TRADE MARKS ORDINANCE (Cap. 559) OPPOSITION TO TRADE MARK APPLICATION NO. 303659310AB

MARK:

CLASSES: 16, 18, 25

APPLICANT: KABUSHIKI KAISHA MIXI (MIXI, INC.) (now changed name to MIXI, INC.)

OPPONENT: MONSTER ENERGY COMPANY

STATEMENT OF REASONS FOR DECISION

Background

1. On 14 January 2016, Kabushiki Kaisha Mixi (Mixi, Inc.) (the “applicant”) filed an application (the “subject application”) under the Trade Marks Ordinance, Cap. 559 (the “Ordinance”) for registration of the following mark:-

(the “subject mark”).

2. Registration is sought in respect of various classes of goods. The subject application was subsequently divided into 303659310AA and 303659310AB. The present proceedings is only in relation to the latter which seeks to register the following goods (“subject goods”) in Classes 16, 18, 25:-

Class 16 pastes and other adhesives for stationery or household purposes, printed lottery tickets [other than toys]; paper and cardboard; stationery; printed matter; paintings [pictures]; calligraphic works; photographs [printed]; photograph stands; cards; card files; trading cards; note books; file folders; mechanical pencils; ballpoint pens; stickers [stationery]; notepads; calenders; sacred lots [Omikuji].

1 Class 18 handbag frames; purse frames; horseshoes; clothing for pets; straps for luggage; bags; pouches; portable vanity cases [not fitted]; umbrellas; tote bags; purses; credit card cases [wallets].

Class 25 tee-shirts; clothing; garters; sock suspenders; braces for clothing [suspenders]; waistbands; belts [clothing]; footwear [other than boots for sports]; masquerade costumes; clothing for sports; boots for sports; sleep masks.

3. Particulars of the subject application were published on 27 May 2016. Monster Energy Company (the “opponent”) filed a notice of opposition which includes a “Statement of Grounds of Opposition” (the “Grounds of Opposition”) on 17 August 2016.

4. The opposition hearing took place before me on 5 June 2019. Mr. Philips B.F. Wong of Counsel, instructed by Rebecca Lo & Co, represented the opponent. Mr. Ling Chun Wai, Counsel, instructed by Hogan Lovells, represented the applicant.

Grounds of opposition

5. In the Grounds of Opposition, it is claimed that the opponent, a company organized and existing under the laws of Delaware, United States of America, is a well-known seller of a wide range of beverage products and the owner of a family of trade marks incorporating the word “MONSTER” including but not limited to “MONSTER”, “MONSTER ENERGY”, “M MONSTER ENERGY”, “M MONSTER ENERGY Device”, “ASSAULT M MONSTER ENERGY”, “ASSAULT M MONSTER ENERGY Device”, “J AVA M O N S T E R ”, “MONSTER REHAB”, “MONSTER PREDATOR”, “M MONSTER MYTANT”, “MONSTER ENERGY + JUICE KHAOS”, “M MONSTER M-80 ENERGY + JUICE Device”, “MONSTER KHAOS ENERGY + JUICE”, “J AVA M O N S T E R BIG BLACK”, “MONSTER M-80”, “MONSTER DETOX”, “MONSTER REHABITUATE”, “MONSTER UNLEADED”, “MONSTER ENERGY ULTRA RED”, “MONSTER RIPPER”, “X-PRESSO MONSTER”, and “JUICE MONSTER” (collectively the “Opponent’s

2 Marks”). Representations of the Opponent’s Marks (25 of them in total) are shown in Schedule A to the Grounds of Opposition. Some of these marks (14 of them in total) have been registered in Hong Kong (collectively the “Opponent’s HK Marks”). Representations of the Opponent’s HK Marks are shown in Schedule B to the Grounds of Opposition.

6. The opponent opposes registration of the subject mark under sections 11(4), 11(5) and 12 of the Ordinance.

Counter-statement

7. The applicant filed a counter-statement on the specified Form T7 on 17 November 2016, attached to it is a statement entitled “Counter Statement” which denies all the grounds of opposition and identifies the co-existence of exemplary groups of trademark registrations in Hong Kong for marks containing the word “MONSTER” in respect of identical or similar goods.

The opponent’s evidence

8. The opponent’s evidence comprises two statutory declarations of Rodney Cyril Sacks, the first one made on 20 April 2017 (“Sacks’ 1st Declaration”) was filed as evidence in support of opposition under Rule 18 of the Rules, the second one made on 19 April 2018 (“Sacks’ 2nd Declaration”) was filed as evidence in reply under Rule 20 of the Rules. Mr. Sacks is the Chairman and the Chief Executive Officer of Monster Beverage Corporation and its subsidiaries including the opponent which authorized him to make the statutory declarations on its behalf to oppose the subject application. The facts he deposed to in his statutory declarations are based on his own personal knowledge or from information derived by him from the opponent’s records.

3 9. According to Mr. Sacks, the opponent is in the business of designing, creating, developing, producing, marketing and selling energy drinks and other beverages such as natural sodas, fruit juices, iced teas etc. It is claimed that the opponent has been widely acknowledged as a leader in the beverages industry. A number of recognition and awards were received by the Opponent e.g. “Beverage Company of the Year” by The Beverage Forum in 2004 and 2006 and “Large Beverage Company of the Year” in 2009, Forbes’ “Top 200 Best Small Companies” in 2000, 2004, 2005, 2006 and 2007, Fortune Magazine’s “100 Fastest Growing Companies” in 2005, 2006, 2007 and 2008, and “One of the Most Innovative Companies” by Forbes in 2014, 2015 and 2016, etc.1

10. The opponent has sought registration of its trade marks which include

“MONSTER”, “MONSTER ENERGY”, and the claw marks “ ” and “ ” in many countries and areas worldwide including Hong Kong. Exhibit “RCS-1” to Sacks’ 1st Declaration contains a list of registered and pending trade marks of the opponent in Hong Kong.2

11. It is claimed that the MONSTER ENERGY beverage line has been tremendously successful since its launch in the United States in April 2002, and MONSTER ENERGY drinks started selling outside of the United States in 2003. At the time of Sacks’ 1st Declaration in April 2017, MONSTER ENERGY drinks were available in approximately 120 nations and territories around the world, and worldwide retail sales exceeded 3 billion cans per year. Over the years, the opponent has expanded the range of beverage products sold under the MONSTER ENERGY marks. Apart from the traditional line of energy beverages, the opponent has other lines of energy drinks such as tea-based non-carbonated energy drinks, dairy-based coffee plus energy drinks, dairy-based protein energy shakes, etc. According to Sacks’ 1st Declaration, MONSTER ENERGY drinks were the best-selling energy drinks in the United States and the second best-selling worldwide by unit volume. Worldwide gross sales increased from US$1.95 billion in 2011 to US$3.11 billion in 2015.3

1 Sacks’ 1 st Declaration, para 4. 2 Paragraph 6 of Sacks’ 1st SD 3 Sacks’ 1 st Declaration, paras 8-12 & 17. 4 12. The opponent launched the MONSTER energy drinks in Hong Kong in April 2012. From April 2012 to December 2015, it had sold more than 2.9 million cans of MONSTER energy drinks in Hong Kong amounting to sales of approximately US$2.9 million. 4 Exhibit “RCS-2” is an undated photograph of a can of MONSTER energy drink which is claimed to have been distributed in Hong Kong. Exhibit “RCS-3” is copy of an invoice dated 17 September 2015 issued by Monster Energy Hong Kong with respect to a product with the description of “Monster Absolutely Zero”.

