Toys "R" Us (Canada) Ltd. v. Manjel Inc., 2003 FCT 282

Date: 20030307

Docket: T-2367-93

Neutral citation: 2003 FCT 282

Ottawa, Ontario, March 7, 2003

Present:    The Honourable Madam Justice Danièle Tremblay-Lamer

BETWEEN:

                     TOYS "a"US (CANADA) LTD. and

                     GEOFFREY TOYS (CANADA) LIMITED

                                                               Appellants

                                   and

                               MANJEL INC.

                                   and

                      THE REGISTRAR OF TRADE-MARKS

                                                              Respondents

                         REASONS FOR ORDER AND ORDER

[1]                 This is an appeal pursuant to subsection 56(1) of the Trade-Marks Act, R.S.C. 1985, c T-13 (the "Act") from a decision of the Registrar of Trade-Marks dated November 20, 1992, whereby the Registrar rejected the opposition proceedings launched by the appellants against the application made by the respondent, Manjel Inc. for the registration of the trade-mark NUTS 'R' US. The Registrar held that the appellants' evidence did not establish that they had used their trade-marks "R" US or KIDS "R" US Design in Canada. He further held that there was no likelihood of confusion within the meaning of the section between the trade-mark of the appellants Toys "a" Us Design and the trade-mark applied for by the respondent, NUTS 'R' US.

FACTS

[2]                 The appellant Toys "a" Us (Canada) Ltd. is a corporation constituted under the laws of Ontario. It is the current owner of the trade-mark Toys "a" Us Design which was registered in the Canadian Trade-marks Office on May 19, 1978 under registration TMA 227,944, the trade-mark "R US" which was registered on March 17, 1989 under registration TMA 353,213, and the trade-mark KIDS "R" US Design which was registered on April 28, 1989 under TMA 355,013.

[3]                 The co-appellant Geoffrey Toys (Canada) Ltd. was a previous owner of the Toys "a" Us Design trade-mark between April 1992 and December 1994. During that time, the appellant Toys "a" Us had been a licensee of the trade-mark.

[4]                 Since at least 1984, the appellant Toys "a" Us has used the Toys "a" Us Design trade-mark in association with the operation of retail stores and in association with various toy items and other products.

[5]                 The respondent, Manjel Inc., is a corporation constituted under the laws of Ontario.

[6]                 Since 1987, Manjel Inc. has sold nuts and related snack foods under the trade-mark NUTS 'R' US.

[7]                 On April 27, 1987, Manjel Inc. filed Application No. 586,352 to register the trade-mark NUTS 'R' US based on use in Canada in association with the following wares and services:

a) Wares: Popping corn kernels, shelled nuts, nuts, chocolates, candies, candied coated peanuts, snack foods comprising a mixture of nuts; novelty items containing popping corn kernels; shelled nuts, chocolates, candies; candied coated peanuts or snack foods comprising mixtures of nuts.

b) Services: Operation of a retail outlet for the sale of popping corn kernels, shelled nuts, nuts, chocolates, candies, candied coated peanuts, snack foods comprising a mixture of nuts; novelty items containing popping corn kernels; shelled nuts, chocolates, candies; candied coated peanuts or snack foods comprising mixtures of nuts.

[8]                 The appellant, Toys "a" Us (Canada) Ltd., filed a statement of opposition on March 30, 1989 primarily alleging that the trade-mark NUTS 'R' US was confusing with its alleged family of "R" US trade-marks.

[9]                 The opponent (the appellant Toys "a" Us) advanced four grounds of opposition. First, the NUTS 'R' US trade-mark was not registrable pursuant to paragraph 12(1)(d) of the Act because it was confusing with its family of "R" US trade-marks, and its Toys "a" Us Design trade-mark. Second, the applicant (the respondent Manjel Inc.) was not the person entitled to registration pursuant to paragraph 16(1)(a) of the Act because the applied for trade-mark NUTS 'R' US was confusing with the opponent's family of "R" US trade-marks, including the trade-marks "R" US and Toys "a" Us Design. Third, the applicant was not the person entitled to registration pursuant to paragraph 16(1)(b) of the Act because the applied for trade-mark NUTS 'R' US was confusing with the trade-mark KIDS "R" US Design, for which an application had previously been filed on July 18, 1983. Fourth, the applied for trade-mark NUTS 'R' US was not distinctive in view of the allegations set out above.

