IN THE COURT OF APPEAL OF NEW ZEALAND
CA227/2014
[2015] NZCA 418

BETWEEN

DAIMLER AG
Appellant

AND

SANY GROUP CO LIMITED
Respondent

Hearing:

28 July 2015

Court:

Ellen France P, White and Winkelmann JJ

Counsel:

P D M Johns and T A Huthwaite for Appellant
M T Lennard for Respondent

Judgment:

8 September 2015 at 9.30 am

JUDGMENT OF THE COURT

A

The appeal is dismissed.

B

The appellant must pay the respondent costs for a standard appeal on a
band A basis and usual disbursements.

____________________________________________________________________

REASONS OF THE COURT
(Given by Ellen France P)
Table of Contents
Introduction
Background
Decision of the Assistant Commissioner
High Court decision
Is there a likelihood of confusion (s 17(1)(a))?
The relevant principles

DAIMLER AG v SANY GROUP CO LTD [2015] NZCA 418 [8 September 2015]

Para No
[1]
[5]
[8]
[9]
[11]
[13]

 Daimler’s case
Our approach
Is use of the Sany mark contrary to New Zealand law (s 17(1)(b))?
Impact of consideration of fair and notional use (s 25(1)(b))
Effect of the Daimler mark being well known (s 25(1)(c))
Result

[18]
[24]
[39]
[44]
[49]
[55]

Introduction
Daimler AG (Daimler),1 the appellant, began to use its three-pointed star

[1]

mark on vehicles it manufactured internationally in 1909 and in New Zealand in
1911.

Daimler has registered a number of trade marks reflecting that use in

New Zealand (the Daimler marks), namely:

[2]

The respondent, Sany Group Co Ltd (Sany), applied on 31 August 2006 to

register the following trade mark (the Sany mark), namely:

[3]

Daimler opposed registration of the Sany mark on a number of grounds

including that Sany’s mark was likely to deceive or cause confusion because of its
similarity to the Daimler marks2 and that Sany’s mark was not registrable under
s 25(1)(c) of the Trade Marks Act 2002 (the Act) dealing with the adverse effect of
similarity to a well known mark.

1
2

Formerly known as DaimlerChrysler AG.
Trade Marks Act 2002, s 17(1)(a).

The Assistant Commissioner of Trade

 Marks (Assistant Commissioner) approved Sany’s application. 3 Daimler’s appeal to
the High Court was unsuccessful.4 Daimler now appeals to this Court.5
[4]

The issues on appeal reflect the grounds of opposition and are as follows:
(a)

Whether use of the Sany mark would be likely to deceive or cause
confusion (s 17(1)(a));

(b)

Whether use of the Sany mark is contrary to New Zealand law
(s 17(1)(b));

(c)

Whether the Sany mark is similar to the Daimler marks, in respect of
the same or similar goods and services, and its use is likely to deceive
or confuse (s 25(1)(b)); and

(d)

Whether the Sany mark, or an essential element of it, is similar to
Daimler’s well known marks; whether Sany’s goods and services are
the same as or similar to Daimler’s goods and services; whether the
use of the Sany mark would be taken as indicating a connection in the
course of trade with Daimler; and whether use of the Sany mark
would be likely to prejudice the interests of Daimler (s 25(1)(c)).

Background
[5]

There is no dispute over the relevant facts. Sany was incorporated in China

in 1989. Its business focus is on the manufacture, leasing, importing and exporting
of “building machinery … road machinery … hoist machinery … vehicle[s] … new
materials … [and] network communication equipment …”.6 Sany first applied to
register its mark in China in 1989 in relation to welding materials. 7 Sany’s mark has
3

4

5

6

7

Sany Group Co Ltd v DaimlerChrysler AG T27/2008, 29 September 2008 [Assistant
Commissioner’s decision].
Daimler AG (Formerly DaimlerChrysler AG) v Sany Group Co Ltd [2014] NZHC 532 [High
Court judgment].
This Court determined the appeal is properly brought under s 66 of the Judicature Act 1908 in
the earlier decision of Daimler AG v Sany Group Co Ltd [2014] NZCA 421, [2014] NZAR 1159.
Declaration of Haobing Wang, 26 September 2007, cited at [5] of the High Court judgment,
above n 4.
The High Court judgment, above n 4, at [7].

