Supershuttle International Inc. v. Canada (Registrar of Trade-Marks), 2002 FCT 426

Date: 20020412

Docket: T-111-00

Neutral citation: 2002 FCT 426

BETWEEN:

                                           SUPERSHUTTLE INTERNATIONAL, INC.

                                                                                                                                                       Applicant

                                                                              - and -

                                              THE REGISTRAR OF TRADE- MARKS

                                                                                                                                                   Respondent

                                                            REASONS FOR ORDER

McKEOWN J.

[1]                 The applicant appeals from the decision of the Registrar of Trade-Marks dated November 25, 1999, refusing the applicant's application to register the trade-mark SUPERSHUTTLE based on proposed use in Canada and foreign use and registration in the United States in association with the services: ‘airport passenger ground transportation services'.

[2]                 The issues are whether the Registrar erred:

            1)        in finding that the applicant had not discharged its onus pursuant to paragraph 14(1)(b) of the Trade-marks Act, and

          2)        in finding that the trade-mark is not registrable by reason of paragraph 12(1)(b) of the Trade-marks Act.

FACTS

[3]                 The applicant, Supershuttle International, Inc. is the owner of application No. 777,875 for the trade-mark SUPERSHUTTLE in Canada. The applicant is an organization that provides airline passengers with ground transportation to and from airports and their homes. The applicant does not have any regular routes or any regular times. Any consumer who wishes to use their service must phone and make a reservation.

[4]                 The applicant applied to register its trade-mark SUPERSHUTTLE in Canada on March 14, 1995 based on proposed use in Canada and foreign use and registration in the United States in association with the services: "airport passenger ground transportation services". The examiner initially refused the application citing section 12(1)(b) of the Trade-marks Act (the "Act") claiming that SUPERSHUTTLE was clearly descriptive or deceptively misdescriptive of the character or quality of the services of the applicant because as a whole the mark indicates

a shuttle service of superior quality. In response to further submissions of the applicant, the examiner then stated by letter dated September 18, 1996, that the mark is not just a fanciful or coined mark, and that its meaning must be looked at in association with the services applied for. It also found that the registration in the U.S. was not relevant to paragraph 12(1)(b), and stated again that the average consumer would understand the mark to indicate a superior shuttle service.

[5]                 On January 28, 1997, the applicant amended its application to claim the benefit of section 14(1)(b) of the Act. In support of this new claim the applicant filed the affidavit of Judy Robertson dated January 16, 1997. The examiner reviewed the affidavit and concluded that it was not sufficient to support a section 14(1)(b) claim. By letter dated April 17, 1997, the examiner requested that since the mark had not been used in Canada the applicant should submit proof of substantial spillover advertising in Canada.

[6]                 The applicant did not provide the examiner with the additional evidence requested. Instead, the applicant disputed the need for proof of substantial spillover advertising and requested the registrar to refuse the application so that the applicant could appeal the decision.

[7]                 The Acting Registrar of Trade-marks issued a decision dated November 25, 1999, whereby he refused to register Trade-mark Application No. 777,875. The letter stated with respect to paragraph 12(1)(b):

It is my position that the average consumer, when faced with the mark SUPERSHUTTLE for use in association with airport passenger ground transportation services, would immediately conclude, as a matter of first impression, that the applicant offers a shuttle service which is of superior quality.

[8]                 With respect to paragraph 14(1)(b) the letter stated:

Since the mark SUPERSHUTTLE has not been used in Canada and the [Judy Robertson] affidavit does not contain specifics as to how the advertising was circulated in Canada, I am of the opinion that the affidavit does not contain sufficient information to allow me to determine that there was substantial spill-over and exposure to the applicant's trade-mark in Canada. Therefore, I consider that the evidence filed is not sufficient to establish that the subject mark SUPERSHUTTLE is not without distinctive character in Canada.