DECISION OF THE REGISTRAR

[10]            The hearing of the opposition was on November 5, 1992 and the decision was issued on November 30, 1992. The Registrar rejected all the grounds of opposition raised by the opponent, finding that there was no evidence of use of the trade-marks R US or KIDS "R" US Design in Canada, and that there was no likelihood of confusion between the NUTS 'R' US and the Toys "a" Us Design trade-marks.

[11]            The Registrar first found that the opponent had not discharged the onus upon it of establishing a family or series of trade-marks comprising the element "R" US. The evidence did not establish that it had used the trade-marks "R" US or KIDS "R" US Design in Canada.

[12]            He determined that the opponent's trade-mark Toys "a" Us Design had developed a significant reputation in Canada as applied to the operation of retail outlets selling primarily toys and children's wearing apparel. However, the opponent's registered trade-mark "R" US had not become known to any extent in Canada.

[13]            The Registrar next considered whether the applicant's trade-mark NUTS 'R' US was confusing with the opponent's trade-mark Toys "a" Us Design. He found that the trade-marks of the applicant and the opponent were phonetically equivalent to the phrases "nuts are us", and "toys are us" which were highly suggestive, if not descriptive of their wares and services. As such, he found them to be weak marks possessing little inherent distinctiveness.

[14]            While the marks beared some resemblance in appearance and in sound, the Registrar determined that the ideas suggested by the marks differed. The applicant's mark suggested a business specializing in the sale of nuts whereas the opponent's mark suggested a business specializing in toys.

[15]            He noted that both parties had used their respective trade-marks in Canada without any evidence or instances of actual confusion having been adduced by the opponent.

[16]            He considered the affidavit of Mr. MacFarlane, where a name search identified a substantial number of businesses that employed the "R US" component as part of their name. Although the opponent had submitted the affidavit of Mr. Miller in reply, which indicated that a large number of those companies had received cease and desist letters from the opponent and were in the process of changing their name, the Registrar was nevertheless of the opinion that a significant number of businesses in Canada still used the "R US" element as part of their name.

[17]            The Registrar also took into account the admission made by the opponent's trade-mark agent that the opponent would never sell the applicant's NUTS 'R' US products in its retail store.

[18]            In light of i) the inherent weakness of the trade-names at issue, ii) the fact that the applicant's wares and services beared little if any, similarity to those of the opponent, iii) the common adoption of the expression "R US" as a component of corporate or business names, and iv) the admission made by the opponent's agent that the opponent would never sell the applicant's NUTS 'R' US products in its retail stores, the Registrar concluded that the applicant had met the legal burden upon it in respect of the issue of confusion and in so doing, rejected the opponent's first ground of opposition.

[19]            Similarly, the Registrar rejected the opponent's second ground of opposition, since the opponent had failed to evidence any use of its trade-mark "R" US. The Registrar also found that the opponent had failed to establish its use of the trade-mark Toys "a" Us Design in association with the sale of confectionery and candy prior to the applicant's claimed date of first use.

[20]            With regard to the third ground of opposition, the Registrar found that although the opponent had filed an application for the mark KIDS "R" US Design, there was nevertheless no likelihood of confusion between this mark and the applicant's trade-mark NUTS 'R' US.

[21]            Finally, as the fourth ground of opposition alleging non-distinctiveness was based on the first three grounds, the Registrar held that the fourth ground also failed.

PROCEEDINGS

[22]            On October 4, 1993, the appellants filed a Notice of Appeal against the Registrar's decision to the Federal Court.

[23]            The appellants filed the following additional evidence before the Federal Court:

[24]            The affidavit of Robert Sterling introduces various certificates of authenticity obtained from the Trade-marks Office.

[25]            The affidavit of John D. Miller introduces correspondence that was exchanged between solicitors of the appellants and the respondent with respect to a demand to cease and desist from all further use of the NUTS 'R' US trade-mark by the respondent.

