Judgments

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Jesse Magder, trading as Sportcam Company, or Sportcam Co. (Appellant)
v.
Breck's Sporting Goods Co. Ltd. (Respondent)
and
Sportcam Co. Limited (Appellant)
v.
Breck's Sporting Goods Co. Ltd. (Respondent)
Court of Appeal, Jackett C.J., Thurlow J. and MacKay D.J.--Ottawa, April 9, 10 and 11, 1973.
Trade marks—Infringement—Foreign wares sold under Canadian trade mark by Canadian distributor and competi- tors—Trade mark not distinctive of wares sold by Canadian distributor—Trade Marks Act, section 2(f) and (t).
A French manufacturer of fishing lures applied the word "Mepps" to lures manufactured by it to distinguish them from those manufactured by others. Its lures were sold under that name in Canada commencing in 1951 and did actually distinguish the French manufacturer's wares from those of others. The trade mark "Mepps" was registered in Canada in 1956 by the exclusive distributor of the Mepps lures in Canada. In 1959 respondent became exclusive dis tributor of Mepps lures in Canada and also the registered assignee of the trade mark "Mepps". Appellant imported Mepps lures from France and sold them in Canada under the "Mepps" trade mark. Respondent brought an action against appellant for infringement.
Held, reversing Gibson J., the action must be dismissed. The registration of the trade mark in Canada was invalid. The trade mark "Mepps" did not actually distinguish lures sold by respondent from those of others as required by section 18(1)(b) of the Trade Marks Act, having regard to the definitions of "distinctive" and "trade mark" in the Act. There was no evidence to support the trial judge's finding that commencing in 1956 the mark "Mepps" actually came to distinguish Mepps lures sold by respondent in Canada.
The Hotpoint Electric (1921) 38 R.P.C. 63, considered.
APPEAL from Gibson J. COUNSEL:
G. F. Henderson, Q.C., and K. H. E. Plum- ley for appellant.
W. F. Green and J. M. Shearn for respondent.
SOLICITORS:
Gowling and Henderson, Ottawa, for appellant.
W. F. Green, Toronto, for respondent.
JACKETT C.J. (orally)—This is an appeal from a judgment of the Trial Division finding infringement of a registered trade mark and dismissing a counterclaim for a judgment strik ing out the registration and a cross-appeal against the dismissal of a claim for breaches of sections 7 and 22 of the Trade Marks Act, S.C., 1952-53, c. 49.
The trade mark is the word "Mepps" and is registered in respect of "Fishing tackle ..." It was registered first in the name of Boehm-Shel- don Inc. on June 29, 1956. On September 1, 1959, an assignment to the respondent, whose name was then Sparkling Products Company, Ltd., was registered. On November 22, 1965, the respondent changed its name to its present name.
After reading the evidence as a whole, I have come to the conclusion that "Mepps" is a word used as the trade mark under which fishing lures manufactured by a certain company in France are sold and that, to a person in Canada who buys fishing lures for his own use, the trade mark simply means that lures sold in association with it have been manufactured by a particular French manufacturer.'
Boehm-Sheldon Inc. had, during the time it was the registered owner of the trade mark, contractual arrangements with the French manufacturer, under which it was entitled to be the exclusive distributor of the "Mepps" lures in the United States and Canada. During that time, the respondent or its predecessor in business was, under a contractual arrangement with Boehm-Sheldon Inc., the sub-distributor in Canada.
In or around 1959, these contractual arrange ments were changed so that the respondent acquired, by virtue of a contractual arrangement
with the French manufacturer, the right to be the exclusive distributor of the "Mepps" lures in Canada.
It is common ground that the appellants, prior to the institution of the actions, imported "Mepps" lures from suppliers in France, who acquired them directly or indirectly from the French manufacturer, and sold them in Canada under the "Mepps" trade mark so that, if the respondent's registration of that trade mark has not been shown to be invalid, there has been established an infringement of the exclusive right vested in the respondent by section 19 of the Trade Marks Act, which reads as follows:
19. Subject to sections 21,31 and 65, the registration of a trade mark in respect of any wares or services, unless shown to be invalid, gives to the owner the exclusive right to the use throughout Canada of such trade mark in respect of such wares or services.
