Docket: T-681-11
Citation: 2011 FC 1008
Ottawa, Ontario, August 18, 2011
PRESENT: The Honourable Mr. Justice Shore
BETWEEN:
|
|
STEPHANIE ANNE PICK
|
|
|
|
Plaintiff
|
|
and
|
|
|
1180475 ALBERTA LTD., OPERATING AS
QUEEN OF TARTS AND LINDA KEARNEY
|
|
|
|
Defendants
|
REASONS FOR JUDGMENT AND
JUDGMENT
I. Overview
[1]
The
right of the owner of a registered trade-mark to its exclusive use shall be
deemed to be infringed by a person not entitled to its use, under the Trade-marks
Act, RSC 1985, c T-13, who sells, distributes or advertises wares or
services in association with a confusing trade-mark or trade-name.
II. Introduction
[2]
This
is an
action for, inter alia, trade-mark infringement and passing-off brought
by the Plaintiff, Ms. Stephanie Ann Pick, pursuant to the Trade-marks
Act, against the Defendants, 1180475 Alberta Ltd. and Ms. Linda Kearney.
[3]
A
Statement
of Claim was issued on April 19, 201 and served on the Defendants on May 11,
2011 (Affidavit of Stephanie Anne Pick).
[4]
The
Defendants have failed to deliver a Statement of Defence within the time
prescribed under the Federal Courts Rules, SOR/98-106, or at all
(Affidavit of Stephanie Anne Pick, sworn August 2, 2011).
[5]
As a
consequence of their failure to deliver a Statement of Defence, the Defendants
are now in default under the Federal Courts Rules (Affidavit of
Stephanie Anne Pick).
[6]
In
the present case, the Defendants have failed to serve and file a Statement of
Defence within the prescribed time, or at all. As such, Ms. Pick was
entitled to bring a motion ex parte, in writing.
III. Judicial Procedure
[7]
Ms.
Pick is
seeking the relief through a Motion for Default Judgment:
a) A declaration that Ms.
Pick is the party exclusively entitled to use THE QUEEN OF TARTS trade-mark, or
any confusingly similar variant thereof, in Canada, on and in connection with
“Baked goods, namely tarts, cookies, cakes, cupcakes, loaves, hand-decorated
gingerbread men and holiday cookies, quiches and savoury tarts; wholesale and
retail store services specializing in baked goods;
b) A declaration
restricting the Defendants from using any trade-name or trade-mark utilizing
the words THE QUEEN OF TARTS, QUEEN OF TARTS, or any confusingly similar
variant thereof;
c) A declaration that 1180475
has infringed or is deemed to have infringed Ms. Pick’s registered trade-mark,
contrary to section 20 of the Trade-marks Act, and a declaration that
Ms. Kearney has authorized or ordered the infringement to occur, in her
capacity as sole Director of 1180475;
d) A declaration that
118475 has directed public attention to its wares, services or business in such
ways as to cause or be likely to cause confusion in Canada, at the time it
commenced so to direct attention to them, between its wares, services or business
and the wares, services or business of Ms. Pick, contrary to paragraph 7(b)
of the Trade-marks Act, and a declaration that Ms. Kearney has
authorized or ordered the passing off to occur, in her capacity as sole Director
of 1180475;
e) A permanent injunction
restraining the Defendants, their promoters, officers, partners, directors,
agents, licensees, employees and all those over whom they exercise control
from, either directly or indirectly using the words THE QUEEN OF TARTS, QUEEN
OF TARTS, or any confusingly similar variant thereof, in any trade-name or
trade-mark;
f)
Damages
for trade-mark infringement and passing off contrary to section 20 and
paragraph 7(b) of the Trade-marks Act in the amount of
$10,000.00;
g) Ms. Pick’s costs in this action,
as assessed;
h) Any further and other
relief this Court deems appropriate.
Parties Identified
[8]
Ms.
Pick is
the owner of a registered trade-mark in Canada for THE QUEEN OF TARTS (TMA636,521). Ms. Pick completed her studies
at the California Culinary Academy in San Francisco, California, and operated a
bakery for over ten years in Toronto, Ontario (Affidavit of Stephanie Anne
Pick).
