.

38. I therefore hold that the Bio-Beauty sets bearing the subject mark and sold

by RetailCorp Limited with implied consent of the registered proprietor had genuine

commercial purposes. The sales effected, even though they are not considerable,

constitute use which objectively is such as to create or preserve an outlet for the

products concerned. With that I now turn to consider the second front of challenge by

Mr. Pun to the registered proprietor’s evidence.

39. Mr. Pun submitted that the use of the subject mark on the “Bio-Beauty” sets

is in relation to and confined only to the facial device alone, and since facial device is

not an item among the registered goods (which I have set out in paragraph 5 above),4 4 Mr. Pun submitted that facial device would be within either Class 7 or Class 8 according to the 8th

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the subject mark has not been genuinely used in Hong Kong by the registered

proprietor or with his consent, in relation to the goods for which it is registered, for the

relevant three-year period. Mr. Pun in particular pointed out that the subject mark had

not been used in relation to the bottle of lotion as contained in the Bio-Beauty sets.

40. The bases on which Mr. Pun argue the above are the following:-

(a) in the instruction manual, the subject mark is being used to refer to the “Bio-

Facial device”, the “Bio-Beauty” professional facial machine and “Bio-

Beauty 美容手機”;

(b) in the invoices, the subject mark is being used to refer to “Bio-Beauty

Device” and “Bio-Beauty 美容手機”;

(c) in the promotional leaflet, the subject mark is being used to refer to “Bio-

Beauty 美容手機”, “個人專用 Bio 美容儀器”, and all references to the

subject mark in the leaflet are to the facial device alone;

(d) in paragraph 5 of Chung’s statutory declaration, Ms Chung said, “There is no

Bio-Beauty branded product sold as a device on its own, and neither is there

a Bio-Beauty branded product sold as a lotion on its own”;

(e) Paragraph 18 of Man Chi Hung’s statutory declaration contains the

following statements: - “The saleslady answered that ‘Bio-Beauty’ was only

used on the facial device as shown in the shop window. I asked whether the

aloe lotion would be sold separately and the saleslady replied in the negative.

The saleslady revealed that the aloe lotion was a free gift for the facial

device and it was not for sale. Further, the saleslady informed me that

customers could use other brands of lotion instead of the aloe lotion with the

‘Bio-Beauty’ Facial Device.”

edition (2001) of the Nice Classification established by Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks, in any event not within Class 3. On the other hand, it does not seem to be in dispute that facial lotion is among the registered goods in Class 3.

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41. Before going into the veracity of these allegations, I would like to first

establish what are the relevant and applicable principles of evaluation in the

circumstances. In this connection, the case much relied on by Mr. Pun is the decision

of the Court of Justice of the European Communities (the “CJEC”) in Silberquelle

GmbH v Maselli-Strickmode GmbH (C-495/07) [2009] E.T.M.R. 28.

42. That case concerns an application for revocation on the ground of non-use.

The owner of the registered word mark WELLNESS (which is the mark in question) is

an undertaking that manufactures and sells clothing. In the context of the sale of its

clothing, the owner used its mark to designate an alcohol-free drink which was handed

out as a gift in bottles marked “WELLNESS-DRINK”, along with the clothing sold.

In its promotional documents, the owner made reference to the free gifts labelled with

the WELLNESS mark. The owner has not used its mark for drinks sold separately.

The question of whether use of a mark on goods which the proprietor of the trade

mark gives, free of charge, to purchasers of his other goods after conclusion of the

purchase contract constitutes genuine use in the context of an application for

revocation on the ground of non-use was referred to the CJEC for a preliminary ruling.

43. The CJEC ruled that where the proprietor of a mark affixes that mark to

items that it gives, free of charge, to purchasers of its goods, it does not make genuine

use of that mark in respect of the class covering those items. Before making this

ruling, the court expressly made it clear that the ruling essentially concerned a case

that is different from one in which the proprietor of a mark sells promotional items in

the form of souvenirs or other derivative products, and the court expressly adopted the

reasons set out in the Advocate General’s Opinion. To understand the rationale for the

ruling, I set out below the relevant extracts of the Advocate General’s Opinion:-

“AG48 Accordingly, the basic premiss means that a trade mark proprietor must place his

goods bearing the mark on the relevant market for those goods, which, in the main

proceedings, is the non-alcoholic drinks market; if trade mark proprietors did not act in that

manner, their goods would not be distinguishable from others. The consumer receives the

WELLNESS drink as a free gift when he purchases clothing and, as such, the consumer

does not perform any conscious act of acquiring the bottled drink by comparing it with other

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similar, substitutable ones; it follows that the trade mark is not strengthened vis-à-vis

competitors' marks because of the customer's preference.

