Court File No. 29956
IN THE SUPREME COURT OF CANADA
B E T W E E N:
KIRKBI AG AND
LEGO CANADA INC.
APPELLANTS
(Appellants)
- and –
RITVIK HOLDINGS INC./GESTIONS RITVIK INC.
(now operating as MEGA BLOKS INC.)
RESPONDENT
(Respondent)
-and –
ATTORNEY GENERAL OF CANADA
ATTORNEY GENERAL OF ONTARIO
ATTORNEY GENERAL OF QUEBEC
INTERVENERS
RESPONDENT’S FACTUM
(Pursuant to Rule 42 of the Rules of the Supreme Court of Canada)
DIMOCK STRATTON LLP
Barristers and Solicitors
20 Queen Street West
Suite 3202
Toronto, ON M5H 3R3
LANG MICHENER
50 O’Connor Street
Suite 300
Ottawa, ON
K1P 6L2
Ronald E. Dimock
Bruce W. Stratton
Henry Lue
Eugene Meehan, Q.C.
Tel: 416-971-7202
Fax: 416-971-6638
Email: rdimock@dimock.com
Solicitors for the Respondent
Tel: 613-232-7171
Fax: 613-232-3191
Email: emeehan@langmichener.ca
Agents for the Respondent
2
BERESKIN & PARR
Barristers and Solicitors
40th Floor, Scotia Plaza
40 King Street West
Toronto, ON M5H 3Y2
GOWLING LAFLEUR & HENDERSON LLP
Suite 2600
160 Elgin Street
Ottawa, ON
K1P 1C3
Robert H.C. MacFarlane
Michael E. Charles
Christine M. Pallotta
Brian A. Crane, Q.C.
Tel: 416-364-7311
Fax: 416-361-1398
Email: rmacfarlane@bereskinparr.com
mcharles@bereskinparr.com
cpallotta@bereskinparr.com
Tel: 613-233-1781
Fax: 613-563-9869
Email: Brian.Crane@gowlings.com
Agents for the Appellants
Solicitors for the Appellants
ATTORNEY GENERAL OF CANADA
Intervener
Christopher M. Rupar
Attorney General of Canada
Bank of Canada Building – East Tower
1216 – 234 Wellington Street
Ottawa, Ontario K1A 0H8
Tel: (613) 941-2351
Fax: (613) 954-1920
Email: christopher.rupar@justice.gc.ca
Agent for Intervener, A.G. of Canada
ATTORNEY GENERAL OF ONTARIO
Intervener
Robert H. Houston, Q.C.
Burke-Robertson
70 Gloucester Street
Ottawa, Ontario K2P 0A2
Tel: (613) 236-9665
Fax: (613) 235-4430
Email: rhouston@burkerobertson.com
Agent for Intervener, A.G. of Ontario
3
ATTORNEY GENERAL OF QUEBEC
Intervener
Sylvie Roussel
Noel & Associes
111 Champlain
Gatineau, Quebec J8X 3R1
Tel: (819) 771-7393
Fax: (819) 771-5397
Email: s.roussel@noelassocies.com
Agent for Intervener, A.G. of Quebec
i
TABLE OF CONTENTS
PART I – STATEMENT OF FACTS .......................................................................................................................................1
OVERVIEW ...................................................................................................................................................................1
FACTUAL CHRONOLOGY ..............................................................................................................................................2
“Self-Locking Building Bricks” Originate with Harry Page in 1940’s: ..........................................................2
Lego Derives LEGO Bricks from Kiddicraft Bricks: ......................................................................................3
Lego’s Market Long Protected by Patents: ......................................................................................................3
Rita and Victor Bertrand Found Mega Bloks in Québec in 1967: ...................................................................4
Mega Bloks Grows With Canadian Children: .................................................................................................5
Lego Stops Manufacturing in Canada when its Patents Expire: ......................................................................5
Mega Bloks Becomes Largest Canadian Toymaker with MEGA BLOKS Brand: .........................................6
Coupling Studs in the Market: .........................................................................................................................6
Lego’s Assertions of Exclusive Rights: ...........................................................................................................7
THE DECISIONS BELOW ...............................................................................................................................................8
PART II - ISSUES ....................................................................................................................................................................9
INTERPRETATION OF THE TRADE-MARKS ACT AND POLICY: .........................................................................................9
PASSING OFF: ..............................................................................................................................................................9
CONSTITUTIONALITY: ..................................................................................................................................................9
PART III - ARGUMENT ........................................................................................................................................................10
SUMMARY..................................................................................................................................................................10
THE PURPOSE OF TRADE-MARK LAW IS INCONSISTENT WITH RIGHTS IN FUNCTIONAL PRODUCT FEATURES ...........11
Purpose of Intellectual Property Law Sets its Boundaries .............................................................................11
The Purpose of Trade-mark Law – Distinctive Trade-marks ........................................................................12
Distinctive Trade-marks and Functional Features of the Product Itself.........................................................12
Functional Product Features, Registered Trade-Marks and Passing Off .......................................................13
Proprietary and Exclusive Rights in Passing Off ...........................................................................................15
STATUTORY “TRADE-MARK” DEFINITION DOES NOT COVER FUNCTIONAL COUPLING STUDS ..................................17
Statutory Definition of “Trade-mark” and Distinctiveness ............................................................................17
The Current Act Made No Change Regarding Functionality .........................................................................19
Section 13 is Consistent with the Relevance of Functionality .......................................................................21
SECTION 7(B) GRANTS NO RIGHTS TO FUNCTIONAL PRODUCT FEATURES ................................................................22
PATENT RIGHTS CANNOT BE EXTENDED USING TRADE-MARKS ................................................................................23
Post-Patent Use of Inventions by the Public ..................................................................................................24
Judicial Consideration of Lego’s Claims for Post-Patent Monopoly Rights .................................................25
NO PASSING OFF........................................................................................................................................................26
No Distinctiveness in Lego’s Coupling Studs ...............................................................................................26
Lego’s Admission Means that the Coupling Studs are “Common to Trade” ................................................28
No Misrepresentation by Mega Bloks ...........................................................................................................29
CONCLUSION – NO TRADE-MARK RIGHTS IN THE COUPLING STUDS .........................................................................32
SECTION 7(B) IS NOT WITHIN THE LEGISLATIVE COMPETENCE OF THE PARLIAMENT OF CANADA .........................33
The Analytical Framework ............................................................................................................................33
Step 1: Section 7(b) Standing Alone.............................................................................................................34
Step 2: The Validity of the Federal Trade-marks Act ...................................................................................34
Step 3: The Extent of Encroachment and the Appropriate Integration Test .................................................35
Step 4: Is Section 7(b) "Truly Necessary" to the Regulatory Scheme in the Trade-Marks Act? ..................36
PARTS IV AND V – COSTS AND ORDER SOUGHT ........................................................................................................40
PART VI – TABLE OF AUTHORITIES ...............................................................................................................................41
PART VII – TABLE OF STATUTES, REGULATIONS, ETC. ............................................................................................47
PART I – STATEMENT OF FACTS
OVERVIEW
1.
The Canadian toy maker Mega Bloks competes successfully in the market with the global
marketing powerhouse Lego1. Mega Bloks has also become the latest in a series of competitors
targeted by Lego’s tactic of seeking to use intellectual property systems around the world to
maintain its grip on the market. In Canada, Lego has turned to s. 7(b) of the Trade-marks Act to
try to stop Mega Bloks from selling an entire line of toys made up of interlocking toy
construction bricks (“toy bricks”). The toy bricks each have an array of cylindrically shaped
connecting knobs (“coupling studs”) on the top surface. Examples of Mega Bloks toys and
packaging that Lego is trying to remove from the Canadian market are shown in Appendix “A”.
Trade-marks Act, R.S.C. 1985 c. T-13.
Second Amended Statement of Claim, App. Record, Vol. II, p. 234.
Trial Reasons, App. Record, Vol. I, para. 5 (Nos. 24 and 25), pp. 9-10.
2.
Lego claims to have “distinguishing guise” trade-mark rights in the coupling studs on the
toy bricks (also referred to as the “Lego Indicia”). The alleged trade-mark is the “shaping of
wares” and is described by Lego both pictorially and verbally as follows:
“a rectilinear array of uniform, smooth-sided, flat-topped,
cylindrical, co-planar protuberances, the proportions of
height, diameter and center-to-center spacing of which are
approximately 2:5:8. Where there is more than one row of
protuberances, they are arranged in mutually orthogonal rows
and columns”
Second Amended Statement of Claim, App. Record, Vol. II, pp. 234-235.
3.
Toy bricks couple together and stay connected due to frictional force (“clutch power”)
created between the coupling studs of one brick and the underside tubes and walls of another
brick. If there are no coupling studs on a brick, there can be no interlocking with another brick.
Trial Reasons, App. Record, Vol. I, para. 44, p. 27.
Petersen Discovery, Resp. Record, Vol. VIII, pp. 1388, 1509-1511.
1
For ease of reference, the appellants will be referred to as “Lego” and the respondent as “Mega Bloks” in this factum.
2
4.
In dismissing Lego’s s. 7(b) passing off action, the Federal Court Trial Judge found as a
fact that the coupling studs are purely utilitarian. The coupling studs are “functional in all
respects” (this finding was based on uncontradicted expert evidence of Mega Bloks). The shape,
size and configuration of the coupling studs are all dictated by function and this arrangement is
the best way to interconnect toy bricks with one another. No other arrangement works as well as
these coupling studs; changing any aspect of the coupling studs changes their function.
Moreover, the coupling studs are a ‘table-stakes’ feature for toy bricks. Without these particular,
wholly functional coupling studs, toy makers cannot effectively compete in the market for this
size of toy brick.
Trial Reasons, App. Record, Vol. I, paras. 44-49, pp. 27-29; para. 61, p. 34; paras. 84-86, p.
46.
Expert Report of Donald Martin, Resp. Record, Vol. VII pp. 1040-1161.
Light Cross-Examination, Resp. Record, Vol. IV, pp. 565, 669-671.
5.
Lego’s Factum includes a Statement of Fact section that ignores salient facts and places
other facts in an incomplete context. A brief summary of facts in a generally chronological order
is set out below.
FACTUAL CHRONOLOGY
“Self-Locking Building Bricks” Originate with Harry Page in 1940’s:
6.
Lego is not the originator of the toy brick with coupling studs. Rather, a British citizen
named Harry Page invented and marketed plastic Kiddicraft toy bricks in the early 1940s. Mr.
Page patented his “self-locking building bricks” in several countries including Canada. The
Kiddicraft bricks “exploited the technology disclosed in the Page patents” and used cylindrical
studs. The top surface of the Kiddicraft toy brick, with its ‘projections’ or ‘bosses’ as Page called
them, is shown in Appendix B, along with a copy of a Kiddicraft instruction sheet.
Trial Reasons, App. Record, Vol. I, para. 5 (Nos. 9, 10, 32, 33), pp. 8, 10-11; paras. 8 and 9,
p. 12.
Peterson Cross-Examination, Resp. Record, Vol. I, p. 120.
7.
Figures from Mr. Page’s (Canadian and U.K.) patents showing the coupling studs
(indicated as 12 and 13) are reproduced below:
3
Fig. 4 of the Page
Fig. 1 of U.K. Patent
Fig. 5 of U.K. Patent
Canadian Patent
No. 587,206
No. 587,206
(expired 1964)
Page Patents, App. Record, Vol. IV, pp. 675-659.
Lego Derives LEGO Bricks from Kiddicraft Bricks:
8.
Lego “ventured into plastic toys and, more particularly, into plastic building bricks. The
first generation of LEGO bricks, produced in 1949, was derived from the Kiddicraft bricks”. The
Kiddicraft bricks and the first generation Lego bricks connected in the same fashion and were the
same size. Lego later improved the clutch power of its bricks by adding tubes to the undersides.
This improvement made the Lego toy brick a world-wide success. The old Kiddicraft brick was
supplanted by the Lego toy brick. The way that the bricks interlocked was key to the
commercial success of the Lego toys.
Trial Reasons, App. Record, Vol. I, paras. 9 and 10, pp. 11-12.
Kristiansen Cross-Examination, Resp. Record, Vol. I, pp. 38-40.
Petersen Cross-Examination, Resp. Record, Vol. I, pp. 120, 137.
Lego’s Market Long Protected by Patents:
9.
Lego took full advantage of intellectual property laws and obtained patent protection
around the world for its improved toy brick. Two Canadian patents were granted to Lego that
covered the improved interconnection of toy bricks using the coupling studs. The first Canadian
patent (No. 629,732) shows coupling studs (“p”) and tubes (“s”):
Fig. 2 of Can. Patent
No. 629,732
(expired 1978)
Fig. 9 of Can. Patent
No. 629,732
4
This patent disclosed and claimed coupling studs in combination with the underside tubes and
walls of an adjoining brick, allowing one brick to interlock with greater clutch power to a second
brick.
Lego Patent No. 629,732, claims 2 and 15, App. Record, Vol. IV, pp. 691, 695-696.
Kristiansen Cross-Examination, Resp. Record, Vol. I, pp. 67-68.
10.
The second basic Canadian Lego patent (No. 880,418), issued in 1971 and claimed a
further improvement covering the interconnection of larger-sized bricks with the now standardsized bricks using the coupling studs.
Fig. 1 of Can. Patent No. 880,418
(expired 1988)
Lego Patent No. 880,418, claim 1, App. Record, Vol. IV, pp. 706-709.
11.
The second of the two basic Lego patents expired in 1988. For almost 30 years Lego had
patent rights in Canada over toy bricks that utilized the coupling studs. Including the Page
patents, later acquired by Lego, patent rights on toy bricks with studs extended for over 40 years
– 1947-1988. Lego purchased the intellectual property rights from Kiddicraft to protect
themselves from competition.
Lego Patent Nos. 629,732 and 880,418, App. Record, Vol. IV, pp. 684-709.
Page Patent No. 443,019, App. Record, Vol. IV, pp. 661-675.
Exhibit D-136, Interlego A/S v. Exin Line Bros. SA (Israeli Supreme Court, Docket No.
