October Case Law: Successful Appeals

There were five Canadian trade-mark cases of note in October. Interestingly, in four of them the Federal Court allowed appeals from the Opposition Board and in three of those cases the appeal was allowed on the basis of new evidence allowed to be filed at the appeal stage.

City Optical Holdings Inc. v. The United States Shoe Corporation was an appeal from a decision of the Opposition Board which refused registration of THE INVINCIBLES for use in association with eyeglass lenses and related wares on the basis that it was confusing with the opponent’s mark, INVISIBLES for  ophthalmic (sic) lenses. The Applicant filed further evidence on appeal, as it was entitled to do. The Opponent chose not to contest the appeal. The Court allowed the appeal on the basis of the further evidence since there was no evidence of actual confusion and different channels of trade.

The appeal from the Registrar in Minolta-QMS, Inc. v. Tsai was also allowed, again on the basis of new evidence filed on appeal. Minolta’s opposition to the registration of MAGICOLOR in association with electrical wire, namely shielded, unshielded and insulated electric wire, cable and cord was dismissed by the Opposition Board. Minolta had not filed evidence in chief and the Board ruled that much of the evidence filed in reply by Minolta was not proper reply evidence. On the basis of the new evidence filed on appeal, it was clear that as of the date Minolta filed its opposition the MAGICOLOR mark was not distinctive, Minolta having had previous use.

In Fairweather Ltd. v. Registrar of Trade-marks, the Court, also on the basis of new evidence allowed on appeal, set aside the Registrar’s decision under section 45 expunging Fairweather Ltd.’s mark TARGET APPAREL. Fairweather had acquired the mark following the receivership of another company and the Opposition Board was not satisfied that the mark had been used or that there was a serious intention to use the mark. The new evidence on appeal demonstrated that Fairweather had taken concrete steps, including the development of artwork by employees of a related company. There were also actual sales, although these were subsequent to the issuance of the section 45 Notice.

In Smart & Biggar v. Jarawan the Court allowed the appeal from the Opposition Board’s decision that the Registrant of the mark, AL-RIFAI ROASTERY (MAHMASAT) had demonstrated use in the last three years in accordance with section 45 of the Trade-marks Act. The Court noted that the standard of review was one of reasonableness.  Given the vague and imprecise Affidavit filed by the Registrant, it was not reasonable for the Hearing Officer to have concluded there was use.

Petrillo v. Allmax Nutrition Inc. was a motion for summary judgement. The Court concluded that no genuine issue for trial existed against the personal defendant Mr. Kichuk for the alleged infringement of the ISO-FLEX trade-mark. The Court examined the law regarding the personal liability of directors and officers and the principles governing summary judgement, concluding there was no evidence to support the assertions in the Statement of Claim that Mr. Kichuk incorporated his companies or pursued a course of conduct through the companies intended to infringe the Plaintiff’s trade-mark.

Protected Poppies

In Edmonton, the local branch of the Royal Canadian Legion is concerned about the sale of white poppies with the word “peace” in the middle. The red poppy has come to symbolize Remembrance Day, when Canadians honour their war dead.

The Legion has had its poppy design registered as a trade-mark since 1948. The poppy design is also protected by federal legislation (s. 15 of the the Royal Canadian Legion Act, S.C. 1948, c. 84, as amended by S.C. 1980-81-82-83, c. 179) which provides that the poppy design as depicted is a mark of the “dominion command” and a registered trade-mark under the Trade-marks Act.

Anti-war activists are offering white poppies with the word “Peace” for sale in Edmonton, claiming that such poppies have been sold as a peace symbol since 1933. The Legion is alleging infringement of its trade-mark rights and arguing that the sale of such poppies politicizes the Legion’s symbol of sacrifice.

Olympic Trademark Legislation

The Vancouver Organizing Committee for the 2010 Olympic and Paralympic Winter Games (VANOC) is seeking legislation from the federal government that will allow it to deal more effectively with persons who misuse Olympic marks. In its annual report released this week, VANOC explains that it is in discussions with Canadian government officials regarding a special legilslation to protect the Olympic brand. The intention is to reduce ambush marketing during the period leading up to the 2008 Beijing Games and the 2010 Vancouver Winter Games.

Such legislation is not new. Italy introduced such legislation prior to the 2006 Turin Winter Games.

September Case Law

There are two trade-mark cases from the Canadian Courts in September 2006 of interest to readers.

In Cafe’ Do Brasil, S.p.A. v. Walong Marketing Inc., the Federal Court agreed with the applicant, an Italian food products company, and expunged a registered trade-mark owned by the respondent. The respondent’s registered trade-mark, KIMBO, was identical to the trade-mark that the applicant had obtained a registration for in Canada in 1990 and had used in Canada since 1992. In 2003, the applicant filed an application to expand the registration of its KIMBO trade-mark, but was informed that the Canadian Trade-mark Office objected to the registration of its KIMBO trade-mark in relation to the additional wares because it was confusing with a KIMBO trade-mark owned by the respondent. The record disclosed that expungement proceedings had been initiated in 1999 which resulted in the expungement of the applicant’s KIMBO trade-mark. However, the applicant had not received actual notice of the expungement proceedings in 1999. The Court held that the application was properly before it since the applicant met the definition of an “interested person”, having not received actual notice of the expungement proceedings. The Court further held that at the time of the first use of KIMBO by the respondent’s predecessor company in 1995, there was a reasonable likelihood of confusion between the two parties’ trade-marks. As a result, the respondent was not entitled to register its trade-mark and it was therefore invalid and was expunged from the Register.

