trade marks ordinance (cap. 559) application … · the applicant had in support of the subject...

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TRADE MARKS ORDINANCE (Cap. 559)

APPLICATION NO.: 302185641

MARK:

CLASSES: 14 and 35

APPLICANT: PHILIP STEIN HOLDING, INC

_____________________________________________________________________

STATEMENT OF REASONS FOR DECISION

Background

1. On 9 March 2012, Philip Stein Holding, Inc (the “Applicant”) applied to register

the mark as shown in Annex 1 (the “Subject Mark”) under the Trade Marks

Ordinance (Cap. 559) (the “Ordinance”).

2. At the examination stage:

(a) the specification of goods and services for which registration of the Subject

Mark is sought has been amended to:

Class 14

Watches

Class 35

Retail store services and retail sales services; all relating to watches

(the applied for goods in Class 14 are hereinafter referred to as the “Subject

Goods”; and the applied for services in Class 35 are hereinafter referred to as

the “Subject Services”);

(b) the mark description for the Subject Mark has been amended to:

The mark consists of a 3-dimensional shape with device appearing on it.

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The applicant claims the ornamental shape of two round windows as an

element of the trade mark.

The outline as shown in dotted lines in the mark is for illustration only and

does not form part of the mark.

3. Objection of the subject application was raised under section 11(1)(b) of the

Ordinance on the basis that the Subject Mark was devoid of any distinctive

character.

4. The Applicant had in support of the subject application filed evidence by way of a

statutory declaration of Will A. Stein dated 2 September 2014 (the “Declaration”)

with a view to showing that the Subject Mark had acquired distinctiveness as a

result of the use made of the Subject Mark, but the objection was maintained by

the Registrar.

5. The Applicant requested a hearing on the registrability of the Subject Mark. The

Applicant filed skeleton submissions on 26 January 2016 (the “Skeleton

Submissions”). The hearing took place before me on 27 January 2016 and 26

February 2016. Mr. Henry Wheare of Messrs. Hogan Lovells appeared on behalf

of the Applicant.

The Ordinance

6. Section 11 of the Ordinance provides that:

“(1) Subject to subsection (2), the following shall not be registered-

(a) …………

(b) trade marks which are devoid of any distinctive character;

(c) …………

(d) …………

(2) A trade mark shall not be refused registration by virtue of subsection (1)(b),

(c) or (d) if, before the date of application for registration, it has in fact

acquired a distinctive character as a result of the use made of it.”

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Decision

Inherent Distinctiveness

7. Section 11(1)(b) of the Ordinance precludes from registration marks which are

devoid of any distinctive character.

8. In Host Hotels & Resorts, L.P. v Registrar of Trade Marks (HCMP 554/2009)

(paragraphs 17-18), the Hon Sakhrani J cited with approval the following cases for

assessing the distinctiveness of a trade mark:

‘17. In British Sugar Plc v James Robertson and Sons Ltd [1996] RPC 281

(British Sugar), Jacob J (as he then was) said at page 306:

“What does devoid of any distinctive character mean? I think the

phrase requires consideration of the mark on its own, assuming no use.

Is it the sort of word (or other sign) which cannot do the job of

distinguishing without first educating the public that it is a trade mark?”

18. In Nestle SA’s Trade Mark Application (Have a Break) [2004] FSR 2,

Sir Andrew Morritt VC (as he then was) said at paragraph 23:

“The distinctiveness to be considered is that which identifies a product

as originating from a particular undertaking. Such distinctiveness is

to be considered by reference to goods of the class for which

registration is sought and consumers of those goods. In relation to

the consumers of those goods the court is required to consider the

presumed expectations of reasonably well informed, and circumspect

consumers. For my part I would particularly emphasise that the

relevant distinctiveness is that which identifies a product as originating

from a particular undertaking… ”’

9. According to Mag Instrument Inc v OHIM [2005] ETMR 46 (Mag Instrument), at

paragraph 30:

“The criteria for assessing the distinctive character of three-dimensional

marks consisting of the shape of the product itself are no different from those

applicable to other categories of trade mark. Nonetheless, for the purpose

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of applying those criteria, the relevant public's perception is not necessarily

the same in the case of a three-dimensional mark consisting of the shape of the

product itself as it is in the case of a word or figurative mark consisting of a

sign which is independent from the appearance of the products it denotes.

Average consumers are not in the habit of making assumptions about the

origin of products on the basis of their shape or the shape of their packaging

in the absence of any graphic or word element and it could therefore prove

more difficult to establish distinctiveness in relation to such a three-

dimensional mark than in relation to a word or figurative mark (see Henkel v

OHIM, paragraph 38 and the case-law cited there).”

10. According to the above principles, I have to assess the distinctiveness of the

Subject Mark by reference to the Subject Goods and the Subject Services, and the

presumed perception of the relevant consumers, being reasonably well-informed,

circumspect and observant. When considering the inherent distinctiveness of the

Subject Mark, the issue to be considered is whether the Subject Mark, assuming no

use has been made of it, can serve to identify the Subject Goods and the Subject

Services as originating from a particular undertaking, and distinguish such goods

and services from those of other undertakings.

11. Mr. Wheare submitted that “the word ‘devoid’ (in section 11(1)(b) of the Ordinance)

[is] taken to refer to the absence of innate distinctiveness in the shape in question”

and the test is whether members of the public would “without analytical

examination and without paying particular attention, immediately and with

certainty distinguish goods of that shape from those of another commercial origin”

(Whirlpool v Kenwood [2008] EWHC 1930 (Ch) (Whirlpool)).1 Mr. Wheare also

submitted that “distinctiveness is assessed, first, by reference to the goods/services

applied for and secondly, by reference to the perception of the relevant public

(Rosenruist v OHIM Case T-388/09 (Rosenruist)), and the overall impression

produced by the appearance of the mark must be analysed (Nestlé Waters France

v OHIM [2004] ETMR 41).2 These principles are not in dispute and are in line

with the principles stated in paragraphs 8 and 9 above. I will take them into

account in considering the present case.

