Best Canadian Motor Inns Ltd. v. Best Western International Inc.


Federal Court

CITATION: Best Canadian Motor Inns Ltd. v. Best Western International Inc., 2004 FC 135
DATE: January 1, 2004
DOCKET: T-656-02


BETWEEN:
 
 
 
Best Canadian Motor Inns Ltd.
 
 
 
Applicant
and
 
 
 
Best Western International, Inc.
 
 
 
Respondent
and
 
 
 
 
 
 
 
 


REASONS FOR ORDER: Gibson J.
 

 INTRODUCTION

[1] These reasons follow the hearing of an application in appeal from a decision of the Registrar of Trade-marks wherein the Registrar, through a Member of the Trade-marks Opposition Board, (the "Member") refused the Applicant’s application to register the trade-mark BEST CANADIAN MOTOR INNS & Design, shown below, based on use in Canada by itself and/or through a licensee since February, 1990. The Applicant sought registration of the trade-mark in issue in relation to the following services: "Hotel, restaurant and accommodation services; promotional services relating to hotel, restaurant and accommodation services."

[2] The following is a representation of the trade-mark for which registration was sought:

[3] The decision appealed from is dated the 20th of February, 2002. The appeal is brought pursuant to section 56 of the Trade-marks Act1 (the "Act"). Subsection 1 of that section reads as follows:

56. (1) An appeal lies to the Federal Court from any decision of the Registrar under this Act within two months from the date on which notice of the decision was dispatched by the Registrar or within such further time as the Court may allow, either before or after the expiration of the two months.

56. (1) Appel de toute décision rendue par le registraire, sous le régime de la présente loi, peut être interjeté à la Cour fédérale dans les deux mois qui suivent la date où le registraire a expédié l’avis de la décision ou dans tel délai supplémentaire accordé par le tribunal, soit avant, soit après l’expiration des deux mois.

[4] On the appeal, the Applicant seeks the following relief:

 BACKGROUND

[5] The Applicant filed its application to register the trade-mark in issue on the 10th of October, 1996. As earlier indicated, it sought registration of the trade-mark in issue in relation to the following services: "Hotel, restaurant and accommodation services; promotional services relating to hotel, restaurant and accommodation services" and based its application on use in Canada by itself and/or through a licencee since February, 1990. The application was amended on the 27th of May, 1997 to disclaim the right to the exclusive use of the words BEST, CANADIAN, MOTOR and INNS and to the eleven-point maple leaf design. The application was advertised for opposition purposes on the 17th of September, 1997.

[6] The Respondent filed a statement of opposition on the 19th of January, 1998 pleading the following grounds of opposition:

[7] The Applicant filed and served a counter statement in which it generally denied the allegations asserted by the Respondent in its statement of opposition.

[8] As its evidence, the Respondent submitted certified copies of each of its trade-mark registrations, along with a supporting affidavit. The Applicant’s evidence consisted of three (3) affidavits. Both the Respondent and the Applicant filed written arguments before the Trade-marks Opposition Board and an oral hearing was conducted by the Member at which both parties were represented.

 THE DECISION UNDER REVIEW

[9] The Member rejected the Applicant’s application pursuant to subsection 38(8) of the Act rather than allowing the application pursuant to subsection 39(1) of the Act. Those two (2) subsections read as follows:

38. (8) After considering the evidence and representations of the opponent and the applicant, the Registrar shall refuse the application or reject the opposition and notify the parties of the decision and the reasons for the decision.

38. (8) Après avoir examiné la preuve et les observations des parties, le registraire repousse la demande ou rejette l’opposition et notifie aux parties sa décision ainsi que ses motifs.

39. (1) When an application for the registration of a trade-mark either has not been opposed and the time for the filing of a statement of opposition has expired or it has been opposed and the opposition has been decided in favour of the applicant, the Registrar shall allow the application or, if an appeal is taken, shall act in accordance with the final judgment given in the appeal.

