Judgments

Decision Information

Decision Content

T-702-87
Borden, Inc. (Appellant) v.
Hostess Food Products Limited and the Registrar of Trade Marks (Respondents)
INDEXED AS: BORDEN, INC. V. HOSTESS FOOD PRODUCTS LTD. (T.D.)
Trial Division, McNair J.—Toronto, June 20; Ottawa, November 29, 1989.
Trade marks — Registration — Opposition — Prior use and non-abandonment not established — Evidence not sup porting argument opponent's trade marks "known in Canada".
Trade marks — Practice — Appeals and new trials — Evidence — Although new evidence may be adduced pursuant to s. 56(5) of Act, such must be in relation to facts material to issues previously before Registrar — To that extent, appeal somewhat of trial de novo.
This was an appeal from the decision of the Registrar of Trade Marks rejecting the opposition to the respondent's application to register the trade mark "Doodles".
The appellant's trade marks "Dipsy Doodles" and "Cheez Doodles" had been registered in the United States in 1959 and 1957 and in Canada in 1960 and 1961 by its predecessor in title in association with "corn chips" and "cheese flavoured corn curls" respectively. First use was claimed for "Dipsy Doodles" since 1965 and for "Cheez Doodles" since 1958. These trade marks were expunged in November 1980 pursuant to the respondent's application under section 44 of the Trade Marks Act. In June 1980, the respondent applied to have the trade mark "Doodles" registered in association with "corn meal based snack foods". Opposition proceedings ensued on grounds the respondent trade mark was not registrable pursuant to subsection 16(3) as confusing and for lack of distinctiveness pursuant to paragraph 37(2)(d) of the Act. The Registrar found the respondent company had satisfied the onus of estab lishing its proposed trade mark was adapted to distinguishing its wares from those of others, the opponents having failed to satisfy the evidentiary burden of showing prior use and non- abandonment. New evidence was submitted on appeal.
Held, the appeal should be dismissed.
The Registrar was not wrong in concluding there had been no prior use of appellant's trade marks within the meaning of section 4 of the Trade Marks Act. The onus being on the applicant: British American Bank Note Co. v. Bank of Ameri- ca, and "use" being as defined in Plough (Canada) Ltd. v. Aerosol Fillers Inc., the evidence establishes no use whatever of
the trade marks "Dipsy Doodles" and "Cheez Doodles" in association with wares from 1960 to 1988 in the first instance and from 1961 to 1988 in the second.
The Registrar made no error in concluding that the appellant had failed to establish non-abandonment of its trade marks as of the date of advertisement of respondent's application. Evi dence showing substantial sales in the United States was not indicative of the fact that there was no intention of abandon ment in Canada. The words of subsection 17(1) of the Act read in their grammatical and ordinary sense, in context with section 16 and the scheme of the Act as a whole, clearly limit the range of abandonment of the confusing trade marks to Canada: Stubart Investments Ltd. v. The Queen.
The evidence does not establish that the appellant's trade marks were at the material time "known in Canada" within the meaning of the phrase as explained in E. & J. Gallo Winery v. Andres Wines Ltd., sufficient to justify the conclusion that the respondent's trade mark was not adapted to distinguishing its wares.
There is no evidence that the appellant foreign trade marks were so widely known in Canada as to justify the conclusion that the respondent's application to register the "Doodles" trade mark was calculated to deceive and mislead the public. There was no evidence that the respondent was aware of the registrations and use of the appellant's trade marks in the United States.
STATUTES AND REGULATIONS JUDICIALLY CONSIDERED
Trade Marks Act, R.S.C. 1970, c. T-10, ss. 2, 4, 6(5),
16(3)(a),(b), 17(1), 37(2)(d), 44, 54(I),(2),(3), 56(5).
Trade Marks Regulations, C.R.C., c. 1559, s. 46(5).
CASES JUDICIALLY CONSIDERED
APPLIED:
Benson & Hedges (Canada) Ltd. v. St. Regis Tobacco Corp., [1969] S.C.R. 192; (1968), 1 D.L.R. (3d) 462; 57 C.P.R. 1; 39 Fox Pat. C. 207; Standard Oil Co. v. The Registrar of Trade Marks, [1968] 2 Ex.C.R. 523; (1968), 55 C.P.R. 49; 38 Fox Pat. C. 127; Johnson (S.C.) & Son, Inc. v. Esprit de Corp. et al. (1986), 13 C.P.R. (3d) 235; 11 C.I.P.R. 192; 8 F.T.R. 81 (F.C.T.D.); Plough (Canada) Ltd. v. Aerosol Fillers Inc., [1981] 1 F.C. 679; (1980), 53 C.P.R. (2d) 62; 34 N.R. 39 (C.A.); Stubart Investments Ltd. v. The Queen, [1984] 1 S.C.R. 536; (1984), CTC 294; 84 DTC 6305; 53 N.R. 241.
DISTINGUISHED:
Algonguin Mercantile Corporation v. Dart Industries Canada Ltd. (1984), 1 C.P.R. (3d) 242 (F.C.T.D.); E. & J. Gallo Winery v. Andres Wines Ltd., [1976] 2 F.C. 3;
(1975), 25 C.P.R. (2d) 126; 11 N.R. 560 (C.A.); Orkin Exterminating Co. Inc. v. Pestco Co. of Canada Ltd. et al. (1985), 50 O.R. (2d) 726; 19 D.L.R. (4th) 90; 30 B.L.R. 152; 34 CCLT 1; 5 C.P.R. (3d) 433; 10 O.A.C. 14 (C.A.).
CONSIDERED:
British American Bank Note Co. v. Bank of America National Trust and Saving Association, [1983] 2 F.C. 778; (1983), 71 C.P.R. (2d) 26 (T.D.); Marineland v. Marine Wonderland & Animal Park Ltd., [1974] 2 F.C. 558; (1974), 16 C.P.R. (2d) 97 (T.D.).
