BUDGET BLINDS cancellation claim closed by court

In Budget Blind Service Ltd v Budget Blinds Inc (2007 FC 801), the Federal Court of Canada has considered whether the trademarks BUDGET BLINDS and BUDGET BLINDS (and design) were likely to cause confusion with the names Budget Blind Services and Budget Blind Cleaning.

Budget Blinds Inc was incorporated in California in 1992. It has since then used BUDGET BLINDS as a trademark and trade name in association with the retail of blinds and the operation of the Budget Blinds franchises. Budget Blinds considered expanding into Canada in 2003 and therefore filed applications that year to register the trademarks BUDGET BLINDS, and BUDGET BLINDS and design based on proposed use. The marks issued to registration on February 16 2006. The registrations cover services identified as "distributorship and retail stores services in the field of window coverings".

Budget Blind Service Ltd and its director Mark Reynolds filed an application to expunge Budget Blinds' registrations on the basis that:

• the marks were confusingly similar to the trade names Budget Blind Services and Budget Blind Cleaning when the trademark applications were originally filed in 2003; and
  
  
• the marks lacked distinctiveness when the expungement proceeding was commenced on May 2 2006.

The applicants for expungement claimed that they had used the names Budget Blinds, Budget Blind Services and Budget Blind Cleaning continuously since 1989 in association with window coverings and services related to the cleaning and repairing of window coverings.

In assessing the question of confusion, a key issue considered by the court was whether the expungement applicants' names were in use as of the date of the trademark applications. While the court conceded use of Budget Blind Services and Budget Blind Cleaning, the evidence supported the conclusion that Budget Blinds was not in use. Accordingly, the court considered only whether Budget Blind Services and Budget Blind Cleaning were confusingly similar to Budget Blinds' marks.

The evidence indicated that sales of window coverings were an insignificant part of the applicants' business and that customers who sought the applicants' services could drop off their blinds at the applicants' business. In contrast, Budget Blinds' franchisees travelled to customers' homes to display, sell, measure and install window coverings. Finally, the court noted that 'budget' is a dictionary word and that the words 'blind cleaning' and 'blind services' are descriptive. Therefore, the court found that Budget Blind Services and Budget Blind Cleaning were weak names with low inherent distinctiveness.

The court concluded that Budget Blinds' marks were not likely to cause confusion with the applicants' names for the following reasons:

• The words 'cleaning' and 'services' in the applicants' names were sufficient to distinguish them from Budget Blinds' marks;
  
  
• The parties were in different businesses as the applicants cleaned and repaired blinds while Budget Blinds sold and installed blinds; and
  
  
• Budget Blinds' franchisees carried on business in a manner that virtually eliminated any possibility of confusion, namely by attending at consumers homes and permitting purchasers to consider the services offered.

On the issue of distinctiveness, Budget Blinds' evidence established that Canadians using the Internet were aware of Budget Blinds' marks as early as 2000. Further, Budget Blinds annually spent significant amounts on print, television and online advertising. It was reasonable to assume, the court reasoned, that Canadians became aware of some of the ads. Budget Blinds also filed evidence of use in Canada commencing in 2006. Accordingly, the court held that distinctiveness was demonstrated and it dismissed the application for expungement with costs.

Samantha J Gervais, Osler Hoskin & Harcourt LLP, Ottawa