39. (1) Lorsqu’une demande n’a pas fait l’objet d’une opposition et que le délai prévu pour la production d’une déclaration d’opposition est expiré, ou lorsqu’il y a eu opposition et que celle-ci a été décidée en faveur du requérant, le registraire l’admet ou, en cas d’appel, il se conforme au jugement définitif rendu en l’espèce.

[10] The Applicant’s application for registration of the trade-mark in issue was rejected solely on the basis of paragraph 12(1)(b) of the Act. The opening words of subsection 12(1) and paragraph (b) thereof read as follows:

12. (1) Subject to section 13, a trade-mark is registrable if it is not

        

      (b) whether depicted, written or sounded, either clearly descriptive or deceptively misdescriptive in the English or French language of the character or quality of the wares or services in association with which it is used or proposed to be used or of the conditions of or the persons employed in their production or of their place of origin;

        [emphasis added]

12. (1) Sous réserve de l’article 13, une marque de commerce est enregistrable sauf dans l’un ou l’autre des cas suivants_:

        

      b) qu’elle soit sous forme graphique, écrite ou sonore, elle donne une description claire ou donne une description fausse et trompeuse, en langue française ou anglaise, de la nature ou de la qualité des marchandises ou services en liaison avec lesquels elle est employée, ou à l’égard desquels on projette de l’employer, ou des conditions de leur production, ou des personnes qui les produisent, ou du lieu d’origine de ces marchandises ou services; [je souligne]

[11] After reviewing the evidence before the Trade-marks Opposition Board and relevant precedents before it, the Member wrote in his or her reasons for decision:

 NEW EVIDENCE BEFORE THE COURT

[12] Pursuant to subsection 56(5) of the Act, both the Applicant and the Respondent herein were entitled to adduce new evidence before this Court, that is to say, evidence that was not before the Member when she or he arrived at the decision under appeal. Both the Applicant and the Respondent availed themselves of this entitlement.

[13] The Applicant filed the expert affidavit of Mr. Chris Yaneff, R.G.D., F.GDC, R.C.A., a consultant in design, marketing and communications. Mr. Yaneff, after reciting his impressive qualifications, attested that he had been asked:

  Mr. Yaneff concluded in the following term:

  Mr. Yaneff’s qualifications as an expert to deliver the opinions expressed in the foregoing quotation were no in dispute before the Court.

[14] The Respondent’s new evidence consisted of seven (7) affidavits all appending pages from various Yellow Page Directories. In the Memorandum of Fact and Law filed on behalf of the Respondent, the Respondent alleges that the new evidence filed on its behalf:

 THE ISSUES

[15] In the Memorandum of Fact and Law filed on behalf of the Applicant, the points in issue are described in the following terms:

 ANALYSIS

a) The scope or standard of review on an appeal such as this

[16] In Molson Breweries, a Partnership v. John Labatt Ltd.(2000)2, Justice Rothstein, for the majority, wrote at paragraph [29]:

[17] Counsel for the Applicant urged that the expert opinion of Mr. Yaneff that was first adduced before this Court would have materially affected the Member’s, here acting on behalf of the Registrar, findings of fact or the exercise of the Member’s discretion and that therefore I should come to my own conclusion as to the "correctness" of the Member’s decision. By contrast, counsel for the Respondent urged that none of the new materials before the Court materially affect the findings of fact or the exercise of the Member’s discretion and that therefore the decision under appeal should be reviewed against a standard of reasonableness simpliciter.

[18] The Court is, of course, conscious of recent decisions from the Supreme Court of Canada that require application of a "pragmatic and functional" analysis to determine the appropriate standard of review3. Against those decisions and the required pragmatic and functional analysis which I do not propose to detail here, I am satisfied that the foregoing passage from Molson Breweries remains good law.