513/89), Resp. Record, Vol. VIII, p. 1369.
Rita and Victor Bertrand Found Mega Bloks in Québec in 1967:
12.
Rita and Victor Bertrand, husband and wife, founded “Ritvik”, now Mega Bloks, in
Québec in 1967. Over time, the company expanded into manufacturing, with injection moulded
pre-school age toys. In the early 80s Mega Bloks began to focus on “building blocks…directed
to pre-school children” and sold under the trade-mark MEGA BLOKS.
Trial Reasons, App. Record, Vol. I, paras. 15-16, p. 14.
5
Mega Bloks Grows With Canadian Children:
13.
Mega Bloks gained market prominence in Canada and elsewhere after introducing its
oversized MAXI blocks for pre-schoolers in the 1980s. No one else was manufacturing largesized blocks for very young children. The MEGA BLOKS brand toys were immediately
successful.
Trial Reasons, App. Record, Vol. I, para. 5 (no. 23), p. 9.
Bertrand Examination-in-Chief, Resp. Record, Vol. II, pp. 358-359, 367.
14.
Mega Bloks wanted to “grow” with the Canadian children who had started by playing
with MAXI blocks. As children get bigger, the blocks they play with get smaller. However,
Mega Bloks waited until 1989, a year after Lego’s patents had expired, before extending its
product line beyond the MAXI blocks. By 1991, Mega Bloks was offering toys containing three
sizes of bricks, including the MICRO MEGA BLOKS brick, the subject of this lawsuit. The
MICRO MEGA BLOKS toy bricks, by utilizing the coupling studs, embody the inventions of the
expired Page and Lego patents. Lego admitted at trial that it would have sued Mega Bloks for
patent infringement for using the coupling studs and underside tubes if Lego’s Canadian patents
had not expired. Mega Bloks uses the coupling studs in their bricks for their utility.
Bertrand Examination-in-Chief, Resp. Record, Vol. II, pp. 368, 371.
Trial Reasons, App. Record, Vol. I, para. 5 (no. 23), pp. 9-10; para. 17, p. 14; para. 44, p. 27;
para. 67, p. 37.
Petersen Cross-Examination, Resp. Record, Vol. I, pp. 190-192.
15.
Mega Bloks respected the Lego patents and waited until the Lego patents had expired
before extending the MEGA BLOKS product line beyond the MAXI blocks. However, six years
after Mega Bloks had entered the market with the MICRO brick, Lego chose to bring this action
against its primary competitor Mega Bloks based on trade-mark law.
Second Amended Statement of Claim, App. Record, Vol. II, p. 232.
Lego Stops Manufacturing in Canada when its Patents Expire:
16.
In 1988, the same year the last of its two Canadian patents on the basic toy brick with
coupling studs expired, Lego stopped manufacturing toys in Canada. Even without
manufacturing in Canada, Lego is successful: its revenue from sales in Canada alone went from
close to $18 million in 1989 to over $44 million in 1998.
Trial Reasons, App. Record, Vol. I, para. 5 (No. 20), p. 9; para. 11, p. 12.
6
Mega Bloks Becomes Largest Canadian Toymaker with MEGA BLOKS Brand:
17.
Mega Bloks has grown from the Bertrands’ small business to become a publicly-traded,
award-winning company that manufactures in Canada and exports its toys to over 100 countries.
It is the largest Canadian toymaker in terms of employees (over 1000) and is ranked in the top
ten toy manufacturers in North America. At the time of trial, Mega Bloks had a team of 90
designers in its Montréal research and development facility, creating new toy kits based on its
range of age-appropriate toy bricks. Interlocking bricks of the MICRO size are sold in sets that
are intended to be assembled into complex “finished products” (eg. dragons, robots, vehicles and
similar “themed” toy sets). Mega Bloks has, over the past fourteen years, designed and sold
hundreds of different MICRO product stock-keeping units or “SKUs”, each designed by its team
in Montréal.
Trial Reasons, App. Record, Vol. I, paras. 15-18, p. 14.
Bertrand Examination-in-Chief, Resp. Record, Vol. II, pp. 352-355; 369-397; 402-404; 412.
Geyer Cross-Examination, Resp. Record, Vol. II, p. 297.
Kristiansen Cross-Examination, Resp. Record, Vol. I, pp. 56-57.
Mega Bloks Awards, Exhibits D-66 – D-71, Resp. Record, Vol. 5, pp. 903-930.
18.
Mega Bloks MICRO toy bricks bear the trade-mark MEGA BLOKS. MEGA BLOKS is
a well known and identifiable brand: the Mega Bloks trade-marks MEGA BLOKS and MICRO
MEGA BLOKS are used on its packaging, in marketing and advertising material, in its television
advertising campaigns, in third-party industry reviews and in compatibility markings on third
party products.
Trial Reasons, App. Record, Vol. I, para. 5 (Nos. 22-25), p. 9; para. 144, p. 73; para. 146, p.
74.
Bertrand Examination-in-Chief, Resp. Record, Vol. II, pp. 413, 423-426.
Donahue Examination-in-Chief, Resp. Record, Vol. III, pp. 437-439.
Rokenbok packaging, Resp. Record, Vol. V, p. 833.
Mega Bloks Toys, Catalogues, Advertising and NPD Group Industry Review, Resp. Record,
Vol. V, pp. 856-902, 931-1039; App. Record, Vol. IV, pp. 594-653, 864-867, 870-871, 873.
Coupling Studs in the Market:
19.
Lego has admitted that there have been a number of competitors who have, at different
times, marketed bricks or other products with a coupling stud configuration since Lego entered
7
the market in 1961, including products from Rokenbok, Tandem, Byggis, Best-Lock, DSI
(Blockmen) and Tyco.
Hoier Cross-Examination, Resp. Record, Vol. II, pp. 223-224.
Boland Cross-Examination, Resp. Record, Vol. II, pp. 229-234.
Third-party Products, Exhibits D-12, D-15, D-16, D-39, D-40, D-41 and D-42, Resp. Record,
Vol. V, pp. 830-854.
Petersen Discovery, Resp. Record, Vol. VIII, p. 1548.
Bertrand Examination-in-Chief, Resp. Record, Vol. II, p. 424.
Lego’s Assertions of Exclusive Rights:
20.
In December 1996, Lego took two steps to try to acquire rights in the coupling studs
themselves using trade-mark law.
21.
First, Lego applied to register the coupling studs as a trade-mark. Despite the ubiquitous
“TM” notation used widely by vendors in Canada, and Lego’s own consistent practice of
designating trade-marks, Lego never used this method, or any other, to indicate to the public that
the coupling studs were themselves considered by it to be a trade-mark (in fact, each coupling
stud is inscribed with the word trade-mark LEGO on its top surface).
Trial Reasons, App. Record, Vol. I, para. 115, p. 58.
22.
Second, a day later, Lego filed suit against Mega Bloks in the Federal Court seeking
relief that included:
a. a permanent injunction against making or selling any product with the coupling
studs;
b. a declaration of ownership in what it claimed to be the unregistered trade-mark
(the coupling studs); and
c. an order requiring delivery up or destruction of all the Mega Bloks moulds used to
make bricks with the coupling studs.
Second Amended Statement of Claim, App. Record, Vol. II, paras. 33(1) and 33(3)(a), p. 241.
23.
The Trade-marks Office has refused Lego’s application on the basis of functionality of
the coupling studs. Despite the finding that the coupling studs are functional in all respects (see
below), Lego continues to seek the rights that would flow from registration of the coupling studs
as trade-marks in Canada.
Petersen Discovery, Resp. Record, Vol. IX, pp. 1536-1537.
8
24.
The Federal Court action is now before this Court on appeal from decisions at two levels
below, both of which rejected the trade-mark arguments of Lego (a brief summary is set out
below).
THE DECISIONS BELOW
25.
The Trial Judge found that Lego had failed to establish the necessary elements of passing
off – he found as a fact that there had been no misrepresentation made by Mega Bloks to the
market.
Trial Reasons, App. Record, Vol. I, paras. 142-147, pp. 72-74.
26.
More fundamentally, the Trial Judge found that the claimed trade-mark of Lego, the
coupling studs, was “functional in all respects”. Consequently, the coupling studs were not a
trade-mark that could be asserted under s. 7(b) of the Trade-marks Act.
Trial Reasons, App. Record, Vol. I, para. 61, p. 34; para. 163, p. 82.
27.
The Federal Court of Appeal dismissed Lego’s appeal on the basis that the coupling studs
(the so-called Lego Indicia) are primarily functional and thus cannot be a trade-mark. The
majority agreed with the Trial Judge that wholly functional product features are inconsistent with
the role of trade-marks. Neither court below based its decision on the fact that the coupling studs
were the subject of expired patents, although both considered this to be a relevant fact. The
minority disputed that the functional nature of the coupling studs could have any relevance to the
issue of passing off and also would have overturned the Trial Judge on his finding of no
misrepresentation. Due to the majority’s conclusion regarding the legal results of the functional
aspect of the coupling studs, they did not consider whether the finding that there was no
misrepresentation actionable in passing off was a reviewable error.
Appeal Reasons, App. Record, Vol. I, paras. 93-95, pp. 171-172; paras. 96-97, p. 173.
9
PART II - ISSUES
28.
The issues that follow are dealt with in the order that they appear in the reasons of the
Courts below and therefore differ from the presentation of issues found in the Lego Factum.
INTERPRETATION OF THE TRADE-MARKS ACT AND POLICY:
(a)
Does the purpose of trade-mark law extend to cover primarily functional product
features?
(b)
Do the Trade-marks Act definitions of ‘distinguishing guise’ and ‘trade-mark’
include functional, or utilitarian, product features such as Lego’s coupling studs?
(c)
Can Lego use s. 7(b) of the Trade-marks Act to obtain rights to functional, or
utilitarian, product features that Lego is not entitled to protect under the registration
scheme set out in the Act?
(d)
Can Lego, after receiving the full benefit of the exclusive monopoly granted by its
patents, turn to trade-mark law to extend its exclusivity in the market?
PASSING OFF:
(e)
Is Lego’s passing off claim supportable when Lego has admitted that its competitors
do use, and may use, the coupling studs in their own competing products? Is Lego’s
claim supportable when the Trial Judge did not expressly find distinctiveness in the
coupling studs and merely concluded that Lego’s “goodwill derives in whole or in
part from the LEGO Indicia” despite holding that it was “impossible to quantify that
contribution”?
(f)
Did Mega Bloks misrepresent by including coupling studs on its toy bricks when it
was found as a fact that Mega Bloks took steps to differentiate its products and that
there was little if anything that could be done to avoid some confusion in the market
as a result of Mega Bloks using the wholly functional coupling stud feature?
CONSTITUTIONALITY:
(g)
Is s. 7(b) of the Trade-marks Act unconstitutional as being an intrusion into
provincial jurisdiction that is neither necessary nor incidental to the Federal
registration scheme for trade-marks?
10
PART III - ARGUMENT
SUMMARY
29.
Lego is seeking to shut down competition from its main rival Mega Bloks, who is
successfully selling toy sets that include bricks with coupling studs. Lego’s patents on the toy
bricks with coupling studs have expired. Trying to use the courts to stifle competition from
Mega Bloks, Lego has turned to trade-mark law (both in Canada and around the world). In
Canada, Lego relies on a novel and over-reaching interpretation of s. 7(b) of the Trade-marks Act
that completely ignores the functionality of Lego’s claimed trade-mark in the coupling studs.
Extending trade-mark rights to cover a primarily functional product feature like the coupling
studs is fundamentally inconsistent with both the purpose and statutory definition of trade-marks.
Courts below, and outside Canada, have refused to go along with Lego’s covetous attempt to
extend trade-mark rights to prevent suppliers of this product from competing in the market.
30.
Problems caused by such an over-extension of trade-mark rights have been identified by
many previous courts which have prevented the undesirable monopolizing effects, and the
patent-prolonging results, of according trade-mark rights in primarily functional product features.
31.
Even if the coupling studs are considered to be a trade-mark, the Trial Judge below found
no passing off. There is no reviewable error in this finding: Lego is asserting a trade-mark that
is, by its own admission, not uniquely used by it and therefore not distinctive of Lego. Mega
Bloks, by merely using coupling studs that are entirely functional, has made no
misrepresentation to the market that is actionable in passing off.
32.
Lego’s action is based solely on s. 7(b) of the Trade-marks Act. The rights and remedies
provided by that section are otherwise within provincial jurisdiction, and are not necessary for
the registration scheme of the Act. Section 7(b) is therefore outside the legislative power of the
Parliament of Canada. This action must therefore also fail as the Federal Court lacks
jurisdiction.
11
THE PURPOSE OF TRADE-MARK LAW IS INCONSISTENT WITH RIGHTS IN FUNCTIONAL
PRODUCT FEATURES
Purpose of Intellectual Property Law Sets its Boundaries
33.
In this appeal, Lego is asking this Court to expand the boundaries of trade-mark law in a
way that ignores its purpose and the subject matter of Lego’s claimed trade-mark. However, it is
an “undesirable practice” to seek “to expand the boundaries of intellectual property rights
beyond the purposes for which they were created in order to obtain an unintended or undeserving
monopoly.” The purpose of trade-mark law – to allow reliable identification of product source –
does not require, nor does it permit, trade-mark rights in primarily or wholly utilitarian functional
product features.
Interlego AG v. Tyco Industries Inc. [1989], 1 A.C. 217 at 256 (P.C.).
34.
Intellectual property intrudes into the competitive marketplace; it interferes with and
restricts free competition. Each of the commonly available intellectual property rights
(copyrights, patents, industrial designs, and trade-marks) differ from one another in subject
matter and in scope. Parliament and the courts define the scope of each of these different
intellectual property rights and its respective remedy according to the underlying basis for the
right. This careful attention to defining the scope of intellectual property rights can be seen in the
treatment of every type of intellectual property right, both in the courts and in express legislative
enactment. Particular care is taken where utilitarian features are covered by such rights:
o Copyright: This right is intended to protect the form of expression such as an original
shape in a work of art (e.g. Henry Moore’s The Archer). The Copyright Act sets
boundaries on the rights of owners by setting out user rights including, for example,
express rights to use utilitarian features.