COUNSEL:
Kenneth D. McKay for appellant. Robert A. MacDonald for respondents.
SOLICITORS:
Sim, Hughes, Dimock, Toronto, for appellant.
Cowling, Strathy & Henderson, Ottawa, for respondents.
The following are the reasons for judgment rendered in English by
MCNAIR J.: This is the appeal of Borden, Inc. from the decision of the Registrar of Trade Marks dated January 30, 1987 whereby he rejected the appellant's opposition to the respondent's applica tion to register the trade mark "Doodles" in asso ciation with "corn meal based snack foods". Battle is joined on the appeal only in respect of the appellant's trademarks "Dipsy Doodles" and "Cheez Doodles", and its related trade mark, "Nutty Doodles", which was also a matter of contestation before the Registrar, is no longer in issue. The Registrar is not opposing the appeal. The facts are relatively complex and a summary of the events leading to this appeal might prove useful.
On September 15, 1960 the appellant's prede cessor in title, Old London Foods, Inc., applied for registration of the trade mark "Dipsy Doodles". The application stated that the trade mark had been used in Canada in association with "corn chips" since April 6, 1960. The trade mark was registered on February 24, 1961 as No. 121,297. The same trade mark had been registered in the
United States on December 22, 1959 as No. 690,326.
On March 2, 1961 Old London Foods, Inc. applied for registration of the trade mark "Cheez Doodles", claiming use of the trade mark in Canada in association with "cheese flavoured corn curls" since February 15, 1961. The trade mark was registered on September 8, 1961 as No. 123,502. Similarly, the same trade mark had been registered in the United States on April 30, 1957 as No. 644,839.
On March 11, 1980 the respondent wrote the Registrar of Trade Marks requesting the issuance of expungement notices under section 44 of the Trade Marks Act [R.S.C. 1970, c. T-10] against the trade marks "Dipsy Doodles" and "Cheez Doodles". Expungement was also sought in respect of the trade mark "Nutty Doodles", but this is no longer relevant. The appellant did not respond to the expungement notices with the result that the registrations of the trade marks "Dipsy Doodles" and "Cheez Doodles" were expunged on November 26 and November 27, 1980 respective ly.
On June 26, 1980 the respondent, Hostess Food Products Limited, filed an application to register the trade mark "Doodles" based on its proposed use in Canada in association with "corn meal based snack foods". The application for registra tion was advertised on September 2, 1981. The appellant filed a statement of opposition on December 23, 1981. This was followed by a revised statement of opposition dated January 14, 1982, which was directed to the respondent on February 2, 1982. The grounds of opposition were: (1) that the proposed trade mark was not registrable because it was confusing with the appellant's trade marks, having regard to the provisions of subsec tion 16(3) of the Trade Marks Act; and (2) that the proposed trade mark was not distinctive within the meaning of section 2 and paragraph 37(2)(d) of the Act in that it did not actually distinguish the wares of the respondent from those of others, and more particularly, in view of the fact that the said trade mark was confusing with the appellant's trade mark "Cheez Doodles" made known in
Canada through media advertising received in Canada.
The respondent filed a counter statement on February 25, 1982 in which it denied the appel lant's allegations and noted that the trade mark registrations for "Cheez Doodles" and "Dipsy Doodles" had been expunged pursuant to section 44 of the Act. The appellant's evidence in the opposition proceeding consisted of the affidavits of Robert V. Boyer, Director of Marketing of the Consumer Products Division of the appellant, and Robert G. Tritsch, Secretary of the appellant. Both affiants were cross-examined on June 6, 1983 and the transcripts of their cross-examinations form part of the record of the present appeal. In support of its application for registration of the trade mark "Doodles", the respondent filed the affidavits of Bill Douglas, its Ontario Sales Manager, and William E. McKechnie, its Market ing Manager. Both affiants were cross-examined thereon but, having failed to reattend a further cross-examination as ordered, their affidavits were deemed not to be part of the record on appeal, pursuant to subsection 46(5) of the Trade Marks Regulations [C.R.C., c. 1559]. Both parties filed written arguments, and were represented by coun sel at an oral hearing before the member of the Trade Marks Opposition Board, David J. Martin, on December 4, 1986. Mr. Martin's decision on behalf of the Registrar was handed down on Janu- ary 30, 1987.
With respect to the first ground of opposition, the Registrar found that the appellant had failed to satisfy the evidentiary burden of showing prior use and non-abandonment of its trade marks. As to the second ground of opposition, the Registrar was unable to find sufficient evidence of reputation in Canada for the appellant's trade marks, where by he concluded that the respondent had satisfied the onus of establishing that its proposed trade
mark was adapted to distinguish its wares from those of others.
The appellant's notice of appeal, which was filed on March 30, 1987, raised two grounds of appeal: firstly, that the Registrar erred in fact and law in rejecting the appellant's grounds of opposition with respect to confusion within the meaning of subsec tion 16(3) and non-distinctiveness in the sense that the respondent's proposed trade mark did not dis tinguish its wares from those of others; and, secondly, that the Registrar erred in his interpreta tion of law as it applies to the test of distinctive ness of trade marks which the respondent knew, or ought to have known, to be used in the United States and to be registered as trade marks of another in the United States prior to any adoption and use in Canada. The appellant filed new evi dence in the form of an additional affidavit of Robert G. Tritsch, sworn October 1, 1987. Two affidavits of Chris A. Abernathy, Vice-President, Marketing, for Snacks and International Consum er Products, were also filed, as were affidavits of R. Scott MacKendrick, of the appellant's law firm, and William A. Stimeling, Manager, Marketing Services, for Snacks and International Consumer Products, a division of the appellant.