[19] In his ultimate conclusion, quoted earlier in these reasons, Mr. Yaneff expresses his opinion that it would be wrong to ignore the design features of the "Best Canadian Logo" that was before the Member, in attempting to understand the impression created by the Logo, and in determining whether the logo as a whole is clearly descriptive or deceptively misdescriptive of accommodation services. He expresses the opinion that "…the visual effect of the design features of the logo… should form part of any analysis of this trademark".

[20] I am satisfied that, if Mr. Yaneff is implying that the Member ignored the design feature of the mark in question in arriving at her or his decision, he is simply wrong. The Member’s conclusion with regard to descriptiveness, quoted earlier in these reasons but repeated here for ease of reference, is in the following terms:

[21] The foregoing concluding paragraph simply does not ignore the design features of the mark in question although it does not specifically mention the intersection of the top line by the maple leaf and the "nesting" of the words "BEST" and "CANADIAN", design features that Mr. Yaneff prefers to emphasize. It does not dissect the mark but rather considers the mark as a whole and as a matter of immediate impression, in a manner that, I am satisfied, is not inconsistent with the Act. While the quoted paragraph reaches a conclusion different from that which would appear to be advocated by Mr. Yaneff, I am satisfied that that is not the test for determining whether Mr.Yaneff’s evidence, while undoubtedly new, is material. I conclude that his evidence is not new material evidence. I reach the same conclusion with regard to the new evidence filed with this Court on behalf of the Respondent. In the result, I am satisfied that the appropriate standard of review on this appeal is reasonableness simpliciter.

b) Against a standard of reasonableness simpliciter, did the Member err in concluding that the mark at issue is clearly descriptive of the Applicant’s services and therefore not registrable?

[22] Given the foregoing brief analysis and conclusion with respect to standard of review, I am satisfied that the foregoing issue question fully comprehends the second, third and fourth issue questions posed on behalf of the Applicant and set out earlier in these reasons.

[23] In arriving at the conclusion regarding descriptiveness of the mark at issue that is quoted earlier in these reasons, the Member noted:

  Noting the difficulty posed by the concept "or sounded" in paragraph 12(1)(b) of the Act when applied to design marks, the Member further noted that the issue had been dealt with by former Chairman of the Trade-marks Opposition Board Partington in Insurance Co. of Prince Edward Island v. Prince Edward Island Mutual Insurance Co.4 In that decision, Chairman Partington, after reviewing two (2) earlier decisions of the Trade-marks Opposition Board dealing with design marks that, as here, incorporated dominant descriptive words, wrote:

  In the present case, the applicant has disclaimed the right to the exclusive use of the word MUTUAL apart from its trade-mark and such disclaimer is arguably an admission that the word is either clearly descriptive of the character or quality of the applicant’s services, or is otherwise common to the trade or is the name of such services. Furthermore, the dictionary meaning of the word MUTUAL as an adjective confirms that it is descriptive as applied to insurance related services. As a result, and having regard to the above decisions of the Opposition Board, I find that the opponent has met its evidential burden in relation to this ground and that the applicant must therefore meet the legal burden upon it of demonstrating that its trade-mark MUTUAL & Design is registrable. However, no evidence or argument has been presented by the applicant to establish that its trade-mark does not offend the provisions of Paragraph 12(1) (b) of the Trade-marks Act. Likewise, no evidence has been furnished by the applicant to establish that, as of the filing date of the present application, the mark MUTUAL & Design had become distinctive in Canada, as contemplated by Subsection 12(2) of the Trade-marks Act. The applicant has therefore failed to meet its legal burden in relation to the final ground. Thus, the Paragraph 12(1)(b) ground of opposition is successful.

