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July 23, 2013

Dim Sum and Trademarks: Would you like fries with that?

by Steven Z. Raber

Canada’s Federal Court released a decision on July 10, 2013, in which McDonald’s Corporation and McDonald’s Restaurants of Canada ("McDonald's") were successful in preventing a purveyor of dim sum, or Chinese snack food, from registering the trademark MACDIMSUM. The matter came on before the Federal Court as an appeal from a decision of a member of the Trademarks Opposition Board refusing the registration of the application. The application was filed on a proposed use basis and the evidence showed that the applicant had not yet finalized any plans to use the trademark.

McDonald’s opposition to the application was essentially based on the likelihood that the applicant’s mark would be confusing with McDonald’s large family of trademarks registered and used in Canada in association with food, drinks, and restaurant services. The number of Canadian registered trademarks totalled approximately 80, all of which included MC or MAC, most with a food-related word following. Sales by McDonald’s exceeded two billion dollars in the previous five years and survey evidence suggested that a statistically significant proportion of consumers would identify McDonald’s as the source of certain listed foods with the name MACDIMSUM.

The court found that the Trademarks Opposition Board member's correctly stated the tests for confusion, as follows:

The test for confusion is one of first impression and imperfect recollection. Factors to be considered, in making an assessment as to whether two marks are confusing are “all the surrounding circumstances including” those specifically mentioned in s.6(5)(a) to s.6(5)(d) of the Act: the inherent distinctiveness of the marks and the extent to which they have become known; the length of tine each has been in use; the nature of the wares, services or business; the nature of the trade; the degree of resemblance in appearance or sound of the marks or in the ideas suggested by them. This list is not exhaustive and all relevant factors are to be considered. Further, all factors do not necessarily have equal weight as the weight to be given to each depends on the circumstances: see Gainers Inc. v. Tammy L. Marchildon and the Registrar of Trade-marks (1996), 66 C.P.R.93d) 308 (F.C.T.D.). However, as noted by Mr. Justice Rothstein in Masterpiece Inc. v. Alavida Lifestyles Inc. (2011), 92 C.P.R.(4th) 361 (S.C.C.), although the degree of resemblance is the last factor cited in s.6(5), it is the statutory factor that is often likely to have the greatest effect in deciding the issue of confusion.

The court later determined that the Trademarks Opposition Board members findings as to confusion, and the disposition that followed, were reasonable. The member found as follows:

Similarly, in the instant case, (i) the opponents’ evidence has established that their mark MACDONALD’S is very well known, if not famous, in Canada in association with restaurant food and services, (ii) the applied-for mark cannot be said to be a strong mark because it is dominated by the non-distinctive element DIMSUM and the applicant has not established any reputation for its mark MACDIMSUM at any material time, (iii) the length of time that the marks in issue have been in use favours the opponents, (iv) the parties’ wares are similar and the applicant admitted at cross-examination that it is his intention to serve the wares specified in the application in a restaurant environment, (v) the parties’ marks are prefixed by the phonetic equivalents MC and MAC and the opponents have established a family of trade-marks which include the prefixes MC and MAC for food products, (vi) the opponents’ evidence shows that they continuously create, use, advertise and promote marks comprised of the prefix MC followed by the name of a food product. Further, in the instant case, the opponents’ survey evidence supports the opponents’ contention that a significant portion of the population would believe that the applicant’s wares sold under the mark MACDIMSUM originate with the opponents.

In view of the evidence presented by the opponents, and applying the same reasoning as was applied in Chung-Kee Noodle Shop Ltd., above, I find that at all material times the applicant has not met the legal onus on it to show, on a balance of probabilities, that there is no reasonable likelihood of confusion between the applied-for mark MACDIMSUM and the opponents’ mark MCDONALD’S. Accordingly, the opponent succeeds on the second, third and fourth grounds of opposition. It is therefore not necessary to consider the remaining grounds.

While the principles applied in this case are not new, the decision and the decision appealed from both are useful reminders of the need to carefully assess the likelihood of confusion and the evidence necessary to dispel a successful opposition. The applicant in this case presented very little probative evidence, in particular with regard to the use or intended use of the MACDIMSUM mark for which he applied. The court noted that evidence as to use or intended use “is critical to any decision such as this.”

Steven Z. Raber, LL.B., F.I.P.I.C., is a lawyer, registered trademark agent, and trained mediator and may be reached by direct telephone at (204) 957-8304, by direct facsimile at (204) 954-0304, or by email at stevenraber@fillmoreriley.com

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