[9]
1180475
operates a booth at a farmers market in downtown Edmonton, Alberta, as well as a retail
bakery in Edmonton. Ms. Kearney is the sole Director of
1180745 (Affidavit of Stephanie Anne Pick).
Ms. Pick’s
Trademark and its Business
[10]
In
or around February 14, 1999, Ms. Pick adopted and commenced use of the trade-name
and trade-mark THE QUEEN OF TARTS, on and in connection with “baked goods, namely,
tarts, cookies, cakes, cupcakes, loaves, hand-decorated gingerbread men and
holiday cookies, quiches and savoury tarts; wholesale and retail store services
specializing in baked goods” (Affidavit of Stephanie Anne Pick).
[11]
Ms.
Pick is the
owner of the following trade-mark registered in the Canadian Trade-marks
Office: THE QUEEN OF TARTS (TMA636,521) registered March 31, 2005 for use in
association with “baked goods, namely, tarts, cookies, cakes, cupcakes, loaves,
hand-decorated gingerbread men and holiday cookies, quiches and savoury tarts;
wholesale and retail store services specializing in baked goods” (Affidavit of
Stephanie Anne Pick).
[12]
The
above-mentioned trade-mark registration is registered with the Canadian
Trade-marks Office (Affidavit of Stephanie Anne Pick).
[13]
Ms.
Pick has
extensively used and advertised THE QUEEN OF TARTS trade-mark in Canada, in
connection with the advertisement and promotion of the Plaintiff’s products and
services in newspapers, trade and consumer magazines, on television and radio,
and through the internet (Affidavit of Stephanie Anne Pick).
[14]
THE
QUEEN OF TARTS trade-name and trade-mark have been prominently presented on Ms. Pick’s advertisements,
web-sites, product packaging, and at their retail store location (Affidavit of
Stephanie Anne Pick).
[15]
By
reason of such extensive use, advertising and promotion, THE QUEEN OF TARTS
trade-mark is well known, instantaneously recognized and associated throughout
Canada with quality baked goods and related services offered by Ms. Pick. THE QUEEN OF
TARTS trade-mark is associated by the public with Ms. Pick as the source of goods
and services sold and rendered (Affidavit of Stephanie Anne Pick).
The
Defendants’ Business and Illegal Activities
[16]
Ms.
Pick
discovered that 1180475 was operating a booth at a farmers market in downtown Edmonton, Alberta, and that
1180475 opened a retail bakery in Edmonton in approximately November 2010. As a result of
the Defendants’ activities, Ms.
Pick initiated an action as against both 1180475 and Ms. Kearney, to stop the
infringement activities described above, and further, with a view to take steps
to protect Ms.
Pick from the likelihood of
confusion associated with the Defendants’ activities (Affidavit of Stephanie
Anne Pick).
[17]
Ms.
Pick now seeks the relief from
this Court to facilitate its further efforts to prevent and discourage both
1180475 and Ms.
Kearney
from persisting in the conduct described herein (Affidavit of Stephanie Anne
Pick).
[18]
The
goodwill associated with Ms. Pick’s
trade-name/trade-mark essentially represents Ms. Pick’s most valuable asset. In the circumstances, as
outlined above, Ms. Pick is in a position
to suffer damages to her reputation and goodwill together with the loss of such
sales as would obviously be associated with the Defendants’ conduct. Consumers
may end up purchasing goods and services outside of Ms. Pick’s normal
supply chain and as a result such goods and services are outside of the control
of Ms. Pick and, are
potentially, of a different quality to negatively impact Ms. Pick’s goodwill and
reputation (Affidavit of Stephanie Anne Pick).
[19]
Ms.
Kearney is the sole Director of
1180475 and, as such, Ms. Kearney authorized or
ordered the infringement and/or passing off to occur, in her capacity as sole
Director, and is therefore jointly liable with 1180475 for the resulting acts
of infringement and/or passing off that did occur. Ms. Pick’s trade-mark
registration would have come up in a clearance search such as NUANS search. Ms.
