Case Law

Off to the Marché We Go! – Not Descriptive and Not Confusing

By In Branding, Case Law

The Federal court recently dismissed an appeal to have a trademark expunged on grounds of descriptiveness and confusion. In Movenpick Holding AG v. Exxon Mobil Corporation and Attorney General of Canada (Registrar of Trade-marks), the Court considered whether Esso’s “Marché Express” mark is too descriptive of the services it provides as a gas-station convenience store. Then it went on to consider whether it was possible to confuse “Marché Express” with Movenpick’s “Marché” mark, which it uses for its chain of restaurants.

Movenpick claimed that “Marché Express” is descriptive of the services Esso offers. Section 12(1)(b) of the Trade-marks Act provides that a trade-mark must not be “clearly descriptive” of the character or quality of the wares or services associated with the mark. So, the question before the Court was whether, in the French language, “Marché Express” was descriptive of a convenience store.

Both sides produced expert evidence of the meaning of the phrase “Marché Express”. The Court was unimpressed with this, favouring evidence of the phrase’s colloquial use rather than academic musings as to its meaning. The Court noted that one must look at the perception of the phrase by regular everyday consumers, not its meaning as derived from a scholarly analysis.

The Court ultimately found that while the word “marché” is used to describe convenience stores (it translates strictly to “market”), the construction “Marché Express” is not something that regularly appears in colloquial French. At best, it could be construed to mean the result produced from shopping at a such a store. Thus, “Marché Express” is not “clearly descriptive”, contrary to s. 12(1)(b).

Movenpick also claimed that Esso’s mark, when used to denote a convenience store, was easily confused with its own registered trademark, “Marché”, which is used in association with the operation of Movenpick’s restaurant. Under s. 12(1)(d), a trade-mark is not registrable if it is confusing with another registered trade-mark.

The Court outlined the test for confusion from Veuve Cliquot Ponsardin v. Boutiques Cliquot Ltée, 2006 SCC 23, wherein the Court must look for confusion in the mind of a “casual consumer somewhat in a hurry” who only has an “imperfect recollection” of the other mark. The Court also carefully considered all of the surrounding circumstances dictated by s. 6(5) of the Act. Most interestingly, the Court agreed with the Registrar’s statement that “Marché” was a weak mark. The term “Marché” is commonly used in the food and beverage industry; thus, consumers are used to seeing it in the marketplace (no pun intended!). When a mark has such a broad usage, the trademark holder cannot expect to have a wide range of protection over the mark. Consumers are able to pick up on slight differences between such weak marks, so the sphere of protection is accordingly narrower. The Court held that the inclusion of “Express” was enough for casual consumers to distinguish the two marks in question.

So, in the end, Esso was able to keep the registration of its trade-mark, and decidedly un-confused consumers are still able to both shop at the Marché Express and dine at Marché restaurants.

Trademark Expungement Proceedings: Standing as a “Person Interested”

By In Case Law, Protection & Enforcement

In McCallum Industries Ltd. v. HJ Heinz Co. Australia Ltd., the Federal Court dismissed the applicant’s action to expunge the respondent’s trademark under s. 57(1) of the Trade-marks Act.

Both the applicant and the respondent produced canned and processed meat products in Canada, the applicant under the name “PALM & Device“, and the respondent under the name “OX & PALM”. The applicant was granted a trademark in July 2003, while the respondent was granted a trademark in October 2005.

Section 57(1) allows “any person interested” to apply to the Federal Court for an order that any entry in the register be struck out or amended on the grounds that at the date of the application the entry as it appears on the register does not accurately express or define the existing rights of the person appearing to be the registered owner of the trademark. The applicant sought expungement of the respondent’s trademark on the grounds that the trademark was confusing to the public, that the respondent was not the person entitled to secure registration of the trademark, and that the trademark was non-distinctive. Read more

Trademark Interlocutory Injunction Denied to Target

By In Case Law, Famous Marks

In Target Brands Inc. v. Fairweather Ltd., the Federal Court of Canada refused to grant the interlocutory injunction sought by the American retail chain, this recent application being part of a continuing battle.

