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TRADE-MARKS - Passing off and unfair competition - Falsehoods

Wednesday, April 15, 2020 @ 5:30 AM  

Lexis Advance® Quicklaw®
Appeal by the Energizer appellants from the summary judgment dismissing aspects of their claim. The appellants manufactured, sold, distributed and promoted batteries in Canada. It owned several trademarks. The respondents manufactured and sold Duracell batteries in Canada. The respondents placed stickers on their packages of AA and hearing aid batteries that stated their batteries were longer-lasting than “the next leading competitive brand” and “the bunny brand”. The Federal Court struck the appellants’ pleading that referred to ss. 7(a), 7(d) and 22(1) of the Trademarks Act in respect of the phrase “the next leading competitive brand” and the pleading that requested an accounting of profits under s. 52(1) of the Competition Act. It did not dismiss the appellants’ claim in respect of the respondents’ use of the phrase “the bunny brand”.

HELD: Appeal allowed in part. After rejecting the respondents’ submission that ss. 7(a), 7(d), and 22(1) of the Trademarks Act only applied to registered trademarks, the Federal Court erred by answering the question of whether the phrases were sufficiently similar to the appellants’ trademarks to be linked by consumers. The issue whether as a matter of fact the phrases at issue would be linked by consumers to the appellants’ trademarks had not been put before it. A respondent to the summary judgment motion in the position of the appellants would reasonably understand that what was in issue was whether ss. 7 and 22 of the Act could apply to the respondents’ use of the phrases “the bunny brand” and “the next leading competitive brand”. By deciding the consumer linkage issue, the Federal Court erred and deprived the appellants of the opportunity to make their case on the issue. The dismissal of the appellants’ claims advanced under ss. 7 and 22 of the Trademarks Act in respect of the phrase “next leading competitive brand” was set aside. The Federal Court correctly dismissed the appellants’ claim for an accounting of profits. The Competition Act clearly provided for compensation for loss, damage and costs but not for an accounting of profits.

Energizer Brands, LLC v. Gillette Co., [2020] F.C.J. No. 246, Federal Court of Appeal, E.R. Dawson, D.W. Stratas and J.M. Woods JJ.A., February 19, 2020. Digest No. TLD-April132020004