Section 6 of The Trade-marks Act sets out the test for confusion in Canadian trademark law.
In particular, s. 6(2) provides:
The use of a trade-mark causes confusion with another trade-mark if the use of both trade-marks in the same area would be likely to lead to the inference that the wares or services associated with those trade-marks are manufactured, sold, leased, hired or performed by the same person, whether or not the wares or services are of the same general class.
The prohibited activity is ‘confusion’, which leads to two key points:
First, it is possible to cause confusion even when the trademarks are not identical;
Second, it is possible for two identical trademarks to not be confusing.
Similar sounding words for similar products are likely to be confusing; conversely, the exact same trademark can be used with very different products or services if it is unlikely to cause confusion as to the source. For instance, three different companies could own rights to RED ROOSTER as a trademark if, for example, one sold a type of battery cables called RED ROOSTER, another sold clothing with RED ROOSTER on the label, and the third sold organic eggs from free-range hens with RED ROOSTER on the box.
Sub-section 6(5) of the Trade-marks Act establishes a non-exhaustive list of factors to be considered when determining whether two trademarks are confusing:
- Inherent distinctiveness of the trademarks and the extent to which they have become known;
- The length of time that the trademarks have been in use;
- The nature of the wares, services or business;
- The nature of trade; and,
- The degree of resemblance between the trademarks in appearance or sound or the ideas suggested by them.
Confusion is a question of fact.
The test to be applied is: is the inference likely to be made by the ordinary consumer somewhat in a hurry when encountering the trademarks in the marketplace. This consumer is of average intelligence and caution. The average consumer is neither stupid nor blessed with perfect recollection, nor does the average consumer spend inordinate amounts of time scrutinizing trademarks.
When considering inherent distinctiveness, a trademark is to be considered as a whole but generally additional weight is given to the first syllable.
Confusion is not limited to goods in the same class. The key issue is the likelihood of confusion in the mind of an ordinary consumer, and thus issues such as the similarlity of the goods/services, and whether they are sold in the same or similar venue or manner are relevant considerations for determining whether two trademarks are confusingly similar or not. This is the concept of “used … in the same area” in subsection 6(1): “area” means “area of commerce”.
Famous marks are not per se afforded any additional protection in Canada.
Channels of trade
Two similar trademarks can co-exist if the nature of the products and services or the places or manner in which they are sold (‘channels of trade’) is such that confusion is unlikely.
In oppositions and litigation close attention should be paid to the date when the test for confusion is to be applied, and who bears the burden of proof.
A frequently-cited application of the confusion test is be found in Toyota Motor Corp v Lexus Food Inc.
It is important to understand that the question is not whether two trademarks are similar or not, but rather, as the Federal Court of Appeal stated in the Mr. Submarine Ltd. case, whether they are likely to be distinguished by an ordinary person having a vague recollection of the one of the marks.
The recent decision of the Supreme Court of Canada in Masterpiece Inc v Alavida Lifestyles Inc re-affirmed that geographical separation of the parties involved in the dispute over confusing trademarks is not relevant: trademark registrations in Canada are national in scope, and unlike the common law are not limited to the area where a party carries on business or has established good will.
Tradition Fine Foods Ltd provides an example and discussion of the various forms of evidence that can be used to assess the likelihood or actual confusion. It is very context dependent, however, what evidence the court will consider relevant. For instance, misdirected phone calls could be relevant when the ordinary course of trade heavily relies on contacting the business by phone, e.g. pizza delivery business. On the other hand, when the ordinary course of trade does not require the consumer to contact the business by phone, these same misdirected phone calls may not be terribly significant.