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Dismissal of Application for “SECRET” Trade-mark upheld by the Federal Court

On December 1, 2015, Justice Gascon of the Federal Court released the judgment and reasons in Eclectic Edge Inc. v. Gildan Apparel (Canada) LP 2015 FC 1332. The case was an appeal of the decision of the Registrar of Trade-marks, refusing Eclectic’s application to register four trade-marks containing the words “valentine” and “secret” in association with women’s clothing, undergarments and lingerie [the VALENTINE Marks].

The trade-mark applications were successfully opposed by Gildan on the basis of a reasonable likelihood of confusion with its own registered trade-mark SECRET and numerous other trade-marks containing the word SECRET [the SECRET Marks] which had been used in Canada for over 40 years in the market for women’s hosiery, intimate apparel and other related clothing products. The TMOB’s four decisions may be found here, here, here, and here.

Eclectic appealed the decisions on the basis that the Registrar incorrectly determined the likelihood of confusion in view of several relevant material facts, including new evidence showing that the word “secret” was widely used in the women’s clothing and undergarment market (and therefore Gildan could not claim exclusivity in it).

Both Eclectic and Gildan claimed that judicial comity should lead the Court to follow two recent Federal Courts decisions, one of which was favourable to Eclectic, the other to Gildan. The decisions involved: (i) Eclectic’s VALENTINE SECRET Marks and trade-marks owned by VICTORIA’S SECRET; and (ii) a WOMEN’S SECRET trade-mark and Gildan’s SECRET Marks. Justice Gascon held that although these cases related to trade-mark disputes in the market for women’s intimate apparel, the decisions would not require the court to invoke the principle of judicial comity as the case involved different parties, different markets, and conclusions that were based on their respective and particular sets of facts.

With respect to the proper standard of review the court confirmed that while decisions of the Registrar are normally reviewed on a standard of reasonableness, where additional evidence is presented on appeal that would have materially affected the Registrar’s findings of fact or exercise of discretion, the decision must be reviewed on the correctness standard. The new evidence must be sufficiently substantial in terms of probative value and should add something of significance. Justice Gascon examined the new evidence regarding the state of the register and the state of the marketplace but held that was not significant enough to change the standard of review.

The remaining issue was whether, using the standard of reasonableness, the Registrar’s findings on the likelihood of confusion and absence of distinctiveness between the marks should be reviewed and set aside. The court held that the Registrar properly applied the confusion test pursuant to s.6(2)(5) of the Trade-marks Act and came to a reasonable conclusion on the issues in dispute:

[130]       In my opinion, the Registrar was reasonable in weighing the evidence and in concluding, based on the evidence, that Canadian consumers are sufficiently familiar with Gildan’s trade-mark SECRET and family of SECRET Marks that casual consumers would probably believe that identical or closely related Wares associated with the VALENTINE SECRET Marks originate from the same source. She relied on the Poirier Affidavits showing how Gildan, over the years, has adopted a series of trade-marks incorporating “secret” with other words and expanded its line of SECRET products. An average consumer having a general recollection of Gildan’s line of SECRET products would likely infer that the VALENTINE SECRET Marks are a logical extension identifying yet another product in its line of products.

On this basis the Appeal was dismissed.

A copy of the decision can be found here