My first reaction to the question of the validi ty of the respondent's registration of the trade mark is that it is invalid by virtue of that part of section 18(1) of the Trade Marks Act that reads as follows:
18. (1) The registration of a trade mark is invalid if
(b) the trade mark is not distinctive at the time proceed ings bringing the validity of the registration into question are commenced; .. .
when that provision is read with the following definitions in section 2 of that Act:
(f) "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;
(t) "trade mark" means
(i) a mark that is used by a person for the purpose of distinguishing or so as to distinguish wares or services manufactured, sold, leased, hired or performed by him from those manufactured, sold, leased, hired or per formed by others,
If the trade mark registration is invalid for that reason, it becomes unnecessary to consider the other attacks that were made on it.
In my view, a reading of the evidence given in this case shows that the trade mark "Mepps" was used in Canada, prior to its registration, to show that lures sold under that name came from a certain French manufacturer and that those in Canada who came to know that trade mark so understood it; and that, notwithstanding its registration in the name of distributors, it never had any other significance in fact . 2
if I am right in so appraising the evidence, it follows that, at the time the actions in question were instituted, the trade mark "Mepps" did not actually distinguish "wares" in association with which it was used by the respondent (its "own- er" by virtue of the registration) from "wares" of persons other than the respondent. In par ticular, use by the respondent at that time of the trade mark "Mepps" in association with goods would not have distinguished such goods from goods of the French manufacturer.' I conclude, therefore, that the trade mark was "not distinc tive" (within the meaning of the word "distinc- tive" as defined by the Act) at the time that the proceedings bringing the validity of the registra tion into question were commenced and that the registration is therefore "invalid" by virtue of section 18(1)(b).
I have reached the conclusion that the trade mark "Mepps" was not, at the relevant time, "distinctive" only after anxious consideration of the learned trial judge's findings on this aspect of the case. He made a finding that "from 1956 until July 7, 1959, the Canadian trade mark `MEPPS' distinguished within the meaning of sec tion 2(f) of the Trade Marks Act the lures sold in Canada by the plaintiff company (manufac- tured in France) from the lures of others, even though the plaintiff was not a registered user of the said trade mark; and from July 7, 1959, to date, the Canadian trade mark `MEPPS' similarly distinguished the lures sold by it in Canada". When he finds that, as of the times to which he refers, the trade mark distinguished, within the meaning of section 2(f), the lures sold in Canada by the respondent from the lures of others, he makes a finding that that trade mark was at
those times a trade mark that "actually distin guishes the wares ... in association with which it is used by its owner from the wares ... of others or is adapted so to distinguish them". In other words his finding would seem to be that, when the "Mepps" mark appeared on lures during the relevant time, it conveyed to the buying public the message that such lures were lures sold by the respondent. Starting with the fact, as found by the learned trial judge and as amply supported by the evidence, that, prior to 1956, the trade mark "Mepps" distinguished, within the meaning of section 2(f), the lures of the French manufacturer from the lures of others, I can find no evidence that, commencing in 1956, anything was done to make it convey to the market some other message. In this connec tion, I adopt what was said by P. 0. Lawrence J. in The Hotpoint Electric case ((1921) 38 R.P.C. 63 at page 71):
It is quite true that a mark can indicate the seller or selector of the goods and need not necessarily indicate the manufacturer, but if the reputation of the mark has been gained owing to its being used by the manufacturer, and it has become known as the manufacturer's mark, I think it might very well cause deception and confusion, if it were used afterwards, without something on the mark itself, for the purpose of indicating only the seller of the goods which were being manufactured by somebody else.
