Pink Panther Beauty Corp. v. United Artists Corp. (C.A.)
1998 Federal Court of Appeal
Respondent's trade-mark "The Pink Panther" (from the comedy films with Peter Sellers
as Inspector Clouseau), the subject of the case herein, has been, for over thirty years,
registered for use in Canada in association with the entertainment business. In 1986, the
appellant, Pink Panther Beauty Corporation, applied to register the trade-mark "Pink
Panther" for proposed use in association with hair care and beauty product supplies, and
in the operation of a business dealing in their distribution, and instructing and educating
others in their distribution.
In the opposition proceeding, the Registrar of Trade-marks found that, given the
completely disparate nature of the wares, services and trades of the parties, there was no
likelihood of confusion between the marks. On appeal from that decision, the Trial Judge
found that, since the mark was very famous and, therefore, worthy of a wide ambit of
protection, the differences in the nature of the wares and of the trades of the appellant and
the respondent were less significant than they might otherwise be in the determination of
the likelihood of confusion. He found in favour of the respondent. This was an appeal
from that decision.
Linden J.A.:
This appeal raises the question of how far the Trade-marks Act will go to protect famous
trade-marks where those marks are used in relation to completely different wares or
services. The respondent, United Artists Corporation, is the owner of three trade-marks
registered in Canada. The mark that is the subject of the case before this Court"the words
"The Pink Panther" is registered for use in association with "phonograph records; motion
picture films; film leasing and distribution services; entertainment services by means of
motion picture films". In addition, there are two drawings of a panther which are also
registered as trade-marks. These latter two trade-marks are not the subject of this case.
Other marks owned by the respondent in Canada were not raised in opposition and are
not relevant to this appeal. Notably, there was no trade-mark registered by the respondent
in relation to beauty products.
Pink Panther Beauty Corporation, the appellant, was incorporated to sell hair care and
beauty supplies under its own name, to be made available through beauty salons. On
February 19, 1986, it applied to register the trade-mark "Pink Panther" (without the
definite article) for proposed use in Canada in association with a wide variety of hair care
and beauty product supplies, and in the operation of a business dealing in the distribution
of hair care and beauty product supplies, and instructing and educating others in the
distribution of hair care supplies and beauty products.
The respondent opposed the registration. The Registrar decided, that there was no
likelihood of confusion between the marks. He determined that the opponent's mark was
not well-known in Canada, placing much emphasis on the difference in the goods and
services used by United Artists as opposed to those proposed by Pink Panther Beauty
Corporation. Explaining his decision, he said:
Notwithstanding that the marks at issue are virtually identical, I have considered
that the wares, services and trades of the parties are completely disparate and that
the opponent failed to evidence any current reputation for the registered mark in Canada.
Contrary to the Registrar's decision, the Trial Judge found the mark to be very famous
and, therefore, worthy of a wide ambit of protection. Moreover, he placed weight on the
fact that it had been in use in Canada for over thirty years. As well he thought that the
marks were virtually identical. He did recognize that the nature of the wares or services,
as well as the nature of the trade, was quite divergent. Pink Panther Beauty Corporation
appeals that decision to this Court.
The essential question in this case is whether the Trial Judge was correct in concluding
that there was a likelihood that the appellant's mark would, in the mind of the average
consumer, be confusing with the mark of the respondent. The law has been codified in
section 6 of the Trade-marks Act which reads:
6. (1) For the purposes of this Act, a trade-mark or trade-name is confusing with
another trade-mark or trade-name if the use of the first mentioned trade-mark or
trade-name would cause confusion with the last mentioned trade-mark or trade-
name in the manner and circumstances described in this section.
(2) 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.
. . .
(5) In determining whether trade-marks or trade-names are confusing, the court or
the Registrar, as the case may be, shall have regard to all the surrounding
circumstances including
(a) the inherent distinctiveness of the trade-marks or trade-names and the extent to
which they have become known;
(b) the length of time the trade-marks or trade-names have been in use;
(c) the nature of the wares, services or business;
(d) the nature of the trade; and
(e) the degree of resemblance between the trade-marks or trade-names in
appearance or sound or in the ideas suggested by them.
