Canadian Trademark Blog

Maintained by Clark Wilson LLP

Interlocutory Injunctions in Trademark Cases: A Difficult Test to Meet

By In Case Law, Protection & Enforcement

Two recent cases, one from the Federal Court and the other from the Federal Court of Appeal, illustrate how difficult it is to meet the test for an interlocutory injunction in a Canadian trademark case.

In CMAC Mortgages Ltd. et al v. Canadian Mortgage Expert Centres Ltd. et al, Lemieux, J. of the Federal Court applied the 3-part test found in the Supreme Court of Canada’s decision in RJR-MacDonald Inc. v. Canada Attorney General (that the applicant for an injunction must demonstrate (1) a serious question to be tried; (2) that the applicant would suffer irreparable harm in the absence of the injunction; and (3) that an assessment of which party would suffer greater harm from the granting or refusal of a remedy favours the applicant.)

The Applicant (Plaintiff), Ontario Mortgage Action Centre Ltd. c.o.b. as OMAC, had been operating a residential mortgage business in Ontario for a number of years and had several trademark registrations. The principal of OMAC had only recently incorporated CMAC Mortgages Ltd. and opened a Calgary office under the latter name.

The Defendant Canadian Mortgage Expert Centres Ltd. c.o.b. CMEC was incorporated shortly after CMAC Mortgages Ltd. and opened two offices, both in Ontario. Thus, CMAC Mortgages Ltd. and the company carrying on business as CMEC operated in different jurisdictions.

There was no evidence of actual confusion regarding CMAC and CMEC. There was, however, some evidence of actual confusion as between OMAC and CMEC, although minimal. Lemieux, J. concluded that there was a serious issue to be tried in respect of confusion and passing–off between OMAC and CMEC, but not between the other Plaintiffs and CMEC since the latter were not operating in the same marketplace.

However, the Plaintiffs had not led sufficient evidence to establish irreparable harm. According to Lemieux J. “the loss of goodwill and the resulting irreparable harm cannot be inferred. It must be established by ‘clear evidence'”. It was noted that the Plaintiffs, rather than focusing on evidence of irreparable harm had attempted to show the defendants were impecunious.

Finally, Lemieux, J. explained that his preliminary assessment of OMAC’s case was that it was weak in terms of confusion since buying mortgage services is not like buying wares off a shelf, given that the buyer of mortgage services will be more discriminating.

In Hyundai Auto Canada v. Cross Canada Auto Body Supply (West) Limited et al the Court of Appeal dismissed the appeal with costs noting that the test for granting an interlocutory injunction had been clearly set out by the Supreme Court of Canada in RJR-MacDonald. The Court of Appeal also agreed with the trial judge that the evidence as to irreparable harm was essentially speculative and there was no demonstration that the harm could not be compensated in damages if the injunction was refused.

It is clear from these cases that interlocutory injunctions are very difficult to obtain. In the absence of clear evidence of irreparable harm that cannot be compensated for in damages, courts will refuse to grant the injunction.

Law Bloggers Unite

By In Uncategorized

Jeffrey Vicq and Larry Munn, two of your hosts here at the Canadian Trademark Blog, had the chance to chat with other West Coast-based law bloggers at the recent Seattle Law Blogger Meetup, hosted by the talented Michael Atkins of Graham & Dunn. The event was a terrific success: good information about blogging effectively, as well as a few rounds of good cheer, were shared. Summaries of the event, as well as a few pictures, can be found at the (excellent!) blogs linked below:

  • Mike Atkins’ Seattle Trademark Lawyer Blog post here;
  • Dan Harris’ China Law Blog post here;
  • Avvo’s Avvo Blog post here;
  • Rod Stephens’ Employment Advisory Blog post here; and
  • Venkat Balasubramani’s Spam Notes post here.

Plans are under development for a second meeting sometime in the coming year, to be held here in Vancouver. Stay tuned.

Social Networking & Anne of Green Gables

By In Branding, Famous Marks

Anne of Green Gables is widely regarded as a Canadian cultural icon. The wholesome image of the redheaded Anne with a straw hat and pigtails is synonymous with Prince Edward Island, the location of the book written over 100 years ago by L.M. Montgomery. The province jointly owns the Anne of Green Gables trademark with the heirs of L.M. Montgomery and have even established the “Anne Authority” to ensure that Anne’s image is properly protected.

According to a recent news report, a new Canadian children’s website, www.annesdiary.com, has come under wrath for using the unauthorised image of Anne to provide a social networking site for girls between the ages of 6 – 14. The website features an avatar in the likeness of Anne, claiming to be inspired by the much loved Anne of Green Gables novels. A spokesman for the website said that the trademark holders were approached but declined to give their permission to use the Anne image. Prince Edward Island Development Minister said that it takes violations of the trademark very seriously and would pursue the matter vigorously.