 been registered in China subsequently in relation to all classes of the Ninth Edition
of the International Trademark Classification System (ITMCS) adopted as part of the
Nice Agreement.8
[6]

Sany’s application in New Zealand is in relation to goods in class 7 and

class 12 of the ITMCS. Those classes relate to the following goods:
Class 7
Road rollers; excavators; diggers (machines); hydraulic pumps; concrete
pumps; trailers and truck-mounted concrete pumps; elevating apparatus;
mixing machines; concrete mixers (machines); bulldozers; motor graders;
asphalt pavers; horizontal directional drilling machines; cranes; asphalt
mixing plants; concrete mixing plants; rotary pile drills; milling machines;
mining machines; pumps (machines); extractors for mines; mine borers;
drilling machines; mine-working machines; rail-laying machines; railroad
constructing machines; power shovels; road making machines; pumps (parts
of machines, engines or motors); belt conveyors; hydraulic controls for
machines, motors and engines; hydraulic components …
Class 12
Buses; lorries; sports cars; motor cars; motor buses; locomotives; concrete
mixing vehicles; aerial conveyors; lifting cars (lift cars); automobile chassis;
hydraulic circuits for vehicle; asphalt material transfer vehicles; automobile
bodies …

[7]

Daimler began as an automobile manufacturer in 1882 when the Daimler

Motorengesellchaft company was established in Stuttgart.9 As we have noted, the
company began to use the three-pointed star trade mark on its vehicles
internationally in 1909 and in New Zealand in 1911. Daimler today reflects a
number of mergers and acquisitions of vehicle and other manufacturing companies
such as Benz & Cic in 1926 and the Chrysler Corporation in 1998. It is “one of the
world’s leading automobile companies”.10 Daimler manufactures a range of cars,
trucks, buses, UNIMOG multipurpose heavy duty vehicles, diesel engines, turbines,
rail vehicles, power generators and other industrial products. Those vehicles are
produced under the name “Mercedes-Benz”. Daimler’s “heavy duty vehicles are

8

9
10

Nice Agreement Concerning the International Classification of Goods and Services for the
Purposes of the Registration of Marks (opened for signature 15 June 1957, entered into force 8
April 1961).
High Court judgment, above n 4, at [10].
High Court judgment, above n 4, at [11].

 often adapted by “partner companies” to create vehicles that have, for example,
cranes, winches … [and] rescue equipment”.11
Decision of the Assistant Commissioner
[8]

Daimler opposed registration on the grounds that registration of the Sany

mark was contrary to ss 17(1)(a), 17(1)(b), 17(2) (bad faith), 25(1)(b) and 25(1)(c) of
the Act. In relation to s 17(1)(b), Daimler said use of the Sany mark was contrary to
New Zealand law because such use would breach ss 9, 10, 13 and 16 of the Fair
Trading Act 198612 and amount to passing off.

The Assistant Commissioner

determined that none of Daimler’s grounds of opposition had been made out.13
Central to the Assistant Commissioner’s approach was her conclusion that the marks
were visually and conceptually different.14

The Assistant Commissioner did not

accept that Daimler’s marks met the test for a well known mark.15
High Court decision
[9]

Before the High Court Daimler abandoned the bad faith argument (s 17(2))

but pursued its other four grounds of opposition. In dismissing the appeal, Collins J
agreed with the Assistant Commissioner that s 17(1)(a) was not made out. Sany had
discharged its burden of proving the absence of confusion or deception.16

It

17

In

followed from this finding that the ss 17(1)(b) and 25(1)(b) grounds also failed.

the High Court Daimler accepted that if Sany was to establish absence of deception
or confusion for the purposes of s 17(1)(a), there was little chance of there being
sufficient evidence to establish breaches of the Fair Trading Act or passing off as
would be required under s 17(1)(b).18 The s 25(1)(b) ground failed because the
marks lacked sufficient similarity to deceive or confuse.19

11
12

13
14
15
16
17
18
19

High Court judgment, above n 4, at [11].
Dealing with, generally, misleading conduct, false or misleading representations and false use of
a trade mark in a manner likely to mislead or deceive.
Assistant Commissioner’s decision, above n 3.
At [33]–[36], [73] and [78].
At [77].
High Court judgment, above n 4, at [46].
At [51] and [58].
At [50].
At [58].

