2011 QCCS 744 (February 11, 2011)
In a trademark infringement case, the Quebec Superior Court found that sales by the defendants of hunting boots marked with the trademark ACTION was likely to cause confusion with the plaintiff's registered trademark ACTON for use in association with similar wares. Nonetheless, the Court refused to hold the defendants liable for trademark infringement, concluding that the plaintiff, having previously manufactured ACTION boots for the defendants and having waited five years thereafter to launch their action, had either acquiesced or had its action barred by limitation period.
In 2003, the plaintiff manufactured 4000 pairs of boots with the trademark ACTION for the defendants. A year later, the plaintiff acquired the rights to the trademark ACTON, registered by a third party in 1995 for use in association with similar wares, but waited until late 2008 to object to the defendants' continued use of their trademark ACTION. The Quebec Superior Court was convinced that a reasonable and informed person, as a matter of first impression, was likely to be confused by these two trademarks, which were both used in association with hunting boots. However, Justice Émond accepted the defendants' arguments that the plaintiff, having waited five years to launch its action, had either acquiesced or had its action barred by prescription (hereinafter "limitation period"). The Court held that the corporate plaintiff had to have been aware that it had previously sold ACTION boots to the defendants when it acquired the trademark ACTON. Such delay was found to be fatal, and the trademark infringement action was dismissed with costs.
Facts. On September 29, 1995, Acton International Inc., a third party to the action, registered the trademark ACTON for use in association with "[f]ootwear, overshoes, galoshes; boots, namely: utility boots, hunting and fishing boots, leather boots, waders, industrial boots, sport boots."
In 2002, the defendants, Naturmania Inc. and 9144-4232 Québec Inc., two associated corporations (hereinafter the "defendants"), began selling hunting clothing under the trademark ACTION. In the following months, they added hunting footwear to their ACTION line.
In May 2003, the defendants had the plaintiff, Chaussures Régence Inc., (hereinafter: the "plaintiff") manufacture 4000 pairs of boots marked with its trademark ACTION.
In August 2004, the plaintiff acquired the trademark registration for ACTON. In 2006, the plaintiff revamped its ACTON line of footwear and began selling hunting boots, which were visually closely similar to the defendants' product.
In 2008, the plaintiff noted two instances of confusion that were said to have triggered the action. First, one of the plaintiff's distributors returned to the latter a lot of defective boots, a pair of which was one of the defendants' ACTION boots. Second, one of its distributors used the trademark ACTION in an advertisement for the plaintiff's boots.
On October 2, 2008, the plaintiff sent a cease & desist letter to the defendants and on February 17, 2009, filed an action in the Quebec Superior Court for trademark infringement contrary to section 19 and 20 of the Trademarks Act and for passing off under the Civil Code of Québec.
Analysis. On the issue of likelihood of confusion, Justice Émond referred to the jurisprudence of the Quebec Court of Appeal. In particular, the Court noted that actual confusion does not need to be shown, but that the degree of likelihood of confusion required is one of probability, not mere possibility. Based on the two instances of confusion that were put into evidence, the Court was convinced that a "reasonable and informed person," as a matter of first impression, was likely to be confused by the trademarks ACTION and ACTON when used in association with boots. The Court thus concluded that the plaintiff's trademark had been infringed and went on to consider the defendants' arguments of acquiescence and limitation period.
The defendants argued that the plaintiff, having manufactured boots marked with the ACTION trademark for them in May 2003, knew that this trademark was used by the defendants when it later acquired the trademark registration for ACTON in August 2004, but nonetheless waited until October 2008 to raise this issue with the defendants. As such, it was argued that the plaintiff had either acquiesced to the defendants' use of the ACTION trademark or let its right of action become barred by limitation period.
In response to these arguments, the plaintiff argued that its President was not aware that his company had previously manufactured ACTION boots for the defendants when it acquired the trademark registration for ACTON, and only found out about the defendants' ACTION boots in 2008 when he saw the advertisement of one of its distributors misidentifying his company's boots as ACTION boots.
Justice Émond held that the plaintiff's position was simply unreasonable and that the corporate plaintiff had to be aware that it had previously sold ACTION boots to the defendants.
This five-year delay in bringing an infringement action was considered fatal by the Court, either because of acquiescence or limitation period. The Court did not, however, refer specifically or discuss the applicable test for acquiescence or limitation period.
The plaintiff's action for trademark infringement was dismissed with costs. This decision is a reminder to trademark owners of the importance of acting swiftly to prevent any infringement of their rights in order to protect the distinctiveness of their marks.
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