In an application to the Registrar, the onus is on the applicant to show that there is no
likelihood of confusion with the registered trade-mark in the mind of the average
consumer. The onus remains on the applicant for registration in opposition proceedings
just as it was on the application to the Registrar. The protection of trade-marks as
property is based in the common law action for passing off. Historically, the marketplace
has been very concerned with guaranteeing consumers the quality of goods that they had
come to rely upon in the course of trade. To further that guarantee, the common law
developed the tort of passing off, which helped to assure that a person was representing
his or her goods as being his or her own goods and not the goods of someone else. A
necessary element of the tort of passing off was always an attempt to deceive. When this
attempt to deceive caused confusion and damage, it was actionable. While the rationale
for the tort was to protect the public, it was not the consumer who sued, but the owner of the trade-mark who brought the action, thereby protecting the public, as well as its own
interest.
Today, even though the common law remedies are still available, trade-marks are
protected statutorily and the action for passing off has been codified in paragraph 7(c) of
the Act. The Act however, offers a wider ambit of protection than the old common law.
First, the plaintiff in an infringement proceeding (or the opponent in an opposition
proceeding) need not show that the goods or services are marketed in the same area as the
old common law did. The registered trade-mark is valid across Canada and, along with it
the owner possesses the right to its exclusive use in association with specified wares or
services nationwide. As well, no damages need to be proven, nor indeed must an attempt
to deceive be made out in order to succeed.
It has been suggested that the common law action sought to protect the consumer's
expectation of quality which resided in those marks. What the registered mark does
nowadays is to ensure that the wares or services are the wares and services of a particular
person and no one else, that is, the source of the goods is guaranteed.
The question posed by the existence of intellectual property regimes has been defined as
one of where to draw the line between the right to copy and the right to compete. This is a
question about what is truly worthy of the status of property and what is in reality an
element of the marketplace which should be open to all competitors to use in their efforts
to succeed. I find this question a profitable one to keep in mind. For example, Henderson
discusses the rationale behind protection for certain things and not others. He wrote:
The main reason that we do not protect ideas per se is because they are
commonplace. To protect an idea at its preliminary or "bare idea" stage could
stultify economic progress. And, most importantly, ideas, per se , are relatively
useless.
When deciding property issues it is always a matter of balancing the public right to
competition with the private right to ownership. I do not find that this is limited to
questions of intellectual property; an owner does not have unlimited rights with respect to
personalty or realty. Consideration of the public interest is advanced through statute and
through the common law (e.g. the tort of nuisance). When considering these types of
questions the Court must be cognizant of the fact that the market relies on individuals
who, through their labour and ingenuity, bolster the strength of our economy. That
strength benefits us all. We must be careful when we determine property rights so that the
line is drawn fairly between the right to the exclusive use of an idea and the right of
individuals to compete and earn a livelihood. This dilemma is neatly summarized by
Madam Justice McLachlin when she says:
We must stop thinking of intellectual property as an absolute and start thinking of
it as a function"as a process, which, if it is to be successful, must meet diverse
aims: the assurance of a fair reward to creators and inventors and the
encouragement of research and creativity, on the one hand; and on the other hand,
the widest possible dissemination of the ideas and products of which the world,
and all the individuals in it, have such great need. A person may propose a mark for registration, but, until it has been used, the trade-mark
cannot be registered. That "use" is a defined term in the Act and does not refer to a state
of being in operation. Subsection 4(1) states the following:
4. (1) A trade-mark is deemed to be used in association with wares if, at the time
of the transfer of the property in or possession of the wares, in the normal course
of trade, it is marked on the wares themselves or on the packages in which they
are distributed or it is in any other manner so associated with the wares that notice
of the association is then given to the person to whom the property or possession
is transferred.