12. The Subject Mark consists of a three-dimensional shape with two round windows

positioned at the back of a watch. The Subject Goods are watches in Class 14,

1 Paragraph 7.2 of the Skeleton Submissions. 2 Paragraph 8.1 of the Skeleton Submissions.

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and the Subject Services are retail store services and retail sales services relating

to watches in Class 35. As watches can be sold in a wide range of prices covering

the luxury and mass markets, and the retail store and retail sales services are also

related to watches, I consider that the relevant consumers are members of the

general public in Hong Kong. The level of attention paid by such consumers

when acquiring such goods or services may be average or higher, depending on the

price of the goods.

13. As stated in the mark description, the Applicant claims the ornamental shape of

two round windows as an element of the Subject Mark. As seen from Annex 1,

the Subject Mark mainly consists of two round windows which appear to be of the

same size and centrally aligned on the vertical axis on the underside of a watch.

14. It is stated in paragraph 10 of the Declaration that “the Applicant’s Products (which

extensively bear the [Subject Mark]) are known for their quality and other

distinctive features, such as … the two round windows on the underside of the

watches through which the NFT discs may be seen (and which comprise the

[Subject Mark]).” The two windows of the Subject Mark therefore allow

consumers to see certain inside components of the watch, namely the NFT discs.

15. I further note that the NFT discs are described in paragraph 9 of the Declaration as

follows:

“The Applicant’s Products contain unique NFT discs that act as antennas

picking up only the beneficial natural frequencies, as a result of which users

of the Applicant’s Products have experienced better sleep, less tension and

improved concentration. The quality of the Applicant’s Products together

with these claimed benefits have led to the Applicant’s Products being

recognized globally as the ‘feel good watches’.”3

16. The Applicant submits that:4

(a) The Subject Mark should be considered overall and in context as two solid

circular windows together in fixed positions. The Subject Mark does not

comprise mere circles, or decoration.

3 It appears from the text of the advertisement on page 105 of Exhibit WAS-16 to the Declaration

(reproduced at Annex 2) that from 2009 onwards, the Natural Frequency Technology (NFT) had been

applied to the Applicant’s watches, in place of the Tesla[r] technology previously applied. 4 Paragraphs 9.2, 9.5, 9.6 and 10.2 of the Skeleton Submissions.

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(b) The Subject Mark is specifically positioned on the back of watches. Such is

neither commonplace nor serves any function. This will be readily

recognized by the public.

(c) The Subject Mark is specific in nature, precisely positioned and centrally

aligned on the vertical axis of the back of the watch.

(d) The unique nature of the Subject Mark forms the overall impression which the

public will perceive as denoting one trader from another with certainty and

without possibility of confusion.

(e) The Subject Mark is not itself a common shape for watches.

17. First, I do not agree that the Subject Mark does not serve any function at all.

According to the Declaration (see paragraph 14 above), the two round windows in

the Subject Mark allow consumers to see certain inside components of the watch

(i.e. the NFT discs).3

18. I am also aware that it is not uncommon in the watch industry for a watch to have

see-through portion(s) or window(s) such that consumers can see certain

components inside the watch. In fact, I notice from publications included in the

Exhibits to the Declaration that various watches offered by different traders have

see-through portions or windows for displaying inside components. 5 Those

examples found in the Exhibits to the Declaration are in different shapes and sizes,

many of which are of more sophisticated design than the two round windows in the

Subject Mark.

19. Mr. Wheare referred me to paragraph 49 of Henkel KGaA v OHIM Case C218-01

(Henkel) and submitted that “a shape which differs from the norm for the goods or

services in question fulfils the essential original function of a mark and is not

devoid of any distinctive character”.6 I note it is actually stated in paragraph 49

of Henkel that:

“It follows that a simple departure from the norm or customs of the sector is

not sufficient to render inapplicable the ground for refusal given in Article

3(1)(b) of [the EU Directive]. In contrast, a trade mark which significantly

departs from the norm or customs of the sector and thereby fulfils its essential

original function is not devoid of distinctive character.” (emphasis added)

5 Pages 18, 83, 168, 216, 251 and 279 of Exhibit WAS-16; pages 37 and 40 of Exhibit WAS-17; and

pages 5, 15, 21 and 32 of Exhibit WAS-18. 6 Paragraph 10.1 of the Skeleton Submissions.

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20. According to Henkel, it is not sufficient that a shape differs from the norm of the

sector in question, but has to significantly depart from the norm or customs of the

sector, and thereby fulfil the essential function of a trade mark in indicating origin,

in order for the mark to be not devoid of distinctive character.

21. I am also aware that it is set out in Henkel (paragraph 52) that:

“Average consumers are not in the habit of making assumptions about the

origin of goods based on the shape of their packaging, in the absence of any

graphic or word element, and it could therefore prove more difficult to

establish distinctive character in the case of such a three-dimensional trade

mark than in the case of a word or figurative mark.”

22. It is also stated in Mag Instrument (paragraph 32) that:

“Therefore, contrary to what the appellant submits, where a three-dimensional

mark is constituted by the shape of the product for which registration is sought,

the mere fact that that shape is a ‘variant’ of a common shape of that type of

product is not sufficient to establish that the mark is not devoid of any

distinctive character for the purposes of Art. 7(1)(b) of Regulation No.40/94.

