Injunction on the menu in restaurant corporate name dispute

Canada

In Quebec Inc v Quebec Inc (Case 700-05-009674-007), the Quebec Superior Court has granted a motion for a permanent injunction prohibiting the defendant from using the corporate names 'Restaurant L'Ancestral' and 'Restaurant La Maison L'Ancestral II' for its restaurant. The court held that both names were confusingly similar to the 'Restaurant L'Ancestral' name used by the plaintiff.

The plaintiff, Quebec Inc (Registration 9042-5703), has been operating a restaurant since 1988 under the name 'Restaurant L'Ancestral'. In 2000 the defendant, Quebec Inc (Registration 9089-6663), opened a restaurant, approximately 30 kilometres away from the plaintiff's, also under the name 'Restaurant L'Ancestral'. Based on its prior use of the corporate name and on a likelihood of confusion between the two enterprises, the plaintiff immediately served a cease and desist letter on the defendant ordering a change of its corporate name.

The defendant proposed to settle the matter by adopting the name 'Restaurant La Maison L'Ancestral II'. The plaintiff was not satisfied by this proposal and filed a motion with the Quebec Superior Court requesting an injunction prohibiting the defendant's use of 'Restaurant L'Ancestral' and 'Restaurant La Maison L'Ancestral II' on the grounds that there was a significant likelihood of confusion. The defendant contended that, pursuant to the Act Respecting the Legal Publicity of Sole Proprietorships, Partnerships and Legal Persons, the case did not fall within the Quebec Superior Court's jurisdiction, as the plaintiff had already brought administrative proceedings before the Inspector General of Financial Institutions.

The Quebec Superior Court dismissed the defendant's argument, holding that the filing of administrative proceedings before the Inspector General of Financial Institutions does not preclude a party from simultaneously seeking a motion for a permanent injunction before the Quebec Superior Court. In the case at hand, the court reasoned that the fact that the plaintiff has rights in its image and reputation justified legal action.

Having established jurisdiction, the court concluded that there was a likelihood of confusion between the plaintiff's and defendant's names. The court noted that:

  • the plaintiff has prior rights and goodwill in the name 'Restaurant L'Ancestral' due to its continuous use of the name since 1988;

  • the names at issue are visually and phonetically similar; and

  • the two restaurants are in close proximity and share a similar clientele.

Thus, the court granted the plaintiff's motion for a permanent injunction prohibiting the defendant's use of 'Restaurant L'Ancestral' and 'Restaurant La Maison L'Ancestral II'.

However, the court did not award damages to the plaintiff because it had failed to demonstrate any monetary loss ensuing from the defendant's activities.

Catherine Bergeron, Léger Robic Richard, Montreal

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