Candrug Health Solutions Inc. et al. v. Thorkelson, 2007 FC 411

• Judge: Teitelbaum, D.J.
• Court: Federal Court (Canada)
• Case Date: March 15, 2007
• Jurisdiction: Canada (Federal)
• Citations: 2007 FC 411;(2007), 312 F.T.R. 13 (FC)

Candrug Health Solutions v. Thorkelson (2007), 312 F.T.R. 13 (FC)

MLB headnote and full text

Temp. Cite: [2007] F.T.R. TBEd. MY.005

Candrug Health Solutions Inc. and Pharmawest Pharmacy Ltd. (applicants) v. Kris Thorkelson (respondents)

(T-318-06; 2007 FC 411)

Indexed As: Candrug Health Solutions Inc. et al. v. Thorkelson

Federal Court

Teitelbaum, D.J.

April 19, 2007.

Summary:

In 2003, Thorkelson registered the trademarks "Canada Drugs" and "Canadadrugs.com" for use in association with an online drugstore. Candrug Health Solutions and Pharmawest Pharmacy Ltd. applied to have the registrations expunged as invalid under s. 12(1) of the Trade-marks Act.

The Federal Court allowed the application.

Evidence - Topic 3755.1

Documentary evidence - Public documents - Internet sites, articles, materials, pictures, etc. - [See Trademarks, Names and Designs - Topic 890 ].

Trademarks, Names and Designs - Topic 261

Trademarks - What trademarks registrable - Prohibition - Marks which are descriptive of the product - In 2003, Thorkelson registered the trademarks "Canada Drugs" and "Canadadrugs.com" for use in association with an online drugstore - The applicants sought expungement of the trademarks from the register, asserting, inter alia, that they were "clearly descriptive" within the meaning of s. 12(1)(b) of the Trade-marks Act - The Federal Court allowed the application - The purpose of the prohibition in s. 12(1)(b) was to prevent any single trader from monopolizing a term that was clearly descriptive or common to the trade, thereby placing legitimate competitors at an undue disadvantage - Looking at the words from the perspective of the public at large, the ordinary consumer would consider the descriptive character of the marks to go to the material composition of the services, i.e. "Canada Drugs" would indicate pharmaceuticals from Canada - Further, the phrase "Canada Drugs" would be a primary method of finding products online - Permitting that combination of words to be trademarked would result in an undue disadvantage for legitimate competitors - The same conclusion applied to Canadadrugs.com, which was merely a conflation of "Canada" and "drugs" - See paragraphs 32 to 40.

Trademarks, Names and Designs - Topic 262

Trademarks - What trademarks registrable - Prohibition - Marks which are deceptively misdescriptive - In 2003, Thorkelson registered the trademarks "Canada Drugs" and "Canadadrugs.com" for use in association with an online drugstore - The applicants sought expungement of the trademarks from the register, asserting, inter alia, that they were "deceptively misdescriptive" within the meaning of s. 12(1)(b) of the Trade-marks Act - The Federal Court allowed the application - The purpose of denying the registration of deceptively misdescriptive trademarks was to prevent the public from being misled - Misdescriptive meant falsely or erroneously describing something as being material to the composition of the goods when it was not - Concerning the "Canada Drugs" mark, the evidence showed that the pharmaceuticals were manufactured all over the world - The only consistent connection with Canada was the office where orders were processed - Canadian consumers would trust prescription fulfilment from a Canadian pharmacy more than that from other countries - The ordinary consumer would think that the marks "Canada Drugs" and "Canadadrugs.com" indicated a greater connection to Canada than merely the location of the office - As a result, the marks were deceptively misdescriptive - See paragraphs 41 to 43.

Trademarks, Names and Designs - Topic 265

Trademarks - What trademarks registrable - Distinctive marks - General - In 2003, Thorkelson registered the trademarks "Canada Drugs" and "Canadadrugs.com" for use in association with an online drugstore - On an application for expungement of the trademarks, the applicants established that the marks were "clearly descriptive" and "deceptively misdescriptive" within the meaning of s. 12(1) of the Trade-marks Act, making them not registrable - At issue was whether the marks were saved by the exception in s. 12(2) as non-registrable marks that had become distinctive as of the date of applying for registration - The Federal Court held that the exception did not apply - To establish distinctiveness, the mark had to be known to consumers as originating from one particular source - Thorkelson's website home page was accessible at the earliest in February 2001 - Thorkelson applied for registration of the "Canadadrugs.com" mark in March 2001 and for "Canada Drugs" in May 2001 - Since April 2001, the website had displayed both marks - It was difficult to imagine that Canadian consumers would have become sufficiently familiar with the marks such that they acquired distinctiveness in the two or three months between inception of the website and the registration applications - The marks were expunged from the register - See paragraphs 44 to 51.

