The Federal Court recently upheld the decision of the Trademarks Opposition Board (the “Board”) refusing an application filed by PDM Parthian Distributer & Marketing Adviser GmbH (“PDM”) to register the trademark BLACK PUNK on the basis that it is confusing with the trademark PUNK, owned by Brewdog PLC (“Brewdog”).
Background
PDM originally applied to register its BLACK PUNK mark on the basis of proposed use in association with a variety of alcoholic and non-alcoholic beverages, but amended its application to include only non-alcoholic beverages after it was opposed by Brewdog. Brewdog successfully opposed the application on the basis that BLACK PUNK is confusing with Brewdog’s PUNK trademark, which it previously used in Canada in association with its beer products, pursuant to section 16(1)(a) of the Trademarks Act.
Brewdog filed evidence in support of its opposition, including samples of its use of the mark on labels of its IPA beer, annual sales numbers, examples of promotional materials displaying the mark, and press coverage of its PUNK-branded products. The Board found that Brewdog’s evidence established that it had used its mark with its beer products before the filing date of PDM’s application, primarily through display of the mark as part of the PUNK IPA logo, that it had not abandoned the mark as at the filing date.
After considering the factors under section 6(5) of the Trademarks Act, the Board member determined that at best, the balance of probabilities regarding the likelihood of confusion was evenly balanced. The Board member then determined that after considering all the surrounding circumstances PDM failed to meet its legal burden with respect to the likelihood of confusion, given the degree of resemblance of the marks, and that PDM had failed to tender evidence showing there was no likelihood of confusion.
The Appeal
PDM appealed the decision under section 56 of the Trademarks Act, alleging the Board member made a number of errors in respect of the determinations on use and confusion, and filed two new affidavits in support of its appeal (but no written representations).
Among other things, PDM’s evidence included: an affiant’s account of a single purchase of an energy drink from a service station, where it was noted that beer was not sold; evidence that STEAM PUNK ale was available for purchase at a brewery, and a printout of the extract of a Canadian trademark registration for STEAM PUNK in association with beer glasses, beer steins, and t-shirts; and evidence that two cans of BRIMSTONE PUNK ROCK PILSNER were purchased from a provincial liquor store.
Justice Tsimberis of the Federal Court held that PDM’s affidavits were immaterial as they were too limited to allow for any inferences to be made about the distinctiveness of the PUNK mark or PUNK element in relation to the Trademarks Register or the state of the Canadian marketplace. Accordingly, Justice Tsimberis reviewed the decision on a standard of palpable and overriding error.
With respect to use, PDM argued that the Board member erred in finding Brewdog’s use of its composite PUNK IPA mark constituted use of its PUNK mark; that Brewdog’s affiant made clear assertions of use of the PUNK mark since 2010 and gave representative examples of such; and that the media articles tendered by Brewdog did not clearly contradict Brewdog’s evidence that the mark was first used in 2010.
In support of its position on Brewdog’s use of a composite mark, PDM argued that the Board could not disregard a portion of a relied-on mark merely on the basis that it is descriptive, as no jurisprudence is available to support such an approach. Justice Tsimberis rejected PDM’s arguments and held that it had not established that a palpable and overriding error was made. In coming to this determination, Justice Tsimberis highlighted the Board’s decision in Nightingale Interloc v Prodesign Ltd., 1984 CarswellNat 1063, 2 CPR (3d) 535 (“Nightingale”), which is often cited for its guiding principles for determining permissible deviations of trademarks. In that decision, the Board outlined that whether use of a mark in combination with additional material constitutes use of a mark per se is “a question of fact depending on such factors as whether the mark stands out from the additional material, for example by the use of different lettering or sizing... or whether the additional material would be perceived as purely descriptive matter or as a separate trade mark or trade name” (emphasis added). It was held that “IPA” would be perceived as a purely descriptive matter, being descriptive of “India Pale Ale” goods.
Justice Tsimberis also found that PDM had not established that the Board made a palpable and overriding error in determining that Brewdog first used its PUNK mark in Canada in 2010. It was held that it was open to the Board member to weigh the evidence, including the affiant’s clear statement of use, which was not subject to cross-examination, the representative samples of use in the exhibits provided, and newspaper articles.
With respect to confusion, PDM argued that the Board erred in determining that BLACK PUNK was not inherently distinctive, in finding it was incumbent upon PDM to furnish evidence of differences in the channels of trade between the parties’ goods, and in determining the degree of resemblance of the trademarks.
With respect to inherent distinctiveness, PDM argued that no previous jurisprudence had established that the Registrar may disregard an element of a mark on the basis that it is descriptive or is a modifier. Justice Tsimberis found that PDM had not established that a palpable and overriding error was made, and that it mischaracterized the Board’s determination on distinctiveness. The Board member did not find that the mark was not inherently distinctive, as alleged by PDM. Rather, the Board member held that the BLACK PUNK mark did have some inherent distinctiveness, derived from the word PUNK (as with Brewdog’s mark), but that the word BLACK acted as an adjective and/or modifier, and therefore offered little added distinctiveness.
With respect to channels of trade, PDM argued that the Board member erred in determining that it was incumbent on PDM to furnish evidence of differences in channels of trade, relying on the Board’s decision in Moosehead Breweries Limited v North American Beverage Corporation, 2000 CanLII 28618. According to PDM, that decision established that in the absence of evidence, the Registrar is obliged to consider the channels in which the goods of the parties would be expected to trade. Justice Tsimberis held that PDM had not established that a palpable and overriding error was made on this issue, and again mischaracterized the Board’s determination. Justice Tsimberis was satisfied that the Board member was referring to PDM’s legal burden when determining that it was incumbent on PDM to furnish evidence of channels of trade. In coming to this finding, Justice Tsimberis noted that the Board member found that Brewdog met its initial evidentiary burden to prove its ground of opposition, having provided evidence of its current channels of trade (that being liquor stores, bars, and restaurants), and therefore the legal burden was shifted to PDM to establish its entitlement to registration. As PDM did not tender any such evidence, or provide any such information in its application, it was open to the Board member to find it had not met its legal burden on this issue.
Lastly, with respect to the degree of resemblance, PDM argued that it was per se illogical that the Board member found that BLACK PUNK may be understood to be the black variety of Brewdog’s PUNK IPA products because of the word “Pale” in the term “India Pale Ale”. Justice Tsimberis found that PDM had not established that a palpable and overriding error was made on this issue, as the Board member’s decision was based on Brewdog’s submissions, including its reliance on Nature Path Foods Inc. v Quaker Oats Co. of Canada Ltd., 2001 FCT 366. In that decision, the Federal Court held that the applicant’s MULTIGRAIN HONEY PUFFS mark incorporated the whole of the opponent’s mark HONEY PUFFS, and that consumers may regard the parties’ products as related “multi-grain” and “plain” varieties. Justice Tsimberis noted that PDM’s argument on degree of resemblance appeared to be based on the assertion that Brewdog’s mark is not in fact PUNK, but the composite mark PUNK IPA, and therefore suffered from the same insufficiency as noted above in light of Nightingale. Further, PDM offered no evidence or legal proposition for its bald assertion that there cannot be a black India Pale Ale.