 [10]

In terms of s 25(1)(c), Collins J took a different view from that of the

Assistant Commissioner. On this aspect, the Judge agreed with Daimler that it met
the criteria for its marks to be considered well known at the relevant date. 20
However, this ground also failed because the Sany mark, or an essential element of
that mark, was not identical or similar to any of the Daimler marks.21
Is there a likelihood of confusion (s 17(1)(a))?
[11]

Section 17(1)(a) provides that the Commissioner must not register as a trade

mark or part of a trade mark “any matter … the use of which would be likely to
deceive or cause confusion”.
[12]

There is general agreement as to the relevant principles applicable in

considering s 17(1)(a). Daimler takes issue on one aspect relating to the nature of
the relevant market and we discuss that aspect shortly.
The relevant principles
[13]

The starting point is that the purpose of the section is, as Collins J said, to

“protect the public rather than the proprietary rights of traders”.22
[14]

It is common ground that the application of s 17(1)(a) required Daimler first

to establish a reputation in its mark. If so, the onus shifted to Sany to show that “any
fair and proper use of its mark is not likely to cause confusion and deception among
a substantial number of consumers of the goods in question”.23 The meaning of
deception and confusion is discussed in Pioneer Hi-Bred Corn Co v Hy-Line Chicks

20
21
22

23

At [69].
At [71].
High Court judgment, above n 4, at [29] citing Pioneer Hi-Bred Corn Co v Hy-Line Chicks Pty
Ltd [1978] 2 NZLR 50 (CA) at 54 per Richmond P and at 63 per Richardson J; see also NV
Sumatra Tobacco Trading Co v New Zealand Milk Brands Ltd [2011] NZCA 264, [2011] 3
NZLR 206 at [78], leave to appeal declined in NV Sumatra Tobacco Trading Co Ltd v New
Zealand Milk Brands Ltd [2011] NZSC 113; and Sexwax Inc v Zoggs International Ltd [2014]
NZCA 311, [2015] 2 NZLR 1 at [27], leave to appeal declined in Zoggs International Ltd v
Sexwax Inc [2015] NZSC 16.
Roby Trustees Ltd v Mars New Zealand Ltd [2012] NZCA 450, (2012) 98 IPR 353 at [44]; and
Pioneer Hi-Bred, above n 22, at 57.

 Ltd.24 Richardson J said that where the alleged deception or confusion is as to the
source of the goods, “deceived is equivalent to being misled into thinking that the
goods bearing the applicant’s mark come from some other source and confused to
being caused to wonder whether that might not be the case”.25
[15]

The assessment assumes fair use of both of the marks and is made from the

perspective of the consumer and others involved in purchase. It is made as at the
applicable date, in this case 31 August 2006, when Sany applied to register its
mark.26
[16]

The two marks are then compared applying the principles in Pianotist

Company’s Application:27
You must take the two words. You must judge of them, both by their look
and by their sound. You must consider the goods to which they are to be
applied. You must consider the nature and kind of customer who would be
likely to buy those goods. In fact, you must consider all the surrounding
circumstances; and you must further consider what is likely to happen if
each of those trade marks is used in a normal way as a trade mark for the
goods of the respective owners of the marks.

[17]

As this Court said in a recent application of these principles in Roby Trustees

Ltd v Mars New Zealand Ltd:28
[46]
Attention must be paid to the whole of each mark, the look and
sound of the marks, the kind of customer likely to buy the goods, the
surrounding circumstances in which the marks will be used, the impact of
imperfect recollection, the idea of each mark, any descriptive quality of the
marks.

Daimler’s case
[18]

There is no question in this case that Daimler has a substantial reputation.

Daimler’s challenge relates rather to the Judge’s overall assessment of the marks and
24

25
26
27

28

Pioneer Hi-Bred, above n 22, at 62; and see Sexwax Inc v Zoggs International Ltd, above n 22,
at [49]–[54] and [65].
At 62.
Roby Trustees Ltd v Mars New Zealand Ltd, above n 23, at [44].
Pianotist Company’s Application (1906) 23 RPC 774 (Ch) at 777 applied in New Zealand
Breweries Ltd v Heineken’s Bier Browerij Maatschappij NV [1964] NZLR 115 (CA) at 139 per
Turner J.
Roby Trustees Ltd v Mars New Zealand Ltd, above n 23; and see Polaroid Corp v Hannaford &
Burton Ltd [1975] 1 NZLR 566 (CA) at 571.

 as to the likelihood of deception or confusion.

