Veuve Clicquot Ponsardin v. Boutiques Cliquot ltée et al., (2006) 349 N.R. 111 (SCC)

• Judge: McLachlin, C.J.C., Major*, Bastarache, Binnie, LeBel, Deschamps, Fish, Abella and Charron, JJ.
• Court: Supreme Court (Canada)
• Case Date: June 02, 2006
• Jurisdiction: Canada (Federal)
• Citations: (2006), 349 N.R. 111 (SCC);2006 SCC 23;349 NR 111;270 DLR (4th) 1;[2006] ACS no 22;[2006] CarswellNat 1402;[2006] 1 SCR 824;[2006] SCJ No 22 (QL);49 CPR (4th) 401

Veuve Clicquot v. Boutiques Cliquot (2006), 349 N.R. 111 (SCC)

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[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

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Temp. Cite: [2006] N.R. TBEd. JN.002

Veuve Clicquot Ponsardin, Maison fondée en 1772 (appellant) v. Boutiques Cliquot ltée, Mademoiselle Charmante Inc. et 3017320 Canada Inc. (respondents) and International Trademark Association (intervenor)

(30398; 2006 SCC 23; 2006 CSC 23)

Indexed As: Veuve Clicquot Ponsardin v. Boutiques Cliquot ltée et al.

Supreme Court of Canada

McLachlin, C.J.C., Major*, Bastarache, Binnie, LeBel, Deschamps, Fish, Abella and Charron, JJ.

June 2, 2006.

Summary:

The plaintiff was registered owner of the trademark "Veuve Clicquot Ponsardin" (and variations) used in association with cham­pagnes. The plaintiff also distributed promo­tional wares (jackets, scarves, dresses, ties, etc.) using the trademark name, but had no intention of extending its business into wo­men's fashion. The defendant operated a small chain of women's clothing boutiques using the name "Boutiques Cliquot" and "Cliquot". The plaintiff alleged that the defendant was guilty of conversion (Trade-Marks Act, s. 20), diluting the plaintiff's goodwill (s. 22) and passing off (s. 7). The plaintiff sought an injunction to preclude infringement of its trademark, requesting that the defendant's mark be struck out. The de­fendant submitted that there was no con­fu­sion between the two trademarks, given their different business activities.

The Federal Court of Canada, Trial Divi­sion, in a judgment reported (2003), 232 F.T.R. 11, dismissed the plaintiff's action. The plaintiff's trademark was limited to cham­pagne, with no intention of extending it into women's fashion. The activities of the plaintiff and defendant were so different that there was no risk of confusion. Accordingly, there was no trademark infringement (s. 20), no passing off (ss. 7(b) and (c)) and no de­preciation of the value of goodwill (s. 22). There was no valid basis for striking out registration of the defendant's trademark. The plaintiff appealed.

The Federal Court of Appeal, in a judg­ment reported (2004), 349 N.R. 106, dis­missed the appeal. The plaintiff appealed.

The Supreme Court of Canada dismissed the appeal.

* Major, J., did not participate in the judg­ment.

Trademarks, Names and Designs - Topic 889.5

Trademarks - Registration - Expungement of mark - Grounds - Confusion - The plain­tiff's trademark "Clicquot" in combi­nation with various other words was regis­tered in association with luxury cham­pagnes - The defendant operated a small chain of retail women's clothing boutiques, using the trademark "Cliquot" to sell brand-name clothing in the mid-price range - The trial judge dismissed the plain­tiff's claim of trademark infringe­ment on the ground of confusion - Although the "Clic­quot" trademark was distinctive and de­serving of extensive protection as a "fa­mous" mark, the signifi­cant differ­ence be­tween the plaintiff's and defend­ant's busi­ness activ­ities resulted in no risk of confu­sion in a consumer's mind - Al­though the plain­tiff used the trademark in promotional wares, there was no evi­dence that the plain­tiff ever intended to extend its trade­mark into the women's fashion field - The Supreme Court of Canada held that there were no grounds to interfere with the find­ing of a lack of confusion in the mind of the somewhat hurried consumer in all of the surrounding circumstances - Although the "Clicquot" mark was "famous", thereby transcending at least to some extent the wares with which it was normally associ­ated, there was no evidence that consumers either associated or would likely associate the "Clicquot" mark with mid-priced women's clothing - See paragraphs 18 to 37.

