Sexwax Incorporated v Zoggs International Limited
 NZCA 311
Deceptively and confusingly similar trade marks – what is
the market for assessing reputation?
S coined the following logo trade mark in California around
The mark was not registered in NZ but was known there from
around 1981 in connection with surf wax, t-shirts, beach wear and
Z coined the ZOGGS trade mark in Australia around 1992 and had
used it in NZ from around 1994 in relation to swimming goggles,
and, later, in relation to swimwear.
In 2009, Z applied for ZOGGS as a trade mark in class 25 for
clothing, swimwear and headgear.
S opposed the application under section 17(1)(a) of the New
Zealand Trade Marks Act 2002 on the grounds that use of the trade
mark would be likely to deceive or cause confusion.
The Assistant Commissioner of Trade Marks ruled in S' favour
and refused registration.
Z appealed to the High Court.
HIGH COURT DECISION (NOTE: THE NZ COURT OF APPEAL IS A SUPERIOR
COURT TO THE NZ HIGH COURT)
The High Court allowed Z's appeal finding that the marks
were "quite dissimilar" with the "sex wax"
element of S' trade mark being the "attention
grabbing" element and "Mr Zogs" being a less
The High Court also ruled that S had failed to establish the
necessary reputation in the individual elements of its mark in NZ
even if it could establish a sufficient reputation in the mark as a
whole. The judge did not accept that S' reputation in the
individual elements overseas had "spilled over" into NZ.
Establishing the necessary reputation was a precondition for
establishing the required level of confusion or deception. The
relevant market was the general purchasing public and retailers
involved in the clothing industry – being the applicant's
S appealed to the Court of Appeal.
COURT OF APPEAL DECISION AND REASONING
The Court upheld S' appeal and refused registration of
Z's mark. S 17(1) involves an assessment firstly of whether the
owner of the mark can establish the necessary reputation in the
relevant market, followed by a fact-specific determination of the
likelihood of deception or confusion in consideration of that
Reputation is determined by reference to awareness of the mark
amongst buyers of the opponent's goods rather than buyers of
the applicant's goods. The High Court erred by merging the
analysis of reputation and likelihood of deception/confusion into
one test determined by reference to the general purchasing
S was found to have a sufficient reputation in the surf wax and
surfing merchandise market. While different from the swimwear
market, the surf merchandise market was connected to it such that a
substantial number of people familiar with S' mark may
encounter Z's mark and be deceived or confused by it.
It was unnecessary for S to establish a separate reputation in
the "Mr Zogs" element of its logo, and in any event that
element was a central and essential part of the logo. This element
would "cause consumers to wonder" if there was a
connection between S and the ZOGGS trade mark. S produced evidence
that consumers referred to its products as "Mr Zogs".
Once the necessary reputation was established, the onus (burden
of proof) then fell to Z to demonstrate that a substantial number
of persons would not be confused or deceived. Z failed to establish
The application was refused but the Court suggested that Z could
file a further application for specific goods which did not overlap
so much with the surf sector market in which S had such a strong
Unregistered marks can be used to block applications if the
necessary reputation in NZ is established.
A mark which contains only some elements of a more complex mark
can still be problematic if those elements are sufficiently
Reputation is determined by reference to the opponent's
market, not the applicant's market.
Likelihood of deception or confusion is determined by reference
to the proportion of consumers from the opponent's market who
may be exposed to the applicant's products (and of course, the
degree of similarity between the marks).
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
Shelston IP has been awarded the MIP Global Award for
Australian IP Firm of the Year 2013.
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