Copyright Act, R.S.C. 1985, c. C-42, s.64.1(1)(a).
CCH Canadian Limited v. Law Society of Upper Canada, [2004] 1 S.C.R. 339 at 348.
o
Industrial Designs: The Industrial Designs Act grants rights to original designs,
including eye-appealing shapes applied to useful articles, for a limited term only (e.g.
shape of furniture). Utilitarian features, however, are excluded from protection as
designs.
Industrial Design Act, R.S.C. 1985, c. I-9, as amended, s. 5.1(a).
o Patents: By statute, patents are granted only for new and useful inventions and given
only a limited term. “[A] functional part per se is open to the world apart from the
protection of the patent law.” In a patent, a functional part may be defined and claimed
12
by its shape (eg. a washing machine agitator in the shape of an auger). There are strict
requirements that require novelty, utility and other aspects of the invention in the
functional part to be shown in a formal and demanding patent office examination
procedure. The consequential intrusion of intellectual property rights into the free market
is greatest for utilitarian features. Patent rights are therefore the most rigorously
reviewed and closely monitored of all intellectual property rights.
H.G. Fox, Canadian Law of Trade-marks and Unfair Competition, 3rd ed. (Carswell: Toronto,
1972) at 558.
Patent Act, R.S.C. 1985, c. P-4, s. 2, “invention”.
o Trade-marks: Trade-marks are used in commerce as a source indicator for goods or
services. There has been both judicial and legislative attention paid to the boundaries and
to the scope of trade-marks, based on the intention underlying trade-mark law. The
definition of these boundaries (and particularly with regard to the shaping of wares) is
central to this appeal and is discussed in detail below.
The Purpose of Trade-mark Law – Distinctive Trade-marks
35.
A trade-mark distinguishes the goods (the wares) of one trader from those of another (and
is thus distinctive). By marking goods a trader hopes to indicate their source on an exclusive
basis and let consumers choose that trader’s goods over those of others. From the public’s
perspective, trade-marks enable the consumer to identify the source of the goods. The “essence
of a protectable trade-mark and the foundation of trade-mark law is distinctiveness”; a “nondistinctive trade-mark is a contradiction in terms”
K. Gill & R.S. Jolliffe, Fox on Canadian Law of Trade-Marks and Unfair Competition, 4th ed.
(Toronto: Carswell, 2002) at 3-19; see also Astra Zeneca AB v. Novopharm Ltd., (2003) 24
C.P.R. (4th) 326 at 334 (F.C.A.) citing H.G. Fox, Canadian Law of Trade Mark and Unfair
Competition, 3rd ed. (Toronto: Carswell, 1972) at 554.
D. Vaver, “Canada’s Intellectual Property Framework: A Comparative Overview”, (2004)
17 I.P.J. 125 at 190.
Distinctive Trade-marks and Functional Features of the Product Itself
36.
Trade-mark law allows purchasers, faced with a number of products of the same type
from different sources, to know which of the products comes from which of the different
sources. The product’s trade-mark connects the goodwill of the source with the particular
product (which competes with other, functionally equivalent products in its category). The
purchaser, choosing between functionally similar products, can thereby rely on his or her
knowledge about source to select between the products. The notion of a product or ware is quite
different from that of a mark used in association with that ware; the product and its functional
features contribute to the goodwill whereas the trade-mark symbolizes the goodwill.
13
37.
The intention of trade-mark law is inconsistent with permitting a single vendor to lay
claim to rights in the functional aspects of the products themselves. The vendor would be
effectively stating to the market that consumers can rely on the very functional attributes of the
product itself to make the connection with the source. The consumer would no longer be
choosing between products with equivalent functional features and using trade-marks to
distinguish between them. Instead, the functional attributes of the products themselves would
become signifiers representing the goodwill of the source and thus become capable of limiting
the number of competing goods offered the consumer.
38.
This is to be contrasted with word marks that may initially be descriptive of the character
or quality of the wares but become distinctive of the goods of one trader (as in Reddaway v.
Banham); this type of trade-mark does not limit competition. In short:
“Words, numerals, initials or other symbols may serve both as trade-marks and as
indicators of quality, composition or grade. A get-up or symbol may serve an ornamental
as well as a trade-mark function. However, trade-mark law is not intended to preclude
competitors from adopting individual features that are merely utilitarian.”
W. L. Hayhurst, “What is a Trade-mark? The Development of Trade-mark Law” in G.F.
Henderson, ed., Trade-marks Law of Canada, (Toronto: Thomson, 1993) 27 at 69.
Reddaway v. Banham, [1896] 13 R.P.C. 218 (H.L.).
39.
As is apparent from the above discussion, a primarily functional trade-mark is
inconsistent with the source-distinguishing intention of trade-mark law. It is for this reason that
the common law, express legislative enactment, and interpretation of the Trade-marks Act all
consistently refuse to recognise trade-marks in primarily functional product features. The
response to attempts to claim trade-mark rights in primarily functional features was the doctrine
of functionality. This response was not born out of superior competition policy (as Lego puts it),
but through a recognition that primarily functional product features do not serve to indicate
source.
Functional Product Features, Registered Trade-Marks and Passing Off
40.
The functionality of a purported trade-mark is considered whether the right asserted
relates to an unregistered trade-mark in a passing off action or to a registered trade-mark. The
law in Canada, the United States, the United Kingdom, and Europe is consistent in refusing to
expand trade-marks to cover functional product features.
14
Canada
41.
Canadian cases stretch back for over sixty years and are remarkably consistent in stating
that functionality goes to the very essence of a trade-mark:
“…any combination of elements which are primarily designed to perform a function…is
not fit subject-matter for a trade mark, and if permitted would lead to grave abuses.”
Imperial Tobacco Co. v. Registrar of Trade- Marks, [1939] Ex. C.R. 141 at 145.
“…the change in the appearance of the wood that is the ordinary consequence of fire
hardening cannot be a trade mark.”
Elgin Handles Ltd. v. Welland Vale Manufacturing Co. Ltd. (1964), 43 C.P.R. 20 at 24
(Ex.Ct.).
“…if what is sought to be registered as a trade mark has a functional use or characteristic,
it cannot be the subject of a trade mark.”
Parke, Davis & Co. v. Empire Laboratories Ltd., [1964] S.C.R. 351 at 354.
“A mark which goes beyond distinguishing the wares of its owner to the functional
structure of the wares themselves is transgressing the legitimate bounds of a trade mark.”
Remington Rand Corp. v. Philips Electronics N.V. (1995), 64 C.P.R. (3d) 467 at 478 (F.C.A.).
In determining whether a product shape can be an unregistered “distinguishing guise
within the meaning of the Trade-marks Act,” the “solution” is to apply “the doctrine of
functionality.”
Thomas & Betts, Ltd. v. Panduit Corp. (2000), 4 C.P.R. (4th) 498 at 506-7 (F.C.A.).
United States
42.
Originally created in the jurisprudence, the “functionality doctrine” in the United States is
now also expressly found in the Lanham Act. As the U.S. Supreme Court has explained:
“The functionality doctrine prevents trademark law, which seeks to promote competition
by protecting a firm’s reputation, from instead inhibiting legitimate competition by
allowing a producer to control a useful product feature.”
This doctrine applies even in cases where alternative designs are available.
Qualitex Co. v. Jacobson Prods. Co., 115 S. Ct. 1300 at 1304 (U.S.S.C. 1995) (citation
omitted).
TrafFix Devices, Inc. v. Marketing Displays, Inc. 121 S. Ct. 1255 at 1262 (U.S.S.C. 2001).
Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 at 769 (1992).
Wal-Mart Stores, Inc. v. Samara Bros., 120 S. Ct. 1339, 1343 (2000).
The Lanham Trade Mark Act, 15 U.S.C.A. §§ 1052 (e)(5), 1064(3), 1115 (b)(8), and 1125(a)(3)
(1997 & Supp. 2000).
15
United Kingdom
43.
The current Trade Marks Act in the United Kingdom implements the European Directive
and therefore sets up an absolute bar to trade-mark registration of any “sign” that is exclusively a
shape that is the result from “the nature of the goods themselves”, is “necessary to obtain a
technical result”, or “gives substantial value to the goods.” The U.K. Court of Appeal has stated
that the “technical result” bar is related to the recognition that monopoly rights are anticompetitive: “Trade marks have been seen as an exception provided they only monopolise
indications of origin and not inventions and designs.” With respect to passing off, the U.K.
courts have permitted rights in a distinctive container (get-up) but have refused to extend passing
off to cover rights “in the article itself”.
EC, Council Directive 89/104 EEC of 21 December 1988, to Approximate the Law of the
Member States Relating to Trade Marks, online: Office for Harmonization in the Internal
Market homepage, http://oami.eu.int/en/mark/aspects/direct/direct.htm.
Trade Marks Act 1994 (U.K.), 1994, c. 26, s. 3(2).
Philips Electronics NV v. Remington Consumer Products Ltd., [1999] R.P.C. 809 at 816
(C.A.).
Reckitt & Colman Products Limited v. Borden Inc. & ORS, [1990] R.P.C. 341 at 418 (H.L.).
Europe
44.
The European Court of Justice has recognized that the result of “the exclusivity inherent
in the trade mark right” will “limit the possibility of competitors supplying a product
incorporating such a function or at least limit their freedom of choice in regard to the technical
solution…”. The leading case has stated that where a product shape gives a technical result, it is
immaterial whether there are alternative shapes available. This principle has been applied in
Europe to cancel Lego’s trade-mark registration for a 2x4 coupling stud toy brick.
Koninklijke Philips Electronics NV v. Remington Consumer Products Ltd.,
[2003] R.P.C. 2 at 28-29 (E.C.J.).
Mega Bloks Inc. v. Kirkbi A/S, Office for Harmonization in the Internal Market (Trade
marks and Designs), Cancellation Division, 63 C 1070291/1 (July 30, 2004).
Proprietary and Exclusive Rights in Passing Off
45.
Lego argues that the doctrine of functionality is based on the notion of exclusive rights,
but that since unregistered trade-marks do not provide exclusive rights, the doctrine does not
apply to them. As explained thoroughly by the Federal Court of Appeal, and contrary to Lego’s
submissions in paragraphs 54 to 70 of its Factum, there is a type of property right (or exclusivity)
16
in an unregistered trade-mark. Although some (but not all) British case law might suggest
otherwise, this Court has invoked property concepts in a passing off case in explaining that the
“right to be protected against the ‘pirating’ of a brand, trade name or the appearance of a
product is linked to a kind of ‘ownership’ which the manufacturer has acquired in that
name, brand and appearance by using them.”
Ciba-Geigy Canada Ltd. v. Apotex Inc., [1992] 3 S.C.R. 120 at 134.
Appeal Reasons, App. Record, Vol. I, paras. 76-83, pp. 159-162.
K. Gill & R.S. Jolliffe, Fox on Canadian Law of Trade-marks and Unfair Competition, 4th ed.
(Toronto: Carswell, 2002) at 4-13 to 4-14.
46.
The Federal Court of Appeal, in prior cases, has taken the same approach, stating that the
“protection of trade-marks as property is based in the common law action for passing off.” The
Ontario Court of Appeal has referred to the monopoly rights that may be the result of asserting a
claim in passing off and the House of Lords have recognized a monopoly in distinctive packaging
asserted in a passing off case.
United Artists Corp. v. Pink Panther Beauty Corp. (1998), 80 C.P.R. (3d) 247 at 255 (F.C.A.)
leave to appeal allowed, but settled (1998), 235 N.R. 399 (note) (S.C.C.).
Orkin Exterminating Co. Inc. v. Pestco Co. of Canada Ltd. et al. (1985), 50 O.R. (2d) 726 at
742 (Ont. C.A.).
Reckitt & Coleman Products Limited v. Borden Inc. & ORS, [1990] R.P.C. 341 at 418 (H.L.).
See also Thomas & Betts, Ltd. v. Panduit Corp. (2000), 4 C.P.R. (4th) 498 at 506 (F.C.A.).
47.
By protecting its property in goodwill, a successful claimant in a passing off action
simultaneously protects its trade-mark symbolizing the goodwill and in effect is afforded
property rights in the trade-mark. Commercial reality is reflected in the Trade-marks Act which
expressly permits assignments of unregistered trade-marks.
Trade-marks Act, R.S.C. 1985, c. T-13, s. 48.
48.
The majority in the Federal Court of Appeal below reviewed the case law and concluded
that exclusivity can be acquired through an unregistered trade-mark. This is consistent with the
intention of Parliament as reflected in the Trade Mark Law Revision Committee Report’s
comments on s. 7 of the Act:
“It will be understood that the general right of a trader to invoke the aid of the courts in
protecting his right to the exclusive use of a trade mark or trade name is not statutory in
origin but is dependent upon the common law. This right was, and still is, exercisable by
the common law action for passing off. This action … has been continued in the present
Bill with added emphasis by the provisions of Section 7(b) and (c).”
17
Canada, Report of the Trade Mark Law Revision Committee (Ottawa: Queen’s Printer, 1953)
(Chairman; Harold G. Fox) at 36-37 (emphasis added).
49.
In this appeal, and in the Federal Court of Appeal below, Lego says that it does not have
exclusive rights in the coupling studs. However, the injunction requested at trial was to prevent
Mega Bloks from “making, using, selling or offering for sale any product in association with” the
coupling studs and even to deliver up or destroy the moulds used to make the Mega Bloks toy
bricks. Although exhibits at trial included literally hundreds of Mega Bloks products with widely
varying packaging, not a single one was said by Lego to represent a non-confusing use of the
coupling studs by Mega Bloks. Under either the injunction first sought, or under the injunction that
Lego is now apparently asking for, Lego would effectively obtain perpetual rights to utilitarian
features, amounting to an unlimited extension of the rights it previously enjoyed under its expired
patents. Lego would get through the back door what it cannot get through the front door.
Appellants’ Factum, para. 5, p. 1.
Trial Reasons, App. Record, Vol. I, para. 19, p. 15.