What is important is that the trade-mark be associated in the minds of the public with the
goods produced by the trade-mark owner. It is the association of a trade-mark with a
particular source which is the key to understanding the rights protected by the Act.
This notion of source in relation to the goods is also fundamental to the definition of
"distinctive" set out in the Act. Section 2 defines that term in this way:
2. . . ."distinctive", in relation to a trade-mark, means a trade-mark that actually
distinguishes the wares or services in association with which it is used by its
owner from the wares or services of others or is adapted so to distinguish them.
Again, the Act makes clear that what is being protected is not the exclusive right to any
mark that a person might think of, but the exclusive right to use it in association with
certain products or services. Where there is no use of the mark, or where the consumer is
unable to rely on the mark to distinguish one person's products or services from another
person's products or services, then no protection is warranted. The right of exclusive use
of the trade-mark granted by section 19 is valid only with respect to the wares and
services stated in the registration. Section 20 of the Act prohibits the use of trade-marks
which are confusingly similar to registered trade-marks, and their use is deemed to be an
infringement. The question of confusion refers us back to section 6 of the Act.
A trade-mark is a mark used by a person to distinguish his or her wares or services from
those of others. The mark, therefore, cannot be considered in isolation, but only in
connection with those wares or services. This is evident from the wording of subsection
6(2). The question posed by that subsection does not concern the confusion of marks, but
the confusion of goods or services from one source as being from another source. It is for
this reason that marks which rely on geographic origins or generally descriptive words
(e.g. the fictional marks Pacific Coffee or Premium Soda) are not afforded a wide ambit
of protection. Even though proposed marks might be similar to them, the public is not
likely to assume that two products that describe themselves as being "Pacific" or
"Premium" necessarily originate from the same source. Because confusion is not likely,
protection is not necessary.
This concentration on the source of the wares or services must inform any consideration
of section 6 of the Act. Six factors are enumerated: five specific and one general one. I
shall briefly discuss each one of them in turn. The five specific considerations that must
be considered indicate that the Court must balance the right of the trade-mark owner to
the exclusive use of his or her mark, with the right of others in the marketplace to compete freely.
(a) the inherent distinctiveness of the trade-marks or trade-names and the extent to which
they have become known
The first item listed under subsection 6(5) is the strength of the mark. This is broken
down into two considerations: the inherent distinctiveness of the mark, and the acquired
distinctiveness of the mark. Marks are inherently distinctive when nothing about them
refers the consumer to a multitude of sources. Where a mark may refer to many things or,
as noted earlier, is only descriptive of the wares or of their geographic origin, less
protection will be afforded the mark. Conversely, where the mark is a unique or invented
name, such that it could refer to only one thing, it will be extended a greater scope of
protection.
Where a mark does not have inherent distinctiveness it may still acquire distinctiveness
through continual use in the marketplace. To establish this acquired distinctiveness, it
must be shown that the mark has become known to consumers as originating from one
particular source. In Cartier, Inc. v. Cartier Optical Ltd./Lunettes Cartier Ltée, Dubé J.
found that the Cartier name, being merely a surname, had little inherent distinctiveness,
but, nevertheless, it had acquired a great deal of distinctiveness through publicity.
Likewise in Coca-Cola Ltd. v. Fisher Trading Co., the Judge found that the word "Cola"
in script form had become so famous that it had acquired a very special secondary
meaning distinctive of the beverage, and was, therefore, worthy of protection.
(b) length of time in use
The length of time that a mark has been used is obviously a factor which will contribute
to confusion on behalf of the consumer in determining the origin of wares or services. A
mark that has been in use a long time, versus one newly arrived on the scene, is presumed
to have made a certain impression which must be given some weight. It is important to
remember that "use" is a term defined by the Act and, therefore, has a special meaning.
(c) nature of the wares, services or business
Clearly, where trade-marks are similar, the degree to which the wares or servi
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