IN THE COURT OF APPEAL OF NEW ZEALAND CA461/2013 ... wax and surfboard related products accounted...
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SEXWAX INCORPORATED V ZOGGS INTERNATIONAL LIMITED CA461/2013  NZCA 311
[9 September 2014]
IN THE COURT OF APPEAL OF NEW ZEALAND
 NZCA 311
ZOGGS INTERNATIONAL LIMITED
22 May 2014 (further submissions received 26 May 2014)
O'Regan P, Stevens and Miller JJ
N J Robb and C A Edmonds for Appellant
J O Upton QC and T A Huthwaite for Respondent
9 September 2014 at 3.15 pm
JUDGMENT OF THE COURT
A The appeal is allowed.
B The direction given in the High Court that the respondent was entitled to
register the ZOGGS mark is quashed.
C The determination of the Assistant Commissioner that the appellant’s
opposition based on s 17(1) of the Trade Marks Act 2002 succeeds is
D The respondent must pay the appellant costs for a standard appeal on a
band A basis and usual disbursements.
E In the absence of agreement, any question of costs in the High Court is to
be determined by that Court.
REASONS OF THE COURT
(Given by Stevens J)
Table of Contents
Assistant Commissioner’s decision 
High Court judgment 
Statutory framework 
Issue one: the MR ZOGS SEX WAX mark 
Submissions of the parties 
Our analysis 
Issue two: reputation/awareness 
Need for awareness of the opponent’s mark 
The correct approach to s 17(1)(a) 
Submissions on reputation/awareness 
Our analysis 
Issue three: likelihood of deception or confusion? 
Submissions of the parties 
Our analysis 
 The appellant Sexwax Incorporated (Sexwax) has since the 1980s marketed a
large selling brand of surfboard wax through a New Zealand distributor. It does so
using a distinctive unregistered mark or logo of which it is the proprietor, (the
MR ZOGS SEX WAX mark):
 The respondent, Zoggs International Ltd (Zoggs), applied in December 2009
to register the trade mark (the ZOGGS mark):
 Zoggs’ application was declined by the Assistant Commissioner of Trade
Marks under a number of statutory provisions, including s 17(1)(a) of the Trade
Marks Act 2002 (the Act), on the basis that its use in New Zealand would be likely to
deceive or cause confusion. 1
 Zoggs successfully appealed to the High Court.2 Simon France J found that
there was no likelihood that the ZOGGS trade mark would be confused with the
MR ZOGS SEX WAX mark if registration were allowed. 3 He said the MR ZOGS
SEX WAX mark was “quite dissimilar” to the ZOGGS mark, with the “predominant
feature of the logo [being] the central Sexwax brand”. The concept of “Sex Wax”
was “attention grabbing” and was the “single feature of the logo which would linger
with people”. 4 Those findings were enough to dispose of the appeal, but the Judge
also concluded: “With less conviction, but on balance, I would also have allowed
the appeal against the finding of a sufficient reputation”. 5
 Sexwax appeals to this Court, contending there was a sufficiently substantial
awareness of the MR ZOGS SEX WAX mark for goods covered by the proposed
registration of the ZOGGS mark. Further, it contends Zoggs has not discharged the
onus of establishing that there is no reasonable likelihood of deception or confusion
resulting from the use of the ZOGGS mark.
 It follows that the key issues on appeal are:
(a) What was the nature of the mark owned by Sexwax?
(b) What is the reputation or awareness of that mark?
1 Zoggs International Ltd v Sexwax Inc  NZIPOTM 31 (Assistant Commissioner’s
decision). 2 Zoggs International Ltd v Sexwax Inc  NZHC 1494 (High Court judgment).
3 At .
4 At .
5 At . The Judge also upheld two other grounds of appeal, namely, against findings by the
Assistant Commissioner that the application was made in bad faith (at ) and that there was
no sufficiently definite intention to use the mark (at ). There was no appeal on these
(c) Has Zoggs discharged the onus of showing there is no reasonable
likelihood of deception or confusion resulting from the notional use of
the ZOGGS mark?
 The questions of reputation and awareness and the likelihood of deception or
confusion were advanced before us in the context of the “relevant market”. In
determining the above questions, therefore, we discuss whether and in what
circumstances the concept of the market ought to be used in applying s 17(1)(a) of
 Sexwax is owned by a Mr Frederick Herzog III of California, USA.
Commonly known as Mr Zog, he has used the name Zog in connection with his
business for over 38 years. He first started manufacturing surfboards under the
“Zog” and “Wave Delineation” brands. These were sold through retail outlets in
California and through surf shops on the East Coast of the United States. In 1972 the
Zog Industries business began manufacturing and selling surfboard wax under the
brand name MR ZOGS SEX WAX. The label embodying the logo, set out at 
above, has remained largely unchanged.
 Mr Herzog’s business was originally named Zog Industries. It changed name
formally in 1978 to Sexwax Incorporated, the name of the appellant, but has
continued to use the name Zog Industries on all its business forms such as invoices,
statements, sales and purchase orders and correspondence. Mr Herzog’s evidence is
that the name Zog is integral to the mark by which the surfboard wax is sold. It is
typically referred to or ordered as “a bar of SEX WAX” or “a bar of Zogs”.
Mr Herzog states further that the phrase “MR ZOGS SEX WAX” is an integral part
of the mark used by the business. The business has engaged in other activities such
as publishing a newspaper, called the Zog Newsletter, and sells various other
products featuring the mark, of which T-shirts and caps are examples.
 Zog Industries sells surfboard wax using different formulas. For example, it
sells a product called MR ZOGS SEX WAX Quick Humps formula, and a hockey
wax using the logo “MR ZOGS SEX WAX Hockey formula”. Other products
include a drumstick formula wax using the same logo and a wide range of products
including T-shirts, sweat-shirts, rash guards, swimwear, wax combs and beach
towels, which are labelled or decorated with either the words
“MR ZOGS SEX WAX” and design mark or using the word “Zog”. The MR ZOGS
SEX WAX logo or the mark SEX WAX have been registered in a number of
countries throughout the world. No application for registration has been made in
 Zog Industries began selling its products in New Zealand through a primary
distributor, Aerial Connection. The product is sold in retail shops all over New
Zealand and is also sold on TradeMe. For the period November 1997 to June 2010,
wax and surfboard related products accounted for 65 per cent of the product sales by
Zog Industries to New Zealand. The balance of the sales (around 27 per cent) was
made up mostly of T-shirts, which have either the complete logo or a dominant
reference to SEX WAX on them. The MR ZOGS SEX WAX label, in whatever form
it appears, is usually prominent and occupies the whole of the front or back of the
 The respondent, Zoggs, was founded in Australia in 1992. The original
products sold comprised swimwear goggles, with the name Zoggs being an
adaptation of that word, or more particularly, of the abbreviation of the word
“goggs”. The goggles were sold in New Zealand through The Warehouse chain from
around 1994. Zoggs then began manufacturing swimwear aimed primarily at the
recreational and fitness/training pool swimmer market. These items were marketed
in various countries including New Zealand under the label “Zoggs Toggs”. In 1996,
that mark was registered in various countries, including New Zealand. This has
since expired and, due to an oversight, was not renewed.
 In 2000 a decision was taken to combine the brands into “Zoggs”. The
application to register the mark was intended to replace the existing mark
registration of Zoggs Toggs and reflected the branding development. Zoggs
International claims to be the largest leisure swimming brand in Australia, New
Zealand and the United Kingdom. New Zealand sales under the Zoggs Toggs label
commenced in the mid-1990s. Some