Appeal Reasons, App. Record, Vol. I, para. 41, p. 134; para. 82, pp. 162-163.
50.
Passing off is not intended to grant such rights. Lego relies on passing off cases that refer
to a duty imposed on traders not to introduce products to the market in a way that will cause
confusion with previously-marketed products. However, this aspect of passing off was never
intended to extend to primarily functional product features. In no case has a court required a
party entering a market to change either primarily functional product features, or its marketing,
to avoid confusion based solely on similarity in primarily functional product features. As
explained above, to do so would be to take passing off beyond its proper metes and bounds.
STATUTORY “TRADE-MARK” DEFINITION DOES NOT COVER FUNCTIONAL COUPLING STUDS
51.
Contrary to Lego’s submissions in paragraphs 93 to 107 of its Factum, the coupling studs
do not fit the definition of “trade-mark” and in particular do not fit the “distinguishing guise”
definition in the Trade-marks Act.
Statutory Definition of “Trade-mark” and Distinctiveness
52.
The Trade-marks Act definition of “trade-mark” is consistent with the analysis set out
above regarding the incompatibility of trade-mark rights and primarily functional product
features. However, since the 1954 amendments to the Federal trade-marks statute, some trade-
18
mark owners have sought rights in functional trade-marks by arguing that the innate character or
quality of a mark or a guise does not limit the basic definitions of a “trade-mark” or
“distinguishing guise” as set out in the Trade-Marks Act (see, for example, the argument raised
by Dr. Fox in his case comment on Parke, Davis).
Parke, Davis & Co. v. Empire Laboratories (1964), 27 Fox Pat. C. 67 at 68 (S.C.C.).
53.
The error in this approach to the statutory definition has been recognized by the courts.
The leading case is the Federal Court of Appeal decision in Remington. MacGuigan, J. started
with the axiom that “the essence of a trade mark is to distinguish” and that “every form of trade
mark, including a distinguishing guise, is characterized by its distinctiveness.” However, the
crucial point identified by MacGuigan, J. is that the purpose of a trade-mark is to “…distinguish
wares from those of competitors, by monopolizing, not the wares, but the mark as used in
relation to them”. Therefore:
“…to the extent that such functionality relates primarily or essentially to the wares
themselves it will invalidate the trade mark…”
“A mark which goes beyond distinguishing the wares of its owner to the functional
structure of the wares themselves is transgressing the legitimate bounds of a trade mark.”
Remington Rand Corp. v. Philips Electronics N.V. (1995), 64 C.P.R. (3d) 467 at 477-478
(F.C.A.) (emphasis added).
54.
MacGuigan, J. carried out a purposive construction of the Act supported by its wording.
The intention of the legislature as expressed in the Act is related to the role of a trade-mark as a
source identifier: to distinguish the wares of a trader from those of its competitors
(distinctiveness). The practical result of the interpretation of MacGuigan, J. is consistent with
this legislative intention: a “trade-mark” is defined in a way that is necessarily connected to its
role as a distinguishing source identifier.
55.
Although the “innate character” of a trade-mark is said by Lego not to be a consideration
in deciding if something is a trade-mark, the definition is not so devoid of context as to be the
equivalent of meaning simply any symbol, sign or mark. It is only certain types of marks that are
trade-marks: those that are distinctive. The conclusion of MacGuigan, J., correctly followed by
the Federal Court of Appeal below, is that a mark transgresses the legitimate bounds of a trademark when it consists of primarily functional product features.
19
Parke, Davis & Co. v. Empire Laboratories Ltd. (1963), C.P.R. 121 (Ex. Ct.); and [1964]
S.C.R. 351.
Remington Rand Corp. v. Philips Electronics N.V. (1995) , 64 C.P.R. (3d) 467
at 477-478 (F.C.A.).
See also, Pizza Pizza Ltd. v. Canada (Registrar of Trade Marks) (1989), 26
C.P.R. (3d) 355 at 361 (F.C.A.).
The Current Act Made No Change Regarding Functionality
56.
It is important to note that with respect to functionality, the approach of the Courts to the
statutory trade-mark definition has not changed over the past six decades. The shift that occurred
in the 1950s, when the Unfair Competition Act was replaced by the Trade-marks Act was
significant in extending registrability in certain cases, but did not change the fundamental
definition of “trade-mark” as being concerned with distinctiveness. The Exchequer Court
(approved by this Court) dealt with the statutory change in Parke, Davis and stated that:
“The new Act has eliminated the words ‘adapted to distinguish’ from the definition of a
trade mark and has, therefore, done away with the necessity which existed under the
Unfair Competition Act of inquiring into the innate character of a mark, leaving now the
matter only of distinctiveness to be determined whether it has that innate character of a
mark or not.”
Parke, Davis & Co. v. Empire Laboratories Ltd. (1963), C.P.R. 121 at 134 (Ex. Ct.) (emphasis
added).
57.
Although Lego relies heavily on the consideration of s. 7(b) passing off in the Parke,
Davis case, there was no discussion at either level of court on the point of functionality as it
relates to s. 7(b) or any discussion that s. 7(b) is tied to the definition of trade-mark in the Act.
The precedential value of Parke, Davis does not include any proposition about functionality in
the context of a s. 7(b) action. In contrast, in the relatively recent Thomas & Betts decision, the
Federal Court of Appeal considered passing off under s. 7(b) and expressly endorsed making
reference to functionality to determine whether a product shape was within the statutory
definition of a “distinguishing guise”.
Parke, Davis & Co. v. Empire Laboratories Ltd. (1963), C.P.R. 121 (Ex. Ct.); and [1964]
S.C.R. 351.
R. Cross and J.W. Harris, Precedent in English Law (Oxford: Clarendon, 1991) at 161.
Thomas & Betts, Ltd. v. Panduit Corp. (2000), 4 C.P.R. 498 at 507 (F.C.A.).
58.
Lego argues that the definition of “trade-mark” changed significantly when the Trade-marks
Act was enacted in 1954, as compared to the predecessor Unfair Competition Act. Lego claims that
20
Parliament specifically intended to do away with the doctrine of functionality as it pertains to
unregistered marks because functionality is not mentioned in the definition section although it
remained relevant under s. 13 of the Act.
Trade-Marks Act, R.S.C. 1985, c. T-13, ss. 2, 13.
Unfair Competition Act, 1932, 22-23, George V., c. 38, s. 2.
59.
Upon the enactment of a statute, there is a presumption that Parliament intends to preserve
the common law, unless clear words are used to indicate the contrary. This principle is especially
pertinent where there exists an established doctrine at common law such as the doctrine of
functionality. At common law, everyone had the right to the use of a functional feature of a product
provided it was not protected by a patent. Lord Jauncey, in Reckitt & Colman (passing off in the
packaging for lemon juice), made clear that, at common law, trade-mark rights could not attach to
an article itself (i.e. its functional features as opposed to its get-up):
“However, although the common law will protect goodwill against misrepresentation by
recognising a monopoly in a particular get-up, it will not recognise a monopoly in the
article itself.”
Reckitt & Colman Products Ltd. v. Borden Inc. & ORS, [1990] R.P.C. 341 at
418 (H.L.) (emphasis added).
Bell ExpressVu Limited Partnership v. Rex, [2002] 2 S.C.R. 559 at 580; citing
E.A. Driedger, Construction of Statutes, 2nd ed. (Toronto Butterworths,
1983) at 87.
R. Sullivan, Sullivan and Driedger on the Construction of Statutes, 4th ed.
(Vancouver: Butterworths, 2002) at 395.
60.
In the present case, the Federal Court of Appeal applied these principles and held that “the
mere fact that the existing definition of ‘distinguishing guise’ expressly says nothing to suggest the
importance of functionality is inconsequential. This silence is not a clear enough indication to
warrant the removal of the well established doctrine of functionality.” This is the correct approach
to interpreting the term “distinguishing guise.”
Appeal Reasons, App. Record, Vol. I, para. 60, p. 151.
61.
A legislature is not presumed to depart from “the general system of the law”, including
both common law and other statutory provisions, without expressing its intention to do so with
“irresistible clearness.” The introduction of the Trade-Marks Act followed the Committee
Report that saw s. 7(b) rights as “exclusive” and the Act did not introduce any express
21
amendment covering rights in unregistered trade-marks. As discussed below, the statute also
showed a clear intention to exclude trade-mark rights in utilitarian features, not to expand them.
The Goodyear Tire & Rubber Company of Canada Limited v. The T. Eaton Company Limited,
[1956] S.C.R. 610 at 613-614 and 615.
Section 13 is Consistent with the Relevance of Functionality
62.
The Unfair Competition Act was flawed in allowing enforceable trade-mark rights to be
acquired in distinguishing guises that include a functional component, even secondarily. The
resulting trade-mark rights could then be potentially asserted to prevent a competitor from using
even the secondarily functional component. The current Act ensures (in s. 13(2)) that even
where a functional component is not a primary feature of the mark, the rights accorded under a
registration would not permit functional aspects to be subject of trade-mark rights.
Distinguishing guises cannot be “proxies for patents or registered designs, since their utilitarian
features remain open for use by all.”
Unfair Competition Act, 1932, 22-23 George V., c. 38, s. 2(d), 2(m).
Trade-marks Act, R.S.C. 1985, c. T-13, s. 13(2).
D. Vaver, Intellectual Property Law, (Concord: Irwin Law, 1997) at 187.
63.
Lego argues (at paragraphs 100 to 106 of its Factum) that the inclusion of s. 13 in the Act
means that there should be no regard to functionality whatsoever in assessing its rights under the
Trade-marks Act. This flies in the face of the intention behind the statutory change – to close a
loophole that previously allowed certain functional features to be brought within trade-mark
rights.
64.
In fact, neither the problem addressed, nor the s. 13 solution, were concerned with
primarily or wholly functional trade-marks. As Sexton, J. pointed out in the majority reasons,
applying s. 13 to a primarily or wholly functional trade-mark results in a legislative
inconsistency. Since s. 13 denies enforceability to any utilitarian or functional feature of a
distinguishing guise, a primarily or wholly functional guise like the coupling studs would be
unenforceable if registered. The Act should not be interpreted to provide a right (a registered
trade-mark right in this case) with no remedy. This legislative inconsistency does not arise,
however, where the definitions of trade-mark and distinguishing guise are given purposive
meanings such that a primarily or wholly functional product feature is not within the definition
22
of trade-mark or distinguishing guise and is therefore not registrable. Section 13 does not come
into play for such marks.
Appeal Reasons, App. Record, Vol. I, para. 59, p. 150.
65.
The clear intention of Parliament is thwarted if the Act is interpreted to ignore
functionality when dealing with unregistered distinguishing guises (Lego’s argument). Such an
interpretation also leads to a paradoxical position in which an unregistered distinguishing guise
could be invoked to stop a competitor’s use of functional features whereas a registration for the
same distinguishing guise could not. As the Federal Court of Appeal most aptly put it, the
“purpose of registration is to confer advantages, not disadvantages, on a registered trade-mark
holder”.
Appeal Reasons, App. Record, Vol. I, para. 79, p. 161.
SECTION 7(B) GRANTS NO RIGHTS TO FUNCTIONAL PRODUCT FEATURES
66.
As set out below, Mega Bloks argues that s. 7(b) is invalid as it is ultra vires the Federal
Parliament. However, whether or not s. 7(b) is a valid statutory provision, the section does not
extend to give Lego rights in their functional coupling studs. To succeed in an action under
s.7(b) it is necessary for Lego to assert a valid and enforceable trade-mark, whether registered or
unregistered.
Asbjorn Horgard A/S v. Gibbs/Nortac Industries Ltd. (1987), 14 C.P.R. (3d) 314 at 328
(F.C.A.).
Dumont Vins & Spiritueux Inc. v. Celliers du Monde Inc. (1992), 42 C.P.R.
(3d) 197 at 210 (F.C.A.).
MacDonald v. Vapor Canada Ltd., [1977] 2 S.C.R. 134 at 156-157.
Trial Reasons, App. Record, Vol. I, para. 61, p. 34.
67.
This action is not sustainable under s. 7(b) since the section requires a “trade-mark” and,
for the reasons given above, the coupling studs cannot serve as a trade-mark. Because of the
concurrence between intellectual property law statutes regarding the treatment of utilitarian
features, as explained in paragraph 34, above (by giving rights and remedies in patent law only),
s. 7(b) must be referring to non-utilitarian features of a product design in the context of “likely to
cause confusion.” Moreover, s. 7(b) cannot provide rights and remedies that are inconsistent
with, and more extensive than, rights that would be accorded to the coupling studs if registered.
23
PATENT RIGHTS CANNOT BE EXTENDED USING TRADE-MARKS
68.
The line between the rights accorded by trade-mark law and those accorded by patent law is
clearly defined in the cases. This Court, and others in Canada, have invariably limited trade-mark
rights where the failure to do so would grant rights equivalent to a patent. Estey, J in Consumers
noted that passing off rights could not be asserted if a vendor could use such rights to achieve “a
monopoly on the sale in Canada of a product to the same extent as it would enjoy if the product
were subject to a patent of invention....”
Consumers Distributing Co. v. Seiko Time Canada Ltd., [1984] 1 S.C.R. 583 at 600.
69.
This Court also acknowledged the danger of extending a patent monopoly through trade-
marks in Parke, Davis.
Parke, Davis & Co. v. Empire Laboratories Ltd., [1964] S.C.R. 351 at 356 citing Canadian
Shredded Wheat Co. Ltd. v. Kellogg Co. of Canada Ltd., [1938] 1 All E.R. 618 at 626 (P.C.).
70.
In Canadian Shredded Wheat, the Privy Council dismissed a passing off action based on the
“pillow-shaped” cereal biscuit and commented on the interplay between expired patent rights and
passing off:
“Their Lordships, however, find it difficult to conceive that a manufacturer could in such
a case be held guilty of passing off, if he manufactured the goods in accordance with the
expired patents, and the only similarity between the rival goods lay in the appearance of
the goods so manufactured and the application to them of the name by which the patented
goods had been known.”