Kearney either directed use of the QUEEN OF TARTS name without conducting any
clearance searches to locate any potential conflicts (and therefore engaged
in willful and knowing pursuit of conduct that was likely to constitute
infringement and/or passing off) or else Ms. Kearney did conduct clearance
searches to locate any potential conflicts, but chose to ignore those search
results and engage in conduct that was likely to constitute passing off and/or
infringement (and therefore reflected an indifference to the risk of
infringement and/or passing off) (Affidavit of Stephanie Anne Pick).
[20]
Furthermore,
Ms. Kearney lived in Toronto prior
to 2003, making it possible that Ms. Kearney would have heard of Ms. Pick’s THE QUEEN OF TARTS
trade-mark as Ms.
Pick
operated a retail location in Toronto during that same period (Affidavit of
Stephanie Anne Pick).
[21]
In the
circumstances, Ms. Pick is ensuring
preservation of her trade-mark in an effort to protect her reputation and
goodwill as well as the interests of consumers throughout Canada (Affidavit of
Stephanie Anne Pick).
Default
[22]
A
Statement
of Claim was issued on April 19, 201 and served on the Defendants on May 11,
2011 (Affidavit of Stephanie Anne Pick).
[23]
The
Defendants have failed to deliver a Statement of Defence within the time
prescribed under the Federal Courts Rules, or at all (Affidavit of
Stephanie Anne Pick).
[24]
As a
consequence of their failure to deliver a Statement of Defence, the Defendants
are now in default under the Federal Courts Rules (Affidavit of
Stephanie Anne Pick).
IV. Analysis
[25]
Where
a defendant fails to serve and file a Statement of Defence within the time set
out in Rule 304 of the Federal Courts Rules (i.e. 30 days after service
of the Statement of Claim if the defendant is served in Canada), a plaintiff
may bring a Motion for Judgment against the defendant on the Statement of Claim
(Federal Courts Rules, Rule 210(2)).
[26]
Such
motion may be brought ex parte, in writing (Rule 210(2) and Rule
369 of the Federal Courts Rules).
[27]
In the present case, the Defendants have failed
to serve and file a Statement of Defence within the prescribed time, or at all.
As such, Ms. Pick was entitled to bring a motion ex
parte, in writing (Affidavit
of Stephanie Anne Pick).
[28]
The
Court is fully in accord with the position of the Plaintiff.
Section 19–
Right to exclusive use of the Plaintiff’s trade-mark
[29]
The
registration of a trade-mark in respect of any wares or services gives to the
owner of the trade-mark the exclusive right to their use throughout Canada of
the trade-mark in respect of those wares and services (Trade-marks Act,
s 19).
[30]
Given
that Ms. Pick’s THE QUEEN
OF TARTS trade-mark, as defined above, is validly registered in respect of
various baked goods and related wholesale and retail services, Ms. Pick has the
exclusive right to the use throughout Canada of such wares and services.
Section 20 -
infringement
[31]
The
right of the owner of a registered trade-mark to its exclusive use shall be
deemed to be infringed by a person not entitled to its use under the Trade-marks
Act who sells, distributes or advertises wares or services in association
with a confusing trade-mark or trade-name of the Trade-marks
Act, s 20).
[32]
Ms. Pick is the registered
owner of THE QUEEN OF TARTS trade-mark and, as such, the sale, distribution or
advertising of wares or services in association with a confusing trade-mark or
trade-mark will be deemed to be an infringement of Ms. Pick’s rights in THE QUEEN
OF TARTS trade-mark.
[33]
In
the present case, 1180475 has engaged in the sale, distribution and/or the
advertising of both wares (baked goods) and services (retail sale of baked
goods) in association with a confusing trade-mark and/or trade-mark name,
namely, the trade-mark/trade-name QUEEN OF TARTS.
[34]
For
the purposes of, inter-alia, section 20 of the Trade-marks Act, a
trade-mark of trade-name is confusing or likely to cause confusion with another
trade-mark or trade-name if the use of the first mentioned trade-mark or
trade-name would cause confusion with the last mentioned trade-mark or
trade-name (Trade-marks Act, ss 6(1)).
