In a recent case, Octeau v Kempter Marketing Inc (2010 QCCA 171), the Court of Appeal of Quebec rendered an important judgement on the issue of confusion between trade-marks composed primarily of a foreign first name that is uncommon in Canada. In a unanimous decision, Justice Hilton confirmed the ruling of the Superior Court judge who had previously ruled that no significant confusion was caused by the use in parallel of the registered trade-mark Horst Dusseldorf owned by appellant Octeau and the common law trade-mark Horst Waterproof used by respondent Kempter. The central issue was one of distinctiveness and whether the use of a foreign first name in a trade-mark has an impact on the degree of distinctiveness of the trade-mark. The Court of Appeal effectively established that a lower degree of distinctiveness is to be afforded to such a trade-mark.

Appellant Octeau, an importer of men clothing and accessories, had been using the trade-mark Horst Dusseldorf since 1992. However, the use of the trade-mark had grown significantly since 1999 while important advertisement campaigns were staged between 2002 and 2007. In comparison, respondent Kempter had only started using its trade-mark Horst Waterproof in 2004 in association with cycling accessories, including bags. Moreover, while Kempter attempted to register its trade-mark with CIPO, it failed to respond to examiner’s objection based on possible confusion with Octeau’s registered trade-marks and therefore Kempter’s demand was considered abandoned. However, the Court of Appeal did not consider Kempter’s failure to answer examiner’s objection as material and stated that one cannot presume of the ultimate decision of the examiner had Kempter provided the required reply.

On the issue of confusion (sec. 6(5) Trade-Marks Act), the Court of Appeal made a number of rulings that depart from previous jurisprudence. It considered that the trade-mark Horst Dusseldorf is not very distinctive because it is composed of a foreign first name and the name of a foreign location. This ruling changes the applicable test from one where the Court must consider the perception of the average Canadian consumer with respect to the trade-marks at issue to determine whether confusion is likely to occur with one where the perception of the Court is to be considered. Had the test of the average Canadian consumer been applied, it is at least possible that the Court would have ruled in favour of Octeau as the average Canadian consumer probably ignores that “Horst” is a common first name in Germany. Moreover, the same reasoning can be applied to Dusseldorf which is probably not a location that is well known to the Canadian public. Thus, it appears from our reading of the case that the Court in rendering judgement either set aside the test of the average Canadian consumer or, at the very least, chose a somewhat knowledgeable Canadian consumer as its reference point.

The ruling of the Court also raises a number of questions as to the weight to be given to the other criteria that the Court must consider as par of the confusion test. For instance, the Court gave little weight to the duration of use of the trade-mark Horst Dusseldorf, which had been effectively in use since 1992, while Kempter’s trade-mark was only introduced in 2002, some 10 years later. Even if one considers, as did the Court, that it’s only since 1999 that the mark Horst Dusseldorf had been more widely used, this is still 5 years prior to the first use of the mark Horst Waterproof.

Moreover, it is also apparent that at least some overlap exists as to the nature of the wares involved. The cycling bags carrying on the trade-mark Horst Waterproof could easily have been commercialized by Octeau whose trade-mark description included “bags”, even though none were commercialized under that mark at the time. However, if one looks at this criteria the other way, one can see that Kempter was in fact commercializing wares which overlapped with the general category of wares (clothing and accessories) commercialized by Octeau. In any event, the decision of the Court closes the door to Octeau who can no longer commercialize bags under the trade-mark Horst Dusseldorf in the future.

In conclusion, the Court of Appeal’s decision somewhat dilutes the protection afforded to the owner of the registered trade-mark, mainly by modifying the test of the average Canadian consumer. It thus becomes necessary to consider, when registering a trade-mark, that simply using a first name of foreign origin or a location located outside Canada may not be enough to create sufficient distinctiveness for one’s brand and that additional elements, including wording and graphics, would need to be added to ensure that the trade-mark is sufficiently distinctive so as to afford adequate commercial protection to the registered owner.