In the recent case of Hearst Communications, Inc. v Toyota Motor Corporation Australia  Ltd [2015] ATMO 36 (4 May 2015), Hearst successfully opposed registration of Toyota’s COSMOPOLITAN trade mark on the ground that Toyota’s application was filed in bad faith.

On 12 August 2010, the Toyota Motor Corporation Australia Limited (‘Toyota’) applied to register the word ‘COSMOPOLITAN’ as a trade mark in respect of ‘Automotive Paints’ and ‘Motor vehicles, and parts and accessories for motor vehicles’.

The US company Hearst Communications, Inc. (‘Hearst’), who is the owner of the international fashion magazine Cosmopolitan and various trade marks for COSMOPOLITAN, opposed Toyota’s trade mark application pressing grounds under sections 43, 59, 60 and 62A of the Trade Marks Act 1995.

ACP Magazines (licensee of Hearst’s Cosmopolitan marks) and Toyota partnered for Australian advertising campaigns in 2009 and 2010. During this time, the advertisements for the Toyota Yaris were featured on the Cosmopolitan website, and many advertisements featured brands from both parties. In July 2010, Toyota wrote to the Editor of Cosmopolitan magazine informing them of their intention to use the name ‘Cosmopolitan’ as the name of a new colour for the Yaris and to apply to register the paint colour name as a trade mark. Toyota did not receive a response to that letter.

In brief, the main arguments from Hearst in opposing the registration were as follows:

  • Section 43 – ‘Cosmopolitan’ contained a likely connotation that there was an implied or inherent sponsorship between Hearst and Toyota which was likely to cause confusion.
  • Section 59 – At the application date, Toyota did not have a bona fide intention to use the trade mark in respect of ‘Motor vehicles, and parts and accessories for motor vehicles’. Hearst was relying on  the correspondence sent to the Editor of Cosmopolitan magazine by Toyota in 2010 pointing to an intention to use COSMOPOLITAN for a paint colour, but not for motor vehicles or their parts.
  • Section 60 – Hearst enjoyed a solid reputation for the trade mark Cosmopolitan, and the use of Cosmopolitan by Toyota would be likely to lead to confusion or deception.
  • Section 62 A – This ground of opposition was pursued on the basis of the prior business relationship and advertising campaign, the reputation  of the Cosmopolitan trade mark and its purported associated reputation in the colour pink, and the prior correspondence from Toyota advising of their intention to apply for the trade mark COSMOPOLITAN.

The grounds of opposition based on Sections 43, 59 and 60 were not upheld by the Hearing Officer. The Hearing Officer relied in particular on the fact that the respective industries in which the parties operated were different.

Under the Section 43 ground, it was held that there was no relevant connotation within the trade mark, as ‘Cosmopolitan’ is an ordinary English word.

Hearst’s argument that Toyota did not intend to use the trade mark (Section 59) was also refuted. According to the Hearing Officer, use of the trade mark in relation to some of the goods and not others did not by itself establish a lack of intention to use it on all the goods. In any event, it was held that use of COSMOPOLITAN as the name of a colour of the vehicle was also sufficient to constitute  use ‘upon or in relation to “automotive vehicles and their parts”’.

Moreover, Hearst did not convince the Hearing Officer that there was a likelihood of deception or confusion (under Section 60), and noted  that the parties are ‘very well-known in their respective industries’ and that deception or confusion arising from the use of the COSMOPOLITAN was unlikely.

Hearst was however successful on the Section 62A bad faith ground.

While the Hearings Officer was not satisfied that the conduct of Toyota amounted to  fraud or dishonesty, he was satisfied that it amounted to bad faith, having regard to all of  the surrounding circumstances and noted that:

  • The existence of the letter from Toyota dated July 2010 was undoubtedly an acknowledgement that Toyota was aware that applying to register the trade mark would be of concern to Hearst.
  • The lack of response to this letter did not imply that Hearst was permitting the use or registration of the trade mark by Toyota.
  • Use of COSMOPOLITAN by Toyota in relation to the colour of Toyota’s ‘Yaris’ model and no other models, supported the inference of an association with the previous joint advertising campaigns (involving the Yaris) and therefore with Cosmopolitan magazine.
  • ‘Reasonable and experienced persons in the field would view Toyota’s conduct as falling short of acceptable commercial behaviour’.

This decision is a reminder that use of another right holder’s mark in very different fields of activity can amount to bad faith, when there has been a previous business relationship between the two parties.