AG49 In those circumstances, the trade mark for the soft drink remains outside the reference

market and, therefore, it does not compete with other marks, and so there is no impediment

to the appropriation of the mark by third parties, since its use on the bottles is a mere tool, a

nice gesture to increase the consumer's loyalty to the WELLNESS mark in the clothing

sector. However, the soft drinks market is unaware of [the owner’s] product and its mark. It

appears unlikely that someone who, as a result of buying WELLNESS clothes, takes a liking

to the drink, would be prepared to spend money on more clothes which they do not need

simply to receive the drink. However, even if someone were to act in that way, their

purchases would not increase the market share of the trade mark in the soft drinks market,

although it would do so on the clothing market, which fits perfectly with the role [the owner]

assigned to the drink: as an advertisement to publicise its core business, that is, fashion.

…….

AG52 …. It has been argued that merely placing a registered trade mark on promotional

items given as a gift, such as pens and T-shirts, does not satisfy the requirements of genuine

use on the grounds that it has no connection with the product for which the application for

trade mark protection was made.

AG53 Although the situation described is reasonably similar to the one in the main

proceedings, it is possible that the guidance it provides may not be fully transposable to the

present case, since the protection afforded by the mark in this case extends to the category of

goods handed out as a free gift. However, I am largely persuaded by the argument, to the

extent that I believe that it is applicable to the present case because, in the absence of a link

with the market, as I explained above, the bottles of soft drink bearing the WELLNESS-

DRINK mark become an advertisement which is completely unconnected with the soft

drinks market.”

44. In my view, if that case could assist, it is in the rationale as expressed in the

above quoted Advocate General’s Opinion, rather than following literally the wording

of the ruling of the CJEC, as after all, what falls to be decided in the present case is

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whether the lotion should be considered as a free gift, not that after accepting that it is

a free gift, whether affixing of the mark on it would make genuine use of that mark. If

I may summarize the rationale, what is crucial is to look at the relevant market for the

goods in question and see whether there is a link between the way the mark is put to

use and that market. Mr. Ling also referred me to Paras.10-071 to 10-073 of Kerly’s

Law of Trade Marks & Trade Names (15th Edition)(“Kerly”) where, commenting on

the Silberquelle case, it is said that “This judgment does not mean that use on

promotional items can never constitute genuine use. The test is whether the proprietor

of the mark is using the mark in order to create an outlet for the goods in question.”

45. Mr Ling also referred me to the Merc case5 as an example showing that it is

possible for a car manufacturer to produce clothing items and sold them, and

maintained trade mark registrations separately for the goods of vehicles and the goods

of clothing. I do not think that case could help very much, bearing in mind that after

all, whether the subject mark has been used on the facial lotion, which is the item of

goods the present proceedings is concerned about, is a question to be decided upon the

own facts of the present case.

46. In the light of the above discussion, I now come back to examine Mr. Pun’s

bases of the allegation that the subject mark on the “Bio-Beauty” sets is confined to

the facial device alone. I shall discuss in the order as set out in paragraph 40 above:-

(a) in strict literal sense, the subject mark can be said to be referring to the “Bio-

Facial device”, the “Bio-Beauty” professional facial machine and “Bio-

Beauty 美容手機” in the instruction manual. This is not surprising at all

given that the very essence of the instruction manual is to describe how the

facial device is to be operated. In passing it is noted that step no. 5 of the

“Operation” has the following description: “Apply cleansing lotion or

[essence] directly onto the face or cotton pad”. This shows the facial device

must be used with certain cleansing lotion;

5 Daimlerchrysler AG v Javid Alavi (t/a Merc) [2001] R.P.C. 42 at 813,

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(b) in the invoices, “Bio-Beauty Device” and “Bio-Beauty 美容手機” appear as

an item under the description/contents column (“內容” is the actual wording

used). A description in invoices is usually just a general or generic

description of the goods involved, however I am more concerned with what

was actually bought and sold under the invoices. In the light of the

circumstances as discussed above, and according to Chung’s statutory

declaration, what was actually bought and sold should be the Bio-Beauty box

sets as shown in Exhibit “CLL-2” to Chung’s statutory declaration;

(c) in the case of the promotional leaflet, the claim that all references to the

subject mark in the leaflet are to the facial device alone is subject to dispute.

