Fame is not everything, Supreme Court rules

5 June 2006

If you dine at a BARBIE'S Restaurant, would you think Mattel Inc. is the owner? Would you also expect that LES BOUTIQUES CLIQUOT, a women's clothing chain, had something to do with the famous VEUVE CLIQUOT champagne?

This morning, the Supreme Court of Canada weighed in on whether well-known trademarks should be allowed to be used by others to sell goods or services in unrelated industries, thus setting the course for Canada's trade-mark policy. Its decision: fame does not, in and of itself, provide absolute protection for a trade-mark. It is one factor to be considered with all the others. As long as there is a difference between the parties wares/services, consumers and channels of trade, there is no infringement on a well-known mark.

The Issue:

In Canada, the owner of a trade-mark can obtain the exclusive right to use the mark across the country by registering the mark in relation to certain wares and services.

At issue in the case of well-known trademarks is whether the scope of trademark protection should be expanded. Other businesses could exploit a trademark's fame to sell their own wares and thus benefit unfairly from its reputation and consumer goodwill. However, such broad protection is inconsistent with the very basis of Canadian trade-mark registration, which is wares- and services-based.

The State of Canadian Law:

As the courts see it, the issue is not how famous the mark is, but whether consumers are likely to confuse the owner of the famous mark with the maker of another, unrelated good.

In Pink Panther Beauty Corp. v. United Artists Corp. (1998), the Federal Court of Appeal allowed the trade-mark PINK PANTHER to be registered in association with beauty products over the objection of United Artists Corporation, owner of the famous THE PINK PANTHER mark registered in association with the entertainment business. The Court held that it was unlikely consumers would be confused. In other words: the PINK PANTHER beauty parlour patron would not be likely to think that the hairdressing services she received were provided by United Artists Studios.

The Court made two similar decisions in the early 2000's. In the Veuve Clicquot case, it dismissed an infringement action brought by the famous champagne producer against a Quebec-based women's clothing chain which used the trade-mark CLIQUOT.

In the Barbie case, the Court allowed the registration of the trade-mark BARBIE'S & DESIGN in association with restaurant services, over the objections of Mattel Inc.

Both decisions were appealed to the Supreme Court which rendered its decision this morning.

The Final Word from the Supreme Court:

The Supreme Court has allowed the mark CLIQUOT to be used in relation to clothing stores and the mark BARBIE'S to be registered in relation to restaurant services. Both decisions are very fact specific, but the Supreme Court has highlighted that fame does not, in and of itself, provide absolute protection for a trade-mark. It is one factor to be considered with all the others. The key, in both cases, was the difference between the parties' wares/services, the channels of trade and the consumers of the parties' wares.

While well-known trademarks did not gain extra protection from the Supreme Court today, the Court did leave open the possibility that different cases could yield a different result - a trade-mark's fame may be capable of carrying the mark across product lines. If a new mark causes confusion in the marketplace, it should not be permitted , whether or not the wares are of the same general class.

About Ogilvy Renault

Ogilvy Renault LLP is a full-service law firm with more than 400 lawyers, patent and trade-mark agents. The firm has offices in Montréal, Ottawa, Québec, Toronto, Vancouver and London and serves a diverse client base that includes many Fortune 500 and FT 500 organizations. For more information, please consult www.ogilvyrenault.com.

For further information: Rachael MacKenzie, (416) 216-3909, cblack@ogilvyrenault.com; Caroline Couillard, (514) 847-4723, ccouillard@ogilvyrenault.com

Source: newswire

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