Daimler makes four principal

submissions.
[19]

Daimler says, first, the Judge placed too much emphasis on the differences

between the marks. In developing this submission, Mr Johns says the three-pointed
star within the circle is the essential element and dominant feature of the Daimler
marks.

Because the Judge found there were similarities between the marks in

relation to their dominant concepts, sufficient similarity was established. This
submission draws on the Judge’s observation that:29
… there are some similarities between Sany’s mark and … Daimler’s marks.
Both involve a circle with a three-pronged device that either abuts or slightly
overlapses the edges of the circle. The three-pronged devices are aligned in
a similar way in both sets of marks. However, those similarities are minor.

[20]

Mr Johns submits that the differences then identified by the Judge are not

enough to neutralise this shared conception, particularly when allowance is made for
imperfect recollection. Rather, it is said, both the dominant concepts and visual
appearances of the marks are similar. Daimler says the assessment of the German
Federal Patent Court30 in an equivalent case provides a more apt comparison than
that of the High Court of England and Wales31 referred to by Collins J.32 The latter
case was a trade mark infringement action in which Daimler bore the onus of proof.
[21]

Second, Daimler says any reliance on conceptual differences between the

marks is misplaced. That is because the “three 1s” conception behind the Sany
mark is too abstract to have any impact on the perception of consumers in
New Zealand. Further, Mr Johns makes the point that the Daimler marks also have a
“trifecta ambition”, namely, “on land, on water, and in the air”.

29
30

31

32

High Court judgment, above n 4, at [43].
DaimlerChrysler AG v Sany Holding Co Ltd 28 W (pat) 115/70, 5 December 2007. That Court
found the “upper figurative element” in the Sany mark featured the “essential elements” of the
Daimler marks: at 9. Similar conclusions were reached in equivalent decisions in France and
Taiwan: Sany Group Co Ltd v DaimlerChrysler OPP 06-3665/VL, 15 May 2007 and
DaimlerChrysler AG v Sany Group Co Ltd G00960830, 2 April 2008 .
Daimler AG v Sany Group Co Ltd [2009] EWHC 2581 (Ch). The Judge said at [80] that while
there was an outer circle with a three-pointed image “within (or partly within)” the circle in both
marks, “there the similarity ends”.
High Court judgment, above n 4, at [43], n 41.

 [22]

Third, Daimler submits that the Judge was wrong to take into account the

inclusion of the word “Sany” in the Sany mark because the word would convey no
information to a consumer in New Zealand about the origin of the goods in question.
Two principal matters are advanced in support of this submission. The first is that
the Judge ignored the fact it is common within the motor industry to use names along
with logos, particularly to distinguish between models. The examples given include
Toyota Corolla and Fiat Punto. The second matter relied on is that the word “Sany”
is an invented word and has no meaning.
[23]

Finally, Daimler says that the Judge placed too much emphasis on the

discerning nature of potential purchasers and thereby limited his analysis to a small
portion of the general public. Mr Johns also emphasises the distinctiveness and
repute of the Daimler marks and, as well, the context in which the marks are used.
The latter submission is a reference to the fact the Daimler marks are consistently
found on the front grill or bonnet of vehicles. Mr Johns submits that if the Sany
mark is similarly placed, or on a Sany trailer attached to a Daimler vehicle,
confusion or deception is likely. Finally, Mr Johns points out the likelihood of
confusion has to be assessed in a context where Sany has not traded in New Zealand.
Our approach
[24]

The question of similarity is ultimately one of impression. This Court must

form its own view of the merits giving such weight to the decisions below as it
thinks appropriate.33

Applying that approach we agree with Collins J and the

Assistant Commissioner that the marks are not similar, essentially for the reasons
they gave. In particular, like Collins J, when we look at the Sany mark we do not
think of the Daimler marks.34
[25]

We agree with the Assistant Commissioner that overall the impression of the

Sany mark is “suggestive of rotational movement or the potential for such
movement; and [Sany’s] device appears not to have the symmetry of [Daimler’s]

33
34

Austin, Nichols & Co Inc v Stichting Lodestar [2007] NZSC 103, [2008] 2 NZLR 141 at [4]–[5].
High Court judgment, above n 4, at [43].

