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The Good, The Bad and The Ugly: Recent Developments Regarding The Duty to Defend
The Medium

Adidas, Veuve Clicquot, Barbie… When is a mark considered “famous” in Canada, and do famous marks enjoy special protection? A handful of Canadian cases have outlined the court’s treatment of well­-known brands:

  • Sure, Barbie is famous… but not “trump-­card” famous. That was the conclusion of the court in Mattel, Inc. v. 3894207 Canada Inc., when Mattel raised a challenged that the mark Barbie used in connection with “restaurant services” would lead consumers to make an inference that the restaurant was affiliated with Mattel’s famous Barbie doll mark.

Canadian Courts will not automatically presume that there will be confusion just because one mark is famous. As the Federal Court in Mattel phrased it, “the fame of the mark could not act as a marketing trump card such that the other factors are thereby obliterated.” Canadian courts will assess all of the surrounding circumstances to determine confusion. In Mattel, they considered the restaurant services to be distinguishable from Mattel’s famous doll. 

  • The owner of the famous luxury brand Veuve Clicquot encountered similar difficulties in its infringement claim against a purveyor of mid-priced women’s wear” being sold under the brand Clicquot in Quebec.

In Veuve Clicquot Ponsardin v. Boutiques Cliquot Ltée., Veuve Clicquot argued that the association with – sniff – mid-­priced apparel was damaging its carefully managed reputation. In an interesting turn of phrase from the decision, the Supreme Court of Canada noted that the champagne maker “has been building its fine reputation with the drinking classes since before the French Revolution.” The role of champagne “drinking classes” as a catalyst for the French Revolution is perhaps a topic for a separate article.

In any event, the Court did not find any evidence that the Veuve Clicquot brand image was tarnished, or that the goodwill was otherwise devalued or diluted. The infringement claim was dismissed, leaving the Clicquot women’s wear shops free to continue business.

  • In a more recent case, shoemaker Adidas challenged a competitor’s registration of a two-stripe design for shoes. Adidas complained that the two-­stripe design was confusing with its own three-­stripe design. In Adidas AG v. Globe International Nominees Pty Ltd., the Federal Court conceded that “the Adidas 3­ Stripes Design is well-­known, if not famous, in Canada and internationally.” However, in deciding that the two­-stripe mark was not confusing with the Adidas 3 ­stripe design, the Court sounded a cautionary note for owners of famous brands:

“Fame and notoriety associated with a trademark can be a double­-edged sword for a trademark owner. On the one hand, an enhanced reputation may provide the owner with extended protection for the trademark beyond goods and/or services covered by a registration for the marks... On the other hand, when a trademark becomes so well known or famous that the public is so familiar with it and readily identifies that trademark as used in the marketplace on goods and/or services, it may be that even as a matter of first impression, any differences between the well-­known mark and another party’s trademark, as used on the same or similar goods and/or services, may serve to more easily distinguish the other party’s trademark and reduce any likelihood of confusion.”

Put another way, a mark can be so well-­known to consumers that small differences in a competing mark will enable consumers to distinguish between the two marks.

Get advice on trade­mark protection and infringement from Field Law's Trademark Group.