In a recent decision of the Supreme Court of Canada Canada (Minister of Citizenship and Immigration) v. Vavilov (Valilov), the Court attempted to clarify and simplify the test for judicial review. Appeals from the Trademark Opposition Board come within the category of judicial review. Unfortunately, applying the Vavilov standard has been less than clear. Fortunately, the Federal Court of Appeal has now had an opportunity to clarify the application of the Vavilov test and provided some useful advice concerning the application of the test for confusion.
The Facts
The applicant filed two trademark applications, one for the word mark JAVELO and the other for the same word with a design. In broad terms the goods consisted of bulk bleach manufactured exclusively to the order of industrial clientele according to their specific needs and excluding sale to retailers and retail sale of the goods to consumers.
The applications were opposed by Clorox Company of Canada Ltd. (Clorox) who owns several registered trademarks for JAVEX and other similar marks for use in association with bleach.
The grounds of opposition included confusion with Clorox’s registered trademarks. Clorox did not file evidence of the use of its mark. After reviewing the statutory factors, the Hearing officer saw no prospect of confusion and dismissed the opposition.
The Federal Court
Clorox appealed to the Federal Court and filed additional evidence attempting to show the extent of the use of its marks. The judge hearing the appeal reviewed the Hearing officer’s decision on a reasonableness standard but said that when issues relating to the use of Clorox’s registered trademarks were raised he would assess the evidence without deferring to the Hearing officer.
The judge reviewed the evidence relating to the statutory factors but emphasized that 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 applicant’s mark when he or she has no more than an imperfect recollection of Clorox’s trademarks and does not give the matter any detailed consideration or examine closely the similarities or the differences between the marks.
The judge also emphasized that confusion must be assessed concerning the registered uses as opposed to the actual use of the marks. The consumer, whose viewpoint must be adopted, was not hurried to the same extent. When faced with valuable or niche-market goods more care will naturally be taken by the consumer.
Regarding the inherent distinctiveness of the parties’ marks, the judge said that the starting point of the analysis was that the two sets of trademarks where derived from the French expression “eau de Javel” a common noun translated as “bleach” and that designates the product in issue. Although it was claimed that the mark JAVEX was a coined term, this was true only to a limited extent. The word “Javex” is composed of a prefix derived from the French common noun “Javel,” which designates the product, to which the letter “x” was added. The same is true of the mark “Javelo.” Both of the parties’ marks possessed limited inherent distinctiveness.
To accept Clorox’s position, from a practical viewpoint, would allow monopolization of words of the French language. It was well established that no person may fence in common words of the English or French languages and words of a general nature cannot be appropriated over a wide area.
The additional evidence filed by Clorox provided evidence of use, but the judge could not assess its intensity. On the product samples provided the trademark CLOROX was preeminent with the JAVEX mark only displayed in the discrete way on the back of the bottle.
The products associated with the two marks were essentially the same. The judge refused to agree with applicant’s argument that the products of the two parties were intended for different markets. The Hearing officer said that the applicant’s attempt to narrow the scope of its application was not relevant. What matters was that the registration of the JAVEX marks did not restrict their use or the market the products where intended for. This overlapping between the two marks favoured a finding of confusion.
Clorox had not proven that its JAVEX marks had inherent or acquired distinctiveness of such a degree that it led to a finding of confusion. That the products associated with the two marks were the same could not counterbalance the low degree of resemblance. There was no confusion between parties’ marks.
The Federal Court of Appeal
Clorox unsuccessfully appealed from this decision to the Federal Court of Appeal.
i) The Vavilov Standard of Review
The Court clarified how theValilov standard should be applied in an appeal from a decision of the Trademark Opposition Board.
First, Valilov does not affect the standard of review the Court must apply when examining the Federal Court’s finding in relation to the materiality of the new evidence. When making such a decision, the Federal Court was not acting as a reviewing court but as a court of first instance. Its decision must be assessed on an appellate standard, and since it is a question of mixed fact and law, it will stand or fall based on the palpable and overriding error standard.
Second, when the new evidence is material—which has been interpreted to mean “sufficiently substantial and significant”, the appeal is de novo in nature and the correctness standard applies.
Finally, if no new evidence is adduced before the Federal Court, or if the evidence is not material or “sufficiently substantial and significant” the appellate standard of review applies. For questions of fact and mixed fact and law (except for extricable questions of law), the standard is that of the “palpable and overriding error”. For questions of law, the standard is correctness.
ii) The Test for Confusion
The Federal Court did not err in saying that a consumer “is not always hurried to the same extent”. For valuable or niche market goods, the degree of care of the relevant consumer may vary with the circumstances, and the normal channels of trade for a particular good must also be considered. This is necessarily the case for JAVELO bleach, which must be ordered by tanker-truck quantities. The Federal Court could consider that factor in assessing the likelihood of confusion and made no error of law in doing so.
The Court refused to reweigh the evidence and to come to a different conclusion than that reached by the TMOB and the Federal Court. This was a steep hill to climb, considering that on questions of fact and of mixed fact and law, the standard of review is the standard of palpable and overriding error. Clorox must convince the Court that the Federal Court made an error that was obvious and goes to the very core of the outcome of the case: This is an even more deferential standard of review than the standard of reasonableness applied by the Federal Court.
Finally, the assessment of inherent distinctiveness cannot be limited to one of the two official languages of Canada. The Act applies throughout the country and French and English must be treated on the same footing. That a unilingual francophone or a bilingual consumer may not be confused by the marks cannot cancel out a likelihood of confusion for the unilingual anglophone. The average consumer is not the average bilingual consumer, to the exclusion of the average anglophone or francophone consumer. Rather, it is any of the three.
If you have questions, please contact mckeown@gsnh.com
Goldman Sloan Nash & Haber LLP
480 University Avenue, Suite 1600
Toronto, Ontario M5G 1V2
Direct Line: (416) 597-3371
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Email: mckeown@gsnh.com
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 on the Lawyer’s Daily website published by LexisNexis Canada Inc.