13. According to Mr. Sacks, in Hong Kong, the opponent’s MONSTER energy drinks have been sold in over 3,000 retail outlets, including retail stores, gas stations and other outlets such as drug stores and on premise. Specific trade outlets include 7-Eleven, Circle K and ParknShop stores.5

14. Mr. Sacks claims that the opponent’s marketing strategy is not conventional in that it does not use direct television or radio advertising to promote its marks. The majority of its marketing, advertising and promotional budget are spent on athlete endorsements and sponsoring athletic competitions and other events. In particular, its marketing focus includes international events, including events that are webcast on the Internet where its target market of young males spend a great deal of time. The advertising, marketing and promotions that it carries in relation to its marks are all about image, and the image of MONSTER energy drinks is “edgy and aggressive”. It is considered that the athletes and events that the opponent sponsors tend to be edgy and aggressive, or extreme, and that it is the indirect and non-traditional forms of advertising such as sponsorship and product placement which are instrumental in reaching the opponent’s target market.6 Exhibit “RCS-4” are some photographs of the opponent’s sponsored athletes bearing the Opponent’s Marks. Exhibit “RCS-5” are photographs showing the point of sale for MONSTER energy drinks sold in Hong Kong.

15. The opponent’s worldwide expenditure since 2002 in advertising, marketing and promoting its MONSTER energy drinks was over US$4.6 billion, and over US$2.04 million was spent between April 2012 and December 2015 in marketing and

4 Sacks’ 1 st Declaration, para.13. 5 Sacks’ 1 st Declaration, para.16. 6 Sacks’ 1 st Declaration, paras 20-24. 5 promotional activities in Hong Kong to promote MONSTER energy drinks.7

16. In Hong Kong, the opponent has participated in a number of events such as the 2012 Animation-Comic-Game entertainment and book fair. It is said that the Opponent’s kiosk at the event featured a tent branded with the MONSTER marks etc. It is also claimed that at the opponent’s official Hong Kong launch party held at Hyde Club on 23 August 2012, the MONSTER marks were prominently displayed throughout the event venue. The opponent also sponsored several action sports competitions in Hong Kong during 2012 including the Hong Kong X-Battle BMX contest, the MX Club Mountain Bike Festival, the DC Monster Energy APAC Skate Tour, and the Monster Energy HK Wakeboard Championship to promote its products and the MONSTER marks.8 No exhibit has been produced for the aforesaid events. It is claimed that in 2012, 2013, 2014 and 2015, the opponent distributed over 62,000, 40,000, 50,000 and 36,000 sample 473 mL cans of MONSTER energy drinks to Hong Kong consumers respectively, for a total of 188,000 cans distributed. Each week during 2012, Monster Ambassador Team members (“MAT’s”) conducted street sampling in Hong Kong and distributing more than 1,000 cans of MONSTER energy drinks each week.9

17. Internationally, the opponent had sponsored different teams and events, including F1 Racing, MotoGP, Supercross and the Ultimate Fighting Championship (“UFC”), World Superbike Championship, FIM Motocross World Championships, Asian X Games / Kia World Extreme Games, Dakar Rally, Monster Energy X-Raid Team, Husqvarna Rallye Team by Speedbrain, X Games, Monster Energy AMA Supercross Series, The National Association for Stock Car Auto Racing (“NASCAR”), DC South East Asia Tour, Venue Marketing Agreements, etc. The Opponent has also sponsored various athletes. From paragraph 40 and Exhibit “RCS-8” of Sacks’ 1st Declaration onwards, up to paragraph 128 and Exhibit “RCS-35”, details of these sponsored teams and events and evidence in support are given. I do not propose to go into the details here.

18. In addition to sponsoring professional athletes and teams, the opponent maintains an amateur sponsorship and athlete development program called The

7 Sacks’ 1 st Declaration, paras 27 and 29. 8 Sacks’ 1 st Declaration, paras 37 and 38. 9 Sacks’ 1 st Declaration, para 39. 6 Monster Army. At the time of Sacks’ 1st Declaration in April 2017, more than 360,000 amateur athletes worldwide have applied to be accepted as part of the Monster Army, including 33 people from Hong Kong.10 Google Analytics for the period from 1 October 2008 to 31 July 2015 show that the Monster Army website received nearly 5.1 million unique visitors during that period, of which more than 1,279 were from residents of Hong Kong.11

19. The opponent also sponsors musicians and music festivals, which receive exposure on the Internet, on television and in magazines and newspapers.12 It is said there were more than 26,000 visits (out of a total of 26 million visits) from Hong Kong to the opponent’s website www.monsterenergy.com over the period from 1 September 2010 to 31 December 2015.13 The opponent also uses the Internet and the social media e.g. Facebook page, YouTube channels to promote its products and marks. According to Mr. Sacks, the MONSTER ENERGY YouTube channel has received more than 223 million views worldwide since its launch (the year of which is not known).14

20. It is claimed that the MONSTER marks and the claw marks have also been used on clothing since 2002, including t-shirts, hooded sweatshirts, sweat shirts, jackets, pants, bandanas, sweat bands, gloves and headgear. The opponent has also given approval and licenses to different companies to sell market apparel and merchandise bearing the MONSTER marks and the claw marks. 15 Exhibit “RCS-49” contains copies of an in-store display of the opponent’s drinks in supermarkets and other stores in Hong Kong in 2014 which features the MONSTER marks in connection with backpacks and some other items including apparel.

21. There are also a number of published articles in magazines like Fortune, Newsweek, Forbes, which feature the Monster marks.16

22. In 2003, the opponent signed a $10 million deal to sponsor the MONSTER

10 Sacks’ 1 st Declaration, para 129. 11 Sacks’ 1 st Declaration, para 131. 12 Sacks’ 1 st Declaration, para 133. 13 Sacks’ 1 st Declaration, para 135 and Exhibits “RCS-38” and “RCS-39”. 14 Sacks’ 1 st Declaration, paras 137 to 143 and Exhibit “RCS-40” to Exhibit “RCS-48”. 15 Sacks’ 1 st Declaration, paras 145 to 154 and Exhibit “RCS-49” to Exhibit “RCS-52”. 16 Sacks’ 1 st Declaration, paras 155 to 157 and Exhibit “RCS-53” to Exhibit “RCS-54”. 7 train, the first multi-car train on the Las Vegas monorail. The opponent’s MONSTER marks were said to have featured on the train.17 The opponent also distributes point of sale items, including display headers, display cases, display cards, stickers etc. Moreover, the opponent’s marks have been featured in some video games and their promotions as the opponent has partnered with some video game publishers. 18 The opponent has sponsored DreamHack (the biggest computer festival in the world) and E-Sports teams which compete in multiplayer video game competitions, since 2014 and 2011 respectively.19

23. Sacks’ 2nd Declaration was filed as evidence in reply to the applicant’s evidence, specifically paragraphs 10 to 13 of the statutory declaration of Toshihiko Nakayama. Copy of a favourable decision issued by the Macau Intellectual Property Office, as one of the decisions in opposition proceedings brought by the opponent against the applicant in other jurisdictions,20 is produced at Exhibit “RCSS-1” to Sacks’ 2nd Declaration.

The applicant’s evidence

24. The applicant evidence comprises a statutory declaration of Toshihiko Nakayama ( 中山俊彥) made on 11 October 2017 (“Nakayama’s statutory declaration”). Mr. Nakayama is the patent attorney of the applicant. He was authorized to make the statutory declaration. The facts he deposed to in his statutory declaration are within his own knowledge and belief or are gleaned from the applicant’s books and records.

25. According to Mr. Nakayama, the applicant is a company organized and existing under the laws of Japan. The subject mark “MONSTER STRIKE” was initially used to represent a smartphone RPG (role-playing game) of the applicant in which players flick away their own “Monster” and “strike” an enemy “Monster”. The mark was adapted with an aim to convey the key features of the game plainly and

17 Sacks’ 1 st Declaration, paras 158 to 161 and Exhibit “RCS-55” to Exhibit “RCS-64”. 18 Sacks’ 1 st Declaration, paras 162 to 167 and Exhibit “RCS-65” to Exhibit “RCS-66”. 19 Sacks’ 1 st Declaration, paras 168 to 170 and Exhibit “RCS-67”. 20 Sacks’ 2 nd Declaration, para 5. 8 simply, and to allow users to better recognize or understand the game easier.