In Community Credit Union Ltd. v. Registrar of Trade-marks, the Federal Court refused to set aside the Registrar of Trade-marks’ refusal to register the trade-mark COMMUNITY CREDIT UNION. With regards to the “clearly descriptive” ground of opposition, the Court held that it was not unreasonable for the Board not to have considered this ground. The Court further stated that if they were wrong in this regard, it was satisfied that the mark was clearly descriptive of the character of the services to be provided by the applicant in association with its use, and that registration of the mark COMMUNITY CREDIT UNION would remove the word “community” from the vocabulary available to others providing credit union services. With regards to distinctiveness, the Registrar had concluded that the mark was inherently non-distinctive because there were numerous credit unions in Canada that used “Community Credit Union” in their trade-marks or trade names. While a mark may become distinctive in a particular geographical area, the court held that there was considerable evidence before them and before the Registrar that the mark was commonly used within the trade in every region and that circumstances pointed to an absence of distinctiveness.

Famous Marks Protected Once Again

The U.S. congress has approved an amendment to the Trademark Dilution Act, in a move intended to close a loophole that the U.S. Supreme Court found in a case involving the marks VICTORIA’S SECRET and VICTOR’S LITTLE SECRET. The Trademark Dilution Revision Act will now be sent to the President for signature, which is expected to occur in the next few week.

When first introduced, the Trademark Dilution Act was intended to provide additional protection to “famous marks” over and above the protection available to less well known marks, which require there to be confusion due to use with similar products or services, overlapping channels of trade and the like. So if a mark is well known enough, in theory no one should be able to use that mark or a similar mark for any goods or services. The problem noted by the Supreme Court in the case involving VICTOR’S LITTLE SECRET, was that it required the famous mark owner to prove that the other mark had caused actual dilution, rather than likelihood of injury.

The new Act makes it clear that a famous mark owner has a cause of action even in the absence of actual dilution, if the identical or similar mark is likely to cause dilution by blurring its distinctiveness or tarnishing its image. The new Act exempts use of famous marks for noncommercial purposes such as parodies, criticisms or new reporting.

Unfortunately for the well known brand owners of the world, this legislation will not be applicable in Canada, where there’s no statutory provisions that are specific to famous marks. The Supreme Court of Canada recently ruled that, in theory, a mark could be famous enough that it would transcend its goods and services boundaries.  However, in the case of BARBIE and VEUVE CLICQUOT, neither mark, though well known for dolls and champagne, was famous enough to stop a third party from using very similar marks for restaurant services and retail clothing services, respectively.

David, Goliath And Reverse Confusion

Microsoft is once again at the forefront of a trademark infringement dispute , though this time the David in the story is on a bit weaker ground – it sells construction management software under the FOREFRONT brand and MS recently announced it will begin selling security software under that same brand – so clearly the claimed goods are different, but the marks are identical and there could be overlap in the channels of trade. Reading between the lines, the earlier user here is worried about reverse confusion, which occurs where a later user floods the market with its brand, subsuming the earlier user’s more modest reputation.

Though an established cause of action in the U.S., it’s only recently been recognized as being actionable in one Canadian case – however, in that case the A&W fast food chain was unable, on the facts, to prove that it had a cause of action against McDonalds in a battle of their respective CHICKEN GRILL and CHICKEN McGRILL sandwiches.

Recent Case Law

Summer is a quiet time for the Canadian courts. Looking back at July and August, there are three decisions that deserve a brief summary:

In Ratiopharm Inc. v. Laboratories Riva Inc., the Federal Court dismissed the plaintiff’s action alleging infringement of its registered Canadian trade-mark. The plaintiff sold a codeine based cough syrup under the mark CALMYLIN, while the defendant sold a similar codeine based product under the mark DAMYLIN. At trial there were two issues to be heard: (1) Did the plaintiff have standing to sue? and (2) Is DAMYLIN likely to be confused with CAMYLIN within the meaning of section 20 of the Trade-marks Act? With regards to standing, the court held that the license requirements of the Trade-marks Act had been satisfied and as such and the plaintiff had standing to commence an action for trade-mark infringement. With regards to the issue of confusion, the court held that there was no likelihood of confusion between CAMYLIN and DAMYLIN in the mind of the average consumer, even if hurried. The plaintiff’s action for trade-mark infringement was dismissed.

In DJang v. Ji, a decision of the British Columbia Supreme Court, the plaintiffs sought an interlocutory injunction restraining the defendants from marketing certain herbal products under names for which the plaintiffs had registered Canadian trade-marks. The plaintiffs also alleged passing off and a breach of the British Columbia Trade Practice Act. The Court applied a two-pronged test for granting interlocutory injunctions, holding that while there was a fair question to be tried, the balance of justice and convenience did not favour the injunctive relief sought by the plaintiffs since there was no convincing evidence of the totality of factors to establish irreparable harm. In the end, the Court declined to grant the interlocutory injunction.

Tradition Fine Foods Ltd. v. Group Tradition’l Inc., was an appeal to the Federal Court from a decision of the Trade-marks Opposition Board (the “Board”). The Board had rejected the applicant’s opposition to the respondent’s registration of BAGEL TRADITION’L and design. Upon reviewing the Board’s decision, the Court held that it was open to the Board to dismiss the applicant’s opposition on the ground of confusion. The Court found there to be almost no points of resemblance between the applicant’s TRADITION and TRADITION FINE FOODS trade-marks and the respondent’s proposed trade-mark when the trade-marks were considered in their totality. In the Court’s view, the Board had properly considered all the factors set out in subsection 6(5) of the Trade-marks Act. The Court further held that the applicant had not met its burden of proving that the word “TRADITION’L” or the imagery of the bagel and wheat sheaves was clearly descriptive of the intrinsic quality of bagels.