Intellectual Property Law Update - A Classic Case: The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963)

Intellectual Property
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Esso was the owner of two registered trade marks consisting of a “grotesque drawing of a person with a head in the shape of a drop of oil which has just fallen from a container and by reason of its viscosity is drawn out to an asymmetrical peak at the top“. 

Background

Court: High Court of Australia

Bench: Dixon CJ, McTiernan, Kitto, Taylor & Owen JJ. (Appeal from decision of Windeyer J).

Date of judgment: 26 July 1963.

Esso was the owner of two registered trade marks consisting of a “grotesque drawing of a person with a head in the shape of a drop of oil which has just fallen from a container and by reason of its viscosity is drawn out to an asymmetrical peak at the top“.  See image below:

Gardiner-Ben-Esso-Trade-Mark.gif#asset:3


The respondent, Shell, used an animated humanised oil drop in two short films advertising its petrol.  The trial judge, Windeyer J, observed that “[b]oth films demonstrate how much animated inanity can be packed into sixty seconds.”

First instance decision (Windeyer J): 

It is interesting to note that despite being reversed 5:0 on appeal, it is Windeyer J’s comments at the trial level in relation to substantial identity and deceptive similarity, rather than the deliberations of the Full Court in relation to “use as a trade mark“, that are more often cited in modern trade marks litigation.

Substantial identity

In relation to the test for substantial identity, Windeyer J said:

In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison.

His Honour found that while it may be that certain frames of the films may be substantially identical to Esso’s marks, the film “does not stand still” and the figure depicted does not hold its pose or expression for long enough to establish infringement by the use of a substantially identical mark.

Deceptive similarity

His Honour went on:

“On the question of deceptive similarity a different comparison must be made from that which is necessary when substantial identity is in question. The marks are not now to be looked at side by side. The issue is not abstract similarity, but deceptive similarity. Therefore the comparison is the familiar one of trade mark law. It is between, on the one hand, the impression based on recollection of the plaintiff’s mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant’s television exhibitions.”

Windeyer J considered “that the oil drop man in each of the films is at various stages so similar in  body, build and expression to the plaintiff’s mark that confusion is likely to arise“.  Thus, he concluded the marks were deceptively similar.

Use as a trade mark

Windeyer J considered that use “in the course of trade, in relation to goods in respect of which the trade mark is registered” was sufficient to constitute “use as a trade mark” for the purposes of infringement. He considered that Shell’s use met this test and therefore infringement was made out.

The Full Court disagreed.  Kitto J (with whom the other judges agreed) assumed for the purposes of his judgment that, in the course of Shell’s advertising, its animated figure “takes on, at least for a moment or two now and then, an appearance substantially identical with that of the trade marks“.  He explained, however, that “the context is all-important, because not every use of a mark which is identical with or deceptively similar to a registered trade mark infringes the right of property which the proprietor of the mark possesses in virtue of the registration.”  The issue was whether Shell’s use was use “as a trade mark“.

His Honour  considered that the statutory  definition of the word “trade mark” in the Trade Marks Act 1955 (Cth) “may be expanded so that the question becomes whether, in the setting in which the particular pictures referred to were presented, they would have appeared to the television viewer as possessing the character of devices, or brands, which the appellant was using or proposing to use in relation to petrol for the purpose of indicating, or so as to indicate, a connexion in the course of trade between the petrol and the appellant. Did they appear to be thrown on to the screen as being marks for distinguishing Shell petrol from other petrol in the course of trade?” (Emphasis added).

While accepting that Shell’s use of its oil man animation was to convey a particular message about its petrol, Kitto J did not consider that a viewer of Shell’s animation would consider that oil drop figure had been chosen to identify the brand source of the petrol in relation to which it was used.  Thus, he considered that the “purpose and nature” of the use complained of was not trade mark use and so the infringement action failed.

*Ben Gardiner has an online blog, Noth Pole Bananas, in which he discusses recent intellectual property cases in Australia. 

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Ben Gardiner practises primarily in intellectual property litigation

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