Canadian Shredded Wheat Co. Ltd. v. Kellogg Co. of Canada Ltd., [1938] 1 All E.R. 618 at 633
(P.C.).
71.
The Federal Court of Appeal has considered the interplay between both registered and
unregistered trade-marks and patent rights. In Thomas & Betts an unregistered mark consisting of a
previously patented product configuration was asserted in an action under s. 7(b) of the Act. The
Court held that:
“it would be unfair to the public if a patentee could, after the expiry of its patent, use the
Trade-marks Act to give itself a monopoly over the shape of its invention when that
shape is so closely related to the invention as to be for all practical purposes an element
essential to making full use of the invention.”
Thomas & Betts, Ltd. v. Panduit Corp. (2000), 4 C.P.R. (4th) 498 at 506 (F.C.A.).
72.
In Pizza Pizza a registered trade-mark was before the Federal Court of Appeal, which held
that trade-marks were not registrable if:
24
“registration of those marks would have granted the applicants a monopoly on functional
elements or characteristics of their wares; the applicants would, in effect, have obtained
patents under the guise of trade marks.”
Pizza Pizza Ltd. v. Canada (Registrar of Trade-marks) (1989), 26 C.P.R. (3d) 355 at 357
(F.C.A.).
See also Remington Rand Corp. v. Philips Electronics N.V. (1995), 64 C.P.R. (3d) 467 at 474475 (F.C.A.).
73.
In Canada, Parliament intended to protect functional articles and processes through the
Patent Act and not through other legislation. This Court, and others, have therefore been assiduous
in recognizing and rejecting attempts to use trade-mark law to acquire patent-like protection. It has
been recognized that the effect of an unjustified monopoly is “to take away free-trade, which is the
birthright of every subject.” Patent monopolies are not for perpetuity; they are a “limited monopoly
for a limited time.”
Free World Trust v. Électro Santé Inc., [2000] 2 S.C.R. 1024 at 1035, quoting from
Clothworkers of Ipswich Case (1653), Godb. 252, 78 E.R. 147 at 148.
Apotex Inc. v. Wellcome Foundation Ltd., [2002] 4 S.C.R. 153 at 172.
Post-Patent Use of Inventions by the Public
74.
The public availability of an invention’s “best mode” after the end of the patent term is
thwarted if trade-marks can be used to maintain the patentee’s rights in the invention after expiry of
the patent. The time-limited patent monopoly creates “serious anti-competitive effects” that are
only justified by the patent’s disclosure of the best mode of practicing the invention. “Disclosure is
the quid pro quo for valuable proprietary rights to exclusivity which are entirely the statutory
creature of the Patent Act”. Disclosure is “the essence of the bargain”; once the patent expires, the
public has “access to all of the information necessary to practise the invention” and is able to “use
the invention as successfully as the inventor could”. A patentee who could “evergreen” a single
invention through the use of intellectual property rights, such as patents, would unjustly prolong the
monopoly beyond what the public has agreed to pay.
Apotex Inc. v. Wellcome Foundation Ltd., [2002] 4 S.C.R. 153 at 172, 175.
Cadbury Schweppes Inc. v. FBI Foods Ltd., [1999] 1 S.C.R. 142 at 171-2.
Consolboard Inc. v. MacMillan Bloedel (Saskatchewan) Ltd., [1981] 1 S.C.R. 504 at 517.
Pioneer Hi-Bred Ltd. v. Canada (Commissioner of Patents), [1989] 1 S.C.R. 1623 at 1638.
Whirlpool Corp. v. Camco Inc., [2000] 2 S.C.R. 1067 at 1086-87.
75.
In this case, the coupling studs are described and claimed as the “best mode” for
25
interconnecting toy bricks shown in the expired Lego patents.
Lego Patent Nos. 629,732 and 880,418, App. Record, Vol. IV, pp. 683-709.
76.
Once Lego’s patents finally expired in 1988, Mega Bloks and any other competitor were
free to make “the same successful use of the invention” disclosed in those patents. The full use of
the disclosed inventions in the Lego patents will be prevented if Lego is granted trade-mark rights in
the coupling studs.
Consolboard Inc. v. MacMillan Bloedel (Saskatchewan) Ltd., [1981] 1 S.C.R. 504 at 520 citing
Thorson P. in Minerals Separation North American Corporation v. Noranda Mines, Limited,
[1947] Ex. C.R. 306.
Judicial Consideration of Lego’s Claims for Post-Patent Monopoly Rights
77.
As noted by the majority below, Lego has sought to stop rival toy makers from selling look-
alike toy bricks utilizing the coupling studs. The judicial response to Lego’s use of non-patent
rights to extend its rights in toy bricks is exemplified by the Privy Council (on appeal from a Hong
Kong decision):
“… the simple but ingenious invention by Mr. Page of interlocking toy bricks was more
than adequately rewarded by patents which expired in 1954 and 1959. Unfortunately,
Lego obtained further protection for what was basically the same invention by patents
and designs which expired in 1975.”
“… other manufacturers of toys can now effectively compete with Lego only by
manufacturing interlocking bricks which interlock with the products of Lego and which
must, therefore, conform with the basic shapes and dimensions of those products.”
“… the House of Lords drew attention to the undesirable practice of seeking to expand
the boundaries of intellectual property rights beyond the purposes for which they were
created in order to obtain an unintended and undeserving monopoly. These proceedings
are a further illustration of that undesirable practice.”
Interlego AG v. Tyco Industries Inc., [1989] 1 A.C. 217 at 255-6 (P.C.).
See also the Canadian interlocutory decision involving Tyco bricks: Interlego AG v. Irwin
Toy Ltd. (1985), 3 C.P.R. 476 (F.C.T.D.).
78.
In 1987, a U.S. Court refused to allow Lego’s trade-mark claim based on its toy brick
configuration to stop competition with Lego. Lego’s trade-mark claim was refused as the toy
brick was held to be wholly functional.
Tyco Industries Inc. v. Lego Systems, Inc., 5 U.S.P.Q. 2d 1023 at 1039 (D.N.J. 1987), aff’d, 853
F.2d 921 (3d Cir.), cert. denied, 488 US 955 (1988).
79.
In the United Kingdom, on appeal from the Registrar’s refusal to register the Lego basic
brick as a trade-mark, Neuberger, J. (as he then was) held:
26
“In all the circumstances, it seems to me … that Interlego are not so much seeking to
protect a mark on an item of commerce, but are attempting to protect the item of
commerce as such.”
“In other words, they are not so much seeking a permanent monopoly in their mark, but
more a permanent monopoly in their bricks. This is, at least in general, contrary to
principle and objectionable in practice.”
“A trade mark is, after all, the mark which enables the public to identify the source or
origin of the article so marked. The function of the trade mark legislation is not to enable
the manufacturer of the article to have a monopoly in the article itself.”
Interlego AG’s Trade Mark Applications, [1998] R.P.C. 69 at 110 (H.C.J. - Ch. Div.).
80.
Also in the United Kingdom, Lego asserted copyright in the brick after industrial design
registrations had expired. Whitford, J. admonished Lego during trial:
“I am bound to say that I find your case immensely unattractive. You are in this position.
You started off with a comfortable monopoly under the patent, that went, and then you
protected your interests by registering designs and then when the designs all start to
expire, you say ‘Oh well, we have a brilliant idea, they were all a lot of nonsense and
now we can get another 50 years’. I am bound to say that this is an approach which I do
not find terribly attractive.”
Transcript from InterLego A.G. v. Alex Folley (VIC) Pty Ltd., page 33 of the
Third Day per Whitford, J., Trial Exhibit D-135, App. Record, Vol. VIII,
pp. 1341-1359.
81.
Lego and Mega Bloks have had trade-mark disputes elsewhere that relate to the
functional features of the toy brick. In Europe, disputes which have gone before the courts have
taken place in France, Greece, Belgium, Portugal, and Spain. In each one of these proceedings,
the court has refused to recognize trade-mark rights in the functional coupling studs (or in the
brick with the coupling studs).
Bertrand Examination-in-Chief, Resp. Record, Vol. II, pp. 379-380.
NO PASSING OFF
82.
Even if its functionality does not preclude the coupling studs from being considered to be
a trade-mark for the purposes of s.7(b), the Trial Judge nevertheless held that Mega Bloks’
conduct did not constitute passing off under s.7(b). There was no reviewable error.
No Distinctiveness in Lego’s Coupling Studs
83.
To succeed in a passing off action, a party must first,
27
“establish a goodwill or reputation attached to the goods or services which he supplies in the
mind of the purchasing public by association with the identifying “get-up” …, such that the
get-up is recognised by the public as distinctive specifically of the plaintiff’s goods or
services.”
Ciba-Geigy Canada Ltd. v. Apotex Inc., [1992] 3 S.C.R. 120 at 132 (emphasis added).
“This concept is embodied in s.13 of the Trade Marks Act which now provides that
registration of a distinguishing guise can only be obtained upon proof of acquired
distinctiveness. This principle is sometimes overlooked but it is a necessary adjunct, not
only for registration, but for success, without registration, in a passing off action.”
H.G. Fox, Canadian Law of Trade-marks and Unfair Competition, 3rd ed. (Toronto: Carswell,
1972) at 554 (emphasis added).
See also Gunnard v. Regal Home Products (1986) 13 C.P.R. (3d) 335 at 341-342 (Ont. H.C.J.).
84.
On this point the Trial Judge found that the coupling studs contribute to Lego’s goodwill
(in his words, the goodwill “derives” from the coupling studs), although it was held to be
“impossible” to quantify that contribution.
Trial Reasons, App. Record, Vol. I, para. 118, pp. 59-60.
85.
The formulation of the Trial Judge, that the goodwill of Lego “derives in whole or in
part” from the coupling studs, is consistent with the view of the studs as a functional product
feature. However, it is inconsistent with Lego’s argument that the studs are a trade-mark: a
functional feature will contribute to the goodwill; in contrast, a trade-mark does nothing to
contribute to goodwill, rather it symbolizes that goodwill.
86.
The approach of the Trial Judge also ignores a “fundamental requirement” identified by
this Court on the issue of distinctiveness in trade-dress passing off cases: imitation of a ‘unique
or distinctive dress’ recognized by the buying public. Without distinctiveness, a product design
is “fair game for any competitor”.
Oxford Pendaflex Canada Ltd. v. Korr Marketing Ltd., [1982] 1 S.C.R. 494 at 504, 506. See
also J.B. Williams Company v. H. Bronnley & Co. Ltd., [1909] 26 R.P.C. 765 at 771 (C.A.),
and Eldon Industries Inc. v. Reliable Toy Co. (1965), 48 C.P.R. 109 at 122 (Ont. C.A.).
Consumers Distributing Co. v. Seiko Time Canada Ltd., [1984] 1 S.C.R. 583 at 609.
87.
In this case, Lego did not meet its onus of positively establishing that the coupling studs
are used by the public to actually distinguish its wares from the wares of others. It is not enough
to show that there is goodwill in the LEGO brand as a whole, including the well-known LEGO
word mark, and then conclude, without more, that part of this goodwill is “derived” from the
coupling studs. In its Factum, Lego attempts to support its argument on goodwill and
28
distinctiveness by citing Dr. Light, the most authoritative marketing expert at trial, called by
Mega Bloks and relied upon by the Trial Judge. Dr. Light acknowledged that the company Lego
has significant reputation. However, he disagreed that as a result consumers consider the
coupling studs to be distinctive of Lego. Further, the Trial Judge cited with approval the
evidence of Mega Bloks witnesses Dr. Ford and Dr. Tarr, who both indicated that the coupling
studs were not distinctive (Dr. Ford provided the “most impressive of the survey evidence”).
Trial Reasons, App. Record, Vol. I, paras. 84-86, p. 46; paras. 109-117, pp. 56-59.
Light Expert Statement, App. Record, Vol. VI, para. 36, p. 903.
88.
A distinctive mark has a role in the market such that “any member of the public would
rely upon the appearance alone to identify the goods.” There is a real difference between mere
product recognition (a Lego brick) and distinctiveness (looking to the coupling studs to
differentiate one packaged set of toy bricks from another).
Unilever PLC’s Trade-mark Applications, [2003] R.P.C. 35 651 at 662 (High Ct. J. - Ch. Div.).
C. Wadlow, The Law of Passing Off, 3rd ed. (London: Sweet & Maxwell, 2004) at 668-669.
See also, C. Wadlow, “Passing Off Enters the Supermarket Age Reckitt & Colman Products
Ltd. v. Borden Inc.,” [1990] 3 E.I.P.R. 104 at 105.
Lego’s Admission Means that the Coupling Studs are “Common to Trade”
89.
The distinctiveness issue is effectively resolved by considering Lego’s express statement
that the coupling studs are available to all competitors. Both Mega Bloks and other competitors
(see, for example Rokenbok) are according to Lego entitled to use the coupling studs exactly as
defined by the so-called Lego Indicia.
Appellant’s Factum, para. 5, p. 1.
Geyer Cross-Examination, Resp. Record, Vol. II, pp. 268-270.
90.
However, as stated by Wadlow, if “two unconnected businesses in competition with one
another already use the same mark on a substantial scale then that mark, on its own, can hardly
be distinctive of either of them.”
C. Wadlow, The Law of Passing Off, 2nd ed. (London: Sweet & Maxwell, 1995), at 363.
See also, Moore Dry Kiln Co. of Canada Ltd. v. U.S. Natural Resources Inc. (1976), 30 C.P.R.
(2d) 40 at 49 (F.C.A.).
Roche Products Ltd. v. Berk Pharmaceuticals Ltd., [1973] R.P.C. 473 at 482 (C.A.).
91.
Lego asserts that the coupling studs may be used by anyone. However:
29
“… 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.”
“… it must be shown that the mark has become known to consumers as originating from
one particular source.”
United Artists Corp. v. Pink Panther Beauty Corp. (1998), 80 C.P.R. (3d) 247 at 258, 259
(F.C.A.) (emphasis added).
92.
The inevitable conclusion is that the coupling studs are not distinctive because Lego
expressly permits their use by competitors. This is also consistent with the role of coupling studs
as a “table stakes” feature and with the fact that numerous competitors have used the coupling
stud feature. The coupling studs are therefore “common to the trade” and not distinctive.