26. It is said that since the release of the game in October 2013, the applicant has created a total of over 1800 types of enemy monsters and the number is still growing. The applicant has been actively promoting and advertising its “MONSTER STRIKE” smartphone game worldwide. In June 2014, the user base for the applicant’s “MONSTER STRIKE” smartphone game surpassed 8 million worldwide, and in May 2016, surpassed 35 million worldwide. Exhibit “TN-1” to Nakayama’s statutory declaration contains copies of the public announcements made by the applicant from June 2014 to May 2016, and copies of the First- and Second-Quarter Earnings Result Briefing Sessions in 2015.

27. In Hong Kong, the applicant’s “MONSTER STRIKE” smartphone game was officially launched in March 2015. Exhibit “TN-2” to Nakayama’s statutory declaration contains a copy of the public announcements made by the applicant on 12 March 2015, printouts from www.appannie.com showing the rank history of the Download Ranks and Grossing Ranks of the applicant’s “MONSTER STRIKE” smartphone game in Hong Kong for iPhone, iPad and Android devices from 12 March 2015 to 14 January 2016, copy of an excerpt from Hong Kong newspaper “Metro Daily” published on 26 August 2015 about the “Best Mobile Phone Game (Action) Award”, and printout from www.eprice.com.hk published on 15 December 2015 reporting on “Google Hong Kong 2015 Most Popular Game Search Ranking”.

28. Exhibit “TN-3” to Nakayama’s statutory declaration contains printouts of the details of the applicant’s trade mark registrations in its home country Japan. Exhibit “TN-4” contains printouts of the details of the opponent’s trade mark registrations in Japan.

29. Exhibit “TN-5” to Nakayama’s statutory declaration contains a copy of the decision on opposition to the grant of the applicant’s trade mark registration no.5779763 in its home country Japan.

30. Exhibit “TN-6” to Nakayama’s statutory declaration contains copies of the registration details of the applicant’s trade mark registrations in China, and a copy of the opposition decision in respect of the applicant’s trade mark registration

9 no.G1242941 in China. Exhibit “TN-7” contains printouts of the details of many trade mark registrations in Hong Kong which concern marks containing the word “MONSTER” in respect of identical or similar goods.

31. The rest of Nakayama’s statutory declaration was mainly devoted to discussions of the differences between the opponent’s marks and the subject mark. I do not propose to go into the details here.

Findings on goodwill and reputation of the opponent’s mark

32. The opponent opposes registration of the subject mark under sections 11(4), 11(5) and 12 of the Ordinance. At the hearing, Mr. Philips Wong, counsel for the opponent, indicated that the opponent would rely on sections 12(3), 12(4) and 12(5)(a) of the Ordinance. I would therefore treat the opposition based on the other pleaded grounds as no longer being pursued by the opponent.

33. It is clear that for the purposes of section 12(3), the opponent would wish to rely on its registered trade marks in Hong Kong, as shown in Schedule B to the Grounds of Opposition and which I refer to as the “Opponent’s HK Marks”, in the assessment with reference to any enhanced distinctive character through use; and for the purposes of sections 12(4) and 12(5)(a), besides the Opponent’s HK Marks, the opponent would also wish to rely on the Opponent’s Marks to establish any reputation or goodwill that it has acquired or generated. It is therefore convenient for me to first investigate the opponent’s evidence and make the relevant findings in this connection.

34. I have outlined the opponent’s evidence in support of the opposition in paragraphs 8 to 23 above. In gist, evidence is produced to show that the opponent, in the business of designing, creating, developing, producing, marketing and selling energy drinks and other beverages such as natural sodas, fruit juices, iced teas etc., has been widely acknowledged as a leader in the beverages industry, in particular, its MONSTER ENERGY beverage line has been tremendously successful since its launch in the United States in April 2002 and outside the United States in 2003.

10 35. Various and large volume of exhibits have been produced to prove the aforesaid, including a number of recognition and awards that the opponent has received, and the substantial marketing, advertising and promotional efforts and expenditure spent on athlete endorsements and sponsoring athletic competitions and other events. However, it is noted that a number of exhibits to Sacks’ 1st Declaration contain materials which show foreign use of the marks that do not bear a direct relationship to their use in Hong Kong, and a number of them are either dated posterior to the date the subject application was filed or with unknown dates of their creation. These materials do not much assist in establishing, in the context of Hong Kong, whether distinctiveness has been enhanced through use, or whether goodwill and reputation in the opponent’s marks had been established, by the date the subject application was filed in Hong Kong.

36. The opponent has sought registration of its trade marks which include “MONSTER”, “MONSTER ENERGY”, the claw mark “ ” and composite mark

“ ” in many countries and areas worldwide including Hong Kong. Based on the evidence available, the mark shown to be used consistently in Hong Kong is the composite mark or as per Exhibits “RCS-2”, “RCS-4”, “RCS-5” and “RCS-49”, and their use had mainly been on beverages, or more exactly on energy drinks.

37. In Hong Kong, the opponent’s MONSTER energy drinks have been sold in over 3,000 retail outlets, including retail stores, gas stations and other outlets such as drug stores and on premise. Specific trade outlets include 7-Eleven, Circle K and ParknShop stores. The opponent distributed a total of over 188,000 sample 473 mL cans of MONSTER energy drinks to Hong Kong consumers from 2012 to 2015; each week during 2012, Monster Ambassador Team members (“MAT’s”) conducted street sampling in Hong Kong and distributing more than 1,000 cans of MONSTER energy drinks each week. Photographs at Exhibit “RCS-5” showing points of sale at retail stores in Hong Kong for MONSTER energy drinks which were sold in cans that bear the mark .

11 38. Examples of promotional events in Hong Kong include the 2012 Animation-Comic-Game entertainment and book fair, the opponent’s official Hong Kong launch party held at Hyde Club on 23 August 2012. Exhibit “RCS-5” show that the mark “ ” appeared on a motorcycle as well as on some motor race helmets.

39. The opponent also sponsored several action sports competitions in Hong Kong during 2012 including the Hong Kong X-Battle BMX contest, the MX Club Mountain Bike Festival, the DC Monster Energy APAC Skate Tour, and the Monster Energy HK Wakeboard Championship to promote its products and the MONSTER marks. The opponent maintains an amateur sponsorship and athlete development program called The Monster Army. Google Analytics for the period from 1 October 2008 to 31 July 2015 show that the Monster Army website received nearly 5.1 million unique visitors during that period, of which more than 1,279 were from residents of Hong Kong.

40. In addition, the opponent also sponsors musicians and music festivals, which receive exposure on the Internet, on television and in magazines and newspapers, and it also uses the Internet and the social media e.g. Facebook page, YouTube channels to promote its products and marks.

41. Whilst many of the above have not been independently verified by more concrete and real evidence, nor is there any breakdown in the exact marks used and items of goods that are advertised or promoted, given the extent and history of use of the opponent’s marks, and the undoubted claim of launch of the MONSTER energy drinks in Hong Kong in as early as April 2012, having regard to the totality of the evidence filed, I would hold that by the date the subject application was filed, the composite mark or has become the distinguishing feature of the opponent’s goods of energy drinks and has acquired through them certain reputation and goodwill in such goods offered and promoted in Hong Kong.

42. It is claimed that the MONSTER marks and the claw marks have also been used on clothing since 2002, including t-shirts, hooded sweatshirts, sweat shirts,

12 jackets, pants, bandanas, sweat bands, gloves and headgear. The opponent has also given approval and licenses to different companies to sell market apparel and merchandise bearing the MONSTER marks and the claw marks. Exhibits “RCS-49” to “RCS-52” are produced to show this.