[26]            The affidavit of Dayle Brands indicates that the respondent's Ontario business name registration for NUTS 'R' US expired on March 5, 1992.

[27]            The affidavits of Carole Méhü, Nicole Filion and Margo Kormeluk are replies to the affidavits of Christine Snelling and Sophie Dufresne. The affidavits of Ms. Snelling and Ms. Dufresne indicate that searches on various online systems listed numerous businesses that incorporate the words "R US" in their name. The affidavit of Ms. Kormeluk explains that the ONBIZ online search system is the Ministry's computerized index system of Ontario companies, but that the Ministry does not monitor if companies are actively doing business in Ontario, and that a company will be listed as active if it has not been dissolved.    The affidavit of Ms. Méhü indicates that the databases used by Ms. Dufresne do not provide any information as to the extent of the usage of trade-names in Canada. The affidavit of Ms. Filion indicates that in Ms. Dufresne's affidavit, out of the six businesses using the words "R US" in their name, four of these businesses have abandoned their trade-mark.

[28]            The affidavit of Jeffrey Sarfin confirms that the Toys "a" Us Design trade-mark is a widely known trade-mark as applied to the operation of retail outlets selling toys and children's wear apparel. The affidavit gives the annual breakdown of total sales from 1984 - 1992, as well as the annual breakdown of sales for candy, snack foods and confectionery, some bearing the trade-mark Toys "a" Us Design, which amounted to approximately 1% of the appellants' total sales. It also indicates the amount of money the appellants have spent on advertising their Toys "a" Us stores and products in Canada.

ANALYSIS

[29]            In Molson Breweries v. John Labatt Ltd., [2000] 3 F.C. 145, the Federal Court of Appeal held that decisions of the Registrar, whether of fact, law or discretion, within his area of expertise, are to be reviewed on a standard of reasonableness simpliciter. However, where new evidence is filed on appeal, and that evidence would have materially affected the Registrar's findings of fact or the exercise of his discretion, the Court must come to its own conclusion as to the correctness of the Registrar's decision.

[30]            For reasons which I will elaborate on further in my decision, I am of the opinion that the new evidence submitted by the appellants would not have materially affected the Registrar's findings of fact or exercise of discretion. Thus, the proper standard of review is that of reasonableness simpliciter.

[31]            The appellants' first ground of opposition was that the applied for trade-mark NUTS 'R' US was not registrable pursuant to paragraph 12(1)(d) of the Act because it was confusing with their family of "R US" trade-marks. Paragraph 12(1)(d) provides:

[32]               In light of the inherent weakness of the trade-names at issue, the fact that the wares of the two parties beared little similarity with each other, the common adoption of the expression "R US" in the names of other companies, and the admission made by the appellants' agent that they would never sell the respondent's NUTS 'R' US products in their retail stores, the Registrar determined that the trade-marks Toys "a" Us Design and NUTS 'R' US were not confusing. He found that the respondent had met the legal burden upon it in respect of the issue of confusion and he rejected the appellants' first ground of opposition.

[33]            The material date for determining whether a mark is confusing for the purpose of deciding registrability under section 12 is the date of the Registrar's decision (Park Avenue Furniture Corp. v. Wickes/Simmons Bedding Ltd. (1991), 130 N.R. 223). In this case, the Registrar's decision was rendered on November 30, 1992.

[34]            Pursuant to subsection 6(2) of the Act, a trade-mark is confusing if it is likely to lead to the inference that the wares or services associated with the trade-mark are manufactured, sold, leased, hired or performed by the owner of another trade-mark, whether or not the wares or services are of the same general class. The likelihood of confusion is determined after weighing the various factors enumerated in subsection 6(5) of the Act:

      Inherent Distinctiveness & Extent to which Marks have become known

[35]            The Registrar found that there was no reputation attached to the appellants' family of "R US" trade-marks. He determined that the appellants' evidence had not established use of their trademarks R US and KIDS "R" US Design. As a result, he focussed solely on the appellants' Toys "a" Us Design trade-mark. He found that the marks Toys "a" Us Design & NUTS 'R' US were both suggestive, even descriptive, of each party's respective wares and services. As such, they were both weak marks that possessed little inherent distinctiveness.

