Canadian Trademark Blog

Maintained by Clark Wilson LLP

Judging A Wine By Its Label: A Trademark Issue

By In Case Law, Registration, Trademark Oppositions

In Sociedad Agricola Santa Teresa Ltda. et al. v. Vina Leyda Limitada, the Federal Court considered what constitutes a place of origin for wine such that the place name cannot be registered as a trademark. At issue was section 12(1)(b) of the Canadian Trade-marks Act which states that a trademark is not registrable if it is “clearly descriptive or deceptively misdescriptive” of the “place of origin” of the wares or services.

Vina Leyda Limitada applied in 2001 to register LEYDA as a trademark and on the evidence before the Registrar in an opposition to such application, the Registrar allowed the application. The Sociedad appealed the Registrar’s decision under section 56 of the Act.

The Court allowed the appeal and held that LEYDA could not be registered. According to Harrington J., “Once the Registrar found as a fact, as he did, that Leyda is a wine producing region in Chile, as a matter of law he was required to conclude on the record before him that the opposition was well founded.” Of concern was the fact that if the registration stood the applicants, wine producers from the Leyda Valley, would not be able to refer to that fact on their labels or in their promotional literature and might be limited to calling their wine Chilean red or white. The judge also noted that “producers from a specific region want to promulgate their area in the belief that their wine is superior to the wine of that country as a whole”. A general appellation could lead a consumer to believe a wine is “plonk”.

In reaching his decision Harrington J. relied on a 1970 Supreme Court of Canada decision, Home Juice Co. v. Orange Maison Ltee, for the proposition that “a shrewd trader should not be permitted to monopolize the name of a foreign wine district in Canada by registering it as a trademark”. He also distinguished Prosciutto di Parma v. Maple Leaf Meats Inc. in which the Federal Court of Appeal refused to expunge the trademark PARMA since it had been used in Canada for 39 years and registered for 26. LEYDA had not been in use in association with wine in Canada at the time the application was filed.

On an appeal under section 56 the parties may introduce evidence that was not before the Registrar and the Sociedad put forward that “Vallee de Leyda” was an appellation of origin in Chile. This evidence was taken into account, but Harrington J. specifically noted that whether a name signifies a geographical area under section 12 of the Act and whether that area produces wine are not contingent upon a governement decree.

Finally, it is worth noting that Harrington J. may very well know something about wine. He not only references the origin of the word “plonk” (“There are different legends as to the origin of the word ‘plonk’. The one I prefer is that a Monsieur Plonque was the purveyor of cheap wine to British Troops in World War I.”), but he also begins his reasons stating, “One may not be able to judge a book by its cover, but one should know something about a bottle of wine from its label; the more the better.”

Turning Over A New …Sheaf?

By In Branding

Thanks for the warm welcome, all. For my first post, I thought it apropos to cover a story originating in the province of my birth, Saskatchewan.

A recent attempt by Saskatchewan’s new government to introduce a new provincial logo clearly demonstrates the need to have a clear and coherent branding strategy in place before rushing headlong down the path to change.

In early December, members of the province’s governing party, the Saskatchewan Party, announced their intention to change the province’s logo. In a move reminiscent of the Tory’s adoption of the Canada’s New Government slogan shortly after they took power in 2006, Saskatchewan’s new government decided that the iconic wheat sheaf symbol had to go. Deputy Premier Ken Krawetz criticized the logo, calling it “dated” and claiming it was no longer an accurate reflection of the province and its broad-based economic boom. (The logo was originally introduced by an NDP-led government under Allen Blakeney in the 1970s, though public notice of the province’s adoption of the sheaf was not issued until 1982.)

In a somewhat curious twist, Krawetz did not introduce a replacement for the sheaf; instead, he urged government ministries to use the province’s shield of arms or its coat of arms until a new logo was developed. Ironically, these marks each prominently depict three wheat sheaves.

However, Krawetz’s announcement was met with, to put it lightly, something less than broad-based enthusiasm. Despite a few local newspaper editorials plugging the proposal, it appeared Saskatchewanians were wildly unenthused by the change. Local call-in shows and newspaper editorial boards were flooded by citizens attached to the dear olde sheaf and unhappy with the use of their tax dollars to fund the new logo. (Some citizens, however, took the opportunity to take logo lemons and make lemonaid, proposing that a new au courant logo might include a genetically modified wheat sheaf, a nuclear power reactor, or a Saskatchewan Roughrider puffing a cigar. Personally, I’ve always been partial to this mark but admittedly, it may not be appropriate for the Premier’s letterhead.)