It must always be determined whether such a mark permits the average

consumer of that product, who is reasonably well informed and reasonably

observant and circumspect, to distinguish the product concerned from those of

other undertakings without conducting an analytical examination and without

paying particular attention.”

23. The Subject Mark is not a word mark or a device mark. Although the Subject

Mark does not consist of the whole three-dimensional shape of the product as in

Mag Instrument, the Subject Mark does involve a three-dimensional shape with

two round windows as stated in the mark description. In my view, the average

consumers are not accustomed to regarding such kind of mark as denoting its trade

origin unless the mark departs significantly and distinctively from the norm or

customs of the relevant industry.

24. I am aware that the two round windows in the Subject Mark are positioned at the

back of a watch, while the examples of see-through portions or windows in the

watches referred to in footnote 5 are positioned at the front of the watch. Mr.

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Wheare submitted that the two round windows of the Subject Mark are not

commonly found on the back side of watches, where trade marks are often found,

and the Subject Mark is “neither simple nor commonplace on watches, particularly

considering the position the mark is being used”.7

25. In my view, the position of the see-through portion or window for displaying an

inside component of a watch mainly depends on where that component is located

in the watch and where it is convenient to show that component on the watch. If

an inside component can only be seen conveniently from the back of a watch, it

will appear sensible to consumers to have the see-through portion or window

located at the back of the watch. I do not see much difference in a consumer’s

impression whether the see-through portion or window is at the back or at the front

of a watch.

26. I note that while trade marks are usually found on a watch face, they can also be

found at the back of a watch, as suggested by Mr. Wheare. Just as consumers may

not view a see-through portion or window on the face of a watch (where a trade

mark is found) as distinguishing the goods of one undertaking from those of other

undertakings, consumers also may not recognize the two round windows in the

Subject Mark on the back of a watch as indicating the trade origin of the watch.

27. In my view, the Subject Mark, which mainly consists of two round windows

positioned at the back of a watch without any special or particular appeal, does not

depart significantly from the norms or customs of the other watches available in

the market having see-through portion or window for displaying the inside

component of the watch. Having taken into account the fact that see-through

portions or windows for displaying certain components inside the watches are not

uncommon, and the various features of the Subject Mark, I consider that the overall

impression created by the Subject Mark does not enable consumers to distinguish

the Subject Goods or the Subject Services of the Applicant from those which have

another origin. As a whole and with all the elements of the Subject Mark in

combination, the Subject Mark would be perceived by the average consumer as

see-through portions or windows for displaying certain components inside a watch.

The Subject Mark would not be regarded as an indicator of commercial origin.

28. Mr. Wheare submitted that “a minimum degree of distinctive character is sufficient

in considering whether a mark is ‘devoid’ of distinctiveness” and “whether a mark

7 Paragraphs 11.4 and 11.5 of the Skeleton Submissions.

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may serve a decorative or ornamental purpose is irrelevant for the purposes of

assessing its distinctive character” (Rosenruist). Mr. Wheare also submitted that

the threshold set by section 11(1)(b) of the Ordinance is very low, and to be devoid

of distinctiveness, innate distinctiveness must be completely lacking and absent.8

29. It is stated in paragraph 25 of Rosenruist that:

“In order to have the minimum degree of distinctiveness required under

Article 7(1)(b) of Regulation No 207/2009, the mark concerned must simply

appear prima facie capable of enabling the relevant public to identify the

origin of the goods or services covered by the Community trade mark

application and to distinguish them, without any possibility of confusion, from

those of a different origin (Case T-445/05 IVGImmobilien v OHIM (I) [2007]

ECR II-1937, paragraph 55).”

30. As discussed in paragraphs 18, 23-27, I find that the Subject Mark does not have

any element or any particular feature that will enable the relevant public to identify

the origin of the Subject Goods and the Subject Services. I do not come to such

conclusion because the Subject Mark only serves a functional or ornamental

purpose, or because it is a design feature. I have assessed the Subject Mark as a

whole, with all its elements in combination, having regard to the perception of an

average consumer of the Subject Goods and the Subject Services and the overall

impression produced by the appearance of the Subject Mark. I conclude that the

Subject Mark does not have the inherent distinctiveness that would enable the

relevant consumers (who are reasonably well-informed, circumspect and observant)

to identify the Subject Goods and the Subject Services as originating from a

particular undertaking; and to distinguish such goods and services from those of

other undertakings. The Subject Mark would not be regarded by the relevant

consumers as an indicator of commercial origin.

31. Mr. Wheare referred me to Lardini Srl v OHIM Case T-131/13 regarding a three-

dimensional mark which may serve as an ornament. It should be noted that I do

not reach my decision based on whether the Subject Mark serves an ornamental

purpose, but on whether the Subject Mark can distinguish the goods and services

of one undertaking from those of other undertakings.

32. Based on the above reasons, I find that according to the principles set out in

8 Paragraphs 7.3 and 7.4 of the Skeleton Submissions.

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paragraphs 8 and 9, the Subject Mark is devoid of any distinctive character in

respect of the Subject Goods and the Subject Services, and is precluded from

registration under section 11(1)(b) of the Ordinance.

Acquired Distinctiveness

33. Under section 11(2) of the Ordinance, a trade mark shall not be refused registration

by virtue of subsection (1)(b), (c) or (d) if, before the date of application for

registration, it has in fact acquired a distinctive character as a result of the use made

of it.

34. The legal principles for assessing whether a mark has acquired distinctiveness are

set out in Windsurfing Chiemsee Produktions-und Vertriebs GmbH v Boots-und

Segelzubehör Walter Huber and Another [2000] Ch. 523 (Windsurfing) as follows:

“49. In determining whether a mark has acquired distinctive character

following the use made of it, the competent authority must make an overall

assessment of the evidence that the mark has come to identify the product

concerned as originating from a particular undertaking, and thus to

distinguish that product from goods of other undertakings.