43. Exhibit “RCS-49” contains copies of an in-store display of the opponent’s drinks in supermarkets and other stores in Hong Kong in 2014 which features the MONSTER marks used in connection with backpacks and some other items including apparel such as T-shirts and hats. However, it is clear from the photos shown which include an in-store advertisement that these backpacks and apparel were only offered as part of the promotion program for MONSTER energy drinks that a customer who bought a can of the energy drink would be able to purchase a T-shirt, a backpack or a hat (whilst stock last) bearing one of the claw marks and . Mr. Ling submitted, which I agree, that it is clear that the event was a modest, one-off effort to promote MONSTER energy drink for a period lasting around three weeks in Hong Kong in 2014, and as no sales figures or store details are given, the evidence in no way support the claim that the MONSTER marks had received extensive exposure in Hong Kong through the promotion. I would add that in such event, even if someone who, as a result of buying MONSTER energy drinks, takes a liking to the apparel, his purchases would not increase the market share of the trade mark in the apparel market, although it would do so on the energy drinks market, which fits perfectly with the role assigned to the advertisement to publicize the opponent’s core business, that is, energy drinks. The MONSTER marks are obviously not used as trade marks on the subject goods in this instance.

44. Exhibits “RCS-50” to “RCS-51” are of no help either to prove use of the opponent’s marks on the subject goods in Hong Kong as the materials they contained regarding the opponent’s licensees’ websites and catalogues selling apparel bearing the MONSTER marks, or screen-shots showing online promotion of MONSTER branded BMX bike, are of foreign origins with nothing to show that they are targeting Hong Kong audience and consumers. Exhibits “RCS-52” contains copies of photographs of Monster Ambassador Team members (“MAT’s”) giving away so-called merchandise bearing the MONSER marks at a sponsored event. But since there is no indication that the so-called merchandise are really goods to be bought and

13 sold rather than being offered as free gifts, it is no proof of use of the MONSTER marks as trade marks on the apparel which forms part of the subject goods.

45. As there is no substantive use of the MONSTER marks as trade marks on any of the subject goods being shown in the evidence, there is no question of distinctiveness of any of the Opponent’s HK Registered Marks having been enhanced in the present proceedings.

Decision on grounds of oppositions

46. In the Grounds of Opposition, the opponent opposes registration of the subject mark under sections 11(4), 11(5) and 12 of the Ordinance. At the hearing, Mr. Wong indicated that the opponent would rely on sections 12(3), 12(4) and 12(5)(a) of the Ordinance. I shall deal with the ground based on section 12(3) first.

47. I just record that for any of the grounds of opposition discussed in this decision, it’s not in dispute that the relevant date is the date the subject application was filed, viz., 14 January 2016 (“the relevant date”).

Section 12(3) of the Ordinance

48. Section 12(3) of the Ordinance provides as follows:

“(3) A trade mark shall not be registered if-

(a) the trade mark is similar to an earlier trade mark;

(b) the goods or services for which the application for registration is made are identical or similar to those for which the earlier trade mark is protected; and

(c) the use of the trade mark in relation to those goods or services is likely to cause confusion on the part of the public.”

14 49. Under section 7(1) of the Ordinance, in determining whether the use of a trade mark is likely to cause confusion on the part of the public, the Registrar may take into account all factors relevant in the circumstances, including whether the use is likely to be associated with an earlier trade mark.

50. Section 12(3) of the Ordinance is similar in effect to section 5(2) of the U.K. Trade Marks Act 1994, which implements Article 4(1)(b) of the First Council Directive 89/104 of 21 December 1998 of the Council of the European Communities (“the Council Directive”).21 In interpreting Article 4(1)(b) of the Council Directive, the European Court of Justice (“ECJ”) has formulated the “global appreciation” test, the principles of which can be found in the ECJ decisions in Sabel BV v Puma AG [1998] R.P.C. 199, Canon Kabushiki Kaisha v Metro-Goldwyn-Mayer Inc. [1999] R.P.C. 117, Lloyd Schuhfabrik Meyer & Co GmbH v Klijsen Handel B.V. [2000] F.S.R. 77, Marca Mode CV v Adidas AG [2000] E.T.M.R. 723 and more recently, in Specsavers International Healthcare Ltd v Asda Stores Ltd [2012] F.S.R. 19.

51. Such principles have long been adopted in Hong Kong case law, as confirmed by the Court of Appeal in Tsit Wing (Hong Kong) Co Ltd v TWG Tea Co Pte Ltd [2015] 1 HKLRD 414.22 In essence, the test under section 12(3) is whether there are similarities in marks and goods which would combine to create a likelihood of confusion. The likelihood of confusion must be appreciated globally. In Tsit Wing, Lam VP cited (at paragraph 35) the propositions endorsed by Kitchin LJ in Specsavers (at paragraph 52) as follows:

“On the basis of these and other cases the Trade Marks Registry has developed the following useful and accurate summary of key principles sufficient for the determination of many of the disputes coming before it:

(a) the likelihood of confusion must be appreciated globally, taking account of all relevant factors;

(b) the matter must be judged through the eyes of the average consumer of the goods or services in question, who is deemed to be reasonably well informed and reasonably circumspect and observant, but who rarely has the chance to make direct comparisons

21 Council Directive 89/104 is now replaced by Directive 2008/95 of 22 October 2008. 22 And also as affirmed by the Court of Final Appeal in the same case: TWG Tea Co Pte Ltd v Tsit Wing (Hong Kong) Co Ltd (2016) 19 HKCFAR 20. 15 between marks and must instead rely upon the imperfect picture of them he has kept in his mind, and whose attention varies according to the category of goods or services in question;

(c) the average consumer normally perceives a mark as a whole and does not proceed to analyse its various details;

(d) the visual, aural and conceptual similarities of the marks must normally be assessed by reference to the overall impressions created by the marks bearing in mind their distinctive and dominant components, but it is only when all other components of a complex mark are negligible that it is permissible to make the comparison solely on the basis of the dominant elements;

(e) nevertheless, the overall impression conveyed to the public by a composite trade mark may, in certain circumstances, be dominated by one or more of its components;

(f) and beyond the usual case, where the overall impression created by a mark depends heavily on the dominant features of the mark, it is quite possible that in a particular case an element corresponding to an earlier trade mark may retain an independent distinctive role in a composite mark, without necessarily constituting a dominant element of that mark;

(g) a lesser degree of similarity between the goods or services may be offset by a greater degree of similarity between the marks, and vice versa;

(h) there is a greater likelihood of confusion where the earlier mark has a highly distinctive character, either per se or because of the use that has been made of it;

(i) mere association, in the strict sense that the later mark brings the earlier mark to mind, is not sufficient;

(j) The reputation of a mark does not give grounds for presuming a likelihood of confusion simply because of a likelihood of association in the strict sense;

(k) if the association between the marks causes the public to wrongly believe that the respective goods [or services] come from the same or economically-linked undertakings, there is a likelihood of confusion.”

Earlier trade marks

52. The term “earlier trade mark” is defined in section 5 of the Ordinance. References to an earlier trade mark shall be construed as including a trade mark in

16 respect of which an application for registration has been made under the Ordinance and which, if registered, would constitute an earlier trade mark under or by virtue of section 5(1)(a), subject to its being so registered.

53. In the Grounds of Opposition, representations of the alleged family of the opponent’s trade marks incorporating the word “MONSTER” (25 of them in total) are shown in its Schedule A, and representations of some of these marks (14 of them in total) as registered in Hong Kong are shown in its Schedule B.

