“The legal system is designed to protect the big guys, not to protect the innocent”, a business owner has claimed, after spending more than $1 million fighting directory giant Sensis in a trademark dispute.
Mark Mina has been operating his direct mail marketing business — which currently employs 36 people — under the name Senses Direct since 2013. In 2016, Mr Mina moved to trademark the name, which he said is about capturing the five senses of human experience.
That, he said, is when his legal battle with directory and marketing giant Sensis — owner of the Yellow Pages, White Pages and True Local brands, amongst others — began.
According to Mr Mina, Sensis objected to the trademark application given the similarity of the names, despite Mr Mina claiming that the two businesses operate in different spaces. Sensis had countered that not only should the Senses Direct trademark be denied, but that Senses Direct had infringed on the Sensis trademark.
The court ruling
The matter was heard by the Federal Court of Australia, which handed down its verdict on 24 May 2019.
“On 2 February 2016, the respondent applied to register the SENSES devices as trademarks in respect of marketing services and business marketing consulting in Class 35. The application is yet to be accepted for registration,” the court noted in its judgment.
“The applicant [Sensis] has alleged that the SENSES marks are deceptively similar to the SENSIS marks within the meaning of s 10 of the Trade Marks Act 1995 (Cth) (“the Act”) and, by using the SENSES marks in relation to services in respect of which the SENSIS marks are registered, the respondent has infringed the SENSIS marks under s 120(1) of the Act.
“The respondent accepts that it has used the SENSES DIRECT mark in relation to certain ‘advertising services’ and ‘marketing... distribution services (excluding transport)’, but it has denied the infringement claim.”
There were also disagreements between the two parties about several subsets of the name.
Noting that the case was fundamentally about “whether that reputation extended beyond the applicant’s directory services and whether, because of that reputation, the use of the SENSES DIRECT mark would be likely to cause confusion”, Judge Davies determined that there were clear similarities between the Sensis brand and name, and that of Senses Direct.
“In my view, the SENSES DIRECT mark so closely resembles the SENSIS mark, it is likely to cause confusion with the SENSIS mark,” the judge said.
“I think there is, as a matter of impression, considerable visual and aural similarity between the words.”
Judge Davies also said that the addition of the word “Direct” did little to minimise this potential confusion:
“I do not think that the appearance of the word ‘DIRECT’, either with or without the device, sufficiently distinguishes that mark so as to mitigate the close resemblance between the marks. Although argued by the respondent that SENSES DIRECT is ‘a distinctive (indeed striking) coined and ungrammatical composite phrase that alludes to the ability of the respondent’s (direct) mail services to appeal directly to the senses’, the addition of the word ‘DIRECT’ is merely descriptive, and does not add a distinctiveness to the mark taken as a whole.”
The judge concluded: “Although I do not think that s 60 would apply to preclude registration of the respondent’s SENSES DIRECT marks, I have found that the respondent’s SENSES DIRECT mark is deceptively similar to the applicant’s SENSIS mark and the defence under s 122(1)(fa) must be established at the time of the first infringing use with the consequence that the claim of honest concurrent use is not available to the respondent. I accordingly find that the respondent infringed the applicant’s registered trademarks by its use of the SENSES DIRECT marks.”
Sensis ‘an absolute bully’
Following the verdict, Mr Mina has accused Sensis of being “an absolute bully” in prosecuting the case, while he stands firm that he should have a right to use and trademark his name.
“My name is Senses Direct Mail and Fulfillment Services. When you ring this phone, you get answered as Senses Direct. We’ve got nothing to do with Sensis — S-E-N-S-I-S — we don’t do anything [regarding] directories or White Pages or Yellow Pages, that’s all they do. We have nothing to do with their services or products. We’re not in their market space,” he told My Business.
“I don’t think they knew that I ever existed... we were operating under Senses Direct, we had a lot of promotional advertising to start the business.
“When we established the business, I went through the registered trademark process, and it’s when we went through the trademark process that it came on their radar. And we had no objections from the trademark specialists, we had no problem with ASIC, we had no problem with anyone, but their legal team... had an issue with it.
“But the trademark people themselves didn’t recognise there was any conflict whatsoever.”
Mr Mina said of Sensis: “All they want to do now is take over the name and my logo and what I’m trying to register — they’re trying to take over my trademark.”
“I just don’t think that is fair, just because they are more powerful — it’s like Goliath trying to squash David.”
‘Numerous attempts to settle’: Sensis
Responding to My Business’ request for comment on the matter, Sensis CEO John Allan said in a statement that the company had “made numerous attempts” to settle outside of court, but pursued the legal action when an agreement could not be reached.