Five days later, after all of the wheat sheaf images were removed from the Government of Saskatchewan’s website, the government succumbed to public pressure and announced it had decided not to change the logo, at least for now. In a confusing and inadvertently humorous news release titled “Wheat Sheaf Logo To Be Retained: New Saskatchewan Government Listens To Public”, Krawetz stated that while he understood some Saskatchewanians were against the change, the logo change had never been a governmental priority, and that for those who oppose changing, it’s not really a matter of whether or not they like the wheat sheaf logo. It was a question of priorities. Whatever that means.

In any event, this story illustrates that altering a brand is a big step that should not be undertaken lightly, particularly when that brand includes a prominent symbol historically associated with the hopes and dreams of an entire province.

Our Blogging Team Is Growing

By In Uncategorized

We’re pleased to welcome two new contributors to the Canadian Trademark Blog, namely Niamh Pollak and Jeffrey Vicq.

Niamh was called to the Bar in Ireland in 2004 and more recently in British Columbia. As an associate with Clark Wilson LLP’s Technology and Intellectual Property Practice Group, her practice will focus on trademark and copyright law, domain name disputes, intellectual property licensing and digital media.

Jeffrey recently completed an LLM at the University of Ottawa with a concentration in Law and Technology, before which he practised for a number of years with another Vancouver law firm. He’s a registered Canadian Trademark Agent and his practice at Clark Wilson LLP will focus on intellectual property and privacy law issues, including trademark prosecution, computer hardware and software licensing, distribution, outsourcing, maintenance and purchase contracts.

With two more contributors we hope to be able to deliver more content to our readership.

Best wishes for the holiday season!

Hockey Nostalgia and Trademarks in Québec

By In Branding, Case Law

A recent discussion of the Federal Court of Appeals shows that Québec City’s former National Hockey Team, the Quebec Nordiques, continues to attract the nostalgia of the city’s population.

In Accessoires D’Autos Nordiques v. Canadian Tire Corp., the Federal Court of Appeal refused to overturn a Federal Court decision and allowed Canadian Tire’s application to register the mark NORDIC & Snowflake Design for use in association with tires.

Accessoires D’Autos Nordiques had successfully opposed Canadian Tire’s application before the Trademark Opposition Board, on the basis of Accessoires’ previously registered and previously used NORDIQUES trademark and trade-name, used in association with automobile parts and accessories.

The Opposition Board refused Canadian Tire’s application on the basis that the trademarks NORDIC and NORDIQUES were phonetically identical to a monolingual French speaking person, and accordingly, constituted confusion under section 6(5) of the Trade-marks Act. The Trial Division and the Court of Appeal concluded, however, that when considering the possibility of confusion between two trademarks, each particular trademark must be considered as a whole and not broken into its component parts to highlight differences. The Appeal Court agreed that the evidence presented by Canadian Tire showed that the trademark NORDIC evoked amongst the French speaking population in Québec, the name of the now-defunct Naitonal Hockey Team league, Quebec Nordiques, and not the tire-concessionaire’s trade-mark NORDIQUES. The Appeal Court held that as the two trademarks were dissimilar in appearance and brought to mind different ideas, on the balance of probabilities, registration of the NORDIC trademark was unlikely to create confusion.

The decision highlights the danger in choosing a trademark which is already well-known in respect of other wares or services. As the Appellant in this case discovered to its peril, the general public associated the trade-mark with Québec City’s former National Hockey Team, rather than with the Appellant’s wares and services.

More On Section 45

By In Case Law, Registration, Trademark Oppositions

Last week we reported on a decision of the Federal Court, Trial Division. The Federal Court of Appeal has also handed down a recent section 45 decision referring to the section as the “‘use it or lose it’ provision for removing ‘deadwood’ from the Register”.

In Bereskin & Parr v. Fairweather Ltd. the Court refused the appeal on the basis that the trial judge’s application of the law to the undisputed facts disclosed neither a palpable and overriding error on a question of mixed fact and law, nor a readily extricable error on a question of legal principle.