50. In that connection, regard must be had in particular to the specific

nature of the [sign] in question…

51. In assessing the distinctive character of a mark in respect of which

registration has been applied for, the following may also be taken into account:

the market share held by the mark; how intensive, geographically widespread

and long-standing use of the mark has been; the amount invested by the

undertaking in promoting the mark; the proportion of the relevant class of

persons who, because of the mark, identify goods as originating from a

particular undertaking; and statements from chambers of commerce and

industry or other trade and professional associations.

52. If, on the basis of those factors, the competent authority finds that the

relevant class of persons, or at least a significant proportion thereof, identify

goods as originating from a particular undertaking because of the trade mark,

it must hold that the requirement for registering the mark laid down in Article

3(3) of [the EU Directive] is satisfied…

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54. … a trade mark acquires distinctive character following the use which

has been made of it where the mark has come to identify the product in respect

of which registration is applied for as originating from a particular

undertaking and thus to distinguish that product from goods of other

undertakings.”

35. The above case is concerned with the interpretation of Article 3(3) of the Directive

of the Council of the European Communities of 21 December 1988 to

“approximate the trade mark laws of Member States” (the “EU Directive”), which

is broadly similar to section 11(2) of the Ordinance. The above principles have

been applied in Dyson Ltd v Registrar of Trade Marks [2003] E.T.M.R. 77 (at

paragraph 43) in determining whether a three-dimensional mark has acquired

distinctiveness through use.

36. I will apply the principles stated in paragraph 34 to the subject application.

According to the above principles, I must make an overall assessment of the

evidence in determining whether the Subject Mark has acquired distinctiveness.

If I am satisfied that the relevant consumers have been educated by the use of the

Subject Mark to recognize the Subject Mark as a badge of trade origin such that a

significant proportion of the relevant class of consumers can identify the Subject

Goods and the Subject Services applied for as originating from a particular

undertaking because of the Subject Mark, the objections raised against the Subject

Mark under section 11(1)(b) of the Ordinance would be overcome.

37. The relevant date for determining whether the Subject Mark has in fact acquired a

distinctive character is 9 March 2012, the application date of the subject application

(“Application Date”).

38. With the above principles in mind, I would now consider the Applicant’s evidence

submitted by way of the Declaration.

Use of the Subject Mark

39. The Exhibits to the Declaration are listed with my observations as follows:

Exhibit Description My Observations

WAS-1 A copy of the official record of the subject

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application

WAS-2 Copies of international media discussing

the health and wellness benefits of Teslar

technology / Natural Frequency

Technology in relation to the Applicant’s

watches (2003-2010)3

This Exhibit consists of 3 pages. The

Subject Mark is not found in this Exhibit.

WAS-3 Printouts from the Applicant’s website at

<www.philipstein.com> outlining the

Applicant’s history and describing the

features of the Applicant’s watches

The printouts show the mark “PHILIP

STEIN” and the Subject Mark, with the

words “NATURAL FREQUENCY

TECHNOLOGY” appearing around the two

round windows in the Subject Mark, and

description of the benefits of Natural

Frequency Technology. The printouts

appear to be printed in July 2014, i.e. after

the Application Date. There is no evidence

that customers in Hong Kong have visited

the website.

WAS-4 News articles detailing the endorsement

of the Applicant’s watches by Oprah

Winfrey (2005-2010)



WAS-5 Printouts of photographs and news

articles detailing the use and endorsement

of the Applicant’s watches by various

celebrities

This Exhibit consists of 27 pages of

photographs of celebrities. The Subject

Mark is not found on any of those pages.

WAS-6 Printouts of a list of the retailers

worldwide where the Applicant’s watches

were available

These printouts appear to be printed in July

2014, i.e. after the Application Date.

WAS-7 Technical drawings showing the design,

specifications and placement of the

Subject Mark on various models of the

Applicant’s watches (2006-2011)

It would appear that the technical drawings

are not available to average consumers of the

Subject Goods.

WAS-8 Printouts of advertisements promoting the

Applicant’s watches in the US and other

coverage of the Applicant’s watches by

the US press (2005-2010)

This Exhibit consists of 147 pages, and the

Subject Mark appears on 23 of them. There

is no evidence that the materials in this

Exhibit have been circulated in Hong Kong.

WAS-9 Printouts of advertisements and press

coverage in international magazine

publications (2005-2010)

This Exhibit consists of 22 pages, and the

Subject Mark appears on 2 of them. There

is no evidence that the materials in this

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Exhibit have been circulated in Hong Kong.

WAS-10 Printouts of articles mentioning the

Applicant’s watches from a range of

English-language news publications

(2003-2006)



WAS-11 Advertisements showing promotion of

the Applicant’s watches in the Philippines

(2009)

The Subject Mark is not found in this

Exhibit.

WAS-12 Printouts relating to promotion of the

Applicant’s watches in Mainland China

(2010)


Exhibit.

WAS-13 Printouts of a list of the retail locations

where the Applicant’s watches could be

found in Hong Kong

These printouts appear to be printed in July

2014, i.e. after the Application Date.

WAS-14 Compilations of Hong Kong magazine

advertisements and promotional materials

relating to the Applicant’s watches in

Hong Kong (October-November 2005)


Subject Mark is only found on 8 of the pages.

WAS-15 Copies of advertisements for the

Applicant’s watches appearing in

newspapers and magazines in Hong Kong

(2009)


advertisements show the front rather than the

back of the Applicant’s watches. The Subject

Mark is not found in this Exhibit.



magazines in Hong Kong (2010-2011)


Subject Mark is only found on 3 of the pages.