[36]            It is well established that trade-marks containing words which are suggestive of the wares or services offered by the owner are considered to be weak marks and consequently, are afforded a minimal level of protection (Skydome Corp. v. Toronto Heart Industries Ltd. (1997), 128 F.T.R. 71). Conversely, trade-marks containing unique or coined words possess greater inherent distinctiveness and are afforded a wider ambit of protection (Pink Panther Beauty Corp. v. United Artists Corp., [1998] 3 F.C. 534 (C.A.)). While I agree with the appellants' assertion that the trade-mark Toys "a" Us Design is unique in that it substitutes the word "are" with the letter "R", it is not my role to substitute my decision for that of the Registrar. In my view, the Registrar's findings were open to it based on the evidence, given that the appellants' trade-mark is phonetically equivalent to the phrase "toys are us" which is descriptive of their business.

[37]            The appellants highlight that in the United States, in the decision of Geoffrey Inc. v. Stratton, 16 U.S.P.Q. 2s 1691, the court held that the expression "R US" was coined by, and was exclusively associated with Geoffrey Inc., the owner of the Toys "a" Us trade-mark in that country. However, in this case, there was evidence that Geoffrey Inc. possessed a family of "R US" trade-marks, given that at the time, it had approximately 405 Toys "a" Us stores and 137 KIDS "R" US stores throughout the United States. By contrast, in the case at bar, the Registrar found that the appellants' evidence did not establish that they had used their trade-marks "R US" or KIDS 'R' US Design in Canada.

[38]            With regard to the extent to which the marks have become known, the Registrar determined that the respondent's mark NUTS 'R' US had been used, advertised, and become known in Canada since 1987, whereas the appellants' mark Toys "a" Us Design had become known in Canada as applied to the operation of retail stores selling toys and children's wear apparel.

[39]            The appellants submitted new evidence in the form of the affidavit of Mr. Sarfin, which indicates that candy, confectionery and snack foods, were also sold in their retail stores from 1984 - 1992. The appellants argue that this new evidence warrants a finding that the Toys "a" Us Design trade-mark has acquired distinctiveness in relation to candy, confectionery, and snack foods.

[40]            In my view, this new evidence does not support the appellants' contention that their mark has acquired distinctiveness in relation to candy, confectionery, and snack foods.

[41]            In McDonald's Corp. v. Coffee Hut Stores Ltd., [1994] F.C.J. No. 638 (Q.L.), the question was whether the trade-mark MCBEANS was unregistrable because it was confusing with the appellants' family of trade-marks. McKeown J. held that although the appellants sold coffee, this represented less than 4% of their total sales and was not sufficient to establish that their marks were associated specifically with coffee. He stated at paras. 32 and 33:

[...]    On the other hand, MCDONALD'S is a fast food restaurant catering to children. Less than 4% of their sales relate to coffee and tea. It sells only one kind of generic coffee, as opposed to a selection of gourmet coffees, and they sell no coffee beans. In short, these are two very different kinds of businesses.

In my view, the Registrar erred in holding that on one hand there "is no similarity between the wares, services and trades of the parties' and holding on the other hand that "there is a potential overlap in the trades of the parties". The suggestion that McDonald's might decide to sell beans in the future, be they jelly beans or coffee beans, is insufficient to support a finding of confusion....Moreover, I think that the Registrar erred in finding that the trade mark MCDONALD'S has become famous with respect to the sale of coffee "given that there have been extensive sales of coffee in association with that mark". Notwithstanding the volume of McDonald's sales of coffee, it represents only 4% of their total sales and I fail to see how this establishes that the mark is associated specifically with coffee.

[42]            Similarly, in the case at bar, I believe that even with Mr. Sarfin's affidavit, the Registrar would have concluded that the trade-mark Toys "a" Us Design was not known in association with the sale of candy, confectionery and snack foods. The appellants applied their trade-mark to the operation of retail outlets selling primarily toys and children's wear apparel. The evidence shows that candy, confectionery, and snack foods represented only 1% of their total sales from 1984 - 1992. In my opinion, the figure of 1% of total sales is too small to establish that the Toys "a" Us Design trade-mark was associated with candy, confectionery and snack foods.