[9]                 Although the applicant claimed in its November 13, 1997 letter that the evidence submitted to the examiner was sufficient to support the applicant's claim under section 14(1)(b), the applicant filed additional affidavit evidence in this appeal (second affidavit of Judy Robertson dated February 18, 2000) which contains examples of spillover advertising in Canada. The applicant has also filed evidence of the state of the registry with regard to, among other things, marks with the prefix SUPER.

LEGISLATION

[10]            It will be helpful to set out the relevant provisions of the Act which are as follows:

ANALYSIS

[11]            I will now review whether the Registrar erred in finding that the applicant had not discharged its onus pursuant to paragraph 14(1)(b) of the Act. While in most cases I would commence the reasons by dealing with the section 12(1)(b) issue as opposed to the 14(1)(b) issue, the case law is not as clear with respect to the paragraph 12(1)(b) issue as it is with respect to paragraph 14(1)(b) in the circumstances of this case. Accordingly, I make no findings with respect to whether the Registrar erred in his findings under 12(1)(b). For the purposes of this decision I will assume that the trademark is contrary to section 12(1)(b).

[12]            In order to determine the section 14(1)(b) question I must look at the appropriate standard of review to be applied. In Young Drivers of Canada Enterprises Limited v. Chan (1999), 2 C.P.R. (4^th) 329 (F.C.T.D.) Lutfy J., as he then was, reviews the standard of review at paragraphs 18-20 and decides to follow the less deferential standard adopted by Heald J. in Labatt Brewing Company v. Molson Breweries, a Partnership (1996), 113 F.T.R. 39 (T.D.) at pages 43-44. In that case Heald J. adopts the position of Strayer J. in McDonald's Corporation v. Silcorp (1989), 29 F.T.R. 151, aff'd. 1992 139 N.R. 319 (F.C.A.) at page 210:

It seems clear that in opposition proceedings where the issue is essentially one of fact concerning confusion or distinctiveness, the decision of the registrar or the board represents a finding of fact and not the exercise of discretion. Therefore, the court should not impose upon itself the same degree of restraint, in reviewing that decision, as it would if the decision were essentially an exercise of discretion. It is thus free to review the facts to determine whether the decision of the registrar or board was correct, but that decision should not be set aside lightly considering the expertise of those who regularly make such determinations: See Benson & Hedges (Canada) Ltd. v. St. Regis Tobacco Corp. (1968), 57 C.P.R. 1, at pp. 199-200 (S.C.C.). While different panels of the Federal Court of Appeal have variously expressed the duty of this court on appeal to be to determine whether the registrar has ‘clearly erred', or whether he has simply ‘gone wrong', it appears that it is the duty of a judge sitting on an appeal such as this to come to his own conclusion as to the correctness of the finding of the registrar. In doing that he must, however, take into account the special experience and knowledge of the registrar or the Board, and more importantly have regard to whether new evidence has been put before him that was not before the Board.

[13]            There is new evidence with respect to 14(1)(b), the affidavit of Judy Robertson, the Director of Franchising for SuperShuttle Franchising Corporation and SuperShuttle, International Inc., relating to the issue of spillover advertising, so the standard would be less deferential on that determination, i.e. correctness.

[14]            In cases where a trade-mark is considered to be contrary to section 12(1)(b) of the Act, as I am assuming in this case, an applicant may be able to rely on paragraph 14(1)(b) of the Act to obtain a Canadian trade-mark registration. The applicant in this case claimed the benefit of section 14 of the Act, and filed certified copies of the registration certificates for the SUPERSHUTTLE along with the affidavit evidence including evidence that the use of SUPERSHUTTLE was extensive and that SUPERSHUTTLE and its services are very well known throughout the United States and Canada.

[15]            The U.S. Patent and Trademark Office registered the trade-mark SUPERSHUTTLE on December 23, 1986 and it was assigned registration number 1,422,276. The registration is based upon use in the United States since 1982. On December 23, 1990, the Patent and Trademark Office awarded SuperShuttle two additional service mark registrations, both for the word "SuperShuttle", accompanied by a design. These registrations were assigned Registration Numbers 1,629,477 and 1,629,481.