[24] On the facts of this matter, the Member clearly concluded that, as in the case before Chairman Partington, the opponent, Best Western, had met the evidentiary burden on it in relation to descriptiveness. Thus it fell to the Applicant to meet the legal burden of demonstrating that its trade-mark here at issue was registrable. As noted earlier in these reasons, the Applicant presented new evidence before this Court in the form of an expert affidavit of Chris Yaneff. I have earlier concluded in these reasons that that new evidence is not of such weight as to be likely to have materially affected the decision under appeal. Put another way, I am satisfied that the new evidence is insufficient to discharge the legal burden on the Applicant.

[25] Since the date of the decision of the Member that is under review, the issue of the interrelationship of paragraph 12(1)(b) of the Act with design marks came before this Court in Fiesta Barbeques Ltd. v. General Housewares Corp.5 As here, the matter before the Court was an appeal from a decision of the Trade-marks Opposition Board refusing to register as a trade-mark the following design mark:

[26] Counsel for the Applicant put before the Court, as an authority, a paper entitled "DESIGN MARKS AND WORD MARKS". It purports to have been prepared by a Mr. Frank Farfan and to have been presented for "The Six-Minute Intellectual Property Lawyer Program" of the Law Society of Upper Canada, held on the 7th of November, 2003. An enquiry to the Law Society of Upper Canada indicates that the paper had not been published and was not generally available for distribution on the date this appeal was heard. In the circumstances, the value of the paper as an authority is questionable but, since its introduction and reference to it was not objected to on behalf of the Respondent, I will nonetheless comment on it.

[27] Mr. Farfan refers to the "GRILL GEAR" decision before the Trade-marks Opposition Board and notes the following finding of that Board at pages 6-27 and 6-28 of the paper:

[28] Mr. Farfan then goes on to review a range of earlier decisions in the same subject-matter area and concludes at page 6-29 in the following terms:

  At page 6-35, Mr. Farfan after citing Justice Russell’s conclusion in the "GRILL GEAR" decision, under the heading "The Better Solution" and contrasting it with Chairman Partington’s decision cited earlier in these reasons, emphasizes his foregoing conclusions with the following succinct sentence:

  I note that words were not "added" by the Member whose decision is under appeal. To the contrary, the words "sounded" by the Member are an integral part of the design mark at issue, perhaps more properly described as a trade-mark with design features, where the Member found the words forming part of the mark to be a predominant feature of the mark.

[29] With great respect, I find that the decision in the GRILL GEAR case and the conclusion expressed in Mr. Farfan’s paper ignored generally applicable principles of statutory interpretation when considering the words of paragraph 12(1)(b) of the Act.

[30] In Rizzo & Rizzo Shoes Ltd. (Re)6, Justice Iacobucci, for the Court, wrote at paragraphs [20] to [23]:

  Although the Court of Appeal looked to the plain meaning of the specific provisions in question in the present case, with respect, I believe that the court did not pay sufficient attention to the scheme of the ESA, its object or the intention of the legislature; nor was the context of the words in issue appropriately recognized. … [some citations and references to recent cases which have cited the quotation from Dr. Driedger with approval omitted. The reference to the Interpretation Act is to the Interpretation Act of Ontario. Emphasis added]

[31] In Harvard College v. Canada (Commissioner of Patents)7, Justice Rothstein, for the majority, wrote at paragraph [30] of his reasons:

[32] The decision of the Federal Court of Appeal in Harvard College was reversed on appeal to the Supreme Court of Canada8. While the foregoing paragraph from the reasons of Justice Rothstein was not specifically cited in either the majority or the minority reasons of the Supreme Court, it might be said to have been qualified by the following extract from paragraph 11 of the dissenting reasons of Justice Binnie which were concurred in by the Chief Justice and two other Justices:

[33] It is to be noted that courts considering the Harvard College matter had before them extensive evidence as to the scheme and object of the Patent Act and as to the "significant policy questions" referred to by Justice Rothstein. By contrast, no such evidence was before this Court in this matter and certainly no judicial history was cited before me that would suggest that the "entire context" that was before Parliament when it was considering enactment of the current Trade-marks Act would warrant variation from the grammatical and ordinary sense of the words of paragraph 12(1)(b) of the Act, and more particularly of the word "sounded" to achieve harmony with "…the scheme of the Act, the object of the Act, and the intention of Parliament".