I am of the view that it is important to bear in mind that a trade mark is only "distinctive" within the meaning of that word as used in the Trade Marks Act if it "actually distinguishes" the wares with which it is used by its owner from the wares of others . 4
It follows from my conclusion that the regis tration was invalid by virtue of section 18(1)(b) that, in my opinion, the appeal should be allowed with costs, because, in my view, the infringement actions should have been dis missed and there should have been judgment on one of the counterclaims striking the registra tion from the Register.
In so far as the cross-appeal is concerned, once the conclusion that I have reached as to
the significance of the trade mark "Mepps" in the Canadian market is accepted, there is no basis for a claim under section 7 of the Trade Marks Act and, if the registration of the trade mark is invalid, there can be no claim under section 22. I am therefore, also, of the view that the cross-appeal should be dismissed with costs.
* * *
THURLOW J. (orally)—On the facts of this case there is no doubt that throughout the period commencing in 1951, when fishing lures bearing the mark "Mepps" first appeared on the market in Canada, and continuing up to the time in 1969 when the counterclaims for expunge - ment in these proceedings were filed, the mark "Mepps" had been applied to such fishing lures by the French company which supplied them, that is to say, Manufacture d'Engins de Préci- sion pour Pêches Sportives. There is also no doubt that the French company applied the mark to the lures for the purpose of distinguish ing its wares from those of others. The word "Mepps", has thus been, throughout the rele vant period, a trade mark, within the meaning of the definition of "trade mark" in section 2 of the Trade Marks Act, used by that company to identify its goods.
To my mind it is also clear that throughout the relevant period the trade mark "Mepps" actually distinguished lures of the French com pany from those of others within the definition of "distinctive" in section 2 and that the French company had applied the mark to the goods in the exercise of its right to do so as owner of the mark and not as agent for the respondent.
The respondent's case as I understand it does not challenge these facts but is based on the proposition that in Canada at one and the same time the trade mark "Mepps" can distinguish the goods of the French manufacturer and the goods of the distributor of them and thus be "distinctive" of both. In my opinion this is not possible under the statute and in view of the
unchallenged facts which I have outlined it appears to me to follow that the trade mark could not be distinctive of the respondent's wares within the meaning of the statute when the counterclaims for expungement were filed.
The learned trial judge found that the mark was distinctive of the French company from 1951 to 1956 and thereafter was distinctive of the respondent company but with respect I am unable to agree that the mark was ever distinc tive of the respondent in the sense of the defini tion of section 2, that is to say, that the mark was a trade mark used by the respondent as owner thereof to distinguish its goods from those of others and which actually distinguished its goods from those of others. The respondent never applied the mark to lures of the French company or to other lures of its own. Nor did the French company apply the mark to them as the respondent's agent. Moreover, as between itself and the French company, the respondent had no right to use the mark in association with goods other than those of the French company. The respondent merely resold in Canada lures to which the French company had applied its mark as the owner thereof, and at no time took steps to inform the market that the mark had ceased to be that of the French company and had now become its trade mark. I do not think therefore that a finding that the mark was dis tinctive of the respondent's wares from 1956 to 1959, a time when neither the respondent nor its predecessor had any claim whatever to owner ship of the mark, is supportable or that the finding that the trade mark was distinctive of the respondent following the purported assign ment of it should be upheld.
I would allow the appeal and dismiss the cross-appeal as proposed by the Chief Justice.
MACKAY D.J. concurred.