Section 56 of the Trade Marks Act deals with appeals to this Court from any decision of the Registrar. Subsection 56(5) of the Act specifically provides as follows:
56....
(5) On the appeal evidence in addition to that adduced before the Registrar may be adduced and the Court may exercise any discretion vested in the Registrar.
In my view, the provision for adducing addition al evidence on an appeal would be meaningless unless the Court could make a judicial determina tion of the issues before the Registrar with due regard to the circumstances of the case and in light of this additional evidence. Clearly, the Court is entitled to substitute its conclusion for that of the Registrar, if satisfied that the latter "has gone
wrong". To a limited extent, the appeal takes on something of the appearance of a hearing de novo, but with this qualification. While the Court is not limited in its right to hear new evidence, it is my opinion that such new evidence must be in relation only to facts material to the same issues that were before the Registrar: Benson & Hedges (Canada) Ltd. v. St. Regis Tobacco Corp., [1969] S.C.R. 192; (1968), 1 D.L.R. (3d) 462; 57 C.P.R. 1; 39 Fox Pat. C. 207, per Ritchie J. at pages 199-200 S.C.R.; Standard Oil Co. v. The Registrar of Trade Marks, [1968] 2 Ex.C.R., 523; (1968), 55 C.P.R. 49; 38 Fox Pat. C. 127, per Jackett P. at pages 55-56 Ex. C.R.; and Johnson (S.C.) & Son, Inc. v. Esprit de Corp. et al. (1986), 13 C.P.R. (3d) 235; 11 C.I.P.R. 192; 8 F.T.R. 81 (F.C.T.D.), per Cullen J. at pages 242-243 C.P.R. In any event, this is how I propose to treat the present appeal.
Preliminary Objections
Counsel for the respondent raised the prelim inary objection that the notice of appeal failed to "set out full particulars of the grounds on which relief is sought" in accordance with subsection 59(1) of the Trade Marks Act. He cited in support of this the case of Algonquin Mercantile Corpora tion v. Dart Industries Canada Ltd. (1984), 1 C.P.R. (3d) 242 (F.C.T.D.), wherein Muldoon J. held that an allegation that the prothonotary had erred in law and in fact in making his order was inadequate as a ground of appeal in that it failed to comply with Rule 336(5) of the Federal Court Rules [C.R.C., c. 663]. The grounds of appeal in the present case are specified with more par ticularity than in Algonquin Mercantile. The alle gation of the Registrar's error in rejecting the opposition is made in reference to specific grounds of error, namely, confusion under subsection 16(3) and distinctiveness within the meaning of section 2 and paragraph 37(2)(d) of the Trade Marks Act. Moreover, the notice of appeal further alleged that the Registrar erred in his interpretation of the law as it applied to the test of distinctiveness with respect to trade marks registered in the United States. Consequently, I consider that the notice of appeal sufficiently sets out the particular grounds thereof.
Counsel for the respondent also objected to the introduction by appellant's counsel of paragraph 16(3)(b) as a new ground of opposition for pur poses of this appeal. The argument is simply that the appellant's applications for registration of trade marks had been previously filed at the date of filing of the respondent's application and that this is another legitimate ground beyond the prior use situation contemplated by paragraph 16(3)(a) of the Act. Obviously this issue had not been raised before the Registrar. Based on my previous comments, I consider that it would be totally inappropriate to hear argument on this point on the appeal.
By the same token, I see no merit in the objec tion of respondent's counsel that the matter of the United States trade mark registrations for "Cheez Doodles" and "Dipsy Doodles" was something new that was not in issue before the Registrar. These foreign registrations were referred to in the affida vits of Mr. Boyer and Mr. Tritsch, both of whom were cross-examined thereon, and their affidavits and the transcripts of cross-examinations formed part of the record in the proceedings before the Registrar.
Confusion and Previous Use
The first ground raised by appellant's counsel is that the respondent is disentitled to registration of its trademark "Doodles" because it was confusing with the appellant's trademarks "Dipsy Doodles" and "Cheez Doodles" that had been previously used in Canada or made known therein, contrary to paragraph 16(3)(a) of the Trade Marks Act. The section on which he relies reads as follows:
16....
(3) Any applicant who has filed an application in accord ance with section 29 for registration of a proposed trade mark that is registrable is entitled, subject to sections 37 and 39, to secure its registration in respect of the wares or services speci-
fied in the application, unless at the date of filing of the application it was confusing with
(a) a trade mark that had been previously used in Canada or made known in Canada by any other person;
He submits that at the date of the respondent's application on June 26, 1980, which is the material date, there was clear evidence of previous use in Canada of the appellant's trade marks "Dipsy Doodles" and "Cheez Doodles", provable by certi fied copies of the registrations thereof, and that it is immaterial for purposes of the statutory provi sion that these trade marks were afterwards expunged.
The applications for Canadian registration claim use of the appellant's trade marks "Dipsy Doodles" and "Cheez Doodles" in Canada since April 6, 1960 and February 15, 1961 respectively. Appellant's counsel submits that certified copies of these applications are evidence of the facts set out therein, by virtue of subsection 54(2) of the Trade Marks Act. Counsel for the respondent submits in response that it is subsection 54(1) which is appli cable, providing, as it does, for the production of copies certified to be true by the Registrar. Both counsel seem to ignore subsection 54(3) of the Act, which provides that a certified copy of the regis tration of a trade mark is evidence of the facts set out therein. On the basis of these certified copies, I find as a fact that the appellant's trade marks had been previously used in Canada as of the dates hereinbefore mentioned. Counsel for the respon dent admitted as much when he stated:
There may have been use in '61. There must have been. They filed the applications claiming use, and we are not suggesting that anything improper was done.