54. Mr. Wong, counsel for the opponent, has singled out the following two Hong Kong registrations among these opponent’s trade marks as the earlier mark the opponent relies upon in launching the opposition under section 12(3) of the Ordinance:-

Trade Mark Date of Trade Mark Specification No. Registration 301212975 02-10-2008 16 Printed matter and publications; posters; stickers; transfers; cards; stationary; signboards in this class. 18 Bags; backpacks; wallets; cases; key cases; leather and imitations of leather, and goods made of these materials and not included in other classes. 25 Clothing, footwear, headgear. 302284371 14-06-2012 16 Stickers, decals, posters. 18 Backpacks; duffle bags, sports bags. 25 Clothing, t-shirts, sweatshirts, jackets, sweat bands, gloves, pants, hats, beanies and caps.

55. Given that the dates of the two registrations are earlier than the date the subject application was filed, the same word mark MONSTER ENERGY in these two registrations is considered to have met the criteria of “earlier trade mark” as defined under section 5(1)(a) of the Ordinance for the purposes of this proceedings. For the purposes of the opposition ground based on section 12(3) of the Ordinance, the above mark which I shall call the opponent’s MONSTER ENERGY mark is considered to be the earlier mark relied upon by the opponent.

17 The average consumer

56. The concept of "average consumer" has been well discussed in many of the case law of the UK and the European Union. As those case law shows, in the global assessment of the likelihood of confusion, account should be taken of the average consumer of the category of goods and services concerned, who is reasonably well informed and reasonably observant and circumspect. It should also be borne in mind that the average consumer’s level of attention is likely to vary according to the category of goods or services in question (Mundipharma AG v Office for Harmonisation in the Internal Market (Trade Marks and Designs) (OHIM) – Altana Pharma (RESPICUR) (T-256/04) [2007] E.C.R. II-449 at [42] and the case law cited), and I have to determine the manner in which these goods and services are likely to be selected by the average consumer in the course of trade.

57. The average consumer has been described by Birss J., in Hearst Holdings Inc, Fleischer Studios Inc v A.V.E.L.A. Inc, Poeticgem Limited, The Partnership (Trading) Limited, U Wear Limited, J Fox Limited [2014] EWHC 439 (Ch), in these terms:

“60. The trade mark questions have to be approached from the point of view of the presumed expectations of the average consumer who is reasonably well informed and reasonably circumspect. The parties were agreed that the relevant person is a legal construct and that the test is to be applied objectively by the court from the point of view of that constructed person. The words “average” denotes that the person is typical. The term “average” does not denote some form of numerical mean, mode or median.”

58. Both the applicant’s applied for goods and the opponent’s registered goods are in Classes 16, 18 and 25 which, in a broad sense, include consumer products that may be bought in the daily life of the general public. The relevant public is therefore made up of members of the general public who purchase these products from stores, as well as the retailers of such products. I do not see there is a great difference between these two sectors of the relevant public. In both cases they should be considered to be reasonably well informed and reasonably observant and circumspect, and whose degree of attention must be regarded as average when purchasing them.

59. I just add that the relevant public’s level of attention will vary from average

18 to higher than average, depending on the price and frequency of purchase of the goods concerned.

Comparison of goods

60. According to settled case-law, in order to assess the similarity between goods or services, all the relevant features of the relationship between them should be taken into account. Those features include, inter alia, their nature, their intended purpose, their method of use and whether they are in competition with each other or are complementary (As per Canon Kabushiki Kaisha v Metro-Goldwyn-Mayer Inc.). Other factors may also be taken into account such as the distribution channels of the goods or services concerned (see for example British Sugar Plc v James Robertson and Sons Ltd [1996] R.P.C. 281; Case T-443/05 El Corte Inglés v OHIM – Bolaños Sabri (PiraÑAM diseño original Juan Bolaños) [2007] ECR II-2579, paragraph 37 and the case-law cited).

61. The comparison of the goods must concern the description of the goods covered by the marks at issue and not the goods for which the trade marks are actually used. Furthermore, in Gérard Meric v Office for Harmonization in the Internal Market (Trade Marks and Designs) (OHIM) Case T-133/05, at paragraph 29 the General Court said:

“In addition, the goods can be considered as identical when the goods designated by the earlier mark are included in a more general category, designated by the trade mark application (Case T-388/00 Institut für Lernsysteme v OHIM – Educational Services (ELS) [2002] ECR II-4301, paragraph 53) or when the goods designated by the trade mark application are included in a more general category designated by the earlier mark (Case T-104/01 Oberhauser v OHIM – Petit Liberto (Fifties) [2002] ECR II-4359, paragraphs 32 and 33; Case T-110/01 Vedial v OHIM – France Distribution (HUBERT) [2002] ECR II-5275,paragraphs 43 and 44; and Case T-10/03 Koubi v OHIM – Flabesa (CONFORFLEX) [2004] ECR II-719, paragraphs 41 and 42.”.

62. The applicant’s subject goods in Class 16 can categorically be called “stationery, printed matter and publications”, which is also an apt description of the goods under which the opponent’s MONSTER ENERGY mark is registered in Class 16 under the Hong Kong Trade Mark Registration.

19 63. Similarly for the other two, the goods in Class 18 can be categorically called “clothing accessories, such as hand bags and purses”, though the specifications of the opponent’s MONSTER ENERGY mark also cover types of bags sold by sports shops and outdoor stockists.

64. As for the Class 25 goods, the broad category of “clothing, footwear, headgear” would capture all items in the specifications of both the opponent’s MONSTER ENERGY mark and the subject mark.

65. In view of the above, it seems identical or similar goods are in play for the majority of the objected applicant’s subject goods in Classes 16, 18 and 25. Mr. Ling, counsel for the applicant, with limited exceptions, accepted that the respective goods are similar.

66. Mr. Ling’s exceptions are “horseshoes; clothing for pets; umbrellas”, all in Class 18 of the applicant’s specification. Mr. Wong, on the other hand, submitted the following: horseshoes is similar to sports bags; umbrellas is similar to bags and bag packs because they are travel items; and clothing for pets is covered by the broad category of “clothing, footwear, headgear”, hence is identical.

67. On my part, first, I fail to see why umbrellas is similar to bags and bag packs, nor why horseshoes is similar to sports bags. Their points of sale are different, not to mention their respective nature and function of use. As regards clothing items, the fact that the term clothing can be interpreted in various ways, for example: clothing for protection against fire (Class 9); clothing for operating rooms (Class 10); clothing for pets (Class 18); clothing for dolls (Class 28), means that they must always be defined by purpose or market sector pertaining to a particular Nice class.23 The aforesaid examples of clothing items being scattered over various classes shows that clothing in Class 25, or the broad category of “clothing, footwear, headgear”, would not cover and describe “clothing for pets” that have been correctly placed by the applicant in Class 18. The fact that Class 25 goods serve human purposes whereas Class 18 goods serve the needs of pets will put them apart in the market sector and they will not be considered similar goods.

23 See for example discussion in paragraph 100 of Mr. Justice Henry Carr’s judgment in Pathway IP Sarl v Easygroup Ltd [2019] E.T.M.R. 18. 20 68. Having regard to the above, I would say that the subject goods of the applicant and the registered goods of the opponent are either identical or similar goods, save and except “horseshoes; clothing for pets; umbrellas” in Class 18 of the applicant’s specification (the “Excepted Goods”).

Comparison of marks

69. According to consistent case law, in order to assess the degree of similarity between the marks concerned, it is necessary to determine the degree of visual, aural and conceptual similarity between them and, where appropriate, to determine the importance to be attached to those different elements, taking account of the category of goods or services in question and the circumstances in which they are marketed (see Lloyd Schuhfabrik Meyer v Klijsen Handel, paragraph 27).