[43]            Furthermore, Mr. Sarfin's affidavit indicates that only 20% of the food items sold beared the trade-mark Toys "a" Us. In other words, the sale of food items bearing the trade-mark Toys "a" Us, represented only 0.2% of the appellants' total sales. This reinforces my conclusion that the trade-mark Toys "a" Us was not known in association with the sale of candy, confectionery and snack foods. The new evidence submitted by the appellants would not have materially affected the Registrar's finding of fact that the appellants' mark was known in association with the operation of retail stores selling toys and children's wear apparel.

            The Length of Time the trade-marks have been in use

[44]            The Registrar found that this factor favoured the appellants, as the Toys "a" Us Design trade-mark had been used since 1984, whereas the NUTS 'R' US trade-mark had been used since September 1987. I am in agreement with the Registrar, as the appellants had used their trade-mark three years longer than the respondent.

            Nature of the Wares

[45]            The Registrar determined that the appellants' wares beared no similarity to any of the wares covered in the respondent's application. His decision was based on the fact that there was no evidence before him indicating that the appellants sold wares resembling those of the respondent.

[46]            The appellants introduced new evidence on appeal indicating that they also sold candy, confectionery, and snack foods, wares for which the respondent's trade-mark NUTS 'R' US was sought to be registered. However, the amount of sales of these products by the appellants is too small to affect the Registrar's finding that the wares of the appellants and the respondent were not similar.

            Nature of the Trade

[47]            This factor takes into consideration the nature of the trade in which the wares or services circulate. The risk of confusion is greater where the wares or services, though dissimilar, are distributed in the same types of stores or are of the same general category of goods (Pink Panther Beauty Corp., supra). Conversely, where the particular channels of trade of each party are very different, the possibility of confusion can be discounted (Sum-Spec Canada Ltd. v. Imasco Retail Inc./Société de Détail (1990), 35 F.T.R. 44).

[48]            The Registrar noted that the appellants' wares were sold exclusively in their own chain of retail stores, and the respondent's NUTS 'R' US products had never been sold in the appellants' Toys "a" Us stores. Furthermore, according to the admission of the appellants' own agent at the opposition hearing, the appellants would never sell the respondent's products in their chain of retail stores. This was another factor that reduced the likelihood of confusion.

[49]            The appellants argue that the Registrar erred in giving weight to this last statement made by the appellants' agent. For the appellants, whether the wares of the appellants and the respondent are sold in the same stores should not be taken into account in an analysis of confusion. Furthermore, the wares of the appellants and the respondent were sold in the same type of stores, namely to casual shoppers in a retail setting.

[50]            In my opinion, it was open for the Registrar to give weight to the agent's statement that the appellants would never sell the respondent's products in their stores. I believe that there would be a greater likelihood of confusion if NUTS 'R' US products were sold in Toys "a" Us stores, there is a greater likelihood that consumers would believe that these products were somehow associated with Toys "a" Us stores.

[51]            I acknowledge that the appellants have cited two cases, Eminence S.A. v. Canada (Registrar of Trade marks), [1977] F.C.J. No. 1104 (Q.L.), and Cartier Men's Shops Ltd. v. Cartier Inc. [1981] F.C.J. No. 810 (Q.L.), where this Court held that it was not necessary that the products be sold in the same stores in order for there to be confusion. However, it is necessary to consider the context in which this statement was made. In these two cases, the trade-marks of the applicants and the opponents were identical and the Court found the trade-marks confusing. As a result, the fact that the products were not sold in the same stores did not eliminate the likelihood of confusion. By contrast, in the case at bar, the trade-marks at issue were not identical. Accordingly, the Registrar was entitled to assess the nature of the trade, and to consider the fact that the respondent's products would never be sold in the appellants' stores.

            Degree of Resemblance of Marks in Appearance, Sound and Ideas Suggested

[52]            The Registrar found that the marks Toys "a" Us Design and NUTS 'R' US were not similar. The only similarity was the phrase "are us" which was very descriptive. While the marks beared some resemblance in appearance and in sound, the Registrar determined that the ideas suggested by the marks differed. The trade-mark NUTS 'R' US suggested a business specializing in the sale of nuts whereas the trade-mark Toys "a" Us Design suggested a business specializing in toys.