(2012)






(2013)

All the advertisements in this Exhibit are

dated after the Application Date.

WAS-19 Printout of an email dated 2 December

2005 between Will A. Stein and the

Applicant’s then distributor in Hong

Kong, with five sample flyers proposed to

be distributed with the Wall Street Journal

The Subject Mark is not found on any of the

five sample flyers.

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Asia during the 2005 winter holiday

period

WAS-20 Proposal for the promotion of the

Applicant’s watches at a two-week long

exhibition at New Town Plaza in Shatin to

display and promote the Applicant’s

watches to the public in Hong Kong

(2007)


Exhibit.

WAS-21 Email with sample flyers (one in

Traditional Chinese and one in Simplified

Chinese) proposed to be distributed at

promotional events in Hong Kong (3

August 2007)

The Subject Mark is found on the flyers

which show the back of a watch. There is

no information as to how many copies of the

flyers have been distributed.

WAS-22 Article published in the South China

Morning Post reporting a charity watch

party promoting the Applicant’s watches

(11 February 2005)


Exhibit.

WAS-23 Photographs taken at events sponsored by

the Applicant in Hong Kong where the

Applicant’s watches were promoted

(2009-2013)


Exhibit.

WAS-24 Photographs of billboard advertisements

throughout Hong Kong to promote the

Applicant’s watches (2009-2011)


Subject Mark is found on 7 of them.

WAS-25 Photographs of various styles of

advertising displays at retail stores in

Hong Kong displaying the Applicant’s

watches (from 2008)

This Exhibit consists of 27 pages and the

Subject Mark is only found on 6 of them.

The date of this Exhibit is stated on the cover

sheet to be “2008 to current”, i.e.

presumably up to the time of the Declaration

in 2014. The photographs are undated. It is

unclear whether those photographs showing

the Subject Mark were taken before or after

the Application Date.

WAS-26 Printouts of historical screen captures of

the Applicant’s website (28 October

2010)

This Exhibit consists of 45 pages and the

Subject Mark is found only on 2 of them.

The 2 pages show the back of a watch,

informing customers where to locate the

serial number of a watch.

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WAS-27 Screen captures of various Hong Kong

television shows showing characters

wearing the Applicant’s watches


Exhibit.

WAS-28 A list of invoices paid to Hong Kong

newspaper and magazines companies in

2005 for placing advertisements of the

Applicant’s watches (2005)


Exhibit. There is no indication as to which

invoice in the list relates to which

advertisement in the Exhibits to the

Declaration. Whether the invoices relate to

promotion of the Subject Mark cannot be

verified.

WAS-29 3 sample invoices issued by advertising

companies to the Applicant’s distributor

at the time for advertising the Applicant’s

watches (2010)


Exhibit. Whether the invoices relate to

promotion of the Subject Mark cannot be

verified.

40. A lot of the evidence provided by the Applicant concerns the use of the Subject

Mark outside Hong Kong. Exhibits WAS-2, 4, 8 to 12 consist of advertisements

and promotional materials for use in the US, Canada, the United Kingdom, the

Philippines, Mainland China and other countries. The Subject Mark is found in a

small proportion of these materials. There is no evidence that any such materials

have been circulated in Hong Kong. I am not satisfied that such use outside Hong

Kong serves to educate the consumers in Hong Kong to recognize the Subject Mark

as a badge of origin which distinguishes the Applicant’s Subject Goods or Subject

Services from those of other undertakings.

41. I note that Exhibits WAS-5, 19, 20, 22, 23 and 27 include advertising and

promotion materials of the Applicant used in Hong Kong and records of the

Applicant’s promotion events and sponsoring programs in Hong Kong. None of

these materials, however, show use of the Subject Mark.

42. I am also aware that the evidence concerning the Applicant’s website (Exhibit

WAS-3), the list of the retail locations worldwide and in Hong Kong (Exhibits

WAS-6 and 13) and the advertisements in Exhibit WAS-18 are dated after the

Application Date. Such evidence does not assist much in showing that the

distinctiveness of the Subject Mark has been acquired on the Application Date.

43. It is stated in the Declaration that the Applicant first used the Subject Mark on the

underside of the Applicant’s watches in 2002 and the Applicant’s watches have

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been sold in Hong Kong since 2004.9 Exhibit WAS-14 to the Declaration shows

that the Subject Mark first appeared in Hong Kong magazines in October 2005.

44. The Applicant has provided advertisements featuring the Applicant’s watches in

magazines and newspapers in Hong Kong from 2005 to 2012 in Exhibits WAS-14

to WAS-17. I note that the Subject Mark is not shown in most of the

advertisements, as in most cases it is the front rather than the backside of the

Applicant’s watch that is shown. I can only locate a total of no more than 11

photographs of the Subject Mark in Exhibits WAS-14 to WAS-17, which consist

of a total of 428 pages. In fact, the Subject Mark is only found in (i) Exhibit WAS-

14 dated October to November 2005; and (ii) Exhibit WAS-16 dated 2010 to 2011.

45. The Subject Mark is also shown on a sample flyer (in Traditional Chinese and

Simplified Chinese) appearing in Exhibit WAS-21 to the Declaration. The flyer

was said to have been distributed at various promotional events in Hong Kong,

including an event in New Town Plaza on 18 August 2007, but there is no

information as to the number of the flyers which have actually been distributed.

There is also no information as to at what events (other than the one at New Town

Plaza on 18 August 2007) the flyer has been distributed, and the extent of

distribution.

46. The Applicant has provided some photographs of billboard advertisements and

advertising displays at retail stores featuring the Subject Mark in Exhibits WAS-24

and 25. The billboard advertisements are dated 2009 to 2011. As noted above,10

it is unclear whether those photographs in Exhibit WAS-25 which show the Subject

Mark were taken before or after the Application Date.