70. In addition, the global assessment of the likelihood of confusion must, as regards the visual, aural and conceptual similarity of the marks in question, be based on the overall impression created by them, bearing in mind, in particular, their distinctive and dominant components. The perception of the marks in the mind of the average consumer of the goods or services in question plays a decisive role in the global assessment of the likelihood of confusion (see Sabel BV v Puma AG, para 23; Lloyd Schuhfabrik Meyer, para 25; and the order in P Matratzen Concord v OHIM (Case C-3/03), para 29). In that regard, the average consumer normally perceives a mark as a whole and does not proceed to analyse its various details (see Office for Harmonisation in the Internal Market (Trade Marks and Designs) v Shaker di L. Laudato & C. Sas, Limiñana y Botella, SL (C-334/05 P) [2007] E.C.R. I-4529 at [35] and the case law cited).

71. Whilst the comparison must be made by examining each of the marks in question as a whole, that does not mean that the overall impression conveyed to the relevant public by a composite trade mark may not, in certain circumstances, be dominated by one or more of its components (see OHIM v Shaker [2007] E.C.R. I-4529 at [41] and the case law cited). It is only if all the other components of the mark are negligible that the assessment of the similarity can be carried out solely on the basis of the dominant element (OHIM v Shaker [2007] E.C.R. I-4529 at [42]).

21 Distinctive and dominant components of the opponent’s mark MONSTER ENERGY and the subject mark

72. The opponent’s MONSTER ENERGY mark as well as the subject mark are both pure word marks. MONSTER, according to online Oxford Dictionaries, means “A large, ugly, and frightening imaginary creature” or “A thing of extraordinary or daunting size”.24 This in relation to the subject goods is neither descriptive nor indistinctive. The word can no doubt form a distinctive element of either of the marks.

73. On the other hand, ENERGY means, according to online Oxford Dictionaries, “A person's physical and mental powers” or “The strength and vitality required for sustained physical or mental activity”.25 Its use vis-à-vis a stationery, a handbag, a clothing, or indeed any articles of goods that could be included in the specifications under Classes 16, 18 and 25, is also neither descriptive nor indistinctive. But the average consumer normally perceives a mark as a whole, the distinctiveness of ENERGY is subordinate to that of MONSTER as it has connotation to the strength and vitality of the articles, or the physical or mental activity of the person, or subject matter, using such an articles. Moreover, I think the general proposition that the initial part of word marks is likely to attract the consumer's attention more than the following parts is true and applicable in the present case. MONSTER and ENERGY can both stand alone and have a distinctive significance independent of each other, the fact that MONSTER comes before ENERGY means that it is the more prominent and significant element.

74. STRIKE, according to online Oxford Dictionaries, means “Hit forcibly and deliberately with one's hand or a weapon or other implement” or simply “Inflict (a blow)”,26 is a word used to describe an action, state, or occurrence such that it must have an object to correlate – in the present case it is the so-called MONSTER. For the same reasons as ENERGY is in relation to the opponent’s mark, the significance and distinctiveness of STRIKE in the subject mark is also lesser than and subordinate to that of MONSTER.

24 https://www.lexico.com/en/definition/monster. 25 https://www.lexico.com/en/definition/energy. 26 https://www.lexico.com/en/definition/strike. 22 75. In my view, in whatever way it is seen, the word MONSTER is the most distinctive and dominant element whether it is in the opponent’s mark or the subject mark.

Visual similarity

76. Visually speaking, both the opponent’s mark and the subject mark have the word MONSTER as its most distinctive and dominant component. Although ENERGY and STRIKE are visually different from each other, they are of the same length and both follow the word MONSTER. Taking into account the overall effect, I find there is at least medium degree of visual similarity between the two marks.

Aural similarity

77. Aurally, the same consideration applies. Both marks are similar in the presence of MONSTER as their first word, and dissimilar in the second word which sounds differently. Mr. Ling submitted that the opponent’s mark is of 5 syllables whereas the subject mark is of 3 syllables. I, on the other hand, accept the general principle that given the tendency of people using the English language to slur the terminations of words, the last syllable of the subject mark is relatively less important and may not impress upon the average consumers. Taking into account that MONSTER is the most distinctive and dominant element of each of the two marks and being the first part of the mark, I find there is at least medium degree of aural similarity between them.

Conceptual similarity

78. Here we have MONSTER dominating the overall impression conveyed by the two marks concerned. To the public at large, whatever is meant for MONSTER, MONSTER ENERGY and MONSTER STRIKE both allude to the immense powers, or the physical powers, of the so-called MONSTER. There is high degree of conceptual similarity between the opponent’s mark and the subject mark.

79. Summing up from the above, as between the opponent’s mark MONSTER ENERGY and the subject mark, I find that the degree of overall similarity is that of moderate to high. 23 Distinctiveness of the opponent’s MONSTER ENERGY mark

80. A mark may be particularly distinctive either per se or because of the reputation it enjoys with the public. The more distinctive an earlier mark, the greater will be the likelihood of confusion (Sabel BV v Puma AG).

81. In determining the distinctive character of an earlier trade mark, I must make an overall assessment of the greater or lesser capacity of the mark to identify the goods or services for which it has been registered as coming from a particular undertaking, and thus to distinguish those goods or services from those of other undertakings. In making that assessment, account should be taken, in particular, of the inherent characteristics of the mark, including the fact that it does or does not contain an element descriptive of the goods or services for which it has been registered; 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 section of the public which, because of the mark, identifies the goods or services as originating from a particular undertaking; and statements from chambers of commerce and industry or other trade and professional associations (Windsurfing Chiemsee v Huber and Attenberger [1999] E.C.R. I-2779; Lloyd Schuhfabrik Meyer v Klijsen Handel [1999] E.T.M.R. 690).

82. I have summarized the opponent’s evidence at paragraphs 8 to 23, and evaluated them at paragraphs 32 to 45 above. Although I have found that by the relevant date, the composite mark or has become the distinguishing feature of the opponent’s goods of energy drinks and has acquired through them certain reputation and goodwill in such goods offered and promoted in Hong Kong, as there is no substantive use of any of the MONSTER marks on any articles of the subject goods being shown in the evidence, there is no question of distinctiveness of the opponent’s MONSTER ENERGY mark having been enhanced in the present proceedings.

Likelihood of confusion

83. The global assessment that I am required to undertake implies some

24 interdependence between the relevant factors. Thus, a lesser degree of similarity between those goods or services may be offset by a greater degree of similarity between the marks, and vice versa.

84. It has been said that the more distinctive the earlier mark, the greater the risk of confusion (SABEL, paragraph 24). Marks with a highly distinctive character, either per se or because of the reputation they possess on the market, enjoy broader protection than marks with a less distinctive character (see Canon, paragraph 18, and Lloyd Schuhfabrik Meyer, paragraph 20). I am of the view that both the words MONSTER and ENERGY are neither descriptive nor indistinctive in relation to the subject goods, hence I find it has above average inherent distinctiveness. As there is no substantive use of any of the MONSTER marks on any of the subject goods being shown in the evidence, I do not find that the opponent’s MONSTER ENERGY mark has acquired an enhanced degree of distinctive character through use in Hong Kong as far as the subject goods are concerned.

85. Counsel on both sides have cited a number of cases, both foreign and local, in which the opponent’s marks (as mark relied upon by the opponent who was also the opponent in those proceedings), including the opponent’s MONSTER ENERGY mark, are in issue. Mr. Ling, in particular, has placed great emphasis on a Singaporean decision, namely Monster Energy TM, Assistant Registrar of Trade Marks (Singapore) 12 September 2017, in which the same parties and the same marks as in the present proceedings are in contest, to urge me to adopt the view that the element “MONSTER” is not the distinctive and dominant component of either of the marks.

86. Mr. Wong was quick to point out that the trade mark law in Singapore is rather different from ours, and as a matter of law, we need evidence, or more strictly expert evidence, on the Singaporean law to address us on the difference between the Singaporean trade mark law and the Hong Kong trade mark law before we could safely consider the Singaporean decision.