Trademarks, Names and Designs - Topic 1806

Trademarks - Infringement - Test - Con­fusion with other marks - [See Trade­marks, Names and Designs - Topic 889.5 ].

Trademarks, Names and Designs - Topic 1808

Trademarks - Infringement - Use - Depre­ciation of goodwill - Section 22(1) of the Trade-marks Act provided that "no person shall use a trademark registered by another person in a manner that is likely to have the effect of depreciating the value of the goodwill attaching thereto" - The Su­preme Court of Canada stated that "sec­tion 22 has four elements. Firstly, that a claim­ant's registered trademark was used by the defendant in connection with wares or services - whether or not such wares and services are competitive with those of the claimant. Secondly, that the claimant's registered trademark is sufficiently well known to have significant goodwill at­tached to it. Section 22 does not require the mark to be well known or famous (in contrast to the analogous European and U.S. laws), but a defendant cannot depreci­ate the value of the goodwill that does exist. Thirdly, the claimant's mark was used in a manner likely to have an effect on that goodwill (i.e. linkage) and fourthly that the likely effect would be to depreci­ate the value of its goodwill (i.e. damage)." - See paragraph 46.

Trademarks, Names and Designs - Topic 1808

Trademarks - Infringement - Use - Depre­ci­ation of goodwill - The plaintiff's trade­mark "Clicquot" in combination with vari­ous other words was registered in associ­ation with luxury champagnes - The de­fen­dant operated a small chain of retail women's clothing boutiques, using the trade­mark "Cliquot" - The plaintiff claimed that the de­fendant depreciated the value of its goodwill in the trade­mark (Trade-Marks Act, s. 22) - The trial judge stated that "although con­fusion is not the test laid down in s. 22, I consider that it is still necessary for there to be an asso­ciation between the two marks. In other words, a consumer has to be able to make a connec­tion between the parties in order for there to be depreciation of the goodwill attach­ing to the trade mark" - The plain­tiff's and defendant's business activities were so dif­ferent that no consumer would make any link or connec­tion between the two trade­marks - The Supreme Court of Canada af­firmed the result - The court stated that there was no link, connection or mental as­sociation in the consumer's mind be­tween the two marks - The plaintiff's mark was not used by the defendant in a manner like­ly to have an effect on the plaintiff's goodwill (linkage requirement) and depre­ciation of the value of the good­will was not proved to be likely (damage require­ment) - The court stated that "I do not suggest that the concept of 'deprecia­tion' in s. 22 is necessarily limited to the no­tions of blurring and tarnishing. Cana­dian courts have not yet had an opportun­ity to explore its limits" - See paragraphs 38 to 70.

Cases Noticed:

United Artists Corp. v. Pink Panther Beauty Corp., [1998] 3 F.C. 534; 225 N.R. 82, refd to. [para. 11].

Toyota Motor Corp. v. Lexus Foods Inc., [2001] 2 F.C. 15; 264 N.R. 158 (F.C.A.), refd to. [para. 11].

Canadian Council of Blue Cross Plans v. Blue Cross Beauty Products Inc., [1971] F.C. 543 (T.D.), refd to. [para. 12].

Mattel Inc. v. 3894207 Canada Inc. et al. (2006), 348 N.R. 340; 2006 SCC 22, refd to. [para. 18].

Benson & Hedges (Canada) Ltd. v. St. Regis Tobacco Corp., [1969] 2 S.C.R. 192, refd to. [para. 20].

Moseley v. V Secret Catalogue Inc. (2003), 537 U.S. 418, refd to. [para. 43].

Mastercard International Inc. v. Hitachi Credit (UK) Plc, [2004] EWHC 1623 (Ch.), refd to. [para. 44].

Pebble Beach Co. v. Lombard Brands Ltd., [2002] S.L.T. 1312; [2002] SctCS 265, refd to. [para. 44].

DaimlerChrysler AG v. Alavi, [2001] R.P.C. 42; [2000] EWHC 37 (Ch.), refd to. [para. 44].

Baywatch Production Co. v. Home Video Channel, [1997] F.S.R. 22 (Ch.), refd to. [para. 44].

Manitoba Fisheries Ltd. v. Canada, [1979] 1 S.C.R. 101; 23 N.R. 159, refd to. [para. 50].

Ulster Transport Authority v. James Brown and Sons Ltd., [1953] N.I. 79, refd to. [para. 50].