47. Included in Exhibits WAS-28 and 29 are (i) a list of invoices paid to Hong Kong

newspapers and magazine companies in 2005 for placing advertisements of the

“Applicant’s Products”; and (ii) three sample invoices issued by advertising

companies to the Applicant’s distributor at the time for advertising the “Applicant’s

Products” in 2010. According to paragraph 45 of the Declaration, “close to HK$2

million” was spent on advertising “the Applicant’s Products” in Hong Kong in print

media in 2005. No promotion and advertising figures other than for the year 2005

has been given. Moreover, the “Applicant’s Products” is defined in paragraph 4

of the Declaration as the Applicant’s watches. As noted in paragraph 44 above,

9 Paragraphs 15 and 27 of the Declaration. 10 Entry for “WAS-25” in the table at paragraph 39.

17

the Subject Mark is not shown in most of the advertisements referred to therein,

and I can only locate a total of no more than 11 photographs of the Subject Mark

in a total of 428 pages in Exhibits WAS-14 to WAS-17. There is no evidence as

to which advertisements in the evidence the invoices referred to in Exhibits WAS-

28 and 29 relate, whether the Subject Mark appears in the relevant advertisements,

and therefore whether those invoices relate to promotion of the Subject Mark.

There is no breakdown as to the proportion of the advertising and promotional

expenses for the Applicant’s Products which is attributable to promoting the

Subject Mark, as opposed to the other trade marks of the Applicant such as the

PHILIP STEIN mark and the Chinese mark翡麗詩丹 which are also featured in

the Applicant’s advertisements.

48. Based on paragraphs 43 to 47, it appears that the advertisements in Hong Kong

which show the Subject Mark mainly appeared during the two periods of (i)

October to November 2005 (Exhibit WAS-14); and (ii) 2009 to 2011 (Exhibits

WAS-16 and 24). Whereas the amount spent in advertising the Applicant’s

Products in Hong Kong through print media in 2005 is stated to be “close to HK$

2 million”, no figure is provided as to the amount spent during the period from

2009 to 2011. Other than these two periods, the only promotional material

featuring the Subject Mark is the flyer in Exhibit WAS-21, but no information is

provided as to the volume of distribution of that flyer or the amount spent in the

relevant promotional activities. The evidence does not show that the Subject

Mark has been continuously and extensively promoted during the period from the

claimed date of first use of the Subject Mark in Hong Kong in 2004 to the

Application Date.

49. I will now comment on the manner of use of the Subject Mark in advertisements

and promotional materials in Hong Kong. They are found in Exhibits WAS-14,

16, 21, 24 and 25.

50. In the few photographs of the Applicant’s watches in Exhibits WAS-14, 16 and 21

which feature the Subject Mark, I note that next to the Subject Mark there is always

a reference to either (i) the “Teslar technology” or the “TESLAR” mark; or (ii) the

“Natural Frequency Technology (NFT)”. (According to the text appearing on

page 105 of Exhibit WAS-16 to the Declaration (see Annex 2), from 2009 onwards,

the Natural Frequency Technology (NFT) had been applied to the Applicant’s

watches, in place of the Tesla[r] technology previously applied.)

18

51. In fact, in one of the clearest photographs displaying the Subject Mark (see Annex

211), part of the back of the watch is shaded for prominently showing an NFT disc

inside one of the round windows in the Subject Mark, with a magnified photograph

of this round window showing even more clearly the NFT disc inside the watch.

The round window is surrounded by the words “NATURAL FREQUENCY

TECHNOLOGY”, and the Applicant’s house mark “PHILIP STEIN” appears

prominently above the two round windows in the Subject Mark. In another

photograph (see Annex 312), the Subject Mark is shown, with each of the two round

windows in the Subject Mark surrounded by the words “NATURAL

FREQUENCY TECHNOLOGY”. These words serve to remind consumers that

the components being displayed in the windows are the NFT discs related to the

Natural Frequency Technology. To the average consumer looking at these

advertisements, the featuring of the Subject Mark is mainly for displaying the NFT

discs inside the watch. The way the Subject Mark appears in these advertisements

does not serve to educate members of the public to recognize the Subject Mark as

a badge of origin.

52. In the flyer in Exhibit WAS-21 (see Annex 413), the photograph of the Subject

Mark is surrounded by a description of the advantages of wearing the watch which

are related to the signal emitted from the “Teslar chip” inside the watch, while a

paragraph describing the application of the “Teslar chips” in detail is featured right

above the photograph.3

53. Moreover, in the billboard advertisements and the advertising displays shown in

Exhibits WAS-24 and 25, I note that the phrase “Natural Frequencies Inside” is

featured near the Subject Mark under the prominent PHILIP STEIN mark. It

appears to me that the main purpose of featuring the Subject Mark in the billboard

advertisements and the advertising displays is to display the NFT discs which

create the natural frequencies highlighted in the text of the advertisements.

54. I am also aware that in the billboard advertisements and the advertising displays in

Exhibits WAS-24 and 25, the back image of the watch case featuring the Subject

Mark is positioned behind the front image of the same watch case. In some of

these photographs the Subject Mark is partially covered by the front image of the

watch case. To the average consumer, the presentation of the Subject Mark in the

11 Page 105 of Exhibit WAS-16. 12 Page 199 of Exhibit WAS-16. 13 Page 2 of Exhibit WAS-21.

19

above advertising materials serves the purpose of displaying a component inside

the Applicant’s watch or informing the consumers the overall design of the watch

including the case back, rather than serving as a trade mark for identifying the

product as originating from a particular undertaking.

