Global reputation of Tivo mark leads to cancellation of Vivo
In Tivo Inc v Vivo International Corporation Pty Ltd ( FCA 252, March 19 2012), the Federal Court of Australia has ordered that the registration of the VIVO mark be cancelled and that the mark be removed from the register.
TiVo Inc bought proceedings against Vivo International Corporation Pty Ltd and its director and shareholder Fabio Grassia for trademark infringement and for removal of Vivo’s trademark from the register.
Vivo counterclaimed for removal of TiVo’s registration insofar as it related to televisions. The case raised many issues; one might say it almost covered the field of issues which might arise in trademark disputes.
TiVo was a pioneer producer of digital video recorders (DVRs). It is the owner of Australian trademark registrations for TIVO and a TIVO logo for a range of goods and services in Classes 9, 35, 38 and 41 of the Nice Classification, including televisions, dating from November 2000. Vivo owns the registered trademark VIVO with a flash device in Classes 9 and 38 for apparatus for use in audio visual communication and transmission of data by audio visual apparatus, respectively, dating from February 18 2008.
TiVo appointed a distributor for Australia in March 2007, but did not directly market its DVRs in Australia until July 2008. However, it was able to show the following:
- From as early as July 2000, TiVo DVRs had been acquired by Australians and modified for use in Australia.
- In 2002 and 2003 an Australian TiVo enthusiast established a website at ‘oztivo.net’ and developed an electronic program guide (EPG) for use with TiVo DVRs in Australia, which he supplied through that site. By October 2007, over 1,200 TiVo enthusiasts were accessing the EPG data.
- Prior to February 2008, over 600 articles were published in Australian media referring to TiVo, and TiVo was referred to in over 86 million copies of newspapers and magazines circulating in Australia.
- TiVo was referred to – and, in many cases, described – in five films and 19 episodes of TV programmes shown in Australia with viewings in excess of 25 million.
- Over 42,000 web pages containing the word ‘TiVo’ were published in Australia.
- There was some evidence of actual confusion between TIVO and VIVO in 2010.
TiVo commenced marketing television sets incorporating the TiVo technology in the United States in July 2011. It has not sold televisions in Australia, but said that it had plans to do so.
Vivo markets in Australia low-cost television receivers, home theatre systems, set top boxes, portable DVD players and peripherals such as monitors and remote controls. It commenced sale of VIVO-branded televisions in 2007. Up to mid-2011, it had sales to the value of more than A$85 million; of this, A$1 million was prior to its filing of its trademark application on February 18 2008. The vast majority of the sales was in respect of televisions.
Vivo’s sale of televisions and other goods clearly fell within the scope of TiVo’s registration, but Vivo was protected by Section 122(1)(e) of the Trademarks Act, which provides that it is not an infringement to use a trademark in the exercise of a right given under the act. To succeed in its action for infringement, TiVo had first to remove Vivo’s registration. To do that, it needed to show that:
- VIVO was deceptively similar to TIVO and the goods covered by Vivo’s registration were the same, or of the same description, as those covered by TiVo’s registration (Section 44(1)); and/or
- TIVO had acquired a reputation in Australia, and the use of VIVO would be likely to deceive or cause confusion, at the date of Vivo’s application (Section 60) or at the date of commencement of the proceedings (Section 88(2)).
To succeed in its defence, Vivo had to show either:
- that VIVO was not deceptively similar to TIVO; or
- that it was, as of February 18 2008, entitled to registration on the grounds of honest concurrent use or other circumstances; and
- that its use was not likely to deceive or cause confusion; or
- that TiVo’s registration should be removed from the register in respect of televisions and similar goods on the ground of non-use.
To defend its registration, TiVo had to persuade the court to exercise its discretion under Section 101(3) of the act to allow the mark to remain on the register on the grounds that, in all the circumstances and, in particular, its use of the mark on goods of the same description, it was reasonable to do so.
TiVo succeeded on almost all issues. Despite the visual effect of the difference between the initial lettering of the words ‘tivo’ and ‘vivo’, the court considered the aural effect of the ‘ivo’ component likely to be of greater significance and found the marks to be deceptively similar. The court also took into account evidence of product convergence, the circumstances of purchasers’ reliance on verbal recommendations of sales persons, the evidence of confusion and, in the court’s view, Grassia’s awareness of TIVO at the time of his adoption of the VIVO mark.
Accordingly, the registration should be cancelled, unless Vivo could establish honest concurrent use. Vivo failed to establish honest concurrent use based largely on the court’s finding that, contrary to Grassia’s evidence, he was aware of the TIVO mark and its reputation when he adopted the VIVO mark and chose it “to secure associated advantages”.
The court also found that, as at February 18 2008, extensive references to TiVo in Australian media and entertainment sources were such that TIVO had acquired a reputation in Australia. Therefore, the use of VIVO would be likely to deceive or cause confusion, and the mark was thus liable to cancellation on that ground (Section 60); similarly, at the time of the application for cancellation, it was likely to deceive or cause confusion (Section 88(2)(c)).
Vivo was also unsuccessful in its attempt to remove TiVo’s registration on the ground of non-use. TiVo was able to persuade the court to exercise its discretion to allow the registration to remain. The court took into account that TiVo had not abandoned its mark in respect of televisions; it had used the mark on televisions in the United States and had plans to do so in Australia. It also considered that:
whilst TiVo has not used the TIVO trademark for the requisite period, the excision of televisions from TiVo’s registration would, particularly in the context of converging functionality, create a potential for fragmented ownership of deceptively similar goods (sic), with a concomitant likelihood of confusion.
In the light of the above findings, the court found that, upon removal of the registration of VIVO from the register, use of the mark on televisions and related goods would infringe TiVo’s registration.
The judgment of the court was extensive, running to over 120 pages, and dealt in detail with the facts and principles underlying its findings. Other matters decided in the case included a finding that Grassia was not personally liable as a joint tortfeasor. The evidence did not establish that the company was merely his alter ego.
Vivo has filed notice of appeal against the court’s finding that:
- VIVO is deceptively similar to TIVO;
- TiVo had established a reputation in Australia at February 28 2008;
- use of VIVO was likely to deceive or cause confusion; and
- Vivo had failed to establish honest concurrent use.
Vivo has not appealed the court’s decision in relation to non-use of TIVO for televisions.
This article by DCC consultant Des Ryan first appeared on WTR Daily, part of World Trademark Review, in April 2012. For further information, please go to www.worldtrademarkreview.com.