[53]            When determining prospective confusion between trade-marks, the trade-marks must be considered in their entirety and not as dissected items (Park Avenue Furniture Corp., supra). In my opinion, the fact that the expression "R US" is shared by the two trade-marks is not sufficient to find the existence of confusion. The trade-marks have to be considered in their entirety.

[54]            A similar approach was adopted by Jerome A.C.J. in the case of Toys "R" Us (Canada) Ltd. v. Babies-R-Us, Inc. (1992), 58 F.T.R. 164. He stated at para 4:

The appellant contends that the use of the term "R Us" in the respondent's trade-mark, is confusing with its own registered trademark Toys "a" Us._ However, the fact that both marks contain the element "R Us" is not sufficient, in and of itself, to conclude that the marks are confusing. The tests to be applied are those of appearance, sound and the ideas suggested by the marks. The marks are to be looked at as totalities and not as dissected parts. It is the idea of each mark, that is, the net impression left by the mark as a whole upon the mind, which is to be considered. Accordingly, the marks should not be subjected to intense and detailed analysis, but should rather be viewed from the standpoint of a person who has only an imperfect recollection of one mark and then later sees or hears the competing mark by itself.

[55]            In my opinion, the use of the words "toys" and "nuts" at the beginning of the marks is sufficient to distinguish the two marks. Although these words may not be as unique as the expression "R US", they are important as they describe the businesses of the appellants and the respondent. The word toys in the trade-mark Toys "a" Us Design indicates that this is a business that specializes in the sale of toys. Conversely, the word nuts in the trade-mark NUTS 'R' US indicates that this is a business that specializes in the sale of nuts.

[56]            The appellants argue that the Registrar erred by failing to consider the marks visually. By doing so, he ignored the fact that the appellants' mark uses the letter R surrounded by quotations, a feature that is also present in the respondent's trade-mark. This Court has held that when comparing marks, it is important to look at the wording and design of the marks in question (Sum-Spec Canada, supra). However, in my opinion, had the Registrar considered the marks visually, he may have noticed greater differences between the marks. Although the letter R is surrounded by quotations in both marks, the appellants' trade-mark has a backwards "R", a feature which the respondent's mark does not share. The style of lettering of the two marks is also different. The appellants' mark is written in a balloon font, with various colours, whereas the respondent's mark is written in a black script font. In my view, all these factors confirm that the trade-marks Toys "a" Us Design and NUTS 'R' US were not similar.

            All the Surrounding Circumstances

[57]            In my view, an additional circumstance which is significant is the fact that the appellants were unable to put forth any evidence before the Court of a single instance of actual confusion between their trade-mark and the respondent's NUTS 'R' US trade-mark. The Court is allowed to draw a negative inference against an allegation of confusion where despite a period of co-existence in the market place, no instances of actual confusion are established. In Christian Dior, S.A. v. Dion Neckwear Ltd., [2002] 3 F.C. 405, the Federal Court of Appeal stated at para. 19:

With respect to the lack of evidence by the opponent of actual confusion, the Registrar expressed the view that an opponent does not need to file that kind of evidence. This is true in theory, but once an applicant has filed some evidence which may point to unlikelihood of confusion, an opponent is at great risk if, relying on the burden of proof the applicant is subject to, it assumes that it does not need to file any evidence of confusion. While the relevant issue is "likelihood of confusion" and not "actual confusion", the lack of "actual confusion" is a factor which the courts have found of significance when determining the "likelihood of confusion". An adverse inference may be drawn when concurrent use on the evidence is extensive, yet no evidence of confusion has been given by the opponent.

[58]            To the same effect, in Monsport Inc. v. Vêtements de Sport Bonnie (1978) Ltée (1988), 23 F.T.R. 222, Addy J. stated at para. 11:

Jurisprudence has also established that the plaintiff must be able to show that a likelihood of confusion between the marks exists; he is not required to prove that confusion has actually occurred. It is important to note however, that the court is entitled to draw negative conclusions about the plaintiff's case if, despite a substantial period of coexistence in the marketplace, no instances of actual confusion are established.