In 2002, Target’s counsel initiated proceedings under s. 45 of the Trade-Marks Act to cancel INC’s trade-mark registration for TARGET APPAREL. The Registrar of Trade-marks issued a notice on April 2002 requiring INC to show use of the trade-mark registration in Canada. INC filed an affidavit on its use of the trade-mark in response to the s. 45 notice. The Registrar of Trade-marks held that the evidence was insufficient to show use. INC appealed the Registrar’s decision and the Federal Court reversed that decision on October 19, 2006. Target’s counsel appealed to the Federal Court of Appeal, which affirmed the Federal Court decision on November 26, 2007.

Target claimed that they only became aware of INC’s use of TARGET APPAREL as a store name in June 2010. Its counsel sent a letter to INC objecting to the use of the TARGET trade name on August 3, 2010. Again, Target commenced a s. 45 proceeding to cancel the trade-mark registration of TARGET APPAREL. The Registrar of Trade-marks has issued another notice to INC under s. 45 of the Trade-marks Act on July 30, 2010, and the proceeding is currently underway.

Target also requested an injunction for the months leading up to the trade-mark dispute trial, scheduled to begin in November 2012.

The Court set out and applied the three-step test for applications for interlocutory injunctions. Although the Court found the first requirement of a serious question to be tried had been met, the question of irreparable harm to the Plaintiff was answered in the negative.
The Court found the Plaintiff’s submission on irreparable harm, advanced on the basis of a marketing theory about “sincere” and “exciting” brand personalities, difficult to assess. The Court noted, where expert evidence is provided by affidavit and is challenged in the course of the proceedings, the assessment of such expert evidence is best left for the fullness of a trial where review of qualifications and in-court testimony, direct, cross-examination and redirect, are present.

In deciding the question of irreparable harm, the Court held that the level of confusion among prospective customers to be a matter of debate, the expert opinions required closer examination and assessment, and the time to trial was relatively short. Resultantly, Target had not proved on balance of probabilities that it would suffer irreparable harm during the intervening months until a decision is rendered at trial.

The Court further considered the issue of the balance of convenience and determined that the balance favoured INC. In looking back upon the chain of events, the Court noted that INC did not begin expansion with the Target Apparel stores until after the Federal Court of Appeal decision in its favour. At that point, Target had not yet announced its expansion into Canada. The Court held that INC’s decision was not the sort of risk that should be met with the Court’s disapproval. They had taken precautionary steps in the face of Target’s claims: they had inscribed a red maple leaf in a circle rather than using a red bull’s-eye; posted a disclaimer to the effect that it is not Target; and undertaken to maintain records of sales while the litigation is continued. 

No evidence was presented to suggest that Target would be prevented or delayed from opening Target stores in Canada, but the granting of the requested injunction would result in INC having to remove and replace its signage for all stores. Such removal and replacement would not only be costly, but may also suggest instability to INC’s customers, having significant consequences for the company. Consequently, the balance of inconvenience, as it was described by the Court, lay with INC rather than Target. Presumably the matter will now proceed toward trial in November 2012.

Certification Marks: Decision Affirmed by Court of Appeal

By In Case Law, Registration

An earlier blog discussed a Federal Court decision, agreeing with a decision of the Registrar of Trade-marks and preventing the registration of a certification mark, HALLOUMI, in association with cheese.  In The Ministry of Commerce and Industry of the Republic of Cyprus v. International Cheese Council of Canada, the Federal Court of Appeal affirmed the decision.

The Trade-marks Act defines a certification mark as a type of trademark and sets up a specific regime for its adoption and registration by a person not engaged in the manufacture, sale, leasing or hiring of the wares or services in question, who wishes to license others to use the marks.  With wares a certification mark is intended to signify character or quality, working conditions, the class of persons producing the wares or the area they are produced.

The opponent successfully established that HALLOUMI could not be registered pursuant to section 12(1)(b) of the Trade-marks Act, which precludes registration of a mark contrary to section 10, namely a mark that has by ordinary and bona fide usage become recognized in Canada as designating, among other things, a kind of wares.  The evidence established such usage with regards to the cheese at issue.