87. Whilst I profess no expertise on Singaporean trade mark law, a quick glance at the Singaporean decision reveals that the test for likelihood of confusion in Singapore is known as the “step by step test”. I have no idea whether this “step by step test” is more or less the same or quite different from the “global appreciation”

25 test I have discussed above and which forms the basis of our analysis and evaluation of the marks in issue. I agree with Mr. Wong that it is unsafe to consider the Singaporean decision without a full understanding of their law and thinking underlying their analysis and evaluation of the marks concerned.

88. As for the other cited cases, irrespective of whether they are foreign or local, I would say that each has its own peculiar facts and circumstances to consider, not to mention that the marks in question or the goods concerned are different from the present ones. They are at best of reference value only.

89. I now come back to the present case. As between the subject mark and the opponent’s MONSTER ENERGY mark, I have found that there is at least medium degree of similarity from the visual and aural perspectives, and high degree of similarity from the conceptual perspective. In sum, I consider that they are moderate to high degree similar. Regarding the subject goods of the applicant and the registered goods of the opponent, I have found that they are either identical or similar goods, save and except the Excepted Goods, namely “horseshoes; clothing for pets; umbrellas” in Class 18 of the applicant’s specification. I am also of the view that the opponent’s MONSTER ENERGY mark has above average inherent distinctiveness insofar as the subject goods are concerned, even though it has not acquired an enhanced degree of distinctive character through use in Hong Kong.

90. The question I have to ask is: under the circumstances, is there risk that the average consumers recognizing the opponent’s MONSTER ENERGY mark used in relation to the subject goods would upon seeing the subject mark being used on the same goods think that they come from the same or economically-linked undertakings as the opponent’s?

91. I think the answer is clear. Taking all of the above into account, I think the risk of confusing the subject mark with the opponent’s MONSTER ENERGY mark is high if consumers were presented with the subject goods which I found to be identical or similar to those offered by the applicant save and except the Excepted Goods. There is a likelihood of confusion within the meaning of section 12(3) of the Ordinance (Canon Kabushiki Kaisha v Metro-Goldwyn-Mayer Inc., op. cit.).

26 92. It follows that the ground of opposition under section 12(3) succeeds in respect of the subject goods in Classes 16, 18 and 25 save and except the Excepted Goods.

93. As I have found in favour of the opponent on the ground of opposition under section 12(3) of the Ordinance in respect of most of the subject goods but fails in respect of the Excepted Goods in Class 18, it is necessary for me to go on to consider the other grounds of opposition.

Section 12(5)(a) of the Ordinance

94. Section 12(5)(a) of the Ordinance provides as follows :

“… a trade mark shall not be registered if, or to the extent that, its use in Hong Kong is liable to be prevented –

(a) by virtue of any rule of law protecting an unregistered trade mark or other sign used in the course of trade or business (in particular, by virtue of the law of passing off); or

(b) …

and a person thus entitled to prevent the use of a trade mark is referred to in this Ordinance as the owner of an “earlier right” in relation to the trade mark.”

95. Section 12(5)(a) concerns the protection of “an unregistered trade mark or other sign used in the course of trade or business” by virtue of the law of passing off vis-à-vis the mark in suit. Nevertheless, there is nothing to prohibit against reliance on this section even if the mark or sign concerned is also a registered mark.

96. A helpful summary of the elements of an action for passing off can be found in Halsbury’s Laws of Hong Kong Vol 15(2) at paragraph 225.001:

“The House of Lords has restated the necessary elements which a plaintiff has to establish in an action for passing off:

27 (1) the plaintiff’s goods or services have acquired a goodwill or reputation in the market and are known by some distinguishing feature;

(2) there is a misrepresentation by the defendant (whether or not intentional) leading or likely to lead the public to believe that goods or services offered by the defendant are goods or services of the plaintiff; and

(3) the plaintiff has suffered or is likely to suffer damage by reason of the erroneous belief engendered by the defendant’s misrepresentation.

The restatement of the elements of passing off in the form of this classical trinity has been preferred as providing greater assistance in analysis and decision than the formulation of the elements of the action previously expressed by the House of Lords. However, like the previous statement of the House of Lords, this latest statement should not be treated as akin to a statutory definition or as if the words used by the House of Lords constitute an exhaustive, literal definition of ‘passing off’, and in particular should not be used to exclude from the ambit of the tort recognized forms of the action for passing off which were not under consideration on the facts before the House of Lords.”

97. The guidance takes account of speeches in the House of Lords in Reckitt & Colman Products Ltd v Borden Inc [1990] R.P.C. 341 and Erven Warnink BV v J Townend & Sons (Hull) Ltd [1979] A.C. 731. These elements have also been repeatedly relied upon by the courts in Hong Kong including the Court of Final Appeal in Re Ping An Securities Ltd.27

98. Normally, the question I have to ask is whether normal and fair use of specific opponent’s marks in Hong Kong for the purpose of distinguishing the goods of interest to the applicant from those of other undertakings was liable to be prevented at the date of application for registration by an action for passing off protecting the relevant opponent’s mark (see the decision of Geoffrey Hobbs QC, sitting as the Appointed Person, in the case of WILD CHILD Trade Mark [1998] R.P.C. 455).

99. As I have found from the opponent’s evidence (see paragraphs 32 to 45) above, by the relevant date, the composite mark or has become the distinguishing feature of the opponent’s goods of energy drinks and has acquired

27 Ping An Securities Limited v 中國平安保險(集團)股份有限公司 (2009) 12 HKCFAR 808 (FACV 26/2008) 28 through them certain reputation and goodwill in such goods offered and promoted in Hong Kong. On the other hand, there is no substantive use of any of the MONSTER marks on any of the subject goods being shown in the evidence. I am therefore satisfied that as at the relevant date, the opponent has goodwill in Hong Kong in relation to the MONSTER energy drinks, which is known to the public by association with the composite mark or .

Goodwill, Misrepresentation and Damage

100. Conduct which the court may regard as calculated unfairly to prejudice the goodwill of another in his business may take many varied forms. If a defendant's conduct has been such as to mislead members of the public into a mistaken belief that the goods or services of the defendant or the defendant's business are or is either (a) the goods or services or business of the plaintiff or (b) connected with the plaintiff's business in some way which is likely to damage the plaintiff's goodwill in that business, the defendant will be liable to be held to have committed the tort of passing off.28

101. As the evidence shows, the opponent’s field of activity is in the business of designing, creating, developing, producing, marketing and selling energy drinks and other beverages such as natural sodas, fruit juices, iced teas etc. This is not the same field as the applicant’s perceived field of activity in the subject goods, nor is it the same filed as the applicant has actually engaged,29 in the promotion and advertising of smartphone game, namely “MONSTER STRIKE” in which players flick away their own “Monster” and “strike” an enemy “Monster”. The subject mark “MONSTER STRIKE” was adapted with an aim to convey the key features of the game plainly and simply, and to allow users to better recognize or understand the game easier.

102. I do not think the applicant’s smartphone game can be considered similar goods to that of the opponent’s energy drinks, nor that they can be put in the same field of business activities.

28 Bulmer v Bollinger [1978] RPC 79 at 99. 29 Please see my summary of the applicant’s evidence in paragraphs 24 to 31 above. 29 103. As the learned editors of Kerly’s Law of Trade Marks and Trade Names, 15th Edition noted at paragraphs 18-106 and 18-107, there is a heavy burden on a claimant to prove misrepresentation where a defendant and a claimant operate in different fields of activities:-

“There is no rule that the defendant must operate in the same field of activity as the claimant. However, this does not mean an examination of their respective fields of activity is irrelevant. The more remote the activities of the parties, the stronger the evidence needed to establish misrepresentation and the real likelihood of damage that are prerequisites of a right of action in passing off. ... this is a question of fact to be determined in the circumstances of the particular case…

It may be said generally that establishing passing off by goods in which the claimant does not trade calls for special evidence to establish that the defendant’s actions will induce the belief, if not that his goods are those of the claimant at least that his business is an extension of or somehow connected with that of the claimant, or his goods somehow approved or authorized by the claimant. Where the fields of activity of the parties are different, the burden of proving that the defendant causes real likelihood of damage to the claimant is a very heavy one…” [all footnotes omitted]

104. I have already discussed about the reputation and goodwill of the opponent’s marks in Hong Kong, which I found to be only in relation to the composite mark

or as used on energy drinks. I do not think the reputation and goodwill associated with the composite mark would spill over to the general purchasing public of smartphone game, nor that of any of the subject goods which scattered all over Classes 16, 18 and 25.