Despite the controversy, many parents will welcome the new website because it claims to be one of the most secure websites for children in the world. The site takes the protection of web content for children very seriously and is secured by the use of a biometric fingerprint sensor. According to the website, once a child has enrolled on the site, only they can access their online secure bedroom and diary. Members receive a fingerprint reader using a one-time authentication code thereby registering their identity on the secure database. The fingerprint matrix itself is encrypted and transmitted securely across the Web to authenticate users. Even if someone gets a hold of the fingerprint matrix, it will be undecipherable and unusable to them.

Parents may also use the secure option to register their child on the site by providing details of a Sponsor who is able to verify the age and identity of the child. In order to be eligible, a Sponsor must be known to the child, be a resident of the country in which the registrant lives, and be a recognised professional from the website’s list. Parents must provide an e-mail mailing address and telephone number where a sponsor can be contacted for verification.  Sponsors are e-mailed a one-time Authentication Code which they must use to activate the child’s Anne’s Diary account. This code is used when the child first registers her fingerprint to initialize her account.

A spokesperson for the website said they would wait to hear from the Anne Authority before deciding on the next step.

Premier’s Blogger Battle

By In Domain Name Disputes, Protection & Enforcement

Canadian domain name aficionados and Albertan politicos of all stripes have had a chuckle over the edstelmach.ca story the last few days. In case you missed it, popular Alberta blogger Dave Cournoyer (who blogs at daveberta.ca) was threatened by lawyers for Alberta Premier Ed Stelmach, who were agitated that Cournoyer had registered the edstelmach.ca domain name.

Stelmach’s lawyer, a specialist in family and criminal injury issues, claimed that Cournoyer had registered the name in “bad faith” (which would open up a claim under CIRA’s Domain Name Dispute Resolution Policy) and also accused Cournoyer of “misappropriating” Stelmach’s personality, which led Cournoyer to quip: “I’m not sure where Ed Stelmach’s personality is, but I certainly didn’t take it.”

However, in a development under the heading “turnabout is fairplay”, on Wednesday the domain daveberta.com was purchased by Calgary-based financial advisor Andrea Kirby. For a brief period on Thursday, the daveberta.com site was directed to the Wikipedia page for weasels.

For more coverage, including Michael Geist’s comments about the Premier’s poor chances of success, see the list of links at see daveberta.ca.

POM-POM Survives Section 45 Scrutiny

By In Case Law

We recently reported on a number of section 45 decisions, the purpose of which is to remove “deadwood” or outdated registered trademarks from the Register. In such proceedings, the burden of proof is on the registered owner of the trademark to demonstrate “use” during the previous three year period in order to maintain the mark on the register.

In the recent Federal Court of Appeal case of Brouillette Kosie Prince and Orange Cove-Sanger Citrus Association, the applicant (the party challenging the registration) appealed the decison of the Registrar with respect to a proof-of-use proceeding. The applicant objected to the quality of the evidence submitted by the respondent (the owner of the registration) both before the Registrar and before the Federal Court of Appeal. The respondent was a grower member of Sunkist Growers, a cooperative that assists in the distribution of its members’ products including invoicing such products to buyers on behalf of its members. The Registrar maintained the registration of the respondent’s mark POM-POM on account of its appearance on packaging when the wares were sold to Canadian distributors. The Federal Court held that it was not necessary for the mark to be seen by the consumers who purchased the wares from the respondent’s customers and the Court of Appeal agreed with this conclusion.

The Federal Court of Appeal held that it need only decide on the issue de novo when additional evidence is adduced that would materially affect the Registrar’s finding of fact or the exercise of his discretion. If new evidence added nothing of significance, but was merely repetitive of existing evidence, the issue was whether the Registrar’s decision could survive a probing examination. As the evidence submitted on the appeal did not raise any new issues, the case was dismissed given the reasonableness of the Registrar’s decision in maintaining the registration of the POM-POM mark.

World of Webkinz

By In Branding

Webkinz, the little stuffed animal toys which may be activated through a code to enter the on-line Webkinz world, are drawing more and more children and tweens into the realm of virtual reality. In the past, many companies have been reluctant to charge children for website access for fear of alienating parents. But the Toronto based Canadian company Ganz may have solved this problem through the powerful brand that is the Webkinz cuddly toy and on-line environment.

Visitors to the free Webkinz website  spent more than one million hours there in November, with the average child clocking up an average of two hours per visit. However, in order to fully access the Webkinz world, parents must pay approximately $15 for a Webkinz real-world pet toy which children may then “adopt” and care for on-line. Users give each toy a gender and a name and can spend “kinz cash” to buy food, clothes and furniture or even to take neglected pets to a virtual doctor.

Ganz have now launched a line of accessories such as cosmetics and clothing items with codes that redeem a prize for the pets’ on-line avatars in order to ensure that the company capitalizes on children’s web time.