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Trademarks - Damages

. Group III International Ltd. v. Travelway Group International Ltd.

In Group III International Ltd. v. Travelway Group International Ltd. (Fed CA, 2020) the Federal Court of Appeal considered different types of damage under trade-mark law:
Power of court to grant relief

53.2(1) If a court is satisfied, on application of any interested person, that any act has been done contrary to this Act, the court may make any order that it considers appropriate in the circumstances, including an order providing for relief by way of injunction and the recovery of damages or profits, for punitive damages and for the destruction or other disposition of any offending goods, packaging, labels and advertising material and of any equipment used to produce the goods, packaging, labels or advertising material.
....
D. Passing off

[40] In 2017, this Court made a separate finding that the respondent was liable for passing off, contrary to section 7(b) of the Act. This Court did not distinguish between damages arising for infringement from damages arising for passing off.

[41] Infringement (section 20 of the Act) and passing off (section 7(b) of the Act) are separate, distinct causes of action. Each may give rise to an order of damages. The remedies available for each depends on whether the impugned mark which gives rise to the proceeding is registered or not. In the case of infringement, damages are generally not available if the impugned mark is registered because of the effect of section 19, unless there is proof of fraud, wilful misrepresentation or bad faith in obtaining registration of the mark.

[42] The cause of action for infringement exists to allow a party who owns a registered trademark to sue the owner of another trademark, whether registered or not, because the impugned trademark is confusing. The cause of action of passing off arising under section 7(b) of the Act is a codification of the common law tort of passing off. It allows a party who owns an unregistered trademark to bring an action for relief under the Act.

[43] In Kirkbi AG v. Ritvik Holdings Inc., 2005 SCC 65, [2005] 3 S.C.R. 302 at paras. 25-26 [Kirkbi], the Supreme Court held that the action for passing off in section 7(b) of the Act protects interests in unregistered trademarks:
25. … First, s. 7(b) is remedial; its purpose is to enforce the substantive aspects of the Trade-marks Act relating to unregistered trade-marks:

The tort of passing off is in many respects the equivalent cause of action for unregistered trade-marks as infringement [s. 20 of the Act] is to registered trade-marks. The overall legislative scheme of the Trade-marks Act is the protection, identification, and registration of trade-marks, whether registered or unregistered.

26. Second, the passing-off action protects unregistered trade-marks and goodwill enjoyed by the trade-marks. …

[My emphasis].
[44] Thus, Kirkbi suggests, but does not decide, that the owner of a registered trademark cannot have recourse to section 7(b) of the Act to protect its trademark. Its recourse is proceedings for infringement or expungement.

[45] This point was made even more clearly in Molson Canada v. Oland Breweries Ltd./Les Brasseries Oland Ltée, 2002 CanLII 44947 (ON CA), [2002] 59 O.R. (3d) 607, 214 D.L.R. (4th) 473 (ONCA) [Oland] which was cited in support of the conclusion on this issue in Remo and where both parties had registered trademarks, the Ontario Court of Appeal wrote:
2. ... The appellant puts forward a series of arguments as to errors made by the trial judge in his analysis of the facts and law, some of which may have merit. However, it is unnecessary to analyze them because, in my view, the respondent holds the trump card. The respondent argues that, whatever the merits of the appellant's grounds of appeal, the trial judge made an initial and fundamental error by failing to conclude that the respondent's trade-mark registration was a complete answer to the plaintiff's claim [for passing off]. I agree.



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Last modified: 04-11-22
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