[35]
More
particularly, the use of a trade-mark causes confusion with another
trade-mark if the use of both trade-marks in the same area would be likely to
lead to the inference that the wares or services associated with those
trade-marks are manufactured, sold, leased, hired or performed by the same business,
whether or not the wares or services are of the same general class (Trade-marks
Act, ss 6(2)).
[36]
Similarly,
the use of a trade-name causes confusion with a trade-mark if the use of
both the trade-name and trade-mark in the same area would be likely to lead to
the inference that the wares or services associated with the business carried
on under the trade-name and those associated with the trade-mark are
manufactured, sold, leased, hired or performed by the same business, whether or
not the wares or services are of the same general class (Trade-marks Act,
ss 6(4)).
[37]
The
test to be applied in determining whether or not there is confusion in such
circumstances is a matter of first impression in the mind of the casual
consumer somewhat in a hurry who hears or sees the name QUEEN OF TARTS as part
of 1180475’s offering of goods and services, at a time when he or she has no
more than an imperfect recollection of Ms. Pick’s trade-mark, and does not
pause to give the matter any detailed consideration or scrutiny, nor to examine
closely the similarities and differences between the marks and/or name (Veuve
Clicquot Ponsardin, Maison Fondée en 1772 v Boutiques Cliquot Ltée. (2006),
49 CPR (4th) 401 (SCC) at para 20).
[38]
In
order to determine whether a trade-mark (or a trade-name) is confusing within
the meaning of the Trade-marks Act, that is, whether concurrent use is
likely to lead a purchaser to believe that the associated products come from
the same source, the surrounding circumstances, particularly the five major
factors as prescribed under subsection 6(5) of the Trade-marks Act, must
be taken into account (Haw Par Brothers International Ltd. v Registrar of
Trade Marks (1979), 48 CPR (2d) 65 (FCTD) at p 70).
[39]
The
five major factors to be considered by this Court in determining whether
trade-marks or trade-names are confusing as prescribed under subsection 6(5) of
the Trade-marks Act, are:
a) The inherent
distinctiveness of the trade-marks or trade-names and the extent to which they
have become known;
b) The length of time the
trade-marks or trade-names have been in use;
c) The nature of the wares,
services or business;
d) The nature of the trade;
and
e) The degree of
resemblance between the trade-marks or trade-names in appearance or sound or in
the ideas suggested by them.
[40]
In
the present case, the subsection 6(5) of the Trade-marks Act factors
mitigate in favour of a finding of confusion:
i.
Inherent
distinctiveness and the extent to which they have become known. THE QUEEN OF TARTS has
become known over the last decade. By virtue of Ms. Pick’s extensive use,
advertising and promotion, THE QUEEN OF TARTS trade-mark has become known, recognized
and exclusively associated throughout Canada with a certain quality of baked
goods and related services offered by Ms. Pick. Moreover, THE QUEEN OF TARTS
trade-mark is associated by the public with Ms. Pick as the sole and exclusive source of the wares
and services sold or rendered under such mark.
In contrast, 1180475
commenced use at a much later date, after Ms. Pick’s trade-mark had already become known in
Canada. 1180745’s mark is neither inherently distinctive nor has it become well
known or acquired any secondary meaning whatsoever.
b. Length
of time the trade-marks/trade-names have been in use. Ms. Pick has used its
trade-marks since 1999, whereas, 1180475 has used the QUEEN OF TARTS
trade-mark/trade-name from a later date. Ms. Pick does not know when 1180475 commenced using
QUEEN OF TARTS trade-mark at the farmers market stall, and, to the best of Ms. Pick’s knowledge, the retail
bakery in Edmonton was opened in
approximately November 2010.
c.&d. Nature
of the wares, services or business and nature of the trade. The wares and
services offered by 1180475 under the QUEEN OF TARTS trade-mark/trade-name can
be confused with those offered by Ms. Pick (baked goods and related services).
e. Degree
of resemblance between the trade-mark/trade-names in appearance or sound or
ideas suggested. Generally speaking, the subject marks/names are to be
considered on a “first impression basis, and not by way of and detailed
comparison” (Ortho Pharmaceutical Corp. v Mowatt & Moore Ltd. (1972),
6 CPR (2d) 161 (FCTD) at p 166).
1180475’s mark QUEEN OF
TARTS replicates the entirety of Ms. Pick’s mark THE QUEEN OF TARTS, but for the
word “the”. The two marks are very similar in sound, appearance and in the
ideas suggested.