 device.”35 That impression is furthered by the fact, as Mr Lennard submits for Sany,
that the three lines in the Sany mark protrude beyond the circle and, if anything, are
as much like a triangle as like a star.36 Even when allowance is made for imperfect
recollection, we find compelling this summary by Collins J:37
The Daimler marks are clearly a representation of a star and symbolise
superior quality. The simplicity of the Daimler marks is one of their striking
features. On the other hand, the Sany mark looks like a spinning rotor. It is
a complicated device, the meaning of which is hard to discern by looking at
the mark. Purchasers in the relevant markets could not confuse the Sany
mark with Daimler’s three-pointed star within a circle. The device elements
in the Sany and Daimler marks are not visually or conceptually similar.

[26]

The Judge’s references to the similarities relied on by Daimler need to be put

in context.

Collins J was simply attempting to articulate why he formed the

impression he did. That exercise may require identifying similarities as a precursor
to explaining why, as a matter of overall impression, the marks are not viewed as
similar.38 We do not consider the Judge found the marks were similar in their
essential elements.
[27]

As to the conceptual differences in the marks, there was evidence to support

the view there were differences. Mr Wang, in-house counsel for Sany responsible
for intellectual property matters, describes Sany’s mark as a “three 1s device”. He
says that this:
… has strong significance in the Chinese community and portrays a strong,
prosperous and first class image. This part of the trade mark consists of
three “1” symbols all pointing towards each other, but not actually
connecting with each other. The three “1” elements are displayed in such a
way that they create a distinctive circle in the middle of them. The three
“1”s appear to be rotating, symbolising that Sany’s future development is
like a snowball and is growing and thriving. The three “1”s pierce the outer
circle, breaking through the siege and radiating outside, meaning that Sany’s
products are sold on a global basis in a thoroughly successful manner.
Further, the three “1”s come from Sany’s three main goals, those are, (1) to
establish a first class enterprise, (2) to cultivate first class people, and (3) to
make a first class contribution.

35
36
37
38

Assistant Commissioner’s decision, above n 3, at [34].
The Assistant Commissioner refers to the lines being arranged in a spiral: at [34].
High Court judgment, above n 4, at [43].
This is not a situation where although there are differences “the main idea left on the mind” by
both marks is the same: James Mellor and others Kerly’s Law of Trade Marks and Trade Names
(15th ed, Sweet & Maxwell, London, 2011) at [18–205].

 [28]

We do not attach a great deal of weight to this aspect but we agree with

Collins J the marks are conceptually different.
[29]

In making the submission Collins J was wrong to rely on the addition of the

word “Sany” in the Sany mark, Daimler relied on the decisions in Crocodile
International Pte Ltd v Lacoste and Carabao Tawandang Co Ltd v Red Bull
GMBH.39
[30]

In Crocodile International Pte Ltd v Lacoste Simon France J was dealing

with a challenge to the refusal of the Assistant Commissioner to register two trade
marks that incorporated the word “CARTELO” with a crocodile depiction. The
Judge accepted that it was “often considered that in combination marks the word will
dominate” but took the view that was not the position in that case because the word
CARTELO was meaningless and so would not “trigger any connections”.40 In that
situation the likelihood the recognisable device, the crocodile, would be the
“operative element” for consumers was increased.41
[31]

In Carabao Clifford J was dealing with the application for registration of a

mark comprising a horned cattle skull on a red background with the word
CARABAO. The mark was intended to be used for an energy drink product in New
Zealand. Registration of the mark was opposed by the company responsible for the
Red Bull brand of energy drink also sold in New Zealand. The Judge accepted that
the marks, to the extent they included the words Carabao and Red Bull, sounded
different. However, Clifford J said:42
… the fact that the word “Carabao” does not have any particular meaning or
certain pronunciation in English may reduce the distinction between the
marks that might otherwise accompany that difference in sound.

