Choice Hotels Inc (CHI) partially succeeded in its opposition to registration of Kenneth Smith’s trade mark ALPINE COMFORT CO in New Zealand, in a case which demonstrates the strengths of New Zealand’s “reverse onus” opposition ground.[1]
In this case CHI’s opposition was based upon its use and registration of various -COMFORT- trade marks, which were registered in class 43 for a range of hotel and motel services. The applicant, Mr Smith, sought registration of his trade mark ALPINE COMFORT CO for a range of services including business consultancy (class 35), construction (class 37) and the provision of holiday accommodation (class 43).
What is New Zealand’s “reverse onus” opposition ground?
Section 17(1)(a) of the New Zealand Trade Marks Act 2002 prohibits registration of a trade mark if its use would be likely to deceive or cause confusion. This provision is often relied upon by opponents in New Zealand trade mark oppositions due to the curious way in which it is assessed and applied in New Zealand opposition proceedings.
Specifically, once the opponent has demonstrated an “awareness” in its trade mark the onus shifts to the trade mark applicant to prove that its use of the trade mark would not be likely to deceive or cause confusion – aka the “reverse onus” opposition ground.
The “awareness” which the opponent needs to demonstrate in its own trade mark does not need to relate to the same or similar goods or services as those of the opposed mark, and the requisite level of awareness that is required is much lower than that required to establish that the opponent’s trade mark is well-known. In addition, the onus on the applicant can be quite difficult to discharge as it requires proof of a negative, namely, that its use of the trade mark will not deceive or confuse. This can be difficult to establish, particularly if the applicant has not commenced use of its trade mark in New Zealand.
In this case, Assistant Commissioner Robb concluded:[2]
Stepping back and considering the overall identity of the trade marks and how they will be encountered in the normal course of trade I consider a consumer knowing or aware of the mark COMFORT for hotel and motel services may well be confused as to whether ALPINE COMFORT CO is an offering from Choice Hotels targeting an alpine location or is some other way associated with the COMFORT business of Choice Hotels.
However, the Assistant Commissioner was not convinced that the same risk of confusion applied to the Applicant’s services in classes 35 and 37, noting that “Mr Smith might provide his services to hotel and motel businesses but the link is tenuous and of little significance to the overall assessment of likely deception or confusion”.[3]
CHI’s trade mark registrations did not provide successful opposition grounds
CHI also relied upon several of its New Zealand trade mark registrations containing the word “comfort” in a stylised form in class 43, along with related word mark registrations for the trademarks COMFORT INN and COMFORT RESORT.
Assistant Commissioner Robb concluded that Mr Smith’s services in classes 35 and 37 were not the same as or similar to those covered by CHI’s trade mark registrations. However, there was clear overlap between CHI’s class 43 trade mark registrations and Mr Smith’s class 43 services. Whilst the Assistant Commissioner did conclude there is some similarity between CHI’s registered -COMFORT- marks and the trade mark ALPINE COMFORT CO, he noted that:[4]
A finding of a similarity of trade marks and services does not inevitably lead to a finding of deception or confusion. It is the interrelationship between the degree of similarity between the respective trade marks and services, in the context of the surrounding circumstances, that answers the question of whether use of ALPINE COMFORT CO will be likely to deceive or confuse.
He then went on to conclude as follows:[5]
Looking at each trade mark registration in turn I conclude that the use of ALPINE COMFORT CO is not likely to cause deception or confusion. In general terms this is because of the limited distinctiveness the word COMFORT has in relation to accommodation and related services. The words ALPINE and CO, like INN, SUITES and RESORT, cannot simply be ignored and they play a part in Mr Smith’s mark as a whole.
The 
, COMFORT INN and COMFORT RESORT registrations all convey the idea of a place. On the other hand the use of CO in Mr Smith’s mark conveys the idea of a company. The difference between a place and an entity has some relevance when considering each of the trade marks. The idea of an ALPINE region is also relevant but not as significant as CO. I have not lost sight of the similarity that COMFORT brings to the respective trade marks. Accommodation and related services are not snap purchases. The consumer will pay some attention when booking accommodation.
The word marks COMFORT INN and COMFORT RESORT are problematic for Mr Smith, but even so I consider on the balance of probabilities deception or confusion is not likely.
A good example of the “reverse onus”
This case demonstrates how a trade mark opponent can rely on New Zealand’s “reverse onus” opposition ground to successfully oppose registration of a trade mark – an outcome that would not necessarily have been achieved if the same fact situation existed in Australia. It also demonstrates the benefit of including this reverse onus ground in New Zealand trade mark oppositions, even if an opponent has prior trade mark registrations upon which it can rely in a New Zealand opposition.
[1] Kenneth Smith v Choice Hotels International, Inc. [2024] NZIPOTM 35 (23 September 2024)
[2] Ibid at [54]
[3] Ibid at [49]
[4] Ibid at [73]
[5] Ibid at [74]-[76]