A recent decision of the Federal Court (Caesarstone Sdot-Yam Ltd. v. Ceramiche Caesar S.P.A. 2016 F.C. 895) sheds light on the law relating to appeals in Canada in trademark cases arising from decisions of the Trademarks Opposition Board.
In most cases, the Federal Court will defer to the expertise of Board, but this case illustrates that there are limits to such deference. The case is also important in clarifying the role of a pre-existing trademark registration to a later filed application by the same party which is then subject to a trademark opposition by a third party.
The opposition was brought by the opponent with respect to some of the services covered by the application, and in particular wholesale and retail store services relating to slabs and tiles formed of composition stone for building panels, floors, stairs and walls, against an application for the trademark CAESARSTONE & Design, on the basis of the opponent’s trademark CAESAR & Design.
The Board held that there was a likelihood of confusion and the application was therefore refused. On appeal, 10 new opposition affidavits were filed on behalf of the applicant. However, the Court held that this new evidence would not have materially affected the Board’s findings or the exercise of its discretion. The reasoning given was that the evidence was considered to be supplemental to and simply more of the same as that which had previously been filed. Accordingly, the Court held that the appropriate standard of review in this case was that of reasonableness, rather than that of correctness.
However, despite adopting this standard, the Court held that the decision of the Board was not reasonable, and therefore reversed the decision with respect to some of the services.
What was most striking to the Court was the existence of the applicant's prior trademark registration. Although the registration was considered by the Board, its decision to afford no weight to that registration and its conclusion that the opposed services were a “departure from" as opposed to an “extension of" the goods covered by the earlier CAESARSTONE registration were held to fall outside of a range of possible, acceptable outcomes which are defensible in respect of the facts and law. The court further held that the finding with respect to the prior registration impacted the further assessment of the lack of actual confusion in the marketplace where both marks have co-existed. The matter was therefore referred to a different member of the Board for re-determination in light of the reasoning of the Court with respect to this issue.
Even in cases where new evidence is unlikely to be determinative, this case illustrates that the Federal Court will exercise its own discretion in evaluating the determinations made by the Board in opposition matters, and will in appropriate circumstances hold such conclusions to be unreasonable. The findings of the Court with respect to the applicant's prior trademark registration may also be particularly helpful to trademark owners who find their new applications opposed by third parties.