Trademarks, Names and Designs - Topic 885

Trademarks - Registration - Expungement of mark - Who may apply for expungement - In 2003, Thorkelson registered the trademarks "Canada Drugs" and "Canadadrugs.com" for use in association with an online drugstore - After Thorkelson brought infringement proceedings against Pharmawest Pharmaceuticals Ltd., Pharmawest applied for expungement of the trademarks from the register - The Federal Court held that Pharmawest had standing to apply for expungement - Under s. 57 of the Trade-marks Act, the court had jurisdiction to order expungement on the application of the Registrar or any person interested - Due to the infringement proceedings, Pharmawest was a "person interested" within the meaning of the Act - See paragraph 22.

Trademarks, Names and Designs - Topic 890

Trademarks - Registration - Expungement of mark - Evidence and proof - On an application to expunge two trademarks from the register, the applicant sought to introduce affidavit evidence that was intended to show substantial use of the trademarks by other third parties in Canada - The evidence made extensive use of historical websites through an internet archive known as the Way Back Machine - The Federal Court indicated that the evidence produced by the Way Back Machine indicating the state of websites in the past was generally reliable - However, even if it was accepted that the website existed at the time, there had to be evidence that Canadian consumers visited the website - As there was no such evidence before the court, the court ascribed no weight to the affidavits - See paragraphs 17 to 21.

Cases Noticed:

ITV Technologies Inc. v. WIC Television Ltd. (2003), 239 F.T.R. 203; 2003 FC 1056, refd to. [para. 20].

General Motors Corp. v. Bellows, [1949] S.C.R. 678; 10 C.P.R. 101, refd to. [para. 26].

Provenzano v. Registrar of Trade-marks (1977), 37 C.P.R.(2d) 189 (F.C.T.D.), refd to. [para. 27].

Havana House Cigar & Tobacco Merchants Ltd. et al. v. Skyway Cigar Store (1998), 147 F.T.R. 54; 1998 CanLII 7773 (T.D.), refd to. [para. 29].

General Motors du Canada et al. v. Décarie Motors Inc. et al., [2001] 1 F.C. 665; 264 N.R. 69 (F.C.A.), refd to. [para. 29].

Neptune S.A. v. Canada (Procureur général) (2003), 237 F.T.R. 240; 2003 FCT 715, refd to. [para. 30].

Mr. P's Mastertune Ignition Services Ltd. v. Tune Masters (1984), 82 C.P.R.(2d) 128 (F.C.T.D.), refd to. [para. 30].

Pizza Pizza Ltd. v. Registrar of Trademarks (1982), 67 C.P.R.(2d) 202 (F.C.T.D.), refd to. [para. 31].

Ingle v. Registrar of Trademarks (1973), 12 C.P.R.(2d) 75 (F.C.T.D.), refd to. [para. 34].

Wool Bureau of Canada Ltd. v. Registrar of Trademarks (1978), 40 C.P.R.(2d) 25 (F.C.T.D.), refd to. [para. 34].

Unitel Communications Inc. v. Bell Canada (1995), 92 F.T.R. 161; 61 C.P.R.(3d) 12 (T.D.), refd to. [para. 37].

Lassonde (A.) Inc. v. Registraire des marques de commerce (2000), 180 F.T.R. 177 (T.D.), refd to. [para. 38].

Atlantic Promotions Inc. v. Registrar of Trademarks (1984), 2 C.P.R.(3d) 183 (F.C.T.D.), refd to. [para. 41].

Tommy Hilfiger Licensing Inc. et al. v. Quality Goods I.M.D. Inc. et al. (2005), 267 F.T.R. 259; 2005 FC 10, refd to. [para. 46].

Carling Breweries Ltd. v. Molson Companies Ltd. (1984), 1 C.P.R.(3d) 191 (F.C.T.D.), refd to. [para. 47].

Counsel:

Timothy Lo, for the applicant;

Mark Robbins, for the respondent.

Solicitors of Record:

Smart & Biggar, Vancouver, British Columbia, for the applicant;

Bereskin & Parr, Toronto, Ontario, for the respondent.

This application was heard at Vancouver, British Columbia, on March 15, 2007, by Teitelbaum, D.J., of the Federal Court, who delivered the following reasons for judgment on April 19, 2007.