There must have been use in '61, but nobody can recall any use, at all.
The Registrar reviewed the affidavit evidence of the appellant and concluded that the appellant had "failed to evidence prior use and non-abandonment of its three trade marks". He based this conclusion on the lack of evidence of any sales of the appel lant's wares and the fact that such sales were
effected in the normal course of trade, from which he concluded that there had been no prior use of the appellant's trade marks "within the meaning of section 4 of the Act".
The Registrar did not specifically address him self to the statutory criteria for determining the issue of confusion as set out in subsection 6(5) of the Trade Marks Act, nor was this argument pressed before me. The main thrust of the appel lant's first ground of appeal was directed to the previous use of its rival trade marks in Canada and the fact that they had not been abandoned. I take it to be common ground that there is no question about the degree of resemblance between the rival trade marks.
Respondent's counsel argues strenuously that in order to succeed under subsection 16(3) of the Act, the appellant must show: (1) prior use of its trade marks in Canada; (2) non-abandonment at the date the application for registration was adver tised; and (3) some measure of reputation in the trade. In his submission, the appellant has failed to do so. Respondent's counsel makes the further point that none of the appellant's affiants could recall any use of the trade marks "Dipsy Doodles" and "Cheez Doodles" in Canada at the time of their respective registrations or thereafter.
In British American Bank Note Co. v. Bank of America National Trust and Saving Association, [1983] 2 F.C. 778; (1983), 71 C.P.R. (2d) 26 (T.D.), Cattanach J., dealing with the matter of onus in an opposition proceeding, said at page 792 F.C.:
The onus is upon an applicant for the registration of a trade mark to establish his right thereto and that onus is constant upon him (see Eno v. Dunn (1890), 15 App. Cas. 252 [H.L.I) and that includes the onus of showing that confusion is unlikely.
But before an opponent can base an objection on prior use under section 16 the opponent must establish a reputation in the trade under a style with which confusion may result. That to me is not an onus but a burden of proof. An onus never shifts but a burden of proof does. The applicant may rebut the proof proffered by the opponent.
In Plough (Canada) Ltd. v. Aerosol Fillers Inc., [1981] 1 F.C. 679; (1980), 53 C.P.R. (2d) 62; 34 N.R. 39 (C.A.), which was an appeal from an expungement of trade mark, Thurlow C.J. said at page 685 F.C.:
But the use of which evidence is required is trade mark use, in the case of wares, use of the kind referred to in section 4 by the mark being marked on wares or their packages or associated with wares at the time of their sale or delivery in the normal course of trade and for the purpose of distinguishing the wares as those manufactured or sold by the owner of the trade mark from the goods of others.
In my opinion, the selfsame concept of "use" is applicable to the present case. Clearly, the Regis trar adopted this approach in concluding that there was insufficient evidence of prior use of the appellant's trade marks within the meaning of section 4 of the Trade Marks Act.
Evidence of prior use of the appellant's trade marks "Dipsy Doodles" and "Cheez Doodles" in Canada is contained in paragraph 2 of the Tritsch affidavit, which reads in part as follows:
2. The opponent has, in the past sold snack food products in Canada under the trade marks DIPSY DOODLES since at least 1960, ... and CHEEZ DOODLES since at least 1961.
Mr. Tritsch stated under cross-examination that he had no personal knowledge of the use of the trade marks "Dipsy Doodles" and "Cheez Doo dles" in the Canadian marketplace. The Director of Marketing, Mr. Boyer, who had been associated with the appellant's snack food products since 1976, stated on cross-examination that he was not aware of any sales of the appellant's wares in Canada under the trade marks "Dipsy Doodles" or "Cheez Doodles". Neither of the other affiants, Messrs. Stimeling and Abernathy, could recall any use of the appellant's trade marks in Canada prior to 1988. The only evidence of use in Canada in relation to the sale of wares is contained in an answer given by Mr. Tritsch in response to an undertaking given on cross-examination, wherein he stated that an investigation of the appellant's records showed sales in 1988 of "Cheez Doodles"
products totalling $573.08 and "Dipsy Doodles" products totalling $171.76.
The evidence in its entirety establishes that there has been no use whatever of the trade mark "Dipsy Doodles" in association with the wares from 1960 until at least February of 1988 and that the same situation pertained with respect to the trade mark "Cheez Doodles" from 1961 until the same date in 1988. Under the circumstances, I am satisfied that the Registrar did not go wrong in concluding that there had been no prior use of the appellant's trade marks within the meaning of section 4 of the Trade Marks Act.
Abandonment
This brings me to the issue of abandonment, which forms the second facet of the first ground of appeal. Counsel are agreed that, by virtue of the combined effect of subsections 16(5) and 17(1) of the Trade Marks Act, it is incumbent upon the appellant to establish on the evidence that it had not abandoned its trade marks "Dipsy Doodles" and "Cheez Doodles" at the date of advertisement of the respondent's application on September 2, 1981. The said subsections read as follows:
16....
(5) The right of an applicant to secure registration of a registrable trade mark is not affected by the previous use or making known of a confusing trade mark or trade name by another person, if such confusing trade mark or trade name was abandoned at the date of advertisement of the applicant's application in accordance with section 36.
17. (1) No application for registration of a trade mark that has been advertised in accordance with section 36 shall be refused and no registration of a trade mark shall be expunged or amended or held invalid on the ground of any previous use or making known of a confusing trade mark or trade name by a person other than the applicant for such registration or his predecessor in title, except at the instance of such other person or his successor in title, and the burden lies on such other person or his successor to establish that he had not abandoned such confusing trade mark or trade name at the date of advertisement of the applicant's application.