[16]            In her original affidavit dated January 16, 1997, which was before the Registrar of Trade-marks, Judy Robertson stated that SuperShuttle operated over 800 vehicles with annual revenues in excess of $80 million. She also noted that SuperShuttle has utilized the blue and yellow colour combination for its vans which is readily recognized by customers as emanating from SuperShuttle. She states that SuperShuttle customers by definition, would include airline customers travelling to and from Canadian cities such as Toronto and Vancouver, who would be familiar with the SuperShuttle name and its service mark. She states that there are no sales made directly in Canada but there has been interest from potential franchisees in Canada. With respect to advertising she stated:

SuperShuttle has advertised and promoted its transportation services in Canada as well as to the Canadian public by its U.S. advertising and its advertising which circulates in Canada.

She also attached samples of the advertising. She indicated that advertising expenditures in the U.S. relating to the SuperShuttle service marks has been in excess of $500,000.00 on an annual basis.

[17]            In her subsequent affidavit, which was filed for this hearing but which was not before the Registrar, she referred to advertisements on the WFAN Sports Radio by SuperShuttle in 1998 around the time of the U.S. Open Tennis Tournament. She also referred to the advertisements by way of newspaper inserts targeted to select demographic households in newspapers including the Globe and Mail. She also noted that there were 147 calls from prospective customers in Manitoba, Saskatchewan, British Columbia, Ontario and Quebec and also noted that 3,000 calls were placed to Canadians across Canada in the period January 1999 to January 2000. She noted as well the web listing and statistics report relating to the SuperShuttle website.

[18]            The respondent takes no position on whether new evidence produced by the applicant is sufficient to provide that the mark SUPERSHUTTLE is not without distinctive character in Canada, but argues that the proper approach would have been for the additional evidence to have been submitted to the Registrar first as the Registrar requested. I agree that this is the proper approach but I do not agree that the failure to do that was fatal in the circumstances of this case. The parties will now be on notice that evidence should be produced before the Registrar with respect to showing that the mark is not without distinctive character in Canada. I am bound by subsection 56(5) of the Act which states:

[19]            I also do not agree with the respondent that the applicant had to submit proof of substantial spillover advertising in Canada. Paragraph 14(1)(b) of the Act only requires the applicant to show that the mark is "not without distinctive character" in Canada. Spillover advertising is just one part of showing that it is "not without distinctive character" in Canada. An applicant has the responsibility to produce this evidence before the Registrar of Trade-Marks. The Registrar of Trade-marks is entitled to make applicants supply proof of spillover advertising as part of the process. The amount of spillover advertising required may vary from case to case depending on the context. Thus, while there may be some cases where substantial spillover advertising is required, this is not the case here.

[20]            The threshold for establishing distinctiveness is somewhat lower for section 14 than for section 12. In my view by including the phrase "not without distinctive character" in paragraph 14(1)(b) Parliament set a lower distinctiveness threshold for section 14 than for section 12. Urie J. in W.R. Grace & Co. v. Union Carbide Corp. (1987), 14 C.P.R. (3d) 337 (F.C.A.) at 346 reviewed the meaning of the phrase "distinctive character":

The word "distinctive" is defined in s. 2 of the Act as follows:

"distinctive" in relation to a trade mark means a trade mark that actually distinguishes the wares or services in association with which it is used by its owner from the wares or services of others or is adapted so to distinguish them.

The word "character" is defined in its most relevant sense in the Shorter Oxford Dictionary, 3^rd ed., under the heading of figurative senses as: 1. a feature, trait, characteristic; 2. essential peculiarity, nature, sort.

Thus, I think that it can be said that in reference to trade marks, the term "distinctive character" means those trade marks which have the traits or characteristics of distinctive trade marks. To revert to the definition, set forth above, the characteristic of distinctive trade marks in Canada is that they actually distinguish the wares or services of the owner from the wares or services of others or are adapted to distinguish them. To put it another way, if a mark to some extent in fact distinguishes the wares or services of the owners from those of others, the mark is not without distinctive character. In the context of this case, the trade mark being descriptive, it may not be sufficiently distinctive to have acquired a secondary meaning in Canada to satisfy the definition of distinctive. None the less, it may have some distinctiveness. If that is so, it is not without distinctive character in Canada.