[34] The foregoing quotation from the reasons of Justice Rothstein reiterates, albeit in a different context, words of former Chairman Partington in Insurance Co. of Prince-Edward Island v. Prince-Island Mutual Insurance Co.(supra), quoted earlier in these reasons and adopted by the Member in his reasons for the decision under appeal.

[35] It was open to Parliament to provide an exception to paragraph 12(1)(b) of the Act in respect of design marks that include words that are a dominant feature of the marks as I find to be the case in this matter. Indeed, Parliament did see fit to provide an exception to the general rule of paragraph 12(1)(b) for a different purpose. For ease of reference, I repeat here the opening words of subsection 12(1) and paragraph (b) of that subsection, along with subsection 12(2):

12. (1) Subject to section 13, a trade-mark is registrable if it is not

        

      (b) whether depicted, written or sounded, either clearly descriptive or deceptively misdescriptive in the English or French language of the character or quality of the wares or services in association with which it is used or proposed to be used or of the conditions of or the persons employed in their production or of their place of origin;

        [emphasis added]

12. (1) Sous réserve de l’article 13, une marque de commerce est enregistrable sauf dans l’un ou l’autre des cas suivants_:

        

      b) qu’elle soit sous forme graphique, écrite ou sonore, elle donne une description claire ou donne une description fausse et trompeuse, en langue française ou anglaise, de la nature ou de la qualité des marchandises ou services en liaison avec lesquels elle est employée, ou à l’égard desquels on projette de l’employer, ou des conditions de leur production, ou des personnes qui les produisent, ou du lieu d’origine de ces marchandises ou services; [je souligne]

[36] The foregoing clearly demonstrates an option that was open to Parliament at the time the Act was enacted and that has remained open to Parliament since that time. That option would have been, and remains, to add an additional exception to the application of paragraph 12(1)(b) for design marks that include words as a dominant feature so that, as with at least some design marks that have no dominant word element, they would not have to meet the "sounded" test on the basis of the word elements. In the result, such design marks that include words as a dominant feature would respond to Mr. Farfan’s criticism that:

[37] I am satisfied that, against the admonition provided by Justice Rothstein and quoted earlier in these reasons, and in the absence of contextual evidence that might lead to a different conclusion, any response to a concern such as that enunciated by Mr. Farfan is for Parliament and not for this Court where the words of paragraph 12(1)(b) of the Act are, as I am satisfied they are, clear on their face. Put another way, the issue that Mr. Farfan and the Applicant would urge the Court to address is one of policy and, on the evidence before the Court in this matter, not one amenable to solution by a contextual statutory interpretation.

 CONCLUSION

[38] Based upon the foregoing analysis, this appeal will be dismissed.

 COSTS

[39] Counsel were in agreement before me that costs, to be determined on the ordinary scale if not earlier agreed to, should follow the event. In the result, an order for costs, on the ordinary scale, will go in favour of the Respondent.

_______________________________

J.F.C.

Ottawa, Ontario

January 29, 2003

Show Appendix





R.S.C. 1985, c. T-13.

5 C.P.R. (4th) 180 (F.C.A.).

See, for example, Dr. Q v. College of Physicians and Surgeons of British Colombia [2003] 1 S.C.R. 226 at paragraph 40.

(1999), 2 C.P.R. (4th) 103 (T.M.O.B.).

[2003] F.C.J. No. 1296 (QL), (F.C.).

[1998] 1 S.C.R. 27 (not cited before me).

(2000), 7 C.P.R. (4th) 1 (F.C.A.), (not cited before me).

Harvard College v. Canada (Commissioner of Patents), (2002), 21 C.P.R. (4th) 417, (not cited before me).


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