Without a finding of distinctiveness, a passing off action must fail. Although the Trial Judge
could have disposed of the passing off allegation on the basis of a lack of distinctiveness, he
went on to correctly dismiss the allegation on the basis that there was no actionable
misrepresentation by Mega Bloks.
No Misrepresentation by Mega Bloks
93.
The finding at trial of no misrepresentation by Mega Bloks is also fatal to the passing off
action. There was no error of law on this point and Lego does not challenge the finding of fact
that the Trial Judge relied on to conclude that the required element of misrepresentation in
passing off was not proven by Lego. There was no reviewable error.
94.
The Trial Judge correctly identified misrepresentation as one of the required elements of
the tort of passing off. Contrary to Lego’s argument in this Court, the Trial Judge did not err in
law by looking only to the intention of Mega Bloks to determine whether there was
misrepresentation. He looked beyond intention to Mega Bloks’ actual conduct and activities.
Consumers Distributing Co. v. Seiko Time Canada Ltd., [1984] 1 S.C.R. 583 at 597 citing
R.F.V. Heuston, Salmond on Torts (London: Sweet & Maxwell, 1977) at 400-401.
95.
The Trial Judge did discuss the intention of Mega Bloks, but only because intention was a
key part of Lego’s own unsuccessful argument that Mega Bloks was a using a deliberate strategy
to confuse (remnants of this rejected argument have reappeared at para. 47 of Lego’s Factum in
this appeal). In considering Lego’s argument of intention to confuse, the Trial Judge rejected the
30
suggestions made by Lego’s marketing witness, Mr. Geyer, and concluded that there was no
deliberate strategy to confuse. As his Reasons show, the Trial Judge made two separate findings:
(i)
There was no deliberate strategy to confuse; and
(ii)
Confusion in the marketplace did not result from a misrepresentation.
This latter finding is discussed below.
Trial Reasons, App. Record, Vol. I, paras. 141-145, pp. 70-73.
96.
The Trial Judge did not find any misrepresentation or confusion resulting from the way
that the products of Mega Bloks were packaged or marketed. The mere finding that there was
confusion due to the use of the coupling studs is insufficient to meet the test of
misrepresentation. More is needed. In particular, the confusion has to amount to a falsehood or
a deception of the public due to a misrepresentation. Here, the confusion resulted from Mega
Bloks’ use of purely utilitarian or functional features (in other words, the product or article itself)
rather than from a misrepresentation calculated to deceive the public.
S. Jolliffe, “The Common Law Doctrine of Passing Off” in G.F. Henderson, ed., TradeMarks Law of Canada (Toronto: Carswell, 1993) 197 at 217.
Trial Reasons, App. Record, Vol. I, paras. 142, 144, 145, p.68.
Hodgkinson & Corby Ltd. v. Wards Mobility Services Limited, [1994] F.S.R. 169 at 178-180
(Ch. D.), citing Reckitt & Colman Products Ltd. v. Borden Inc. & ORS, [1990] R.P.C. 341 (HL)
at 425.
Reckitt & Colman Products Limited v. Borden Inc. & ORS, [1990] R.P.C. 341 at 412 (H.L.).
97.
The Trial Judge, citing Reckitt & Colman and Ciba Geigy, appreciated that for confusion
to be actionable, there must be a misrepresentation that the wares are those of another. In other
words:
“The essence of the tort is not in the mere copying of the plaintiff’s goods or symbols; it
lies in the representation by the copier that its goods are those of the plaintiff.”
S. Jolliffe, “The Common Law Doctrine of Passing Off” in G.F. Henderson, ed., TradeMarks Law of Canada (Toronto: Carswell, 1993) 197 at 217. See also Renwal Manufacturing
Co. Inc. v. Reliable Toy Co. (1949), 9 C.P.R. 67 at 96 (Ex. Ct.), Ciba-Geigy Canada Ltd. v.
Apotex Inc.,[1992] 3 S.C.R. 120 at 132.
Trial Reasons, App. Record, Vol. I, paras. 77-78, p. 42.
98.
There is no passing off if a trader copies, even precisely, the appearance of features or
goods that are valued for functional or practical reasons rather than for an indication of source:
31
“there must be something more than mere similarity between the goods themselves to amount to
a representation constituting passing off.”
Benchairs Limited v. Chair Center Limited, [1974] R.P.C. 429 at 436 (High Ct. Justice– Ch.
Div.).
Sport Maska Inc. v. Canstar Sports Group Inc. (1994), 57 C.P.R. (3d) 323 at 343 (Que. S.C.).
citing J.B. Williams Co. v. H. Bronnley & Co. , [1909] 26 R.P.C. 765 (C.A.).
Kun Shoulder Rest Inc. v. Joseph Kun Violin and Bow Maker Inc. (1998), 83 C.P.R. (3d) 331
at 345-6 (F.C.T.D.).
Reckitt & Colman Products Limited. v. Borden Inc. & ORS, [1990] R.P.C. 341 at 418 (HL).
99.
There are no reported cases where a defendant has been found to be passing off solely by
utilizing functional features of a plaintiff’s product. The closest case to which Lego can point
(Edge v. Niccolls) is a nineteenth century British decision that was later considered by the Privy
Council to be “peculiar” and to involve a functional feature that was not part of the wares
themselves but was “in effect part of the get up” (packaging) of the goods. The Canadian
counterpart in this respect is Pizza Pizza where trade-mark rights in a functional feature not part
of the wares (permitted) were contrasted with trade-mark rights in the functional aspects of the
wares themselves (not permitted).
Canadian Shredded Wheat Co. Ltd. v. Kellogg Co. of Canada Ltd. [1938] 1 All
E.R. 618 at 633-634 (P.C.)
Pizza Pizza Ltd. v. Canada (Registrar of Trade Marks) (1989), 26 C.P.R. (3d) 355 at 361
(F.C.A.)
William Edge & Sons Ld. v. William Niccolls & Sons Ld., [1911] R.P.C. 582 at 595 (H.L.).
100.
The view of Pelletier, J. in dissent at the Federal Court of Appeal, was that the Trial
Judge had applied the wrong standard (“deliberate intention to deceive”) and that there was
evidence accepted by the Trial Judge on which a finding of misrepresentation could be made.
With respect, Pelletier, J. did not appear to appreciate that the intentional deception argument
was one advanced by Lego at trial. Further, he misunderstood the factual findings of the Trial
Judge who determined that Mega Bloks could not have avoided the confusion that resulted from
marketing products functionally equivalent to Lego’s.
Reasons of Pelletier, J., App. Record, Vol. I, para. 177, p. 208; para. 182, p. 210.
Trial Reasons, App. Record, Vol. I, paras. 141-144, pp. 70-73.
Geyer Cross-Examination, Resp. Record, Vol. IV, pp. 688-692.
Light Expert Statement, App. Record, Vol. VI, pp. 891-915.
32
101.
The finding of fact of the Trial Judge was that Mega Bloks does not market its toy bricks
as being those of Lego. To the contrary, Mega Bloks has taken deliberate steps to differentiate
its products from those of Lego in the market. Evidence of use of the trade-marks MEGA
BLOKS on goods, in marketing and advertising material, in its television advertising campaigns,
in third-party industry reviews and in compatibility markings on third party products as well as
the fact that Mega Bloks has a well known and identifiable brand, all weigh against a finding of
misrepresentation. “[A] manufacturer … is entitled to display a pictorial representation of his
product in his promotional literature, and he is also entitled to display in pictorial form the
circumstances under which the product can, or is intended to, be used.”
Trial Reasons, App. Record, Vol. I, para. 5 (Nos. 22-28), pp. 9-10; paras. 15-18, p. 14; paras.
144-145, p. 73.
Prairie Maid Cereals Ltd. v. Christie Brown and Company Limited (1966), 48 C.P.R. 289 at 293
(B.C.C.A.).
Renwal Manufacturing Co. Inc. v. Reliable Toy Co. (1949), 9 C.P.R. 67 at 93 (Ex.Ct.).
See also references cited at paragraph 18 above.
102.
Mega Bloks sells toy sets with bricks that say right on them “MEGA BLOKS”. Lego sells
toy sets with bricks that say, on each coupling stud, “LEGO”. Similarly, the respective containers
and packages for both Mega Bloks and for Lego bear those respective word trade-marks. There is a
simple and easy way to figure out the source of any toy set or brick: look at what it says.
103.
The Trial Judge correctly held that the mere use by Mega Bloks of the purely functional
features of the coupling studs does not amount to a misrepresentation. Mega Bloks is not “telling a
falsehood” and the public is not deceived by Mega Bloks’s conduct into thinking that the MICRO
MEGA BLOKS products are those of Lego. As a result, the Trial Judge was correct in his finding
that Mega Bloks’ sales of its toys did not breach s.7(b). There was nothing Mega Bloks could have
done to eliminate whatever confusion did occur. In the market there is “very little room, if any, for
a competitor … adopting the purely utilitarian or functional features of the LEGO brick …to
distinguish its MICRO MEGA BLOKS from LEGO’s construction bricks.”
Trial Reasons, App. Record, Vol. I, paras. 142-144, p. 73.
CONCLUSION – NO TRADE-MARK RIGHTS IN THE COUPLING STUDS
104.
Lego has, globally, sought to stop all competitors. The Trial Judge found Lego to be “very
aggressive” in asserting intellectual property rights and Mega Bloks to have merely used a utilitarian
33
feature necessary for competition. The Federal Court of Appeal noted that “the Appellants are
attempting to extend the monopoly they once held over these construction bricks and their knobs
through the guise of a trade-mark,” and went on to say that “if facts are needed to justify applying
the policy behind the doctrine of functionality, they are certainly present in this case.” J. Philips in
“An Empire Built of Brick: A Brief Appraisal” succinctly describes the situation which Lego must
now accept:
“Now that Lego’s original patents have expired and, in a number of jurisdictions, design
or copyright protection is lacking or cannot be utilized, Lego will find it increasingly
difficult, and in the end impossible, to prevent rival manufacturers making look-alike
bricks with similar interlocking systems….rights in the bricks themselves are all too
ephemeral.”
Trial Reasons, App. Record, Vol. I, para. 13, p. 13; para. 144, p. 73; para. 153, p. 77.
Appeal Reasons, App. Record, Vol. I, para. 90, p. 168; para. 93, p. 171.
J. Phillips, “An Empire Built of Brick: A Brief Appraisal”, [1987] 12 E.I.P.R. 363 at 366
(emphasis added).
SECTION 7(B) IS NOT WITHIN THE LEGISLATIVE COMPETENCE OF THE PARLIAMENT OF
CANADA
105.
Because the Trade-marks Act is not aimed at the registration of trade-marks in
interprovincial or international trade, but is also intended to apply to registrable trade-marks that are
purely local or intraprovincial, it is the so-called "second branch" of s. 91(2) – the "general
regulation of trade affecting the whole dominion" – that has emerged as the constitutional
foundation for federal trade-marks legislation.
Constitutional Act, 1867 (U.K.), 30 & 31 Vict., c. 3, reprinted in R.S.C. 1985,
App. II, No. 5, s. 91
The Analytical Framework
106.
In GM v. City National Leasing, this Court set out the following analytical framework for
deciding whether an impugned civil remedy provision that otherwise falls within provincial
jurisdiction can nonetheless be upheld as a legitimate exercise of the "second branch" of the federal
trade and commerce power. The four questions comprising this framework, as set out below, have
been adapted to refer to the legislation at issue herein:
(1) Is the impugned civil remedy provision, s. 7(b), standing alone and separate
apart from the Trade-marks Act, ultra vires the federal government?
and
(2) Is the Trade-marks Act itself a valid exercise of Parliament's jurisdiction under the
second branch of section 91(2)?
34
(3) How serious is the encroachment on provincial jurisdiction and what is the appropriate
integration test – if it is only a marginal intrusion, then the test is whether there is a
"rational connection" between s. 7(b) and the federal Trade-marks Act; if it is a
substantial intrusion, then the test is whether s. 7(b) is "truly necessary" or "essential" to
the operation of the federal Act.
(4) Is s. 7(b) "truly necessary" to the operation of the trade marks registration scheme in the
Trade-marks Act?
General Motors of Canada Limited v. City National Leasing, [1989] 1 S.C.R.
641 at 666 and 672.
Constitutional Act, 1867 (U.K.), 30 & 31 Vict., c. 3, reprinted in R.S.C. 1985,
App. II, No. 5, ss. 91 and 92
Step 1: Section 7(b) Standing Alone
107.
Section 7(b) standing alone, and separate and apart from the Trade-marks Act, is a civil
remedy provision that, in essence, codifies the common law tort of passing off. This Court has held
that the creation of a general civil cause of action is a matter that falls within exclusive provincial
jurisdiction and that s. 7, standing alone, is "a clear invasion of provincial legislative power." It is
beyond dispute that, as Laskin C.J.C. noted in Vapor, s. 7(b), separate and apart from the Trademarks Act, would be ultra vires the federal government.
MacDonald v. Vapor Canada Ltd., [1977] 2 S.C.R. 134, at 147 and 172.
General Motors of Canada Limited v. City National Leasing, [1989] 1 S.C.R. 641 at 672.
Step 2: The Validity of the Federal Trade-marks Act
108.
In order for a federal law to be upheld as a valid exercise of the "second branch" of the
federal trade and commerce power, this Court has required that the following criteria be satisfied:
(1) the federal legislation must contain a general regulatory scheme; (2) the regulatory scheme must
operate under the oversight of a federal agency; (3) the federal legislation must be concerned with
trade as a whole rather than with trade in a particular industry; (4) the federal legislation must be of
a nature that the provinces jointly or severally would be constitutionally incapable of enacting; and
(5) the failure to include one or more provinces in the federal regulatory scheme would jeopardize
the successful operation of the scheme in other parts of the country.
General Motors of Canada Limited v. City National Leasing, [1989] 1 S.C.R. 641 at 661-662.
109.