[59]            Having considered and weighed all the factors enumerated in subsection 6(5) of the Act, the Registrar concluded that the trade-marks Toys "a" Us Design and NUTS 'R' US were not confusing. In light of the foregoing, I am of the opinion, that this conclusion was reasonable.

[60]            The appellants' second ground of opposition was that the respondent was not the person entitled to registration pursuant to paragraph 16(1)(a) of the Act because the applied for trade-mark NUTS 'R' US was confusing with the appellants' family of "R" US trade-marks, including the trade-marks "R" US and Toys "a" Us Design. Paragraph 16(1)(a) provides:

[61]            Section 16 of the Act establishes that the material date regarding entitlement to registration is the date on which the application for registration was filed. In this case, it was April 27, 1987.

[62]            The Registrar found that the appellants had failed to evidence any use of their trade-mark "R" US. He also found that the appellants had failed to establish their use of the trade-mark Toys "a" Us Design in association with the sale of confectionery and candy prior to the respondent's claimed date of first use.

[63]            In my opinion, the new evidence submitted by the appellants is not sufficient to alter the Registrar's finding that the appellants had failed to establish their use of the trade-mark Toys "a" Us Design in association with the sale of confectionery and candy prior to the respondent's claimed date of first use. The sale of food items represented only 1% of the appellants' total sales. Furthermore, only 20% of this amount dealt with food items bearing Toys "a" Us labels.

[64]            As a result, I find that the Registrar's conclusion with regard to the appellants' second ground of opposition was reasonable.

[65]            The appellants' third ground of opposition was that the respondent was not the person entitled to registration pursuant to paragraph 16(1)(b) of the Act because the applied for trade-mark NUTS 'R' US was confusing with the trade-mark KIDS "R" US Design, for which an application had previously been filed on July 18, 1983. Paragraph 16(1)(b) provides:

[66]    The Registrar found that although the appellants had filed an application for the mark KIDS "R" US Design, there was nevertheless no likelihood of confusion between this mark and the respondent's trade-mark NUTS 'R' US. In my opinion, this was a discretionary finding which was reasonable based on the evidence.

[67]            The appellants' fourth ground of opposition was that the applied for trade-mark NUTS 'R' US was not distinctive in view of the allegations set out above.

[68]            Distinctiveness of a mark is to be assessed as of the date on which the opposition is commenced (Merrill Lynch & Co. v. Bank of Montreal (1996), 108 F.T.R. 241). In this case, the material date was March 30, 1989.

[69]            As the fourth ground of opposition alleging non-distinctiveness was based on the first three grounds, the Registrar held that the fourth ground also failed. This finding was reasonable.

[70]            In conclusion, I am of the opinion that the Registrar's reasons for dismissing the appellants' four grounds of opposition were reasonable.

[71]            As a result, this appeal is dismissed with costs.

                                                  ORDER

THIS COURT ORDERS THAT the appeal is dismissed with costs.

                                                                      "Danièle Tremblay-Lamer"

J.F.C.C.

FEDERAL COURT OF CANADA

Names of Counsel and Solicitors of Record

DOCKET:                                               T-2367-93

STYLE OF CAUSE:                               Toys "R" Us (Canada) Limited and others v. Manjel Inc., and others

DATE OF HEARING:              January 28, 2003

PLACE OF HEARING:                         Toronto, Ontario.

REASONS FOR ORDER BY:             Tremblay-Lamer J

DATED:                                                   March 7, 2003

APPEARANCES BY:

Mr. Nigel Campbell

Mr. Anthony Prenol

Mr. Michael Vaillancourt                        For the Plaintiffs

Mr. Robert H.C. MacFarlane    For the Defendant

SOLICITORS OF RECORD:

Blake, Cassels & Graydon LLP

Barristers and Solicitors

Box 25, Commerce Court West

199 Bay Street

Toronto, Ontario

M5L 1A9                                                 For the Plaintiffs

Bereskin & Parr

Suite 4000, Scotia Plaza

40 King Street West

Toronto, Ontario

M5H 3Y2                                                For the Defendant