T-2380-89
Joseph E. Seagram & Sons, Limited (Plaintiff)
v.
Hiram Walker & Sons, Limited (Defendant)
INDEXED AS: JOSEPH E. SEAGRAM & SONS, LTD. V. HIRAM
WALKER & SONS, LTD. (T.D.)
Trial Division, Addy J.—Ottawa, December 4 and
12, 1989.
Injunctions — Application for interlocutory injunction to
restrain defendant from using "Limited Edition" on bottles of
Canadian Club whisky — Principle enunciated in certain cases
that where there is registered mark and arguable case estab
lished, balance of convenience immaterial and need not be
considered, unacceptable — Contrary to equitable principles
upon which relief founded — Injunction denied with respect to
bottles on which only labels different, but granted with respect
to specially packaged decanter-shaped bottles engraved
"Limited Edition" sold only at duty-free shops.
Trade marks — Infringement — Application for interlocu
tory injunction restraining defendant from using registered
mark "Limited Edition" — Plaintiff using mark to distinguish
grade A aged Canadian whisky, selling for $10 more per bottle
than its Crown Royal brand — Defendant marketing Canadian
Club whisky in "Limited Edition" bottle, selling for $.65 'more
than regular bottle — Only label different — No indication
"Limited Edition" applying to contents — "Limited Edition"
followed by "Bottle" clearly descriptive of container — No
likelihood of confusion, nor evidence of actual confusion —
Length of use and composition of mark (originality or distinc
tiveness) considered — Injunction denied — Sale of Canadian
Club Classic in decanter-shaped bottle with "Limited Edition"
engraved on it at duty-free shops enjoined — Nothing indicat
ing words used otherwise than as mark — Shape of bottle
similar to plaintiff's bottles — Strong likelihood of confusion
— Strong arguable, even prima facie, case.
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
Trade - marks Act, R.S.C., 1985, c. T-13, ss. 6, 20.
COUNSEL:
Jacques Léger and Laurent Carrière for
plaintiff.
Douglas N. Deeth and Mary G. Manocchio
for defendant.
SOLICITORS:
Léger, Robic & Richard, Montréal, for
plaintiff.
Blake, Cassels & Graydon, Toronto, for
defendant.
The following are the reasons for order ren
dered in English by
ADDY J.: At the time of issuing in part the
interlocutory injunction requested by the plaintiff
in this action, I informed counsel that brief reasons
would follow.
The plaintiff was requesting an interlocutory
injunction restraining the defendant from using its
registered mark "Limited Edition", which was
applied for on the 23rd of June 1987 and regis
tered on the 20th of October 1989 as number
TMA-360519. It began using the mark in Septem-
ber 1989. The mark is described as being used for
distilled alcoholic beverages of the plaintiff. The
material filed indicated that the plaintiff intended
to use and does in fact use the mark exclusively to
distinguish what it considers to be its grade A aged
Canadian whisky which is sold for $10 or $10.50
more than its Crown Royal brand.
The defendant who had for several years been
producing its Canadian Club whisky in direct com
petition with the plaintiff's Crown Royal, also
began to market its Canadian Club whisky in a
special black and gold bottle. It bears the words
"Limited Edition Bottle" and sells for $.65 more
than the regular Canadian Club whisky bottle. It
is common ground that, contrary to the Crown
Royal Limited Edition, there is no difference
whatsoever between the Canadian Club marketed
in its normal amber glass bottle and the one sold in
the limited edition black and gold bottle.
Considerable argument was addressed by coun
sel for the plaintiff to the issues whether section 20
or section 6 of the Trade-marks Act [R.S.C., 1985,
c. T-13] applied.
There exists, however, in my view, a preliminary
question to be decided. Although on an application
for an interlocutory injunction the validity of the
trade mark cannot be considered, the preliminary
question of whether the plaintiff has or has not an
arguable case obviously depends not only on the
existence of the mark but on whether there
appears to be on the evidence submitted on the
motion an arguable case of infringement of the
mark by the defendant.
Notwithstanding all of the jurisprudence which
has evolved lately by reason of the introduction of
the principle of arguable case as opposed to the
principle of a prima facie case which existed as a
basic principle for many years, an interlocutory
injunction remains an exceptional remedy founded
on the principles of equity. It should not be grant
ed merely because the plaintiff is the owner of a
registered trade mark and has instituted an action
and that there might exist a remote possibility that
an action might lie. All of the relevant circum
stances disclosed by the affidavits and exhibits
filed must be taken into account by the Court
before the final decision is arrived at regarding
whether an injunction lies at this stage of the
proceedings. I am not prepared to accept the prin
ciple mentioned in certain cases that where there is
a registered mark, and once an arguable case has
been established, the balance of convenience is
completely immaterial and need not be considered.
This, in my mind, flies in the face of the basic
equitable principles on which injunctive relief is
founded.
It is clear that the plaintiff Seagram uses its
mark- to distinguish its special blend of aged
Canadian whiskies. It is equally clear that Sea-
gram's has never used the mark solely in the form
as registered but has invariably used it in the
expression "Crown Royal Limited Edition". The
words "Crown Royal" however are of a different
character than the words "Limited Edition". It is
also undisputed that the limited edition marketing
program was devised mainly to celebrate this year
at Christmas time the fiftieth anniversary of the
inauguration of the Crown Royal brand which was
first used to mark the occasion of the royal visit to
Canada of King George VI and Queen Elizabeth
in 1939.
The defendant's label has remained substantial
ly unchanged for one hundred years. In order to
promote sales for the Christmas season this year, it
devised the black and gold bottle which bears the
normal Canadian Club label with the addition of
the words "Limited Edition Bottle" (an exemplar
of this black and gold bottle is filed in these
proceedings as exhibit RD-7). The bottle is in the
traditional shape of all normal Canadian Club
bottles, e.g.: resembling a Bordeaux wine bottle.
