Monster Energy Company v Mixi Inc

[2020] FCA 1398

This was an appeal by Monster Energy Company (“MEC”) from a decision of the Registrar. The Registrar had refused MEC’s opposition to an extension of protection in Australia to International Registration Designating Australia (“IRDA”) no. 1242941 for the trade mark MONSTER STRIKE for a large array of goods and services in classes 9 and 41, including electronic games and gaming. The trade mark applicant (“Mixi”) publishes a downloadable video game called Monster Strike.

MEC opposed the registration of Mixi’s MONSTER STRIKE mark on the grounds set out in s 42(b) (use of the mark would be unlawful) and s 60 (by reason of a reputation in another mark, use of the mark would deceive), of the Trade Marks Act 1995 (Cth).

The relevant date at which the grounds of opposition was to be established was 27 December 2013. As at this date, MEC’s principal, and almost exclusive, goods that were traded in Australia using the relevant trade marks were energy drinks. The marks use the word MONSTER, usually in conjunction with the word ENERGY and also with device marks, principally the M (claw) device. MEC’s traded goods were not computer or video games. However, MEC had undertaken extensive marketing and promotion of its trade marks, including by way of sponsorship, in relation to activities that are of substantial interest to the likely target audience of the designated products and services of Mixi’s MONSTER STRIKE mark, including gaming, eSports, certain genres of music and extreme sports.

The bulk of the decision considers the opposition under s 60, with a very detailed analysis of all of the evidence of use relied upon by MEC. The case includes a detailed analysis of what is meant by reputation for the purposes of s 60 (and relatedly s 42(b)), acknowledging that reputation can be proven by a number of means and that it goes beyond mere examination of sales or turnover of goods sold under the trade mark and contemplation of the advertising and promotional figures. Justice Stewart referred to both the recognition component of reputation and the esteem component. He also acknowledged that brand recognition does not depend on direct advertising, noting that indirect advertising must be given proper consideration.

A number of witnesses in this case had been witnesses in the earlier case of Rodney Jane Racing Pty Ltd v Monster Energy Company [2019] FCA 923. Mixi urged Stewart J to make a number of similar findings of fact to findings that were made in that case. His Honour refused to do so, noting that the bulk of the evidence in the two cases was not the same. Nevertheless, his Honour’s conclusions in this case are not dissimilar to those of O’Bryan J in Rodney Jane (that case now being on appeal).

In this case, Stewart J (not to be confused with Steward J who will shortly join the High Court) analysed in detail all of the evidence relied upon by MEC to establish its reputation in its various MONSTER marks, including sales and distribution, marketing approach and spend. In relation to the latter, MEC spends the majority of its advertising, marketing and promotions budget on athlete, gamer and musician endorsement and sponsorship of sporting competitions, eSports competitions and music festivals. Specifically, Justice Stewart examined evidence of use of the various MONSTER marks in relation to a gaming website and social media, sponsored games and in-game use of marks, gaming promotions, sponsorship of teams and athletes, sponsorship of eSports tournaments and gaming content creators, hospitality and sampling, social media, extreme sports, music sponsorship, apparel and merchandise. His Honour noted that in more than 3,000 pages of tendered material, including thousands of pages of photographs and screenshots, while there were examples of the word MONSTER used on its own by MEC, it was not used as a brand or trade mark but as a shorthand or abbreviated reference to MONSTER ENERGY, “which is really the brand that has a strong reputation”.

Justice Stewart dismissed the s 60 case concluding: the MEC marks in question, being the claw device and the term MONSTER ENERGY, had a strong and distinctive reputation in relation to energy drinks, and while its reputation was also strong and distinctive within the gaming, eSports, extreme sports and “edgy” music spheres, the reputation was in relation to energy drinks and not of a trader in goods and services in those spheres themselves; there were distinctive differences between the relevant marks and the relevant opposing marks, which almost always include the key elements of the device marks, being the M icon (claw), the stylised MONSTER word and the word ENERGY; many other traders had registered or sought to register marks in relation to video and computer games and gaming software that included in their marks the word MONSTER and this detracts from the confusion that MEC submits will arise from the use of the MONSTER STRIKE mark in that market; the relevant group of consumers is generally brand-savvy and not gullible or easily confused; and there was no evidence of actual confusion.

Unsurprisingly the opposition under s 42(b), based on ss 18 and 29 of the Australian Consumer Law, also failed. In this regard, Stewart J noted that an opposition under s 60 was less exacting than under s 42(b) and that MEC put no submissions in support of its case under s 42(b) that it did not put in support of its s 60 case, stating “a real question arises as to why the s 42(b) case was run at all”.

 

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