The provisions of the Trade-marks Act regarding the registration and enforcement of
registered trade-mark rights, including forms of public oversight and control, satisfy the definition
of a regulatory scheme as set out in the case law. Trade-mark examiners appointed by the Registrar
35
investigate and report on whether a trade-mark is registrable (s. 37(1)). An application deemed
registrable is then advertised in the Trade-marks Journal (ss. 37 and 38). If a third party opposes an
application, an Opposition Board considers submissions and makes a decision on registrability (s.
38). The Registrar maintains a public Register of trade-marks and an index of marks (ss. 26-28). In
contrast, there are no corresponding provisions in the Trade-marks Act relating to unregistered
trade-marks.
Trade-marks Act, R.S.C. 1985, c. T-13.
MacDonald v. Vapor Canada Ltd., [1977] 2 S.C.R. 134, at 158.
110.
The key feature that anchors the Act in federal jurisdiction is the establishment of a
regulatory scheme – a national trade-mark registration system operating under the oversight of the
Registrar of Trade-marks.
D. Vaver, “Canada’s Intellectual Property Framework: A Comparative Overview”, 17 I.P.J.
125 at 127 (“In Canada, Parliament can legislate for registered marks under its power to
regulate trade and commerce, while provinces may protect peripheral IP such as
unregistered marks and trade secrets under provincial laws, the common law or the law of
delict.”)
Canada, The Report of the Trade Mark Law Revision Committee, (Ottawa: Queen’s Printer,
1953) (Chairman: Harold G. Fox), pp.36-37 (“The essential function of a trade mark statute
is to provide a system of registration for trade marks….”)
Bell and Probert, “The Constitutionality of Canadian Trade Mark Law” (1986) 4 C.P.R.
(3d) 305 at 310 and 313 (“[T]he regulatory portions of the Act comprise a scheme
supportable under the trade and commerce power, so that there should be no dispute as to
the validity of the provisions of the Act relating to registration of trade marks, the
enforcement of rights in registered marks, and also the provisions relating to registered
user.”)
Step 3: The Extent of Encroachment and the Appropriate Integration Test
111.
If an impugned federal provision only encroaches marginally on provincial powers, then a
"rational" or "functional" relationship (with a federal Act) may be sufficient to justify the provision.
However, if the impugned provision is highly intrusive vis à vis provincial powers, then a stricter
test such as "truly necessary", "integral" or "essential" is appropriate.
General Motors of Canada Limited v. City National Leasing, [1989] 1 S.C.R.
641 at 671 and 669.
112.
Section 7(b) is not a "marginal" encroachment on provincial jurisdiction. As this Court has
noted, "the creation of civil actions is generally a matter within provincial jurisdiction under section
92(13) of the Constitution Act. “This is an "important" and "significant" power "that is not lightly
encroached upon." Section 7(b) standing alone is a "clear invasion of provincial legislative power."
36
The appropriate test to measure the "degree of fit" with the federal Act is therefore the stricter test –
namely, whether s. 7(b) is "truly necessary" or "essential" or "integral" (which means "necessary to
the completeness of the whole") to the regulatory scheme set out in the Trade-marks Act.
General Motors of Canada Limited v. City National Leasing, [1989] 1 S.C.R.
641 at 672 and 683.
MacDonald v. Vapor Canada Ltd., [1977] 2 S.C.R. 134 at 172.
K. Barber, ed. The Canadian Oxford Dictionary (Toronto: Oxford University, Press, 1998), at
732.
113.
This Court has not hesitated to strike down federal civil remedy, or other, impugned
provisions when they were found not to be "necessary" or "integral" to federal jurisdiction, for
example, over the establishment of additional courts, the regulation of fisheries, juvenile
delinquency, or the operation of railways.
The Queen v. Thomas Fuller Construction Co., [1980] 1 S.C.R. 695 at 713.
Fowler v. The Queen, [1980] 2 S.C.R. 213 at 226.
Regional Municipality of Peel v. Mackenzie and Viking Homes et al, [1982] 2 S.C.R. 9 at 19
and 22.
Clark v. C.N.R., [1988] 2 S.C.R. 680 at 708.
114.
The appropriate test to measure the "degree of fit" between s. 7(b) and the regulatory
scheme in the federal Trade-marks Act is not whether the former is "rationally or functionally
connected" to the latter, or whether it "rounds out" the federal registration scheme, but whether it is
"truly necessary" or "essential" to the effective exercise of the federal government's legislative
authority to establish a national trade-mark registration scheme.
Step 4: Is Section 7(b) "Truly Necessary" to the Regulatory Scheme in the Trade-Marks Act?
115.
Previous decisions upholding the validity of s. 7(b) have not correctly applied the truly
necessary standard. It is important to note that the "degree of fit" is between the impugned
provision and the regulatory scheme contained in the Act, and not just between the provision and
the overall statute. MacGuigan J. erred in Asbjorn Horgard when he upheld s. 7(b) on the ground
that it "rounds out" or has a "rational and functional connection" to Parliament's "statutory scheme
of protection of all trade marks" registered or unregistered. With respect, MacGuigan J. asked the
wrong question. The question is whether s. 7(b) is truly necessary to a regulatory scheme that
grounds federal trade-mark legislation in the general regulation of trade power. In constitutional
terms, the only regulatory scheme in the Trade-marks Act is the scheme governing registered trade-
37
marks.
Asbjorn Horgard A/S v. Gibbs/Nortac Industries Ltd. (1987), 14 C.P.R. (3d) 314 at 328
(F.C.A.) (emphasis added).
Richard, De la constitutionallitė de l’alinėa 7(b) de la Loi sur les marques de commerce, (19881989) 1 Les Cahiers de propriėtė intellectuelle 229 at 236-237.
116.
The general civil remedy provision of s. 7(b) has no necessary or functional connection to
the registered trade-mark scheme. It codifies common law and civil law delictual responsibility for
passing off and is not limited to – or even connected with – the enforcement of the registration
scheme in the Trade-marks Act. The civil action in s. 7(b), contrary to Lego’s submissions, offers
no protection to the holders of registered trade-marks that is not already available through actions
for infringement of registered trade-marks.
Trade-marks Act, R.S.C. 1985, c. T-13, ss. 19, 20, 53.
MacDonald v. Vapor Canada Ltd. [1977] 2 S.C.R. 134 at 156.
Also see S.C. Johnson and Son Ltd. v. Marketing International Ltd. (1977), 32 C.P.R. (2d) 15
at 31 (F.C.T.D.).
Bereskin, “The Trade Marks Act and the Constitution”, (1982) 12(8) Patent and Trademark
Institute of Canada Bulletin 687 at 697: "It is evident that the sections relating to Unfair
Competition have no substantial connection with the remainder of the Act…"
117.
Strayer J. in Royal Doulton and MacGuigan J. in Asbjorn Horgard erred when they found
that the interpretive rules in ss. 2 to 6 and the provisions regarding unfair competition and prohibited
marks in ss. 7 to 11 are sufficient to constitute a "regulatory scheme" for unregistered trade-marks.
They failed to measure these statutory provisions against the distinct and restricted definition of a
regulatory scheme that has been established in the decisions of this Court.
Royal Doulton Tableware Ltd. et al. v. Cassidy's Ltd., [1986] 1 F.C. 357 at 374 (F.C.T.D.).
Asbjorn Horgard A/S v. Gibbs/Nortac Industries Ltd. (1987), 14 C.P.R. (3d) 314 at 328 (F.C.A.).
118.
In City National Leasing, Dickson J., as he then was, found that the civil remedy provision
in the Combines Investigation Act was "intimately linked" to the regulatory scheme of the Act. He
emphasized two features of the civil remedy: it was not the exclusive means of enforcing the
prohibitions in the Act, and it was “carefully bounded by the parameters of the Combines
Investigation Act. It provides a private remedy only for particular violations of the Act and does not
create a private right of action at large.”
General Motors of Canada Limited v. City National Leasing, [1989] 1 S.C.R.
641 at 684.
119.
These features are conspicuously absent from s. 7(b) of the Trade-marks Act. Sections 7(b)
38
and 53(2) together create a private civil action "at large" for which there is no public oversight nor
public enforcement whatsoever. Section 7(b), in conjunction with the s. 53(2) remedy, is not
bounded by the parameters of the regulatory scheme set out in the Trade-marks Act. On the
contrary, it is designed to move beyond those parameters into the realm of provincially-regulated
unregistered trade-marks.
120.
If Parliament could invade provincial jurisdiction over civil rights by the simple device of
statutory codification of tort rights in national legislation, as it has with s. 7(b), working in
conjunction with s. 53(2), the federal balance of legislative powers would be seriously threatened.
The provinces' ability to develop their own approaches to civil remedies – including Québec's
ability to preserve and promote its distinct civil law tradition – would always be potentially
subordinated, through the operation of the federal paramountcy rule, to national definitions of
statutory torts.
121.
The legislative history of s. 7(b) also supports the view that it is neither necessary nor
functionally related to the trade-mark registration scheme in the Act. Under the trade-marks statutes
from 1868 to 1953, a civil action could be invoked only to prevent the unauthorized use of
registered trade-marks.
Trade Mark and Design Act, 1868, 31 Vict., c. 55.
Trade Mark and Design Act, R.S. 1927, c. 71, s. 20.
Unfair Competition Act, 1932 22-23 George V, c.38, s. 4(4).
122.
Although there was no civil remedy provided, the 1932 Unfair Competition Act included s.
11 that extended the federal legislation beyond the use of registered trade-marks for the first time.
However, Parliament's purpose in enacting s. 11 was not to bolster or otherwise support the existing
regulatory scheme for registered trade-marks.
Unfair Competition Act, 1932 22-23 George V, c. 38, s. 11.
Harold G. Fox, The Canadian Law of Trade Marks and Industrial Designs (Toronto:
University of Toronto Press, 1940) at 291.
Stephen P. Ladas, “New Trade-Mark and Unfair Competition Law in Canada” (1932) 27
Bulletin of the United States Trade-Mark Association 187 at 213.
123.
The unfair competition Bill in 1932 was seen as being necessary to resolve "grave doubts
cast upon the constitutional validity of our present Trade Marks Act". Two Privy Council opinions
in 1932 suggested that Parliament possessed a power to enact legislation implementing Canada's
39
international treaties and conventions (a suggestion denied in the Labour Conventions case of
1937). Relying on such a federal treaty power, the Minister who introduced the unfair competition
Bill in 1932 said that it would be constitutionally valid because it “expressly states that it is for the
enforcement of an international convention” (the International Convention for the Protection of
Industrial Property).
Paris Convention for the Protection of Industrial Property, 20 March 1883, online: World
Intellectual Property Organization homepage, http://
www.wipo.int/clea/docs/en/wo/wo020en.htm. Article 10 bis.
W.P.M. Kennedy, “Is the Canadian Legislation on Trade Marks Ultra Vires?” (1930) 8 Can.
Bar Rev. 711 (expressing doubts about the constitutional validity of the Trade Mark and
Design Act).
Canada, Debates House of Commons, Third Session – Seventeeth Parliament 22-23 George
V., Volume I 1932 (February 8, 1932) at 11-12; February 12, 1932) at 162-163; Volume III,
1932 (May 2, 1932) at 2541-2542.
Canada, Debates of The Senate of the Dominion of Canada, Third Session – Seventeeth
Parliament 22-23 George V (May 10, 1932) at 418-419.
Reference re Regulation and Control of Aeronautics in Canada, [1932] A.C. 54 at 73, 74 and
76 (P.C.).
Reference re Regulation and Control of Radio Communication in Canada, [1932] A.C. 304 at
311 and 313 (P.C.).
Constitutional Act, 1867 (U.K.), 30 & 31 Vict., c. 3, reprinted in R.S.C. 1985, App. II, No. 5, s.
132
A.G. Canada v. A.G. Ontario (Labour Conventions), [1937] A.C. 326 at 349-350 (P.C.).
124.
Section 7 of the current Trade-marks Act extended the prohibitions on unfair competition
previously set out in s. 11 of the 1932 Act. After the Labour Conventions ruling, and several court
rulings suggesting in obiter dicta that Parliament had jurisdiction over a trade-mark registration
scheme pursuant to s. 91(2), the presumed constitutional basis for the Act shifted from Parliament's
treaty power to its jurisdiction in relation to trade and commerce. Yet this shift left s. 7(b), a
statutory civil rights provision unconnected to the registration scheme, bereft of a constitutional
mooring.
Good Humor Corporation of America v. Good Humor Food Products Ltd., [1937] Ex. C.R. 61.
Attorney-General for Ontario v. Ontario General for Canada, [1937] A.C. 405 at 417 (P.C.).
Constitutional Act, 1867 (U.K.), 30 & 31 Vict., c. 3, reprinted in R.S.C. 1985, App. II, No. 5,
ss. 91 and 132
125.
In its Report to Parliament, the Committee responsible for drafting the current Act made no
connection between s. 7(b) and the trade-mark registration scheme. Rather, the authors saw s. 7(b),
like s. 11(b) before it, as an extension of the federal government's policy against unfair competition
40
into new terrain.
Canada, Report of the Trade Mark Law Revision Committee (Ottawa: Queen’s Printer, 1953)
(Chairman: Harold G. Fox) at 37.
126.
Section 7(b) found itself in the federal Trade-marks Act not because it was necessary for the
operation of the trade-mark registration scheme but because of a well-intentioned but misguided
legislative effort to shelter the Unfair Competition provisions under a convenient canopy after the
federal treaty-making power was found wanting. Section 7(b) is nothing more than a federal
codification of the common and civil law tort of passing off. It is a serious encroachment on
provincial jurisdiction. It is not linked or connected in any way to the trade-mark registration
scheme in the federal Act. And it is being used in this case by Lego even though the trade-mark in
question, the coupling studs, is not even enforceable as a registered trade-mark under the federal
Act.
127.
For all of these reasons, s. 7(b) of the Trade-marks Act is not within the legislative
competence of the Parliament of Canada under s. 91(2) of the Constitution Act.
PARTS IV AND V – COSTS AND ORDER SOUGHT
128.
The Respondent requests that this appeal be dismissed, with costs.