The appellant's affiant, Mr. Abernathy, deposed in his first affidavit that the snack food products associated with the trade marks "Dipsy Doodles" and "Cheez Doodles" were confined to a viable market area having a radius of approximately 300 miles from the producing plant by reason of pack aging, shipping charges and shelf life limitations. Paragraph 16 of the affidavit states as follows:
16. The results of the above research and development and market limitations is that it has not been viable to service the Canadian market with existing snack food plants owned and operated by Borden, Inc. in the United States of America although it has always been the intention of Borden, Inc. to do so.
In his second supplementary affidavit, Mr. Abernathy states that the appellant purchased Humpty Dumpty Foods Limited on February 2, 1988, that the vendor is a major producer of snack foods in eastern Canada whose 1987 sales exceed ed $120,000,000, and that Borden proposes to market its "Dipsy Doodles" and "Cheez Doodles" products by utilizing the distribution and sales network of the Humpty Dumpty acquisition.
Counsel for the respondent argues that the rea sons given by Mr. Abernathy for not having exploited the Canadian market for some twenty years and upwards cannot be taken by any stretch of the imagination to justify non-use of the trade marks "Dipsy Doodles" and "Cheez Doodles" in Canada. In his submission, the decision not to sell in Canada was purely voluntary and not something dictated by special circumstances over which the appellant had no control. He relies particularly on the case of Marineland v. Marine Wonderland & Animal Park Ltd., [ 1974] 2 F.C. 558; (1974), 16 C.P.R. (2d) 97 (T.D.), wherein the Court dis missed an appeal from the Registrar's dismissal of an opposition to the registration of a trade mark on the ground, inter alia, that the respondent's rival trade mark had been abandoned. Cattanach J., dealing with this point, said at pages 574-575 F.C.:
When the appellant seeks to oppose the respondent's applica tion for registration on the grounds of prior use or making known in Canada of the same trade mark by the appellant, the
burden is on the appellant to establish that the appellant has not abandoned the trade mark.
Assuming that the use by the appellant of the word "Marine- land" in association with films is a trade mark use (which question I have not decided) it is apparent from the evidence that such films have not been produced since 1958, nor dis tributed for exhibition in Canada since 1964.
However, mere non-use of a trade mark is not sufficient to create abandonment. That non-use must also be accompanied by an intention to abandon.
In my opinion, the intention to abandon the use of the trade mark "Marineland" in association with films in the circum stances of the present matter, is to be inferred from the appellant's long disuse. I take it from the evidence that the appellant produced the one series of films for distribution. It has produced no others for exhibition and there has been no exhibition in Canada. There has been no use by the appellant of that trade mark in connection with the particular wares since 1964....
Therefore, in the circumstances outlined, I am of the opinion that the appellant has not discharged the burden of establishing that the use of its trade mark in association with films has not been abandoned in Canada and, accordingly, I conclude, assuming that such trade mark use existed, the trade mark has been abandoned in Canada.
The point that is being pressed is simply this: if disuse of the appellant's trade mark for a period of ten years in Marineland justified the inference that it had been abandoned, then the same conclu sion must be reached in the present case of disuse for a period, of twenty years or more.
Appellant's counsel argues that Borden's failure to file evidence of use in response to the section 44 notice does not bespeak abandonment, but rather simply evinces that there was no use of the appel lant's trade marks in Canada at the date of the expungement notice. He further argues that the affidavit evidence of total sales of $465,000,000 for "Dipsy Doodles" and "Cheez Doodles" prod ucts in the United States as at the date of filing of the opposition is indicative of the fact that the appellant had no intention of abandoning its trade marks. In his submission, subsection 17(1) of the Trade Marks Act speaks only of abandonment generally and not in particular reference to aban donment in Canada. Appellant's counsel also rests his case on the evidence of Mr. Abernathy with respect to the present barriers against exploitation of the Canadian market.
I am unable to accede to the submission that the reference to abandonment in subsection 17(1) has some global significance and must be construed to mean abandonment in general and not merely in Canada. True, the words "in Canada" do not appear in subsection 17(1). However, section 16 of the Act uses the words "in Canada" repeatedly with respect to the issue of confusion. Applying the modern rule of statutory interpretation, it is my opinion that the words of subsection 17(1) impos ing the burden on an opponent of establishing "that he had not abandoned such confusing trade mark ... at the date of advertisement of the applicant's application", read in their grammatical and ordinary sense in context with section 16 and the scheme of the Act as a whole, clearly limit the range of abandonment of the confusing trade mark to abandonment in Canada: Stubart Investments Ltd. v. The Queen, [ 1984] 1 S.C.R. 536; (1984), CTC 294; 84 DTC 6305; 53 N.R. 241, per Estey J. at page 578 S.C.R.
Considering the evidence in its entirety, I find that the appellant had abandoned its trade marks "Dipsy Doodles" and "Cheez Doodles" in Canada as at the date of advertisement of the respondent's application. That being the case, I am unable to attribute any error to the Registrar in concluding that the appellant had failed to establish the non- abandonment of its trade marks.
Distinctiveness
This brings me to the appellant's second ground of appeal which is that the respondent's trade mark is not distinctive, pursuant to paragraph 37(2)(d) of the Trade Marks Act. The word "dis- tinctive" is defined in section 2 of the Act as follows:
2....
"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.
As the respondent's application is for registration of a proposed trade mark, it is the latter part of this definition which pertains, and the question becomes that of whether the respondent's trade
mark "Doodles" was adapted to distinguish its snack food products from those of the appellant at the material time. In my view, the material time for this purpose is the date of filing of the opposi tion on December 23, 1981. It is undisputed that the appellant's trade marks "Cheez Doodles" and "Dipsy Doodles" had been registered in the United States showing first use since May 1, 1956 and August 25, 1958 respectively. In the circum stances, both counsel are agreed that the question of distinctiveness falls to be determined according to the principles enunciated by the Federal Court of Appeal in E. & J. Gallo Winery v. Andres Wines Ltd., [1976] 2 F.C. 3; (1975), 25 C.P.R. (2d) 126; 11 N.R. 560 (C.A.).