105. Moreover, it could hardly be said that the opponent has produced in the present case any evidence which could show the existence of any misrepresentation. In Re Ping An Securities Ltd, the court implicitly acknowledged that the “global assessment” test is, in substance, the same as the requirement in passing off to consider the likelihood of false representation or deception in all the circumstances, though there was no occasion to pursue the matter further in that case.30 I have analyzed the likelihood of confusion between the opponent’s MONSTER ENERGY mark which is a plain word mark, and the subject mark under the global appreciation

30 (2009) 12 HKCFAR 808 at 818 [19] 30 test. I have found that there is at least medium degree of similarity from the visual and aural perspectives, and high degree of similarity from the conceptual perspective.

But that would certainly not be the case between the composite mark or and the subject mark, their similarity would be much less especially in respect of the visual aspect given the presence of the claw device and the representation of the word MONSTER in stylized fashion. I would say their overall similarity could at most be said to be low to average.

106. It follows from all of the above that there is no relevant goodwill or reputation of the opponent’s word mark which could be damaged by any misrepresentation (if any) on the part of the applicant, reputation and goodwill associated with the opponent’s composite mark would unlikely spill over to the general purchasing public of the applicant’s field of activities and the subject goods, and the degree of similarity between the opponent’s composite mark and the subject mark is at most low to average. The ground of opposition under section 12(5)(a) therefore is not made out.

Section 12(4) of the Ordinance

107. Section 12(4) of the Ordinance provides as follows:

“(4) Subject to subsection (6), a trade mark which is-

(a) identical or similar to an earlier trade mark; and (b) proposed to be registered for goods or services which are not identical or similar to those for which the earlier trade mark is protected,

shall not be registered if, or to the extent that, the earlier trade mark is entitled to protection under the Paris Convention as a well-known trade mark and the use of the later trade mark without due cause would take unfair advantage of, or be detrimental to, the distinctive character or repute of the earlier trade mark.”

108. Section 12(4) of the Ordinance, like section 12(3), requires the existence of an earlier trade mark which is identical or similar to the mark in question. Moreover,

31 section 12(4) requires that the earlier trade mark is entitled to protection under the Paris Convention as a well-known trade mark.

109. For the case of section 12(3) of the Ordinance, the opponent’s plain word mark MONSTER ENERGY is taken to be the earlier trade mark. But that mark must also be a well-known trade mark for the purposes of section 12(4). This is impossible given that there is no substantive use of the plain word mark MONSTER ENERGY on any goods in Hong Kong being shown in the evidence.

110. On the other hand, I have found that, by the relevant date, the composite mark or (this composite mark, in either version of its representation, is referred to in this section as the “opponent’s Composite Mark”) has become the distinguishing feature of the opponent’s goods of energy drinks and has acquired through them certain reputation and goodwill in such goods offered and promoted in Hong Kong.

111. Section 4 of the Ordinance provides that a trade mark which is entitled to protection under the Paris Convention as a well-known trade mark shall be construed as references to a trade mark which is well known in Hong Kong, and further provides that in determining whether a trade mark is well known in Hong Kong, the Registrar or the court shall have regard to Schedule 2 to the Ordinance.

112. Although the opponent launched its MONSTER energy drink in the United States in 2002, the drink was not launched in Hong Kong until April 2012, which was less than 4 years before the relevant date. Worldwide gross sales increased from US$1.95 billion in 2011 to US$3.11 billion in 2015,31 and more than 2.9 million cans of MONSTER energy drinks had been sold in Hong Kong from April 2012 to December 2015 amounting to sales of approximately US$2.9 million.32 However, there is no indication whether such sales figures constitute a significant portion of the Hong Kong market for energy drinks during the material times.

113. Although the opponent’s Composite Mark has been promoted through the opponent’s sponsoring international sports events and teams and athletes participating

31 Sacks’ 1 st Declaration, paras 8-12 & 17. 32 Sacks’ 1 st Declaration, para.13. 32 in these events, and had received tremendous exposure on the Internet, television and magazines, newspapers, social media through the sponsorship of numerous sportsmen, sports events, musicians, music festivals etc., the majority of the evidence are reports, screenshots, photos, printouts from social media relating to events, competitions and promotions, which took place outside Hong Kong. It is not clear if the broadcast or webcast of sports events such as Formula 1 were available to consumers in Hong Kong or if so, the extent to which those events were broadcasted or viewed in Hong Kong, the number of viewers in Hong Kong of such events (or through which media) and the extent of recognition with regard to the Opponent’s products or trade marks.. There is no evidence that the average TV viewer watching the relevant events would likely be looking out for the opponent’s Composite Mark (which is only one amongst the many other marks of various sponsors) than going through photographs and stills of the relevant events in the evidence in this case.

114. There is simply no direct evidence of the degree of knowledge or recognition of the opponent’s Composite Mark in the relevant sectors of the public, nor evidence of the value associated with the composite mark.

115. Having regard to the totality of the opponent’s evidence filed in these proceedings and all relevant factors for consideration in accordance with section 1, Schedule 2 to the Ordinance, I do not find that the opponent has successfully established that the opponent’s Composite Mark is well known in Hong Kong at the relevant date.

116. Moreover, even assuming that the opponent’s Composite Mark is considered to be well-known under section 12(4), the opponent will need to satisfy the condition that there must be a degree of similarity between the opponent’s Composite Mark and the subject mark such that the relevant section of the public establishes a link between them, even though it does not confuse them (Adidas-Salomon AG v Fitnessworld Trading Ltd [2004] ETMR 10). The existence of such a link must be appreciated globally, taking into account all factors relevant to the circumstances of the case, including the degree of similarity between the conflicting marks; the nature of the goods or services for which the conflicting marks were registered, the degree of closeness or dissimilarity between those goods or services, and the relevant section of the public; the strength of the earlier mark’s reputation; the degree of the earlier

33 mark’s distinctive character, whether inherent or acquired through use; and the existence of likelihood of confusion on the part of the public (Adidas-Salomon (supra); Intel Corporation Inc. v CPM United Kingdom Ltd. [2009] R.P.C. 15 at paragraph 42).

117. I am of the view that between the opponent’s Composite Mark and the subject mark, their similarity could at most be said to be low to average. Given such level of similarity, it is unlikely that when the subject mark is used in relation to the subject goods, it would call to mind the opponent’s Composite Mark in the minds of the relevant consumers, hence a link between them.

118. It follows that the ground of opposition under section 12(4) is not made out.

Conclusion

119. As the opponent has been successful in this opposition under section 12(3) of the Ordinance in the majority of the subject goods in Classes 16, 18 and 25 save and excepted the goods of “horseshoes; clothing for pets; umbrellas” in Class 18 of the applicant’s specification, I award the opponent costs. Subject to any representations, as to the amount of costs or calling for special treatment, which either the opponent or the applicant makes within one month from the date of this decision, costs will be calculated with reference to the usual scale in Part I of the First Schedule to Order 62 of the Rules of the High Court (Cap. 4A) as applied to trade mark matters, unless otherwise agreed.

(Frederick Wong) for Registrar of Trade Marks 3 December 2019

[Postscript: this decision has been corrected by Corrigendum of 21 August 2020 issued by the Registrar.]

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