Clairol International Corp. v. Thomas Supply & Equipment Co., [1968] 2 Ex. C.R. 552, refd to. [para. 52].

Playboy Enterprises Inc. v. Welles (2002), 279 F.3d 796 (9th Cir.), refd to. [para. 64].

Tiffany & Co. v. Boston Club Inc. (1964), 231 F. Supp. 836 (D. Mass.), refd to. [para. 65].

Polaroid Corp. v. Polaroid Inc. (1963), 319 F.2d 830 (7th Cir.), refd to. [para. 65].

Exxon Corp. v. Exxene Corp. (1982), 696 F.2d 544 (7th Cir.), refd to. [para. 65].

Dallas Cowboys Cheerleaders Inc. v. Pussycat Cinema Ltd. (1979), 604 F.2d 200 (2nd Cir.), refd to. [para. 66].

Edgar Rice Burroughs Inc. v. Manns The­atres (1976), U.S.P.Q. 159 (C.D. Cal.), refd to. [para. 66].

Mattel Inc. v. Jcom Inc. (1998), 48 U.S.P.Q.2d 1467 (S.D.N.Y.), refd to. [para. 66].

Toys 'R' Us Inc. v. Akkaoui (1996), 40 U.S.P.Q.2d 1836 (N.D. Cal.), refd to. [para. 66].

Anheuser-Busch Inc. v. Andy's Sportwear Inc. (1996), 40 U.S.P.Q.2d 1542 (N.D. Cal.), refd to. [para. 66].

Statutes Noticed:

Trade-marks Act, R.S.C. 1985, c. T-13, sect. 4(1), sect. 4(2) [para. 47]; sect. 22(1) [para. 38].

Authors and Works Noticed:

American Law Institute, Restatement (Third) of Unfair Competition (1995), s. 25, Commentary b [para. 42]; Com­men­tary e [para. 53].

Canada, Report of the Trade-mark Law Revision Committee to the Secretary of State of Canada (Fox Report) (1953), generally [para. 39].

Fox, Harold George, The Canadian Law of Trade Marks and Unfair Competition (2nd Ed. 1956), vol. 1, pp. 507, 508 [para. 40].

Fox, Harold George, The Canadian Law of Trade Marks and Unfair Competition (3rd Ed. 1972), vol. 2, p. 376 [para. 48].

Fox, Harold George, The Canadian Law of Trade Marks and Unfair Competition (4th Ed. 2002) (2005 Looseleaf Update, Release 2), p. 8-49 [para. 48].

Fox Report - see Canada, Report of the Trade-mark Law Revision Committee to the Secretary of State of Canada.

Gervais, Daniel, and Judge, Elizabeth F., Intellectual Property: The Law in Canada (2005), pp. 189, 245 [para. 36].

International Trademark Association, The Protection of Well-Known Marks in the European Union, Canada and the Middle East: A Country and Regional Analysis (2004), generally [para. 54].

Lindley and Banks on Partnership (18th Ed. 2002), p. 241 [para. 51].

McCarthy, J. Thomas, Trade­marks and Unfair Competition (4th Ed. 1996) (2005 Looseleaf Update, Release 36), p. 24-136, s. 24:67 [para. 45].

Mostert, Frederick W., Famous and Well-Known Marks: An International Analysis (1997), pp. 11 to 15 [para. 54].

Robinson, Christopher, The Canadian Trade Marks Act of 1954 - A Review of Some of its Features (1959), 32 C.P.R. 45, p. 61 [para. 39].

Counsel:

Jacques A. Léger, Q.C., Barry Gamache and Marie-France Major, for the appel­lant;

Louis Coallier and Alexandre Ajami, for the respondents;

Scott Jolliffe and Kevin Sartorio, for the intervener.

Solicitors of Record:

Léger Robic Richard, Montréal, Quebec, for the appellant;

Miller Thomson Pouliot, Montréal, Que­bec, for the respondents;

Gowling Lafleur Henderson, Toronto, On­tario, for the intervener.

This appeal was heard on October 18, 2005, before McLachlin, C.J.C., Major, Bas­tarache, Binnie, LeBel, Deschamps, Fish, Abella and Charron, JJ., of the Supreme Court of Canada.

On June 2, 2006, Binnie, J., delivered the following judgment in both official lan­guages for the Court.