In , the Andres Wines Ltd. case, supra, the respondent, a Canadian company, filed an applica tion for registration of the trade mark "Spanada" for use in association with wines. The appellant, a United States corporation, opposed the application on the grounds that the proposed trade mark was confusing with the appellant's trade mark made known in Canada in association with its fruit flavoured wine, that the respondent knew the appellant's trade mark was well known in Canada as such, and that the trade mark was not distinc tive as it was incapable of distinguishing the respondent's wine from that previously and cur rently advertised in Canada by the appellant. The Registrar rejected the opposition after concluding that none of these grounds had been substantiated. The appellant appealed to the Trial Division and filed some fifty-eight additional affidavits in sup port of its objections. The respondent adduced no evidence and did not cross-examine any of the appellant's proponents, but simply took exception to the affidavits on technical grounds. The Trial Judge held that none of the appellant's grounds of attack had been substantiated and dismissed the appeal. The Federal Court of Appeal upheld the appeal and directed the Registrar to refuse the respondent's application on the principal ground that the respondent's trade mark was not adapted to distinguish its wines from that of others as of the date of the opposition. Thurlow J. [as he then was], dealing with the issue of distinctiveness, said at page 7 F.C.:
The question to be determined on this attack is, therefore, whether the mark, "SPANADA" was, at the material time, adapted to distinguish the wine of the respondent from that of others and as the mark appears to have an inherent distinctive ness the question, as I see it, becomes that of whether it has been established by the evidence that this inherently distinctive mark is not adapted to distinguish the wine of the respondent. The basis put forward for reaching a conclusion that the mark is not adapted to distinguish the respondent's wine is that it is already known as the trade mark of the appellant in respect of similar wares. But for this purpose it is not necessary, in my opinion, that the evidence should be sufficient to show that the mark is well known or has been made well known in Canada within the meaning of s. 5, or by the methods referred to in that section. Such proof, coupled with use in the United States, would be sufficient to entitle the appellant to registration and to a monopoly of the use of the mark. But that is not what is at stake in this proceeding. Here the respondent is seeking to monopolize the use of the mark and the question is that of his right to do so, which depends not on whether someone else has a right to monopolize it, but simply on whether it is adapted to distinguish the respondent's wares in the marketplace. Plainly, it would not be adapted to do so if there were already six or seven wine merchants using it on their labels and for the same reason it would not be adapted to distinguish the respondent's wares if it were known to be already in use by another trader in the same sort of wares. [Emphasis added.]
The learned Judge then turned to a careful consideration of the evidence. There was affidavit evidence of gross sales of more than $8,700,000 for the appellant's wine sold in Canada prior to the date of the opposition. There were three affidavits of persons concerned with trade publications show ing the publication and general distribution of articles and related business records in respect of the appellant's "Spanada" wine as proof of the Canadian circulation thereof. There were, in addi tion, forty-six affidavits of managers, sales manag ers or other officials of television broadcasting stations operating near the U.S.-Canada border referring to broadcasts of the appellant's commer cials. Each of these affiants swore, inter alia, that he was familiar with the extent of reception of his station's telecasts by television sets in Canada and the number of times each commercial was telecast, with the respective dates and times thereof. There were also two affidavits of the appellant's Director of Media Purchasing, wherein he compiled all the information contained in the forty-six affidavits into a chart showing the total number of United States television stations covering almost every
U.S.-Canadian border state and the number of wine commercials telecast into Canada. The affidavits further deposed that these wine commer cials had the potentiality of reaching fifty-one per cent of the Canadian populace. Expert opinion evidence on the part of persons of long experience in the advertising business as to the extent of viewing in Canada of United States border stations was ruled admissible, despite the fact that some of the opinions expressed were based on hearsay. On the basis of all this the learned Judge concluded at page 14 F.C.:
On the whole, therefore, I am of the opinion that it has been established that the mark SPANADA was known in Canada at the material time as the trade mark of the appellant, widely known at least, if indeed not also well known within the meaning of section 5, and that this conclusion is irresistible on the evidence notwithstanding the very cogent observation of the learned Trial Judge that there was not so much as one affidavit by a Canadian viewer to the effect that he had seen appellant's SPANADA advertising on any of the United States television stations.
I have already touched on some features of the appellant's affidavit evidence bearing on the other issues, and thus will endeavour to confine my reconsideration of the same to an encapsulation of matters pertaining to distinctiveness.
The first affidavit of Robert G. Tritsch refers to the registration in Canada of the appellant's trade marks "Dipsy Doodles" and "Cheez Doodles" and their subsequent expungement, and states addi tionally that the appellant is owner of trade mark registrations in the United States for these trade marks as well as "Fruit Doodles", "Yankee Doo dles", "Nutty Doodles" and "Sunny Doodles". The affidavit further deposes that the appellant acquired its "Sunny Doodles" and "Yankee Doo dles" registrations through Drake Bakeries, an operating division of the appellant and a principal competitor in the United States of the respondent, and that the respondent "is therefore well aware of the long and extensive use by the appellant of its "Doodles" family of trade marks in association
with snack food products". The second affidavit of Mr. Tritsch deals primarily with the appellant's involvement in opposition proceedings with respect to the respondent's applications for the trade marks "Hostess Cottage Fries" and "Hostess Home Fries". I consider this evidence to be irrele vant for purposes of the present appeal.