Surrounding
circumstances
[41]
In
addition to the five factors dealt with above, subsection 6(5) of the Trade-marks
Act also directs the Court to consider all surrounding circumstances. The
trade-mark/trade-name QUEEN OF TARTS is clearly confusing and as such the use
of same by 1180475 in the prsent case constitutes an act of infringement
contrary to section 20 of the Trade-marks Act. The Defendants have
not responded to Ms. Pick’s Statement of Claim
nor have they provided any explanation that would justify the use of a
virtually identical trade-name and trade-mark.
Subsection 7(b)–
statutory passing off
[42]
The Trade-marks
Act prohibits any business from directing public attention to its wares,
services or business in such a way as to cause or be likely to cause confusion
in Canada, at the time the business commenced so to direct attention to them,
between the wares, services or business and the wares, services or business of
another (Trade-marks Act, ss 7(b))
[43]
By
virtue of its invoking the QUEEN OF TARTS trade-mark and trade-name in the
context of operating a retail baker as described above, 1180475 has acted to
direct public attention to its wares, services or business in the manner
prohibited by subsection 7(b) of the Trade-marks Act.
[44]
By
virtue of its conduct, 1180475 has acted contrary to the provisions of
subsection 7(b) of the Trade-marks Act.
Liability of Ms. Kearney
[45]
A
director of a corporate defendant attracts personal liability where the
director engages in willful and knowing pursuit of conduct that was likely to
constitute infringement and/or passing off (Mentmore Manufacturing Co. v
National Merchandise Manufacturing Co. (1978) 40 CPR (2d) 164 (FCA)).
[46]
Ms. Kearney is the sole
Director of 1180475 and, as such, Ms. Kearney authorized or ordered the infringement and/or
passing off to occur, in her capacity as sole Director, and is therefore
jointly liable with 1180475 for the resulting acts of infringement and/or
passing off that did occur. Ms. Kearney either directed use of the QUEEN OF
TARTS name without conducting any preliminary searches to locate any potential
conflicts (and therefore engaged in willful and knowing pursuit of conduct that
was likely to constitute infringement and/or passing off) or else Ms. Kearney
did conduct preliminary searches to locate any potential conflicts, but chose
to ignore those search results and engage in conduct that was likely to
constitute passing off and/or infringement and therefore reflected an
indifference to the risk of infringement and/or passing off).
[47]
Furthermore,
Ms. Kearney did live in Toronto
prior to 2003, making it possible that she would have heard of Ms. Pick’s THE QUEEN OF TARTS
trade-mark as Ms.
Pick
operated a retail location in Toronto during that same time period.
Damages
[48]
The
proper basis for the assessment of damages in the case of infringement or
passing off is:
On
the question of the measure of damages it has ben held that the defendant is
liable for all loss actually sustained by the plaintiff that is the natural and
direct consequence of the unlawful acts of the defendant, including any loss of
trade actually suffered by the plaintiff, either directly from the acts
complained of or properly attributable thereto, that constitute an injury to
the plaintiff's reputation, business, goodwill or trade … Difficulty in
assessing damages does not relieve the court from the duty of assessing them
and doing the best it can. The court is entitled to draw inferences from the actions
of the parties and the probable results that they would have. If damages cannot
be estimated with exactitude, the best reasonable estimate must be made.
(Ragdoll Prodctions (UK) Limited v Jane Doe (2002), 21 CPR (4th)
213 (FCTD) at para 40).
[49]
In
the case of infringement and the related tort of passing-off (i.e. section 20
and subsection 7(b) of the Trade-marks Act), the authorities are
to the effect that damages are presumed upon proof of passing-off (Oakley,
Inc. v Jane Doe (2000), 8 CPR (4th) 506 (FCTD) at para 7)
[50]
Moreover,
even in a case of infringement without an allegation of passing-off, the Court
may award damages for loss of goodwill without proof of actual damage (Oakley, above,
at para 8).