The same expression of "Limited Edition Bottle"
is found also on the back with the note that the
commemorative design was produced in a strictly
limited edition. There is not the slightest indication
that the expression "Limited Edition" somehow
applies to its contents.
The words, followed by the word "Bottle" are
clearly descriptive of the container and are not, in
my view, used as a trade mark. I fail to see how
any person endowed with a minimum amount of
intelligence and judgment, when viewing the
Canadian Club black and gold bottle bearing the
inscription "Limited Edition Bottle", could in any
way confuse it with the Crown Royal Limited
Edition product nor could one reasonably expect
confusion to occur if they were viewed separately.
Therefore, I am not prepared to find, on the
evidence before me, that there might exist a likeli
hood of confusion. As to whether any confusion
has actually occurred, no evidence in fact has been
furnished: the two examples mentioned in the
affidavit of Richard Fiamelli and confirmed by the
affidavits of Bruce Morrison and Adrian Van Hel-
voirte are not evidence of confusion in British
Columbia as the product of the plaintiff had not
been distributed anywhere in that province at the
time. It is most difficult to accept that there in fact
exists evidence of confusion where one of the
articles has not even been seen by the person who
allegedly is confusing the two articles.
Where a registered mark is composed of
common ordinary words, none of which can be
described as either original or intrinsically distinc
tive, and where it has not been used for such a
length of time or in such a manner that, in the
minds of the public, it is clearly associated with
the wares of its owner, it will not enjoy the degree
of protection to which it might otherwise be en
titled. This is therefore one of the considerations
which must be weighed in deciding whether an
interlocutory injunction should or should not be
granted.
In the case at bar, as to length of use, it appears
that both marks were initially used at the same
time, namely in September 1989.
There is nothing original or intrinsically distinc
tive in the words Limited Edition whether con
sidered as an expression or separately. They are
well-known common words of the language. With
regard to their use in marketing, limited edition
packaging has been used, and described as such,
throughout the years for such things as cognac,
scotch whisky, soft drinks, beer, clothing and even
automobiles, as a device to encourage members of
the public to purchase the articles before the lim
ited supply is exhausted. The defendant has in fact
on other occasions used the words "Limited Edi
tion" to indicate various forms of packaging of
their Canadian Club whisky in order to commemo
rate special events. In each case, the bottles bore
the words "Limited Edition Bottle". This occurred
as recently as 1986 where special limited edition
bottles of Canadian Club were produced (1400
cases) to commemorate Expo '86.
This is not a case where the defendant, being
aware of the existence of a registered mark, took a
calculated risk and marketed a product under a
mark which might possibly lead to confusion. I
accept the evidence tendered on its behalf to the
effect that, contrary to its normal practice of
always searching for previous marks or applica
tions for marks before marketing a product under
a name or a mark, it did not make a search in this
case which would have revealed the existence of
the plaintiff's application for registration, for the
simple reason that the defendant considered the
words as purely descriptive and was not intending
to use them as a mark. I also accept the evidence
to the effect that, had it known of the plaintiff's
application for registration, a formal objection to
same would have been filed with the Registrar.
A high grade of whisky known as Canadian
Club Classic had been sold in a limited edition
package at the duty-free shops for some time
before the defendant committed itself to the black
and gold limited edition bottles and no complaint
had been received from the plaintiff. The latter did
not raise originally any objection to the sale of
Canadian Club Classic as a limited edition
because they in turn were totally unaware of the
situation at the duty-free shops until immediately
before the hearing of the present application.
Strangely enough it was only late in September of
this year that the defendant also learned that the
plaintiff was planning to market a Limited Edition
of Crown Royal.
For the above reasons, in so far as Canadian
Club whisky in the black and gold bottle is con
cerned, the injunction is refused.
The factual situation, however, is quite different
in the case of Canadian Club Classic, specially
packaged for sale exclusively in duty-free stores
and marked "Limited Edition".
The marking "Limited Edition" is quite promi
nent since it is engraved on the bottle. There is
nothing on the face of the bottle to indicate that
those two words are used otherwise than as a
mark. Its shape is quite different from the normal
Canadian Club bottle. The Canadian Club Classic
bottles in question, which are marked "Limited
Edition", are decanter shaped and are strikingly
similar in appearance and shape to the well-known
decanter type bottles in which Crown Royal and
Crown Royal Limited Edition whiskies are
marketed.
Although the bottle is contained in an elaborate
wooden box, the likelihood exists that the bottle
would be displayed on the box or, alternatively in
the box with the cover open in which case a person
might well be deceived by the use of the mark.
There is no evidence of actual confusion before
me but, for the reasons mentioned in the above
paragraphs, I do not hesitate to find that there is a
strong likelihood of confusion arising. This is suffi
cient to meet the test of confusion.
Very little appears to turn on the balance of
convenience since a very limited number of Lim
ited Edition Canadian Club Classic bottles for sale
at duty-free shops have been produced when com
pared to the Crown Royal Limited Edition. Fur
thermore, the plaintiff has established a strong
arguable case. If the tests formerly required were
applicable, I would be finding that a strong prima
fade case had been established. The balance of
convenience in this instance where a registered
mark is concerned, would have to distinctly favour
the defendant to justify a denial of the right to an
interlocutory injunction.
Therefore, the injunction with regard to Canadi-
an Club Classic marked "Limited Edition" and
produced for sale at duty-free shops is granted.
Since success is divided, both parties will be held
to their respective undertakings and costs will be in
the cause.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.