Trademark Confusion and Nature of the Parties’ Goods and Business and Trade

The Federal Court considered whether the Trademarks Opposition Board was wrong to find that the nearly identical trademarks CHEFS-OWN for bean sprouts and CHEF’S OWN for sauces and seasonings could co-exist because the channels of trade and the nature of the goods were sufficiently dissimilar that confusion was unlikely?  Yat Sun Food Products Ltd. v. Griffith Foods International Inc. 2025 FC 1688

Background of the Dispute 

The Applicant owns the registered trademark CHEFS-OWN, for use in association with fresh bean sprouts. The Respondent filed a trademark application for the trademark CHEF’S OWN, for use with soup bases; sauces and seasonings; and salad dressings.  The application was amended to limit it to goods sold on a business-to-business basis with commercial clients in the restaurant, healthcare, travel & leisure, food service chains, food processing, and education industries.

The Applicant opposed the application based on several grounds primarily turning on confusion with its registered mark.

Trademark Opposition Board’s Decision

The Hearing Officer said the trademarks in issue had a low degree of inherent distinctiveness because they consisted of ordinary words and have a laudatory connotation. The Applicant’s more than 25 years of use versus the Respondent’s then three years in the marketplace, favoured the Applicant.

Fresh bean sprouts were intrinsically different from the Respondent’s soup bases, seasonings, sauces, and coatings. She also determined that the channels of trade and target audiences associated with the respective trademarks were sufficiently different that confusion was unlikely. 

Weighing the above factors, she concluded that the intrinsically different goods, the different channels of trade and the different target audiences tipped the balance of probabilities in favour of the Respondent. The opposition was rejected.

The Federal Court Appeal and New Evidence

The Applicant filed additional new evidence which included affidavits outlining Applicant’s sale of bean sprouts to wholesalers / commercial clients in the same channel of trade as the Respondent. The affidavit also said that the Applicant has “recently made the decision to brand their wholesale products with their CHEFS-OWN trademark.”

The ability to file new evidence is no longer as of right and leave of the Court is required. The Court reviewed the transitional provisions of the amending legislation and determined that leave requirement did not apply in this case. The Judge said the Court has not determined yet whether the new leave requirement is purely procedural or what criteria must be satisfied for the Court to grant leave.

The Judge concluded the new evidence relating to the Applicant’s past sales to wholesalers / commercial clients satisfied the materiality requirement and was admissible but the evidence relating to the recently made the decision to brand their wholesale products with their CHEFS-OWN trademark was not. The later evidence was post decision and immaterial.

The de novo Review of the Statutory Factors

Based on the acceptance of the new evidence the Judge did a a de novo review of the paragraph 6(5)(c) and 6(5)(d) factors – nature of the parties’ goods and business and nature of the trade –considering the accepted additional evidence. This included the overall weighing of the confusion factors. 

The Judge was not persuaded that the parties’ goods were as disparate as found by the Hearing Officer. The Hearing Officer’s analysis of the differences in the parties’ goods was linked to the perceived differences in the businesses and channels of trade based on the evidence before the Board. Now it was clear that regardless of how the parties accomplish it, they both produce food products intended for sale in overlapping wholesale channels of trade that could be used in some of the same recipes or dishes.

The Hearing Officer failed to consider the Supreme Court of Canada’s direction it was incorrect in law to limit consideration to post-application use of a trademark to find a reduced likelihood of confusion. Actual use is not irrelevant, but it should not be considered to the exclusion of potential uses within the registration.

While it was not incorrect for the Hearing Officer to consider the Applicant’s actual use, she did so to the exclusion of the scope of the Applicant’s registration, i.e. unrestricted as to the channels of trade. Further, the Hearing Officer’s inference could not have been supported had Applicant’s new evidence, that it had been selling in the wholesale channel for six or seven years by the time of the hearing, been put before her.

The judge concluded that the nature of the goods and business factor somewhat favours the Applicant bearing in mind that both parties’ food products businesses encompass a wholesale component. In addition, the nature of the trade factor favours the Applicant given the overlapping channels of trade and customers, in the wholesale channel, as shown by the Applicant’s new material evidence.

Taking all the subsection 6(5) factors into account, including the reconsidered factors based on the Applicant’s new material evidence, the likelihood of confusion balance tipped in favour of the Applicant and the Respondent has not met its legal onus of establishing that the trademark is registrable and distinctive and that it is entitled to the registration of the mark in Canada. The opposition was allowed.

Conclusion and Practical Takeaways 

Like almost all decisions concerning trademarks the result in this case turns of the facts. The key takeaway is the importance presenting importance of presenting the right evidence at the right time in oppositions particularly when the new requirement to obtain leave is looming.

If you have questions, please contact me at mckeown@gsnh.com 

John McKeown

Goldman Sloan Nash & Haber LLP

480 University Avenue, Suite 1700 

Toronto, Ontario MSG 1V2

Direct Line: (416) 597-3371

Fax: (416) 597-3370

This article is of general nature and is not intended to provide specific legal advice as individual situations will differ. Specialist advice should be sought about your specific circumstances. 

A version of this article originally appeared in the Law360 Canada published by LexisNexis Canada Inc.