Cousins Submarines' application sunk by appellate court

In Maison Cousin (1980) Inc v Cousins Submarines Inc (Case 2006 FCA 409), a decision which has only recently been translated into English, the Federal Court of Appeal has overturned a decision of the Federal Court and has allowed an opposition against the registration of the mark COUSINS.

Cousins Submarines Inc filed an application for the mark COUSINS for use in association with "sandwiches, namely submarine sandwiches; beverages, namely carbonated beverages, coffee, milk and ice tea" and with "restaurant services". At the time of the application, it had not yet used the mark in Canada. The opponent, Maison Cousin (1980) Inc, uses the mark MAISON COUSIN in association with "breads, desserts, cold cuts and sandwiches". In particular, it specialized in "submarine sandwiches". The Opposition Board dismissed the opposition, except with respect to submarine sandwiches. On appeal to the Federal Court, Maison Cousin, as it was entitled to do, filed additional evidence which the trial judge found was sufficiently significant and probative that he should apply the standard of correctness, rather than mere reasonableness, in his review of the Opposition Board's decision. Like the Opposition Board, he decided that there was no likelihood of confusion since, with the exception of submarine sandwiches, the goods of the parties were completely different. He also based his decision on the fact that the goods were not sold through the same commercial networks or in the same types of establishments because Maison Cousin's products are sold in convenience and grocery stores, while those of Cousin Submarines are to be sold in its restaurants (see "Ambit of protection for famous marks squeezed further"). Maison Cousin appealed.

The Federal Court of Appeal found that the judge below had erred in two respects. First, since he was entitled to apply the standard of correctness, he should have ignored the decision of the Opposition Board and instead decided the issues on the merits based on the evidence before him. A judge deciding an issue de novo may intervene without having to identify any error committed by the Opposition Board and need not defer to that decision. The appellate court also found that the judge below had erred on the issue of likelihood of confusion. The Federal Court of Appeal found that the goods of Cousin Submarines and Maison Cousin were all food products which are very similar and commonly found in the same vicinity. Any distinction between the products was not sufficient to eliminate the possibility of confusion. The court noted that the Trademarks Act provides that confusion will arise when the use of both trademarks in the same area would be likely to lead to the inference that the goods or services were manufactured, sold, leased, hired or performed by the same person, whether or not the goods or services are of the same general class. The court relied upon the recent decision of the Supreme Court of Canada in Mattel Inc where the Supreme Court noted that Parliament's intent was not to require that the goods or services belong to the same class. Moreover, the appellate court found that the judge below was wrong to compare Cousin Submarines' present intended way of operating with that of Maison Cousin. Cousin Submarines was entitled to change its distribution networks and sell its products in the same convenience stores or other establishments as Maison Cousin, which would increase the likelihood of confusion. Cousin Submarines' trademark application did not restrict its scope of operations with respect to the distribution of its products. In addition, Maison Cousin had used the trade name and trademark MAISON COUSIN for many years in the province of Quebec and was entitled to a measure of protection. The court further noted that Maison Cousin was not prevented from using its MAISON COUSIN mark in the restaurant industry, and had effectively already done so, meaning that the presence of COUSINS-marked food products in the marketplace or used in association with restaurant services would be likely to cause confusion. The Federal Court of Appeal, accordingly, ordered the registrar of trademarks to reject the application and allow the opposition.

This case serves as a reminder that the burden is always on the applicant to show that its mark is registrable. Evidence provided by an opponent which supports a reasonable likelihood of confusion must be met with strong rebuttal evidence and arguments.

Gordon Zimmerman, Borden Ladner Gervais LLP, Toronto