“Sensis made numerous attempts to settle the issue with Senses Direct prior to court and avoid costly legal proceedings for both parties, but each of these was rejected,” Mr Allan said.
“Whilst court action was a final resort, we welcome the ruling which supports the significant investment we’ve made in [the] Sensis brand over the past 17 years.”
He continued: “Sensis has invested a significant amount in the Sensis brand since 2002 and, like all intellectual property owners, wishes to ensure that its valuable intellectual property rights are protected and that customers are not confused by the use of a similar name for similar kinds of services.”
According to Mr Allan, the court had found there was some evidence to suggest that Senses Direct customers had been confusing the business with Sensis, and that there was some overlap in the operations of the two businesses.
“The Court stated that ‘such evidence is a powerful indication of the potential for confusion to arise’,” said Mr Allan.
“The Court also found that Senses Direct was using the SENSES DIRECT mark to promote a broader range of advertising and marketing services than just direct mail services, and that this heightened the likelihood of confusion with the SENSIS mark.”
Mr Allan declined to comment any further, citing that the court has yet to make a decision regarding costs.
Size no excuse
The company subsequently issued a statement denying the accusation of bullying.
“Sensis rejects any claim that this case involved bullying of any kind. Sensis, like all intellectual property owners, needs to ensure that its valuable intellectual property rights and reputation are protected and that customers are not confused by the use of a similar name for similar kinds of services,” it said.
“Being a smaller business in size to Sensis does not give Senses Direct the right to infringe. Sensis made numerous attempts to settle the matter before trial but each of these was rejected. The details of any settlement discussions between the parties are confidential”.
‘We’ve lost half our business’
Mr Mina rejected the notion that Sensis had made any meaningful attempts to settle, stating that its offers fell well short of what would be required to undertake a full rebrand.
“On occasions, they’ve offered me absolute petty cash to say ‘go and change your name’. They offered me $10,000 to change my name,” he said.
“10,000 [dollars] is not enough to rebrand a building and rebrand everything that we have here: uniforms, logos, credit cards, websites... we’ve got a lot of things in that brand.
“We don’t want to infringe on anything they do — we’re happy to work within our limits, we’re happy to talk to them, we’re happy to negotiate with them.
“We’re a small business, we just want to carry on with what we’re doing; we just want to make sure we’re not bullied or shut down or exhausted by legal costs and the legal system to force us to succumb to their wishes.”
Mr Mina explained that the lengthy legal battle has been a serious drain on his business, as well as himself personally. He has even been forced to shed staff as the legal bills mounted.
“You face it morning, afternoon and night, it’s an ongoing fight. It’s draining emotionally, it’s draining financially, it’s draining physically, and it’s very distracting and very draining on the business,” he said.
“I have had to reduce my staff numbers, and if this goes ahead, I might have to shut down altogether.”
“I’ve let go at least seven staff in the last few months.”
He said that his costs are now approaching $1.4 million over the stoush, which has hit the business hard.
“In the last three and a half [years], we’ve spent over $800,000, but there’s more bills outstanding which we can’t even pay. There’s another $500,000 owed to the intellectual property lawyers — so the intellectual property lawyers cost me nearly $1.4 million,” said Mr Mina.
“That’s almost killed the business — the business is half what it was. We’ve lost half of our business fighting this fight.”
‘I will not quit’
Despite the heavy toll inflicted both on his business and himself personally to date, Mr Mina is standing firm and said that he will appeal the verdict.
“I will not quit,” he said defiantly.
“They brought the fight to me, I didn’t take the fight to them.
“I think it’s devastating they’ve allowed our system to do this — that any big business can shut down any small business. And yes, would I have done it again? Absolutely. But perhaps I would have gone to the media earlier, perhaps I would have made a lot more noise, but I did it as professionally as I could possibly do.
“Now the legal system has failed me, I’m thinking of getting support [by] exposing what’s going on rather than keeping it under wraps. Now I’m trying to expose it so that no one else can go through the same pain and the same financial constraints and devastation that I’ve gone through.”
Asked for any advice he would give to other business owners who may be facing a similar battle, Mr Mina said that giving up is simply not an option.
“It’s not in our Australian nature just to roll over, it’s never been part of our history, it’s not part of our culture. And why should I roll over just because they’ve got more money? Why should I roll over? I’m not doing anything wrong,” he said.
“I honestly think no one should give up what they’ve created, what they’re passionate about. If you can’t stand for what you believe in and what you’re passionate about, what is the point?”
Mr Mina added: “The other thing is, don’t go through the legal system: the legal system is designed to actually protect the big guys, it’s not designed to protect the innocent. It’s not designed for the little guy who’s going to be broke anyway.”
Mr Mina said that he is still holding out hope that a compromise can be reached between the parties.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.