Mr. Boyer's affidavit makes reference to the widespread sales of the appellant's "Dipsy Doo dles" and "Cheez Doodles" snack food products throughout the whole area of the eastern seaboard of the United States as far south as Florida, and particularly in such vacation areas as Orlando and Miami as well as in the States of Texas and Louisiana. He gives figures for the yearly retail sales of "Dipsy Doodles" and "Cheez Doodles" products in the United States for the years from 1975 to 1982, amounting to millions of dollars. The affidavit also sets out the total advertising expenditures for these products in the United States in the period from 1977 to 1982. Again, the amounts are substantial. Paragraphs 6, 7, 8 and 9 of the Boyer affidavit deal with the nature and extent of television commercials telecast by sta tions in the Albany, Buffalo and Rochester areas that would have been received in Canada and seen by Canadians living in the Toronto, Barrie, Peter- borough, Kitchener, Sudbury, Kingston and Ottawa areas. This was all based on information received from an account executive with the appel lant's advertising agency. It was not based on the firsthand knowledge of persons engaged in the operation of those television stations in proximity to the United States-Canada border, as was the case in Andres Wines Ltd. In my view, the evi dence of overspill advertising contained in these paragraphs of the Boyer affidavit is inadmissible as hearsay evidence.
Finally, Mr. Boyer refers to three exhibits annexed to his affidavit. The first is a page from a December 1981 issue of Mademoiselle magazine containing an article "The best (and worst) of
times". Passing reference is made in one sentence to "Cheez Doodles" snack foods. The affiant deposes that the magazine "has a circulation in Canada, and is therefore read by Canadians". The second exhibit in the Boyer affidavit is a cartoon referring to "Cheez Doodles" which appeared in the magazine Esquire in January of 1961. Similar ly, the affiant reiterates that the magazine has a circulation in Canada and is read by Canadians. The third exhibit is an article by a news commen tator which appeared in the Daily News newspaper on May 17, 1982 in which the appellant's "Cheez Doodles" product featured prominently. The news commentary is irrelevant, in my view, as being after the date of filing of the opposition on Decem- ber 23, 1981, which is the material date for pur poses of resolving the issue of distinctiveness.
Next comes the affidavit of William A. Stimel- ing, Manager, Marketing Services, of a snack food division of the appellant since 1957, who was responsible for the marketing and advertising of snack food products sold in the United States under the trade marks "Cheez Doodles" and "Dipsy Doodles". As part of his responsibility, the affiant reviews and relies upon compilations of television advertising data prepared by outside agencies. Paragraph 3 of the Stimeling affidavit gives a number of television commercial spots shown in the Albany, Buffalo and Rochester market areas during the months from June 1981 to September 1981 and their cost in terms of Canadi- an dollars, as well as for the period from February 1982 to September 1982. The commercial spot advertising for the subsequent period is, in my view, irrelevant. The affiant further deposes that television advertisements for "Cheez Doodles" products were placed in the same markets prior to 1981, and particularly during the years 1979 and 1980, but there appears to be no record of such advertisements. The last paragraph of Mr. Stimel- ing's affidavit reads as follows:
5. Commercials shown by Albany market stations would be seen by Canadians in Eastern Ontario. Commercials shown by
Buffalo market stations would be seen by Canadians in South Western and South Central Ontario. Commercials shown by Rochester market stations would be seen by Canadians in South Central and Eastern Ontario. In having television com mercials aired on Albany, Buffalo and Rochester market televi sion stations, Borden, Inc. was aware that those commercials would be seen by Canadians.
The purpose of all this evidence is to establish that the appellant's trade marks "Dipsy Doodles" and "Cheez Doodles" were, at the material time, "known in Canada" within the meaning ascribed to that phrase in E. & T. Gallo Winery v. Andres Wines Ltd., supra. As previously mentioned, there were in the Andres Wines case forty-six affidavits of border television station officials giving details of television broadcasts that were received in Canada. There was also affidavit evidence that the television commercials had the potentiality of reaching fifty-one per cent of the population of Canada. Thurlow J. was thus able to conclude at page 13 F.C.:
... the telecasts, as a whole, of commercial messages referring to the appellant's SPANADA wine by United States border television stations in the period between January 1970 and November 2, 1970 were received in Canada not only by a few but by a very large number of television viewers in Canada and further that the trade mark "SPANADA" had become known to many people in Canada. [Emphasis added.]
I am unable to draw any such conclusion from the evidence in the present case. As I see it, the evidence relating to spill-over television advertising is largely hearsay. Mr. Boyer admitted on cross- examination that he was not personally aware that any of the television commercials were actually shown in Canada. Likewise, Mr. Stimeling had no personal knowledge that the appellant's television commercials were actually broadcast into Canada. The statement in his affidavit to the effect that the appellant's commercials would be seen by Canadi- ans in Ontario appears to have been founded on his personal recollection of listening to United States television shows while camping in Canada as well as on Federal Communications Commission maps showing the reach of broadcast signals. It was brought out in cross-examination that these maps give no indication of the actual extent of viewer participation, and the extent to which the affiant actually consulted these maps is left very much in
doubt. To Mr. Stimeling's knowledge, the appel lant had never inquired of border television sta tions as to whether the television commercials reached Canadian markets by way of direct signals or cable broadcasts. Mr. Abernathy confirmed on cross-examination that the appellant had never studied or investigated the extent of spill-over ad vertising into the Canadian market. When ques tioned specifically as to the basis for his statement that the appellant had promoted "Cheez Doodles" products by spill-over advertising as early as 1981, he replied:
I think anyone who is familiar with the Toronto, Montreal, Ontario markets, is aware that measured media broadcast from one country very readily crosses into the other. It's common for U.S. stations to be seen in Toronto. I saw a number of them on television in my hotel room last night.