[32]

Those cases do not stand for the proposition a word without meaning is

necessarily irrelevant as a part of the mark. Rather, they make the point that in some
cases the addition of a word may not be significant. In this case, we consider the
39

40
41
42

Crocodile International Pte Ltd v Lacoste HC Wellington CIV-2009-485-2534, 1 March 2011;
and Carabao Tawandang Co Ltd v Red Bull GMBH HC Wellington CIV-2005-485-1975, 31
August 2006.
Crocodile International Pte Ltd v Lacoste, above n 39, at [45].
At [45].
Carabao Tawandang Co Ltd v Red Bull GMBH, above n 39, at [52].

 inclusion of the word “Sany” does further distinguish the marks, but even without its
inclusion there is no risk of confusion because of the lack of visual similarity.
[33]

In our view the likelihood of confusion is further reduced by the fact, as the

Assistant Commissioner found, purchasers or prospective purchasers of the goods
are likely to be both “discerning and reasonably knowledgeable given that the goods
in both classes are high-involvement because they are likely to be expensive and are
likely to involve technical information concerning matters such as performance and
safety”.43 The Assistant Commissioner also considered that in terms of sports cars
and motor cars “prestige will also be a relevant consideration”.44
[34]

Daimler submitted that confusion could occur where composite pieces of

construction machinery, for example, a truck-mounted concrete mixer, have a Sany
and a Daimler component. The evidence of practice suggests the composite pieces
often comprise a cab or chassis made by one manufacturer and a body (such as a
concrete-mixing unit) made by another manufacturer. There was evidence that the
relevant consumers were alive to this practice and that Daimler had worked with
Sany in China since at least 2003. We agree with Mr Lennard that in light of the
industry practice and the significant cost of this type of equipment, confusion and
deception are unlikely. Accordingly, even if there is overlap between the users and
trade channels of the goods as Daimler suggests, the prospective consumer is not
likely to wonder whether Sany’s goods are those of Daimler or connected to
Daimler’s goods. We consider the industry practice and the nature of the purchase
are relevant also to Daimler’s concern that potential customers may only see the
mark very briefly on the grill or bonnet of a vehicle as the vehicle drives by.
[35]

We need to deal here with the submission made by Daimler as to the effect of

this Court’s decision in Sexwax Inc v Zoggs International Ltd.45 Daimler argues that
it is wrong to attach weight to the sophistication of prospective purchasers in
assessing the likelihood of confusion, because the market is more extensive than

43
44

45

Assistant Commissioner’s decision, above n 3, at [21].
At [21]; and see Paul Sumpter Intellectual Property Law (2nd ed, CCH, Auckland, 2013) at
¶316: in referring to the surrounding circumstances Sumpter differentiates between “goods of a
trivial nature purchased in a busy supermarket” and “a grand piano, latest laptop or sports car”.
Sexwax Inc v Zoggs International Ltd, above n 22.

 purchasers or prospective purchasers and extends to all those who are aware of the
well known Daimler mark and who may be exposed to Sany’s goods.

This

submission relies on the following observation from Zoggs:
[54]
These authorities demonstrate that the risk of confusion is properly
measured by reference to those who may be exposed to the applicant’s goods
and are aware of the opponent’s mark. Absent exposure to goods bearing the
applicant’s mark, there will be no risk of confusion.

[36]

We do not read the above observation as meaning that it is not possible to

take into account the fact that purchasers and prospective purchasers are discerning.
Accordingly, we reject Daimler’s proposition. Two points can be made. First, the
Court in Zoggs endorsed various principles from this Court’s earlier judgment in
Pioneer Hi-Bred. In particular, the Court cited this proposition from Pioneer HiBred:46
(7)
It is in relation to commercial dealing with goods that the question of
deception or confusion has to be considered, and the persons whose states of
mind are material are the prospective or potential purchasers of goods of the
kind to which the applicant may apply his mark and others involved in the
purchase transactions.

[37]

Second, the issue in Zoggs was whether the Assistant Commissioner and the

Judge were wrong to look at the likelihood of confusion of a mark relating to
surfboard wax by treating the relevant market as consisting of the general purchasing
public. In concluding it was wrong to look at the market in this broader way, the
Court said:47
The correct focus is on the awareness of the opponent’s mark in relation to
prospective purchasers of the goods to which its mark attaches and
individuals and entities involved in that trade; not the entirety of the
purchasing public of New Zealand. The question of likelihood of deception
or confusion must then be assessed against that reputation, considering the
fair, notional use of the goods bearing each of the marks.

[38]

In summary, for these reasons we agree that the lack of similarity between the

marks means deception or confusion is not likely. The Judge was right to conclude
that s 17(1)(a) did not apply. That conclusion is reinforced by the fact the relevant
purchasers or prospective purchasers are discerning.
46
47

At [29], citing Pioneer Hi-Bred, above n 22, at 61.
At [65].