[51]
In
default cases, the assessment of damages will always be difficult due to a lack
of records and financial information. Nonetheless, owners of intellectual
property have a right to damages arising from the Defendant’s infringement
conduct even without proof of actual damages or damage to goodwill (Oakley,
above, at para 10).
[52]
In
the circumstances of default where proof of actual damages is lacking, the
Court has awarded damages by convention (i.e. in the context of counterfeit
infringement: $3,000.00 in the case of sales by street vendors, $6,000.00 in the
case of sales by fixed retail vendors and $24,000.00 in the case of
manufacturers and distributors) or by simply fixing an amount for compensatory
damages as reflecting the infringement of the Plaintiff’s legal rights without
any need for proof of the actual quantum of damages (Oakley, above, at
para 11; Radgoll Productions, above, at para 35, 42 and 43).
[53]
In
the present case, an award of damages fixed is fixed in the sum of $10,000.00
as compensatory damages in relation to lost sales as well as in relation to the
damage to Ms.
Pick’s reputation and
goodwill caused by the Defendants’ actions.
Ancillary
Relief
[54]
In
all of the circumstances, Ms. Pick is entitled to the declaratory and
injunctive relief set out in paragraphs 2(a), (b), (c), (d) and (e) above (Horn
Abbot Ltd. v Thurston Haze Developments Ltd. (1997), 77 CPR (3rd)
10 (FCTD) at p 22; Sullivan Entertainment Inc. v Anne of Green Gables
Licensing Authority Inc. (2000), 9 CPR (4th) 344 (FCTD) at para
11, 18 and 20; Bagagerie SA v Bagagerie Willy Ltee. (1992), 45 CPR (3d)
503 (FCA) at p 515; Federal Courts Act, section 44; Federal Courts
Rules, Rule 64).
V. Conclusion
[55]
In light
of the Defendants’ breach of section 20 and subsection 7(b) of the Trade-marks
Act as described above, the judgment reflects the relief sought in the Order
below.
JUDGMENT
THIS COURT
ORDERS AND ADJUGES:
- that Ms. Stephanie
Anne Pick is the party exclusively entitled to use THE QUEEN OF TARTS
trade-mark, or any confusingly similar variant thereof, in Canada, on and
in connection with “Baked goods, namely tarts, cookies, cakes, cupcakes,
loaves, hand-decorated gingerbread men and holiday cookies, quiches and
savoury tarts; wholesale and retail store services specializing in baked
goods”;
- a restriction on the Defendants from using
any trade-name or trade-mark utilizing the words THE QUEEN OF TARTS, QUEEN
OF TARTS or any confusingly similar variant thereof;
- it be known that 1180475 has infringed or
is deemed to have infringed Ms. Pick's registered trade-mark contrary
to section 20 of the Trade-marks Act, and Ms. Kearney has
authorized or ordered the infringement to occur, in her capacity as sole
Director of 1180475;
- it be known that 1180475 has directed
public attention to its wares, services or business in such ways as to
cause or be likely to cause confusion in Canada, at the time it commenced
so to direct attention to them, between its wares, services or business
and the wares, services or business of Ms. Pick, contrary to paragraph 7(b)
of the Trade-marks Act, and it be known that Ms. Kearney has
authorized or ordered the passing off to occur, in her capacity as sole
Director of 1180475;
- a permanent injunction restraining the
Defendants, their promoters, officers, partners, directors, agents,
licensees, employees and all those over whom they exercise control, from
either directly or indirectly using the words THE QUEEN OF TARTS, QUEEN OF
TARTS, or any confusingly similar variant thereof, in any trade-name or
trade-mark;
- that Ms. Pick be entitled to damages and
the Defendants shall be jointly and severally liable to pay such damages
for trade-mark infringement and passing off contrary to sections 20 and paragraph
7(b) of the Trade-marks Act in the amount of $10,000.00; and
- that Ms. Pick be entitled to costs of this action
as assessed.
This Judgment bears the
interest as applied by this Court from this date.
“Michel
M.J. Shore”
Email this Content