On appeal to the Court of Appeal, the Cyprus Ministry of Commerce and Industry argued that the relevant date for an opposition based on section 10 was other than the date of the Registrar’s decision and that the judge had failed to apply the proper burden of proof and assess the evidence.  However, none of these arguments succeeded and the registration was not allowed.

Supreme Court Has Spoken On Confusion

By In Case Law, Registration

Following up on a couple of earlier posts on this topic, the Supreme Court of Canada has this morning handed down its decision in the Masterpiece Inc. v. Alavida Lifestyles, Inc. case.  This decision has been long awaited as it appears to put to rest a critical issue in relation to the assessment of confusion in the context of who is entitled to registration of a mark in Canada.

First, a recap of the basic facts.  Alavida obtained a registration of the mark MASTERPIECE LIVING in Canada in 2007 for use in association with various real estate related services.  Its application was filed in December of 2005, based on proposed use of the mark in Canada.  Alavida commenced use of the mark in January of 2006.   Masterpiece Inc. didn’t oppose Alavida’s application, but instead sought to expunge Alavida’s registration, after it issued, on the basis, among other things, that Masterpiece Inc. had used the same or a similar mark in Canada in association with the same or similar services, prior to Alavida’s application being filed and prior to Alavida’s use of the mark in Canada.

At the Trial Division and in the Federal Court of Appeal, Alavida won and its registration was maintained, on the basis of the argument that Masterpiece Inc.’s prior use of the same mark for the same services, even if proven, was limited in time and space and was in a different part of Canada (Alberta) than where Alavida used its mark (Ontario) and that the geographic location of any alleged prior use was a factor to be looked at in determining likelihood of confusion – in essence importing into the analysis, a common law passing off test. Read more

PETA’s Use Of Canadian Club Trademark Gets Whacked

By In Case Law, Protection & Enforcement

People for the Ethical Treatment of Animals (PETA) is in the news again for its cheeky ad campaigns, which sometimes use well known trademarks of other parties to garner exposure for its views on Canada’s seal hunt.  We previously blogged about the use by PETA of an ad featuring the 2010 Winter Olympic and Paralympic Games mascots. 

A recent Globe & Mail article reports that PETA had been distributing postcards in a number of bars in Toronto, with plans to roll out the campaign across the country.  The postcards pictured on one side, a cartoon featuring a seal sitting at a bar and asking  the bartender for “Anything but a Canadian Club”.  The other side of the postcard featured a photograph of a hunter about to club a seal.

The North American distributor of Canadian Club Whisky didn’t see the humour in PETA’s cartoon and sent a cease and desist letter, claiming that the publication had caused degradation of Canadian Club’s corporate image and damage to its brand and trademark.

In response to the demand letter PETA agreed not to send out more postcards and to remove the cartoon from its website.   Notwithstanding its compliance with the demand, a spokesperson for PETA argued that it had the doctrine of fair use on its side, to permit the use of trademarks for parody or satire.  Unfortunately for PETA, fair use is a U.S. doctrine that doesn’t apply in Canada in the context of either copyright or trademarks.

Keyword Advertising Appeal Discounts Trademark Analogies

By In Case Law

Canada continues to await its first Court decision on the use of trademarks in keyword advertising.  The British Columbia Court of Appeal issued its decision this week in the case of Private Career Training Institutions Agency (the Agency)  v. Vancouver Career College (Burnaby) Inc. (VCC).  While the Trial Judge’s decision, that the use of keyword advertising in this case was not misleading in the context of the applicable Bylaw, was upheld, the reasoning of the Trial Judge, to the extent it relied on an analysis of confusion under trademark law, was overruled.

At issue was whether the use of keyword advertising by VCC, which is the operator of a private college, was offside the provisions of a Bylaw of the Agency, which is a regulatory body created by the Private Career Training Institutions Act of British Columbia.  The Bylaw in question states that an institution such as VCC “must not engage in advertising … that is false, deceptive or misleading.  Deceptive advertising includes but is not limited to an oral, written, internet, visual, descriptive or other representation that has the capability, tendency or effect of deceiving or misleading a consumer“.   The Agency went further and issued a guideline for interpretation of this Bylaw which specifically stated that keyword advertising and other similar practices would constitute false, deceptive or misleading activity. Read more