ALL OF WHICH IS RESPECTFULLY SUBMITTED
THIS 24th DAY OF DECEMBER, 2004
Ronald E. Dimock,
Counsel
______________________________
Bruce W. Stratton,
Counsel
______________________________
Henry Lue,
Counsel
41
PART VI – TABLE OF AUTHORITIES
AUTHORITIES
Paragraph Numbers
Where Cited
A.G. Canada v. A.G. Ontario (Labour Conventions), [1937] A.C. 326
(P.C.).
123
Apotex Inc. v. Wellcome Foundation Ltd., [2002] 4 S.C.R. 153.
73, 74
Asbjorn Horgard A/S v. Gibbs/Nortac Industries Ltd. (1987), 14
C.P.R. (3d) 314 (F.C.A.).
66, 115, 117
Astra Zeneca AB v. Novopharm Ltd. (2003), 24 C.P.R. (4th) 326
(F.C.A.).
35
Attorney-General for Ontario v. Ontario General for Canada, [1937]
A.C. 405 (P.C.).
124
K. Barber, ed., The Canadian Oxford Dictionary (Toronto: Oxford
University Press, 1998).
112
Bell and Probert, "The Constitutionality of Canadian Trade Mark
Law" (1986) 4 C.P.R. 3d 305.
110
Bell ExpressVu Limited Partnership v. Rex, [2002] 2 S.C.R. 559.
59
Benchairs Limited v. Chair Center Limited, [1974] R.P.C. 429 (High
C.J. – Ch. D.).
98
D. Bereskin, "The Trade Marks Act and the Constitution", (1982)
12(8) Patent and Trademark Institute of Canada Bulletin 687.
116
Cadbury Schweppes Inc. v. FBI Foods Ltd., [1999] 1 S.C.R. 142.
74
Canadian Shredded Wheat Co. Ltd. v. Kellogg Co. of Canada Ltd.,
[1938] 1 All E.R. 618 (P.C.).
69, 70, 99
CCH Canadian Limited v. Law Society of Upper Canada, [2004] 1
S.C.R. 339.
34
Ciba-Geigy Canada Ltd. v. Apotex Inc., [1992] 3 S.C.R. 120 (S.C.C.).
45, 83, 97
Clark v. C.N.R., [1988] 2 S.C.R. 680.
113
Consolboard Inc. v. MacMillan Bloedel (Saskatchewan) Ltd., [1981] 1
S.C.R. 504.
74, 76
42
Consumers Distributing Co. v. Seiko Time Canada Ltd., [1984] 1
S.C.R. 583.
68, 86, 94
R. Cross and J.W. Harris, Precedent in English Law (Oxford:
Clarendon, 1991).
57
Canada, Debates House of Commons, Third Session – Seventeeth
Parliament 22-23 George V, Volume I, 1932 (February 8, 1932) at 1112; (February 12, 1932) at 162-163.
123
Canada, Debates House of Commons, Third Session – Seventeeth
Parliament 22-23 George V, Volume III, 1932 (May 2, 1932) at 25412542.
123
Canada, Debates of The Senate of the Dominion of Canada, Third
Session – Seventeeth Parliament 22-23 George V (May 10, 1932) at
418-419.
123
Dumont Vins & Spiritueux Inc. v. Celliers du Monde Inc. (1992), 42
C.P.R. (3d) 197 (F.C.A.).
66
Eldon Industries Inc. v. Reliable Toy Co. (1965), 48 C.P.R. 109 (Ont.
C.A.).
86
Elgin Handles Ltd. v. Welland Vale Manufacturing Co. Ltd. (1964), 43
C.P.R. 20 (Ex. Ct.).
41
Fowler v. The Queen, [1980] 2 S.C.R. 213.
113
H.G. Fox, Canadian Law of Trade-marks and Unfair Competition, 3rd
ed. (Toronto: Carswell, 1972).
34, 35, 83
H.G. Fox, The Canadian Law of Trade Marks and Industrial Designs
(Toronto: University of Toronto Press, 1940).
122
Free World Trust v. Électro Santé Inc., [2000] 2 S.C.R. 1024.
73
General Motors of Canada Limited v. City National Leasing, [1989] 1
S.C.R. 641.
106, 107, 108, 111,
112, 118
K. Gill & R.S. Jolliffe, Fox on Canadian Law of Trade-marks and
Unfair Competition, 4th ed. (Toronto: Carswell, 2002).
35, 45
Good Humor Corporation of America v. Good Humor Food Products
Ltd., [1937] Ex. C.R. 61.
124
Goodyear Tire & Rubber Co. of Canada Ltd. et al. v. T. Eaton Co. Ltd.
61
43
et al., [1956] S.C.R. 610.
Gunnard Co. v. Regal Home Products (1986), 13 C.P.R. (3d) 335
(Ont. H.C.J.).
83
W. L. Hayhurst, “What is a Trade-mark? The Development of Trademark Law” in G.F. Henderson, ed., Trade-marks Law of Canada,
(Toronto: Thomson, 1993) 27.
38
Hodgkinson & Corby Ltd. v. Wards Mobility Services Limited, [1994]
F.S.R. 169 (High C.J. – Ch. D.).
96
Imperial Tobacco Co. v. Registrar of Trade- Marks, [1939] Ex. C.R.
141.
41
Interlego AG et al. v. Irwin Toy Ltd. et al. (1985), 3 C.P.R. (3d) 476
(F.C.T.D.).
77
Interlego A.G. v. Tyco Industries Inc., [1988] 1 A.C. 217 (P.C.).
33, 77
Interlego AG’s Trade Mark Applications, [1998] R.P.C. 69 (High C.J.
– Ch. D.).
79
J.B. Williams Company v. H. Bronnley & Co. Ltd., [1909] 26 R.P.C.
765 (C.A.).
86, 98
S. Jolliffe, “The Common Law Doctrine of Passing Off” in G.F.
Henderson, ed., Trade-Marks Law of Canada (Toronto: Carswell,
1993) 197.
96, 97
W.P.M. Kennedy, “Is the Canadian Legislation on Trade Marks Ultra
Vires?”, (1930) 8 Can. Bar Rev. 711.
123
Paris, 18 October 2000, Kirkbi, Lego A/S & Lego v. Ritvik SARL Toys
Europe SARL, et al., 1999/16118.
Koninklijke Philips Electronics NV v. Remington Consumer Products
Ltd., [2003] R.P.C. 2 (E.C.J.).
44
Kun Shoulder Rest Inc. v. Joseph Kun Violin and Bow Maker Inc.
(1998), 83 C.P.R. (3d) 331 (F.C.T.D.).
98
S.P. Ladas, “New Trade-Mark and Unfair Competition Law in
Canada”, (1932) 27 Bulletin of the United States Trade-Mark
Association 187.
122
MacDonald v. Vapor Canada Ltd., [1977] 2 S.C.R. 134.
66, 107, 109, 112,
44
116
Mega Bloks Inc. v. Kirkbi A/S Office for Harmonization in the Internal
Market (Trade marks and Designs), Cancellation Division, 63 C
1070291/1 (July 30, 2004).
44
Moore Dry Kiln Co. of Canada Ltd. v. U.S. Natural Resources Inc.
(1976), 30 C.P.R. (2d) 40 (F.C.A.).
90
Orkin Exterminating Co. Inc. v. Pestco Co. of Canada Ltd. et. al.
(1985), 50 O.R. (2d) 726.
46
Oxford Pendaflex Canada v. Korr Marketing Ltd. et al., [1982] 1
S.C.R. 494 (S.C.C.).
86
Parke Davis & Co. v. Empire Laboratories Ltd. (1963), C.P.R. 121
(Ex. Ct.).
55, 56, 57
Parke, Davis & Co. v. Empire Laboratories Ltd., [1964] S.C.R. 351.
41, 57, 69
Parke, Davis & Co. v. Empire Laboratories Ltd. (1964), 27 Fox Pat.
C. 67 (S.C.C.)
52
Philips Electronics NV v. Remington Consumer Products Ltd., [1999]
R.P.C. 809 (C.A.).
43
J. Phillips, “An Empire Built of Bricks: A Brief Appraisal of ‘Lego’”,
[1987] 12 E.I.P.R. 363.
104
Pioneer Hi-Bred Ltd. v. Canada (Commissioner of Patents), [1989] 1
S.C.R. 1623.
74
Pizza Pizza Ltd. v. Canada (Registrar of Trade Marks) (1989), 26
C.P.R. (3d) 355 (F.C.A.).
55, 72, 99
Prairie Maid Cereals Ltd. v. Christie Brown and Company Limited
(1966), 48 C.P.R. 289 (B.C.C.A.).
101
Qualitex Co. v. Jacobson Prods. Co., 115 S. Ct. 1300 (U.S.S.C. 1995).
42
The Queen v. Thomas Fuller Construction Co., [1980] 1 S.C.R. 695.
113
Reckitt & Colman Products Limited v. Borden Inc. & ORS, [1990]
R.P.C. 341 (H.L.).
43, 46, 59, 96, 98
Reddaway v. Banham, [1896] 13 R.P.C. 218 (H.L.)
38
45
Reference re Regulation and Control of Aeronautics in Canada,
[1932] A.C. 54 (P.C.).
123
Reference re Regulation and Control of Radio Communication in
Canada, [1932] A.C. 304 (P.C.).
123
Regional Municipality of Peel v. Mackenzie and Viking Homes et al,
[1982] 2 S.C.R. 9.
113
Remington Rand Corp. v. Philips Electronics N.V. (1995), 64 C.P.R.
(3d) 467 (F.C.A.).
41, 53, 55, 72
Renwal Manufacturing Co. Inc. v. Reliable Toy Co. (1949), 9 C.P.R.
67 (Ex.Ct.).
97, 101
Canada, Report of the Trade Mark Law Revision Committee, (Ottawa:
Queen’s Printer, 1953) (Chairman: Harold G. Fox).
48, 110, 125
H.G. Richard, "De la constitutionallité de l'alinéa 7(b) de la Loi sur les
marques de commerce", (1988-89) 1 Les Cahiers de propriété
intellectuelle 229.
115
Roche Products Ltd. v. Berk Pharmaceuticals Ltd., [1973] R.P.C. 473
(C.A.).
90
Royal Doulton Tableware Ltd. et al. v. Cassidy's Ltd., [1986] 1 F.C.
357 (F.C.T.D.).
117
S.C. Johnson and Son Ltd. v. Marketing International Ltd. (1977), 32
C.P.R. (2d) 15 (F.C.T.D.).
116
Sport Maska Inc. v. Canstar Sports Group Inc. (1994), 57 C.P.R. (3d)
323 (Que. S.C.).
98
R. Sullivan, Sullivan and Driedger on the Construction of Statutes, 4th
ed., (Vancouver: Butterworths, 2002).
59
Thomas & Betts, Ltd. v. Panduit Corp. (2000), 4 C.P.R. (4th) 498
(F.C.A.).
41, 46, 57, 71
TrafFix Devices, Inc. v. Marketing Displays, Inc. 121 S. Ct. 1255
(U.S.S.C. 2001).
42
Two Pesos, Inc. v. Taco Cabana Inc. 505 U.S. 763 (1992).
42
Tyco Industries Inc.. v. Lego Systems, Inc., 5 U.S.P.Q. 2d 1023 (D.N.J.
1987), aff’d, 853 F.2d 921 (3d Cir.), cert. denied, 488 US 955 (1988).
78
46
Unilever PLC’s Trade-mark Application [2003]¸ R.P.C. 35 (High C.J.
– Ch. D.) 651.
88
United Artists Corp. v. Pink Panther Beauty Corp. (1998), 80 C.P.R.
(3d) 247 (F.C.A.).
46, 91
D. Vaver, “Canada’s Intellectual Property Framework: A Comparative
Overview”, (2004) 17 I.P.J. 125.
35, 110
D. Vaver, Intellectual Property Law, (Concord: Irwin Law, 1997).
62
C. Wadlow, The Law of Passing Off, 2nd ed. (London: Sweet &
Maxwell, 1995).
90
C. Wadlow, The Law of Passing Off, 3rd ed. (London: Sweet &
Maxwell, 2004).
88
C. Wadlow, “Passing Off Enters the Supermarket Age Reckitt &
Colman Products Ltd. v. Borden Inc.”, [1990] 3 E.I.P.R. 104.
88
Wal-Mart Stores Inc. v. Samara Brothers, Inc., 120
S. Ct. 1339 (2000).
42
Whirlpool Corp. v. Camco Inc., [2000] 2 S.C.R. 1067.
74
William Edge & Sons Ld. v. William Niccolls & Sons Ld., [1911]
R.P.C. 582 (H.L.).
99
47
PART VII – TABLE OF STATUTES, REGULATIONS, ETC.
STATUTES, REGULATIONS
Book of Authorities
Tab
Constitutional Act, 1867 (U.K.), 30 & 31 Vict., c. 3, reprinted in
R.S.C. 1985, App. II, No. 5.
90
Copyright Act, R.S.C. 1985, c-C-42, s. 64.1(1)(a).
91
EC, Council Directive 89/104 EEC of 21 December 1988, to
Approximate the Laws of the member States Relating to Trade Marks,
online: Office for Harmonization in the Internal Market homepage,
http://oami.eu.int/en/mark/aspects/direct/direc.htm.
92
Industrial Design Act, R.S.C. 1985, c. I-9, s. 5.1(a).
93
Lanham Trade Mark Act, 15 U.S.C.A.
94
Paris Convention for the Protection of Industrial Property, 20 March
1883, online: World Intellectual Property Organization homepage,
http://www.wipo.int/clea/docs/en/wo/wo020en.htm, Article 10bis.
95
Patent Act, R.S.C. 1985, c. P-4.
96
Trade Marks and Design Act, 1868, 31 Vict., c. 55.
97
Trade Mark and Design Act, R.S. 1927 c. 71.
98
Trade Marks Act 1994 (U.K.), 1994, c. 26, s. 3(2).
99
Trade-marks Act, R.S.C. 1985, c. T-13.
100
Unfair Competition Act, 1932, 22-23 George V., c. 38.
101