In my opinion, the evidence of the spill-over effect from television commercials in the United States falls far short of proving that the appellant's trade marks "Dipsy Doodles" and "Cheez Doo dles" were known in Canada at the material time.
Moreover, no evidence was adduced as to the extent of circulation in Canada of the magazines Mademoiselle and Esquire and Mr. Boyer could only say under cross-examination, "I guess I was advise[d] that they have circulation in Canada". Presumably, I can take judicial notice of the fact that these publications enjoy some circulation in Canada. However, it would be improper to specu late as to the extent thereof. The reference to "Cheez Doodles" in the Mademoiselle magazine is very brief and essentially innocuous. As for the Esquire cartoon, I find that it would have little weight or significance from the standpoint of a Canadian reader.
It remains to consider the evidence supporting the submission that many Canadians are exposed to the appellant's trade marks in their travels to the United States, particularly in the eastern sea-
board and Florida areas. The Boyer affidavit deposed that many Canadians travelling in United States vacation areas are aware of the "Cheez Doodles" products of the appellant. When ques tioned on cross-examination as to the basis for this statement, Mr. Boyer replied: "I suspect it would be the assumption of mobility of people within the United States and Canada as well". The evidence of Mr. Abernathy with respect to Canadian travel patterns in the United States was limited to reports from a fellow sales and marketing employee, and to his own observations of Canadian licence plates on U.S. highways. No direct evi dence was adduced to establish the actual number of Canadians travelling in the states in which the appellant's snack food products are advertised, or the extent of their exposure to these advertise ments.
In the result, I find that the appellant's trade marks have not become known sufficiently in Canada to justify reaching a conclusion that the respondent's trade mark "Doodles" was not adapt ed to distinguish its wares in the marketplace from those of others. I do not propose to elaborate on the case of Orkin Exterminating Co. Inc. v. Pestco Co. of Canada Ltd. et al. (1985), 50 O.R. (2d) 726; 19 D.L.R. (4th) 90; 30 B.L.R. 152; 34 CCLT 1; 5 C.P.R. (3d) 433; 10 O.A.C. 14 (C.A.), cited by appellant's counsel, inasmuch as the case is distinguishable as one involving a passing-off action and an injunction. Moreover, the case is further distinguishable by the fact that there was direct evidence of Canadian customers that the plaintiff's trade mark in relation to pest control meant to them services of the plaintiff.
Deception or Misleading the Public
The crux of the appellant's case on this point is that respondent's knowledge of the appellant's registration and use of the "Doodles" family of trade marks in the United States, and more par ticularly the registrations for "Dipsy Doodles" and "Cheez Doodles", should preclude the respond-
ent's registration of its proposed trade mark in Canada. Counsel for the appellant argues that the respondent was fully aware of the appellant's sales activities in the United States with respect to its snack food products, but nevertheless blatantly copied the trade mark "Doodles". Appellant's counsel points to the difficulty encountered by the fact that Messrs. McKechnie and Douglas refused to submit themselves to further cross-examination, with the result that their affidavit evidence was struck from the register. In his submission, their refusal to reattend for cross-examination justifies the inference that they had knowledge of the appellant's registration and use of its trade marks in the United States, which they were fearful of disclosing.
Counsel for the respondent submits that there is no cogent evidence that the respondent knew about the U.S. registrations in respect of the appellant's trade marks "Dipsy Doodles" and "Cheez Doo dles". Respondent's counsel also argues that mala fides is not relevant to the issue of distinctiveness, and submits that the respondent's applications for "Hostess Cottage Fries" and "Hostess Home Fries" are irrelevant to the present appeal.
In the Andres Wines case, Thurlow J. quoted extensively from the judgment of Maclean J. in Williamson Candy Co. v. W.J. Crothers Co., [1924] Ex.C.R. 183, and came to the following conclusion at pages 17-18 F.C.:
The statute has been changed since this was written but the general comments of the learned Judge are as valid today as they were in 1924. The significant part of this for present purposes is that on facts which are strikingly similar in princi ple the learned Judge held that having regard to the plaintiff's advertising and the knowledge of its mark thereby generated in Canada the defendant's registration of the mark for use in Canada was "calculated to deceive or mislead the public" and for that reason should be expunged. This particular finding of the learned Judge later became the basis for the affirming of his judgment by the Supreme Court. [1925] S.C.R. 377; [[1925] 2 D.L.R. 844.]
At page 380 [S.C.R.], Anglin, C.J., speaking for the majori ty of the Court said:
The learned President has held that the defendant's trade mark as registered "is calculated to deceive and mislead the public". That finding has not been successfully impeached. The evidence warrants it. It in turn fully supports the order
made by the Exchequer Court that the defendant's trade mark should be expunged as a trade-mark which the Minis ter in the exercise of his discretion could properly have refused to register.
On the facts of the present case I am of the opinion that here too the registration of the mark "SPANADA" as the trade mark of the respondent and its use by the respondent in association with its wines would be calculated to deceive and mislead the public and that it follows from this that the mark is not adapted to distinguish the wares of the respondent. The opposition of the appellant under s. 37(2)(d) of the Trade Marks Act should therefore be sustained.
'In my view, the present case is distinguishable from the Andres Wines case by the fact that there is no evidence that the appellant's foreign trade marks "Dipsy Doodles" and "Cheez Doodles" were so widely known in Canada as to justify the conclusion that the respondent's application to reg ister the "Doodles" trade mark was calculated to deceive and mislead the public. In any event, I find that there is no real evidence that the respon dent was aware at the material time of the regis trations and use of the appellant's trade marks "Dipsy Doodles" and "Cheez Doodles" in the United States. Moreover, section 5 of the Trade Marks Act was neither pleaded nor argued. Conse quently, this ground of appeal based on deception must also fail.
For the foregoing reasons, the appellant's appeal is dismissed, with costs.
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