55. In some advertising displays at retail stores in Exhibit WAS-25, similar to the

photograph described in paragraph 51, part of the Subject Mark is shaded for

prominently showing an NFT disc inside one of the round windows in the Subject

Mark, with a magnified photograph of this round window showing even more

clearly the NFT disc inside the watch (see for example Annex 514).

56. In all those advertisements in Exhibits WAS-14, 16, 21, 24 and 25 discussed above

where the Subject Mark is found, the PHILIP STEIN mark, with or without the

Chinese mark翡麗詩丹, is always prominently shown in the advertisements or

publications in close proximity to the Subject Mark. It appears to me that the

average consumers will only find the Subject Mark in the above advertisements as

a feature for displaying components inside the watch rather than a mark that

indicates the trade origin of the Applicant’s watch. It is the Applicant’s other

marks such as PHILIP STEIN or 翡麗詩丹 which the consumers will use to

identify the trade origin of the watches.

57. The Subject Mark is also featured in two photographs in Exhibit WAS-26 15

displaying the back of a watch on two webpages in the Applicant’s website. I

note that the purpose of these particular webpages is to educate consumers how to

find a strap to match an Applicant’s watch based on the serial number of the watch.

The back of the watch is shown mainly for informing the consumers where to

locate the serial number, which happens to be positioned next to the two round

windows in the Subject Mark. There is no evidence as to whether the webpages

have been visited by members of the public in Hong Kong before the Application

Date, and if so, to what extent. Moreover, to the average consumer visiting these

webpages, it would be the Applicant’s PHILIP STEIN mark displayed at the top

left corner of the webpages rather than the Subject Mark which would serve to

identify the Applicant’s watches as originating from a particular undertaking.

58. Mr. Wheare referred me to Colloseum Holding AG v Levi Strauss & Co. Case C-

12/12 (Colloseum) and submitted that “the use of the [Subject Mark] alongside

14 Page 18 of Exhibit WAS-25. 15 Pages 1 and 2 of Exhibit WAS-26.

20

‘PHILIP STEIN’ mark does not mean that the [Subject Mark] itself is not being

used as a consequence of which it serves to identify the goods as originating from

a particular taking”, but rather the use of the PHILIP STEIN mark alongside the

Subject Mark “all the more educates the public that it is the Applicant’s Trade Mark

and no other”.16 However, according to Colloseum (at paragraphs 27 and 28),

what is required, as regards the acquisition of a distinctive character by a mark

through use, is that:

“…the relevant class of persons actually perceive the goods or service,

designated exclusively by the mark applied for, as originating from a given

undertaking (Case C-353/03 Nestlé [2005] ECR I-6135, paragraph 30).

Therefore, regardless of whether the sign is used as part of a registered trade

mark or in conjunction with the registered trade mark, the fundamental

condition is that, as a consequence of that use, the sign for which registration

as a trade mark is sought may serve to identify, in the minds of the relevant

class of persons, the goods to which it relates as originating from a particular

undertaking.” (emphasis added)

59. It is apparent from the above analysis of the Applicant’s evidence that the Subject

Mark only appears in a small proportion of the advertising and promotional

materials for the Applicant’s Subject Goods in Hong Kong before the Application

Date. The evidence does not show that the Subject Mark has been continuously

and extensively promoted during the period from the claimed date of first use of

the Subject Mark in Hong Kong in 2004 to the Application Date. In the

Applicant’s advertising and promotional materials, it is usually the front rather than

the backside of the watch which is displayed. Where the two round windows in

the Subject Mark are seen on the backside of an Applicant’s watch, the average

consumer would perceive the showing of the two round windows in the Subject

Mark as being for the purpose of showing some components inside the watch and

informing the consumers the benefits of such components; or to display the overall

design of the watch including the case back. The average consumer would

perceive the PHILIP STEIN mark or the翡麗詩丹 mark, and not the Subject Mark,

as identifier(s) of the trade origin of the Subject Goods.

60. In Société des Produits Nestlé SA v Mars UK Ltd. [2005] E.T.M.R. 96 (C-353/03)

(Have a Break), where the European Court of Justice considered the question of

16 Paragraphs 13.2 and 13.3 of the Submission.

21

whether the distinctive character of a mark might be acquired in consequence of

the use of that mark as part of or in conjunction with a registered mark, the Court

stated that:

“29 The expression ‘use of the mark as a trade mark’ must therefore be

understood as referring solely to use of the mark for the purposes of the

identification, by the relevant class of persons, of the product or service as

originating from a given undertaking.”

61. Having regard to the manner in which the Subject Mark has been used in

promotional materials of the Applicant’s Subject Goods in Hong Kong before the

Application Date, I do not consider that a significant proportion of the relevant

class of persons would, because of the Subject Mark, identify the Subject Goods

as originating from a particular undertaking.

62. During the hearing, Mr. Wheare referred me to paragraph 28 of the Declaration

which showed a table of revenue from 2008 to 2014 generated by sales of the

Applicant’s watches bearing the Subject Mark, and suggested that a substantial

amount of watches featuring the Subject Mark had in fact been sold in Hong Kong

before the Application Date. The sales revenue figures from 2008 to 2012

provided by the Applicant are as follows:

Year Sales Revenue (in rounded figures)

2008 In excess of HK$0.70 million





63. No copy of any sales invoice was provided to support the above figures. Mr.

Wheare submitted that despite the lack of invoices, the sales revenue figures were

provided in a sworn statutory declaration which was of evidential value.

