Friday, June 02, 2006

The Supremes on Famous Trade-marks in Canada

The Supreme Court of Canada has issued two brilliant decisions today which dismissed two appeals that would have - if successful - taken “famous mark” protection in Canada to a level even beyond what the big Americans trade-mark owners have in their own country under the badge of what they call “anti-dilution”. Readers will recall that Victoria’s Secret lost a case in the US Supreme Court three years ago against an adult novelty store named Victor's Little Secret that sold “tawdry merchandise”.

One appeal involved the attempt by MATTEL - owner of the BARBIE trade-mark to stop a Montreal BBQ Restaurant from calling itself BARBIE’S. The other involved an attempt by the French high end champagne maker VEUVE-CLICQUOT to stop a Montreal clothing shop chain from calling itself CLIQUOT.

The judgments were released together and were both written by Justice Ian Binnie. Although they involved different facts and legal issues, there are certain obvious common elements - the most important being the ambit of protection to what are regarded as “famous” trade-marks. The Court has said that the ambit is not unlimited. BARBIE may cover dolls and maybe more but it doesn’t extend to restaurants and likewise CLIQUOT may cover champagne and maybe more but not women’s clothes.

The result in no surprise to Canadian intellectual property lawyers. However, Justice Binnie, in his characteristic manner, clearly and constructively sets straight decades of sometimes confusing and even apparently contradicting case and statutory law that has left practitioners and business people perplexed. Here is my quick take on the two very important rulings:

• The fact that a trade-mark is famous is a factor - but not by any means determinative - that there can be a likelihood of confusion or deprecation of good will
• there must be real evidence of a likelihood of confusion or deprecation of good will - not just speculation - and the absence of evidence of actual confusion is relevant and may even lead to an “adverse inference”. In other words, there’s got to be real evidence of a likelihood of confusion - and preferably of actual confusion - in order to succeed
• confusion is assessed in the mind of the “The Casual Consumer Somewhat in a Hurry” and such consumer is to be given “ a certain amount of credit” and not regarded as “completely devoid of intelligence or of normal powers of recollection or are totally unaware or uninformed as to what goes on around them.”
• the farther apart or more “remote” the wares and services in question are, the safer it will be for the less famous party
• And lest anyone forget, “Unlike other forms of intellectual property, the gravamen of trade-mark entitlement is actual use. By contrast, a Canadian inventor is entitled to his or her patent even if no commercial use of it is made. A playwright retains copyright even if the play remains unperformed. But in trade-marks the watchword is “use it or lose it”.

Justice Binnie has also provided a wonderful guide to trade-mark lawyers in terms of what they will need in evidence in future cases and on the use of surveys and how important it is to ask the right questions in these surveys.


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