[21]            However the onus on the applicant remains a heavy one. Urie J. went on at page 347 to state:

The onus resting on such a claimant was succinctly put by Cattanach J. in Standard Coil Products (Canada) Ltd. v. Standard Radio Corp. and Registrar of Trade Marks (1971), 1 C.P.R. (2d) 155, [1971] F.C. 106, when he said at p. 172:

It remains for me to assess the probative value of such evidence. In so doing I am conscious that the onus on a person contending that a trade mark which is descriptive or laudatory of his wares has come to actually distinguish those wares is a heavy one and that onus is increased by the adoption of a work which lacks inherent distinctiveness.

I recognize that that case as well as Carling Breweries Ltd. v. Molson Cos. Ltd. et al. (1984), 1 C.P.R. (3d) 191 at pp. 196-8 inclusive, dealt with the issue of "distinctiveness" per se and not that of "distinctive character" but I am of the opinion that the onus is no less stringent in the latter instance.

[22]            I am satisfied in the matter before me that the applicant has established that the trade-mark in Canada is not without distinctive character having regard to all the circumstances of the case, including the 20 years that it has been used in the United States.

[23]            In this case the applicant submitted there was no need for the mark to be have been used or made known in Canada under this section. However, I disagree, since the language of the provision explicitly uses the words "in Canada", stating that a trademark is registrable if "in Canada ... it is not without distinctive character ...". In my view, this language suggests a requirement of at least some knowledge of the mark in Canada. Knowledge or use exclusively in another country would be insufficient.

[24]            In this case, however, the applicants have introduced evidence of spillover advertising into Canada. They have given numerous examples of advertising which would have been seen in Canada, including advertising on flights to and from Vancouver, radio advertising heard in Canada, and newspaper inserts in Vancouver and Toronto newspapers. Further, it seems that this advertising has reached Canadians, given the volume of customer inquiries the company has received from Canada. I find that all the evidence presented by the applicant meets the onus that the mark is not without distinctive character in Canada.

[25]            The appeal is allowed. The Court orders that the decision of the Acting Registrar of Trade-Marks dated November 25, 1999, is overturned. The Court further orders that the Registrar of Trade-Marks shall allow application serial No. 777,875 to proceed to publication in the Trade-Marks Journal pursuant to section 37 of the Trade-Marks Act. No costs.

"W. P. McKeown"

                                                                                                       JUDGE

TORONTO, ONTARIO

April 12, 2002

FEDERAL COURT OF CANADA

                   Names of Counsel and Solicitors of Record

COURT NO:                                           T-111-00         

STYLE OF CAUSE:                               SUPERSHUTTLE INTERNATIONAL, INC.

                                                                                                     Applicant

- and -

THE REGISTRAR OF TRADE-MARKS

                                                                                                 Respondent

DATE OF HEARING:              TUESDAY, MARCH 5, 2002

PLACE OF HEARING:                         TORONTO, ONTARIO

REASONS FOR ORDER BY:             McKEOWN J.

DATED:                                                   FRIDAY, APRIL 12, 2002

APPEARANCES BY:                          Mr. Kenneth D. McKay

For the Applicant

Ms. Liz Tinkler

For the Respondent

SOLICITORS OF RECORD:           Sim, Hughes, Ashton & McKay LLP

Barristers and Solicitors

330 University Ave., 6^th Floor

Toronto, Ontario

M5G 1R7

For the Applicant

Morris Rosenberg

Deputy Attorney General of Canada

For the Respondent

FEDERAL COURT OF CANADA

            Date: 20020412

                    Docket: T-111-00

BETWEEN:

SUPERSHUTTLE INTERNATIONAL, INC.

                                                 Applicant

- and -

THE REGISTRAR OF TRADE-MARKS

                                             Respondent

REASONS FOR ORDER