A decision of the Federal Court raises issues concerning the Applicant’s choice of its primary trademark. Blyth Cowbells Brewing Inc. v. Bellwoods Brewery Inc. 2022 FC 248.
The Facts
The Applicant, a craft brewer in Ontario, filed a trademark application for the registration of the following mark
on the basis of the proposed use in association with beer and brewery services, among other things.
The Respondent, who is also a craft brewer in Ontario, opposed the application primarily because the Applicant’s mark was confusing with its registered mark shown below
registered for use in association with beer and brewery services, among other things.
The Trademark Opposition Board
The Hearing Officer found that the probability of confusion between the respective marks was evenly balanced between a finding of confusion and of no confusion. There was a fair degree of resemblance of the respective marks in terms of their appearance and the suggested idea because they are both bell designs. Both parties offer similar goods and services, and their channels of trade overlap. The Applicant’s evidence was not sufficient to support the conclusion that a bell design was widely used in the alcoholic beverages and restaurant industry, such that the average Canadian consumer is accustomed to distinguishing these marks. However, the Respondent filed no evidence of use of its mark in association with its goods, and any use shown in association with its services was limited.
Since the burden was on the Applicant to establish that, on a balance of probabilities, its mark was not confusing with the Respondent’s mark, the Respondent’s opposition succeeded.
The Appeal
The Applicant appealed to the Federal Court. On appeal, evidence in addition to that adduced before the Board may be presented, and the Court may exercise any discretion vested in the Board.
Where new evidence on the appeal would have materially affected the Board’s findings of fact or exercise of discretion, the Federal Court must come to its conclusion as to the correctness of the Board’s decision. Otherwise, the standard of review is the appellate standard of correctness (for questions of law) and palpable and overriding error (for questions of fact or mixed fact and law).
The Applicant filed additional affidavits relating to the state of the register and the marketplace concerning the use of similar marks by others and the extent of its advertising using its mark, and the goodwill it had acquired relating to its mark. The Respondent filed additional affidavits concerning the extent of the use of its mark, among other things.
The Judge concluded that the new evidence submitted by both parties could have led the Hearing Officer to a different conclusion regarding the extent to which the respective marks have become known; the length of time the marks have been used; and the overall surrounding circumstances regarding the confusion. He carried out a de novo review of the evidence with the allowed new evidence in mind to assess the overall balancing of the statutory factors and the surrounding circumstances relating to the likelihood of confusion.
Since this was a de novo review, the material date was the date of the decision. Under the Act, the use of a trademark causes confusion with another trademark if the use of both marks in the same area would be likely to lead to the inference that the goods or services associated with those trademarks are manufactured, sold, or performed by the same person. The test to be applied is a matter of first impression in the mind of a casual consumer somewhat in a hurry who sees the mark when he or she has no more than an imperfect recollection of the prior trademark and does not give the matter any detailed consideration or scrutiny, or examine closely the similarities and differences between the marks.
Subsection 6(5) of the Act sets out the statutory factors to be considered in determining whether trademarks are confusing. The court shall have regard to all the surrounding circumstances, including
(a) the inherent distinctiveness of the trademarks and the extent to which they have become known;
(b) the length of time the trademarks have been in use;
(c) the nature of the goods, services or business;
(d) the nature of the trade; and
(e) the degree of resemblance between the trademarks, including in appearance or sound or in the ideas suggested by them.
When the Judge considered the admissible evidence, he concluded there was a likelihood of confusion at the time of his decision. The statutory factors, when considered individually and as a whole, together with the surrounding circumstances, were neutral or weighed in favour of a finding of a likelihood of confusion:
There was a fair degree of resemblance between the marks in issue;
The Respondent has been using their mark for a greater length of time;
There was an overlap in the nature, goods, and trade favouring the Respondent;
The respective marks are both distinctive, but the Respondent’s mark was known to a greater extent;
The state of the register and marketplace evidence does not assist the Applicant; and
The evidence of actual confusion was of no consequence and was given little or no weight.
The Judge’s said that the Applicant chose a similar bell design as used by their competitor, in the same Ontario market, for essentially the same wares and services with eyes wide open and subject to the risk of confusion.
The appeal was dismissed with costs.
Comment
The Applicant’s choice of its mark subjected it to significant risk. Obtaining an adequate search of the register and common law references and opinions based on the search can mitigate the risks of adopting a new mark. You can’t build a business on sand - there needs to be a solid trademark foundation.
If you have questions, please contact me at mckeown@gsnh.com.
Goldman Sloan Nash & Haber LLP
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Toronto, Ontario M5G 1V2
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These comments are of a general nature and not intended to provide legal advice as individual situations will differ and should be discussed with a lawyer.
A version of this article originally appeared in the Lawyer’s Daily published by LexisNexis Canada Inc.