64. Even if the above sales figures are taken at their face value, given the Applicant’s

claim that it specializes in “high-end” timepieces, 17 the sales volume of the

Applicant’s watches has not been very substantial, and seems to be dropping since

2009. Revenue figures for only 5 years have been provided. Moreover, the

17 Paragraph 7 of the Declaration.

22

claim that all those figures relate to use of the Subject Mark is not verified by any

Exhibit to the Declaration.18

65. I refer to paragraph 51 of Windsurfing set out in paragraph 34 above. The

Applicant has not provided (i) any evidence in relation to the market share held by

the Subject Mark; (ii) any direct evidence on the proportion of the relevant class of

persons who, because of the Subject Mark, identify goods as originating from a

particular undertaking; or (iii) any statement from chambers of commerce and

industry or other trade and professional associations.

66. Moreover, it is doubtful that there has been any use at all of the Subject Mark by

the Applicant or with its consent in relation to any of the Subject Services. It is

stated in paragraph 27 of the Declaration that “The Applicant’s Products were

initially sold through the Applicant’s then distributor, Fifty Fifty Holdings Limited,

which in about November 2005 was replaced by Christie International Holdings

Limited and in about 2006 by Charmonde Luxury Limited. The Applicant’s

Products have been sold at high-end watch retailers and luxury department stores

including Oriental Watch and Lane Crawford.” The Applicant does not claim to

have been engaged in the provision of retail store services and retail sale services

in relation to watches.

67. It is also stated in paragraph 28 of the Declaration that “Today, in Hong Kong alone,

the Applicant’s Products bearing the [Subject Mark] can be purchased at 40 points

of sale. There is now produced and shown to me marked WAS-13 printouts of a

list of the retail locations where the Applicant’s Products bearing the [Subject Mark]

can be found in Hong Kong.” The list of retail locations at Exhibit WAS-13

includes different retailers such as Oriental Watch Co., Ltd., Prince Jewellery &

Watch Company and Lane Crawford. There is no evidence that the Applicant has

provided retail store services and retail sales services in relation to watches in Hong

Kong.

68. I have considered each piece of evidence of use of the Subject Mark in Hong Kong

before the Application Date. It appears from Exhibit WAS-25 that the retailers

involved in the supply of the Applicant’s watches bearing the Subject Mark include

Prince Jewellery & Watch Company, Choice Hints and Oriental Watch Co., Ltd.

18 For example, Exhibit WAS-14 to the Declaration includes advertising materials in October 2005 for

the Applicant’s “TESLAR” watches. The Subject Mark is found on some of the pages in those materials.

It is not entirely clear whether the Applicant has had other lines of watches which neither incorporate the

“TESLAR” chip nor include the Subject Mark.

23

The Subject Mark has not been used to distinguish the Subject Services of one

undertaking from those of other undertakings.

69. I am reminded to take an overall assessment of all the evidence filed to determine

whether the Subject Mark has acquired distinctive character through use. I have

considered all the evidence filed in relation to the use of the Subject Mark with

reference to the principles set out in Windsurfing, including how intensive,

geographically widespread and long-standing use of the Subject Mark has been,

and the amount invested by the Applicant in promoting the Subject Mark. I have

also taken into account the manner in which the Subject Mark has been used. I

have come to the conclusion that I am not convinced that by the Application Date,

a significant proportion of the relevant consumers in Hong Kong can identify the

Applicant’s Subject Goods or Subject Services as originating from a particular

undertaking because of the Subject Mark, and thereby distinguish them from those

of other undertakings.

70. In other words, the Applicant has not been successful in demonstrating that the

Subject Mark has, by the Application Date, in fact acquired a distinctive character

as a result of the use made of it. As such, the objection under section 11(1)(b) of

the Ordinance must be maintained.

Other Registrations on the Register

71. Mr. Wheare referred me to the following marks on the register:

(1) No. 303472083 for “ ” in class 9;

(2) No. 302351790 for “ ” in classes 9, 16, 25, 28, 35, 36, 38, 39, 41, 42,

45;

(3) No. 2002B08681 for “ ” in class 30; and

(4) No. 1991B3956AA for “ ” in classes 21, 24, 25.

Each of the above marks contains elements different from that of the Subject Mark

24

and are registered in different classes. None of them is registered in respect of

goods in Class 14. Such registrations are not comparable to the Subject Mark.

72. It has been long established that the state of the register is not relevant in

considering the registrability of a mark since each case has to be decided on its own

merits. As noted by Jacob J in British Sugar at page 305, “It has long been held

under the old Act that comparison with other marks on the register is in principle

irrelevant when considering a particular mark tendered for registration, see e.g.

MADAME Trade Mark and the same must be true under the 1994 Act.”

PRC Registrations

73. It is stated in paragraph 48 of the Declaration that the Subject Mark had been

registered in the PRC.19 National trade mark rights are territorially limited and

granted independently of each other. The bare fact of registrations in another

jurisdiction is not sufficient to establish that a sign is eligible for registration here

in Hong Kong (Automotive Network Exchange Trade Mark [1998] R.P.C. 885).

The reasons behind the acceptance of the Subject Mark in the PRC are not known

to me. Since I have found valid grounds under the Ordinance for refusing the

subject application, the above registration of the Subject Mark in the PRC does not

serve to overcome the objection raised under section 11(1)(b) of the Ordinance.

Conclusion of the Subject Application

74. I have considered all the documents filed by the Applicant including the

Declaration, together with all the oral and written submissions made in respect of

the subject application. For the reasons stated above, I find that the Subject Mark

is devoid of any distinctive character and is objectionable under section 11(1)(b)

of the Ordinance in respect of the Subject Goods and the Subject Services. The

subject application is accordingly refused under section 42(4)(b) of the Ordinance.

Derek Lau

for Registrar of Trade Marks

29 July 2016

19 See Exhibit WAS-30.

25

Annex 1

26

Annex 2

27

Annex 3

28

Annex 4

29

Annex 5

trade marks ordinance (cap. 559) application … · the applicant had in support of the subject...

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