' Whether or not the individual members of the purchas ing public were aware of the French manufacturer's name is immaterial—the theory is that those who had shown a preference for the goods sold under the marks had learned to have confidence in the manufacturer of such wares regardless of whom he might be. See Wotherspoon v. Currie, L.R. 5 E. & I. App. 508, per Lord Hatherley, L.C. at pages 514-15: "Therefore the name `Currie' ought to be distinct, as I believe it is, and the name of the article again, if it has acquired a name, should not, by any honest manufacturer, be put upon his goods if a previous manufacturer has, by applying it to his goods, acquired the sole use of the name. I mean the use in this sense, that his goods have acquired by that description a name in the market, so that whenever that designation is used he is understood to be the maker, where people know who the maker is at all—or if people have been pleased with an article, it should be recognized at once by the designation of the article, although the customers may not know the name of the manufacturer. It may very well be that hundreds of people like Glenfield Starch, and order it because they think that it is the best starch that they ever used, without having heard the name of Mr. Wotherspoon, and without knowing him at all. They say, I want the thing that bears that name, the thing made in a particular way, made by the manufacturer who makes it in that way, and there being only one manufacturer who does make it in that way, I want the article made by that manufacturer."
z' Throughout the whole period of its user in Canada until after the actions in question here had been instituted, words were regularly used in conjunction with the "Mepps" trade mark making it clear that the lures being sold under it were the well-known lures of French manufacture.
Compare Impex Electrical Ld. v. Weinbaum, (1927) 44 R.P.C. 405 per Tomlin, J. at page 410: "If a manufacturer having a mark abroad has made goods and imported them into this country with the foreign mark on them, the foreign mark may acquire in this country this characteristic, that it is distinctive of the goods of the manufacturer abroad. If that be shown, it is not afterwards open to somebody else to register in this country that mark, either as an importer of the goods of the manufacturer or for any other purpose. The reason of that is not that the mark is a foreign mark registered in a foreign country, but that it is something which has been used in the market of this country in such a way as to be identified with a manufacturer who manufac tures in a foreign country. That, I venture to think, is the basis of the decision in the Apollinaris case ([1891] 2 Ch. 186). It seems to me to be the basis of the decision in the case before Mr. Justice Clauson of Lacteosote Limited v. Alberman (44 R.P.C. 211) and it seems to me to be conso nant with good sense." Contrast J. Ullmann & Co. v. Leuba, (1908) 25 R.P.C. 673 (P.C.) where the Hong Kong trade mark denoted in Hong Kong the goods of the Hong Kong retailer and not the goods of the foreign manufacturer who
supplied them to him. Compare also Wilkinson Sword (Canada) Ltd. v. Juda, [1968] Ex.C.R. 137.
In reality, as I understand the facts, a use by the respond ent of the trade mark "Mepps" on goods sold to sports fishermen in Canada at the time of the commencement of these actions would not have been a use of the mark as a trade mark of the respondent because, by definition, supra, a trade mark means "a mark that is used by a person for the purpose of distinguishing or so as to distinguish wares .. . manufactured, sold (etc.) ... by him from those manufac tured, sold (etc.) ... by others". If the respondent had used the trade mark "Mepps" on goods of the French manufac turer that it sold in Canada, it would certainly not have distinguished such goods from goods manufactured by such French manufacturer and, if the respondent had used the trade mark "Mepps" on goods that did not come from the French manufacturer, it would have been a false representa tion that they were manufactured by the French manufacturer.
As put to us, the respondent's case depends upon the proposition that a trade mark can, at one and the same time and at the same place, distinguish the goods of two different persons. Having regard to the definition of "trade mark", I am of opinion that that proposition is fallacious.
Possibly because I have failed to appreciate the true significance of it, I must express my reservation as to the correctness of what is implied by the following paragraph of the judgment appealed from:
In my view, it is sufficient that the origin in Canada of these lures be established. The fact that the origin of manufacture in France of the lures was known by some persons in Canada in this case, is irrelevant, in that this is a claim in respect to a trade mark used only in selling wares in Canada.
As I understand the Trade Marks Act, there is no justifica tion for ignoring the message of a trade mark that wares are manufactured by a foreign manufacturer and treating it as a message that the wares are sold by a Canadian who imports and sells them in Canada. In my view, having regard to the words in section 2(D, the question is one of fact as to what message the trade mark "actually" conveys to the public. I am sure that the learned trial judge did not mean anything different by the above passage but it seems to me to be open to another interpretation.
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