 Is use of the Sany mark contrary to New Zealand law (s 17(1)(b))?
[39]

Section 17(1)(b) provides that the Commissioner must not register as a trade

mark or part of a trade mark any matter:
the use of which is contrary to New Zealand law or would otherwise be
disentitled to protection in any court; …

[40]

The Assistant Commissioner’s decision was that it was unnecessary to

consider whether registration of the Sany mark would be contrary to ss 9, 10, 13 and
16 of the Fair Trading Act or amount to passing of because these grounds would
require a higher threshold of confusion than s 17(1)(a).48
[41]

Collins J found that his conclusions on s 17(1)(a) meant that the s 17(1)(b)

ground of appeal also failed.49
[42]

Daimler argues that the higher threshold of reputation required for passing off

is met and that the remaining elements of passing off and breach of the relevant
sections of the Fair Trading Act are also met. The submission is use of the Sany
mark will damage Daimler’s business, including damage to its reputation and
goodwill through mistaken associations and erosion of the distinctiveness of the
Daimler marks through dilution of goodwill.
[43]

Daimler’s submission on this section is dependent on our accepting the Judge

was wrong in his conclusions on s 17(1)(a). As we have upheld Collins J’s decision
on that subsection it follows that this ground of appeal must also fail.
Impact of consideration of fair and notional use (s 25(1)(b))
[44]

Section 25(1)(b) states that the Commissioner must not register a trade mark

(trade mark A) in respect of any goods or services if:
it is similar to a trade mark (trade mark C) that belongs to a different owner
and that is registered, or has priority under section 34 or section 36, in
respect of the same goods or services or goods or services that are similar to
those goods or services, and its use is likely to deceive or confuse; …
48
49

Assistant Commissioner’s decision, above n 3 at [51]–[53].
High Court judgment, above n 4, at [51].

 [45]

This Court in NV Sumatra Tobacco Trading Co v New Zealand Milk Brands

Ltd said that the order of inquiry under s 25(1)(b) is:50

[46]

(a)

Is an applicant’s proposed mark (or marks) in respect of the same or
similar goods or services covered by any of the opponent’s trade
mark registrations?

(b)

If so, is the applicant’s proposed mark (or marks) similar to any of
the opponent’s trade mark registrations for the same or similar goods
identified in the first enquiry?

(c)

If so, is use of the applicant’s proposed mark likely to deceive or
confuse?

Under this heading, Daimler submits that the Judge was wrong just to rely on

the findings in relation to s 17(1)(a). That is because under s 25(1)(b) the test is a
broader one encompassing fair and notional use of the Daimler marks. 51 Daimler
identifies two different notional uses:
(a)

Use of all goods in classes 7 and 12; and

(b)

The use of its devices with a word underneath, for example a brand or
model name. For example, use of the three-pointed star with the word
ACTROS or the word UNIMOG underneath.

[47]

The Judge acknowledged the “key” difference between ss 25(1)(b)

and 17(1)(a) is that the former is not dependent on Daimler’s actual use but upon
notional use.52

However, Collins J said he was “driven” to conclude that the

s 25(1)(b) ground of appeal must be dismissed because of his conclusion under
s 17(1)(a) that the Daimler marks and Sany mark lack sufficient similarity to deceive
or confuse.53
[48]

Following the inquiry set out in NV Sumatra we reach the same conclusion.

The notional use of the Daimler marks does not alter the conclusion that the Sany
mark is not similar to the Daimler marks and use of the Sany mark is not likely to
deceive or confuse. It is relevant, as Sany submits, that there is still nothing to
50
51
52
53

NV Sumatra Tobacco Trading Co v New Zealand Milk Brands Ltd, above n 22, at [32].
Anheuser-Busch Inc v Budweiser Budvar National Corp [2003] 1 NZLR 472 (CA) at [66].
High Court judgment, above n 4, at [53].
At [58].

 suggest that Daimler and Sany will find themselves competing in a market where the
purchasers or prospective purchasers are not discerning.
Effect of the Daimler mark being well known (s 25(1)(c))
[49]

Under s 25(1)(c) the Commissioner must not register a trade mark (trade

mark A) in respect of any goods or services if:
it is, or an essential element of it is, identical or similar to, or a translation of,
a trade mark that is well known in New Zealand (trade mark D), whether
through advertising or otherwise, in respect of those goods or services or
similar goods or services or any other goods or services if the use of trade
mark A would be taken as indicating a connection in the course of trade
between those other goods or services and the owner of trade mark D, and
would be likely to prejudice the interests of the owner.