On the cover page, whilst “美容手機” appears immediately below the mark

, the words “有效提升護膚品功能 ” (meaning that it

effectively enhance the function of the skin care product) are displaced at the

bottom part; on page 2, photo of the whole Bio-Beauty set, including the

bottle of lotion, is depicted; on page 3, the facial device is depicted with the

bottle of lotion just beside it at a slightly behind position; the rest of the

promotional leaflet explains why can enhance the function

of the skin care product and describe how one should use the

product. All this suggest, if anything, the opposite to the

claim, viz., embraces not just the facial device but the Bio-

Beauty set sold as a whole, in particular, on page 10 of the promotional

leaflet, a large picture of the bottle of lotion was depicted, and aloe lotion (特

效蘆薈保濕精華素) was expressly listed as one of the component items of

;

(d) the statement of Ms Chung in paragraph 5 of her statutory declaration

accepted that the lotion was sold only as part of the Bio-Beauty set, it was

never sold on its own;

(e) as far as the statements of the saleslady as recorded in paragraph 18 of Man

Chi Hung’s statutory declaration were concerned, Ms Chung confirmed that

the subject mark was only used on the packaging and on the facial device but

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not on the lotion bottle, and the lotion in the Bio-Beauty set was not sold

separately. She pointed out that the subject mark was separately used as

printed advertising and promotional materials for the Bio-Beauty sets. There

was no comment on the statements that the aloe lotion was a free gift and

that customers could use other brands of lotion instead of the aloe lotion in

the Bio-Beauty box set. I would emphasis again that whether the lotion

should be considered as a free gift is a question of fact to be decided in the

present proceedings.

47. Following from all of the above, what should by now become clear is this:-

within the relevant period, the subject mark had been used on the packaging of the

Bio-Beauty sets which had the appearance as shown in Exhibit “CLL-2” to Chung’s

statutory declaration, containing essentially the facial device, an instruction manual on

how to operate the device and a bottle of lotion. The subject mark also appears on the

facial device and the instruction manual, but not on the bottle of lotion. Promotional

leaflets bearing the subject mark, however, were available and in my view as

discussed above, the subject mark was used in relation to the “Bio-Beauty” set as a

whole, which contains also the lotion, even though the facial machine is a major

component of the set.

48. In the light of the above, I agree that Mr. Ling’s submission, viz., that the

subject mark had been genuinely used on the lotion – which as contained in a bottle

that did not bear the subject mark but nonetheless formed an integral part of the Bio-

Beauty set which had the subject mark appearing conspicuously on the front of the

packaging that hold all of the items inside – is a closer connotation of what consumers,

in actual circumstances, would perceive to be the case, rather than the free gift mental

picture as suggested by the applicant’s side. With that I reject Mr. Pun’s point that use

of the subject mark on the “Bio-Beauty” sets does not extend to the lotion. The lotion

is, after all, part of the whole box set that consumers purchased. Consumers, whether

through reading the promotional leaflets or seeing the actual packaging of the “Bio-

Beauty” sets on display at the “HealthPlus” retail shops or outlets, came to know that

purchasing of the “Bio-Beauty” facial device would necessarily include getting the

lotion as well, as these two were bought and sold as a whole within the same box set

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and there is no other way known to get each of the items comprising the box set

separately and individually. Even though there is no information available what

portion of costs the lotion would make up in the price of the “Bio-Beauty” set, I do not

think consumers would perceive the lotion as just a free gift, nor as a promotional item.

This is more so given that facial lotion is an indispensable item in the essential

operation of the facial device. The analysis I have done above in relation to the

promotional leaflets just reinforces this. Clearly the subject mark had been used with

reference to the market of facial device as well as the market for lotion, if the two

were not one single big market of skin care essentials. I am satisfied that the

registered proprietor has been using the subject mark in order to create an outlet for

the goods of facial lotion, targeting those who would also purchase a facial device.

Revocation

49. Notwithstanding all the findings above, the evidence contains nothing that

can show that the subject mark had, since the date of registration, been used on or in

relation to any goods listed in the specification other than face care preparations. The

use by the registered proprietor on face care preparations partly saves the registration.

The registration of the subject mark is to be revoked for all goods save for face care

preparations. It is to be revoked in respect of all other goods with effect from 17

September 2008, which is the date specified in the notice of opposition as the date

from which revocation is sought to take effect. The specification is, therefore, to read:

“face care preparations.”

Costs

50. Both the applicant and the registered proprietor have sought costs. As each

side has achieved a measure of success, and counsel has reserved the right to make

submissions on costs, I shall not make any costs order without hearing the parties. I

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hereby direct both parties to make their respective written submissions on costs within

14 days from the date of this decision.

(Frederick Wong)

for Registrar of Trade Marks

30 May 2013