The trial judge had allowed the appeal from the Registrar of Trade-marks decision to expunge the trademark TARGET APPAREL for use in association with “men’s clothing, namely, suits, pants, jackets and coats”. The trademark had been acquired by Fairweather Ltd. from another company. In front of the Registrar, Fairweather had failed to produce evidence demonstrating a serious intention to use the mark. Such evidence can constitute special circumstances and excuse the absence of actual use in the preceding 3 years. However, when Fairweather appealed under section 56 of the Trade-marks Act, it filed new evidence (which is allowed on a section 45 appeal) and provided the judge with preliminary design and artwork showing an ongoing intention to use the mark. There was also evidence of sales after the date of the section 45 notice that gave credibility to the evidence of an intention to use. Thus, use was established.

Clear Evidence of Use Required: Section 45 Appeal Allowed

By In Case Law, Registration

Section 45 of the Trade-marks Act allows the Registrar, at the written request of any person, to give notice to the registered owner of a trademark requiring the registered owner to furnish, within three months, an Affidavit or Statutory Declaration showing that the trademark has been used in association with each of the wares and services specified in the registration during the preceding three-year period.

In 88766 Canada Inc. v. Monte Carlo Restaurant Limited Justice Pinard of the Federal Court allowed an appeal from the decision of the Registrar of Trade-marks and expunged the mark. The mark at issue was MONTE CARLO that was registered for use in association with the wares “pizza and spaghetti” and the services “operation of a restaurant, food take-out and catering, operation of a bar and operation of a banquet hall”. On the basis of the Affidavit evidence furnished by the owner of the mark, the Registrar struck out only “operation of a bar and operation of a banquet hall”.

The Court first noted, given there was no new evidence filed on the Appeal (an option where there is an appeal from a section 45 mark), that the standard on the Appeal was one of reasonableness. The Court then reviewed the Affidavit furnished by the registered owner and concluded that it did not clearly establish use during the relevant period. Thus, the mark was struck from the registry.

It was not sufficient to simply establish that advertising materials had been distributed in the previous five years.  The Court noted that there was nothing specifically stated regarding distribution during the preceding three-year period and noted that it was up to the owner of the mark to provide clear proof regarding use. The Court also referred to BMW Canada Inc. v. Nissan Canada Inc., a case that we previously commented on, for the proposition that the appearance of a trademark in an advertisement does not constitute use in association with wares unless the advertisement is distributed at the time of the transfer of the property in or the possession of the wares.

Damages for Counterfeit Goods – A Significant Award

By In Case Law, Famous Marks, Protection & Enforcement

Louis Vuitton Malletier S.A. et al v. Yang et al. provides a useful analysis of the damages that can be awarded against a Defendant trading in counterfeit goods.

In this case, the owners of the well-known brand had been attempting since 2001 to stop the sale of counterfeit goods at K2 Fashions, a Richmond, British Columbia retail store, having obtained two previous judgments, having sent numerous letters and having made a number of seizures. This latest action, against the persons who controlled and operated the business and premises, was not defended and the Plaintiffs brought a motion for default judgment, including an assessment of damages.

The Federal Court concluded that the Defendants had been properly served and the time to file a defence had expired. The Court was also satisfied that infringement was established.

The Court then assessed damages for both copyright and trademark infringement.  

The Plaintiffs had elected an award of statutory damages pursuant to section 38.1 of the Copyright Act. After considering the relevant factors set out in section 38.1(5) (the good or bad faith of the Defendant, the conduct of the parties during the proceedings and the need to deter other infringements of the copyright in question), the Court concluded that the Plaintiffs were entitled to the statutory maximum of $20,000.00 for each of the two copyrighted works at issue.

With regards to trademark infringement, the Court concluded that it could not quantify the damages suffered by the Plaintiffs, it being difficult to determine what depreciation of goodwill or loss of sales may have occurred.

The Court chose instead to assess the profits made by the Defendants “based on the best available evidence, reasonable inferences, the Plaintiffs’ experiences in similar situations and a dose of common sense”. However, since its estimate of $76,000.00 was only the minimum, the Court applied a “nominal award per infringing activity” and assessed damages at $87,000.00. To this the Court also added punitive damages of $100,000.00, being satisfied that the requisite elements were present (conduct that was planned and deliberate, outrageous conduct over a lengthy period of time, an attempt to conceal, an awareness by the Defendants that they were wrong, and profiting from the misconduct).

Finally, the Court awarded solicitor and client costs of $36,699.14, given the Defendants’ intentional infringement and ongoing behaviour that was “scandalous and outrageous”.

The total judgment amounts to $263,699.14.

A Globe & Mail article notes that this is believed to be the “highest amount ever awarded in an undefended action involving counterfeit goods”. Clearly, the Court is sending a message that counterfeiting should and will be treated harshly.