[50]

In NV Sumatra this Court accepted the approach taken in Intellectual Reserve

Inc v Sintes applied to s 25(1)(c).54 Substituting the parties to this appeal, the
approach is as follows:
(a)

Is the Sany mark identical or similar to one of the Daimler marks
which is well known, or is an essential element of the Sany mark
identical or similar to that which is well known?

(b)

Are Sany’s goods and services the same as or similar to the goods and
services of Daimler? If not,

(c)

Would use of the Sany mark be taken as indicating a connection in the
course of trade with Daimler?

(d)

If the answer to issue (b) or (c) is yes, would use of the Sany mark be
likely to prejudice the interests of Daimler?55

54

55

NV Sumatra Tobacco Trading Co v New Zealand Milk Brands Ltd, above n 22, at [59]; and
Intellectual Reserve Inc v Sintes HC Auckland CIV-2007-404-2610, 13 December 2007 at [40].
NV Sumatra involved Milk Brands’ iconic ANCHOR brand. Milk Brands’ goods were similar to
those of Sumatra. The Court accepted that in seeing a similar sounding name (ANGKOR)
dealing with similar goods, consumers were likely to “see what they know”, namely, the
ANCHOR brand: at [60] and [63]; see also Fonterra Brands (Tip Top Investments) Ltd v Tip Top
Restaurant Ltd HC Wellington CIV-2011-485-1011, 4 November 2011; TKS SA v Swatch AG
(Swatch SA) (Swatch Ltd) [2012] NZHC 2642; and Carabao Tawandang Co Ltd v Red Bull
GMBH, above n 39.

 [51]

Mr Johns says the various limbs of s 25(1)(c) are met. Relying on the

submissions under s 17(1)(a), it is submitted that the marks are similar. Further,
Daimler says an essential element of the Sany mark is the three-pointed star within a
circle and that element is similar to the Daimler marks for the reasons Daimler
advances in the argument under s 17(1)(a). Mr Johns notes that the comparison of
marks is broader under this section than under s 17(1)(a) because s 25(1)(c) provides
for the situation where an essential element of the Sany mark is similar to the
Daimler mark. The submission is that the parties’ goods are the same and the Sany
mark would be taken as indicating a connection in the course of trade between
Sany’s goods and those of Daimler. When the well known status of the Daimler
marks is taken into account together with the similarity of the Sany mark, it is
submitted consumers may well think there is at least an association between the
marks.
[52]

In this context Daimler emphasises that Mercedes-Benz was ranked as the

eleventh most valuable brand in the world in the 2005 Business Week International.
It is submitted that given the evidence as to sales and advertising expenditure over
the relevant period in New Zealand, the Daimler marks have a very high level of
awareness and distinctiveness in New Zealand across a broad section of the public.
[53]

There is no challenge to the finding that the Daimler marks are well known.

Nonetheless, we agree with the submission for the respondent that s 25(1)(c) is not
engaged in this case. That is because the marks are not similar and nor, on our
analysis, is the Sany device inside the circle identical or similar to Daimler’s
three-pointed star. We agree with Mr Lennard that s 25(1)(c) is not engaged even if
the word Sany is not taken into account.
[54]

The question of what is necessary to show a connection in the course of trade

for the purpose of the inquiry identified in [50](c) above has not been finally
resolved in New Zealand. But it does appear to require more than a “tenuous

 association” with limited similarity of names.56 In any event, in the present case the
only evidence as to common usage suggests that no connection would be made.
Result
[55]

For these reasons, the appeal is dismissed. As the parties agreed, costs should

follow the event. The appellant must pay the respondent costs for a standard appeal
on a band A basis and usual disbursements.

Solicitors:
Baldwins Law Ltd, Wellington for Appellant
Ellis IP Ltd, Wellington for Respondent

56

Wistbray Ltd v Ferrero SPA HC Wellington CIV-2007-485-460, 11 December 2008 at [43]; as to
prejudice, [50](d) above, see Zespri Group Ltd v Enza Ltd HC Wellington CIV-2008-485-1072,
18 September 2008 at [65].