Trademark law has received increased attention from the Supreme Court of Canada as of late. In addition to releasing a decision on November 17, 2005 in the well publicized LEGO case, Kirkbi AG v. Ritvik Holdings Inc., (2005 SCC 65) (a summary of which appears on page 4 of this newsletter), the Supreme Court also heard two cases on October 18, 2005, dealing with famous trademarks: Veuve Clicquot Ponsardin v. Boutiques Cliquot Ltée (2004 FCA 164) and Mattel Inc. v. 3894207 Canada Inc. (2005 FCA 13).
In Veuve Clicquot, the well known manufacturer of champagne sued the owner of women’s retail clothing stores that were operating under the names CLIQUOT and LES BOUTIQUES CLIQUOT for trademark infringement, passing off and depreciation of goodwill. The Plaintiff had used its VEUVE CLICQUOT trademark for many years in connection with champagne and promotional items, such as scarves and other fashion articles. The Plaintiff had also advertised its champagne in fashion magazines and had sponsored fashion events. Despite these facts, both the Federal Court and the Federal Court of Appeal found that there was no risk of confusion in consumers’ minds and dismissed the claims of Veuve Clicquot. The key factor in this analysis was the difference between the parties’ wares and services.
In Mattel, the manufacturer of the famous plastic doll BARBIE opposed the trademark application of a Montreal area restaurant owner seeking to register the trademark BARBIES & Design in association with restaurant services. The Trademarks Office, the Federal Court and the Federal Court of Appeal all rejected Mattel’s opposition and held that there is no reasonable likelihood of confusion between the parties’ trademarks, largely due to differences in their wares and services.
Both Veuve Clicquot and Mattel are appellants before the Supreme Court in their respective proceedings, and are arguing that their trademarks are famous and therefore deserve a broad scope of protection that goes beyond an association with any particular wares or services. The appeals were argued on October 18, 2005, and the decisions are under reserve.
There is no existing Canadian legislation that specifically defines the scope of protection afforded to famous trademarks. The primary battleground is the general concept of “confusion” as set out in section 6 of the Trademarks Act (the “Act”). Section 6(5) of the Act specifically enumerates “the nature of the wares, services or business” and “the nature of the trade” as factors that must be considered in assessing confusion. However, Veuve Clicquot and Mattel are arguing that the courts have improperly introduced a requirement that a connection must exist between the parties’ wares and services in order for confusion to exist, contrary to the wording of section 6(2) of the Act, which states that confusion as to the source of wares and services may be inferred “whether or not the wares or services are of the same general class”.
Interestingly, in two recent decisions rendered since the Supreme Court’s hearings (Remo Imports Ltd. v. Jaguar Cars Limited and Ford Motor Company of Canada (2006 FC 21) and Vibe Ventures LLC v. 3681441 Canada Inc (2005 FC 1650)), the Federal Court has demonstrated its willingness to bridge the gap and find confusion with famous (or at least well known) trademarks, notwithstanding the parties’ seemingly disparate wares.
First, in Jaguar (issued January 16, 2006), Jaguar Cars has succeeded in both enjoining a Montreal-based luggage company (Remo) from using the trademark JAGUAR and in expunging their JAGUAR trademark registration for luggage and related wares.
In this case, which spanned 14 years of litigation and involved more than 6,000 exhibits, the Federal Court issued a 136 page decision that comprehensively considers the issues of famous marks and depreciation of goodwill in Canada.
The Federal Court held that the evidence established both confusion and depreciation of the goodwill in the trademark JAGUAR. In so doing, the Court indicated that there was a “natural brand extension from luxury cars into luggage”, and identified the following factors as being relevant: an overlap in the function and concurrent use of the parties’ JAGUAR wares; an industry practice worldwide establishing that other automotive brands have extended into the luggage field; that there was an actual extension by Jaguar Cars into the luggage field and this had been their intention for many years prior to Remo’s adoption of the JAGUAR mark; and that there was a connection in the attributes of the brand as perceived by consumers.
In the second case, the publisher of VIBE magazine sought to expunge a trademark that was registered by a clothing manufacturer. The trademark was identical to that used by the publisher on its magazines, website, and various promotional articles such as T-shirts and sweatshirts. On December 5, 2005, the Federal Court ordered that the registration be expunged and held that use of a trademark that is identical in appearance creates confusion in the same youthful clientele to which the products are targeted. However, the Federal Court declined to expunge a parallel registration for the word mark VIBE.
The Federal Court stated that regardless of the Supreme Court’s eventual conclusion in the Veuve Clicquot and Mattel cases, “[o]ne cannot use an identical script when targeting a specific clientele, even though one party’s wares are sold at newsstands and the other’s in stores”.
The decisions of the Supreme Court in the Veuve Clicquot and Mattel appeals are highly anticipated, and it is hoped that they will clarify the scope of protection of famous (and not quite famous) trademarks in Canada.
Mark K. Evans and Rex M. Shoyama, Toronto