The Federal Court Declares BLUESEAL Trademark Invalid

In Blue Seal Inc. v. Lourens Poorter, 2020 FC 178, the Federal Court (the “Court”) granted an application declaring a trademark registered by Lourens Poorter invalid pursuant to subsection 18(1) of the Trademarks Act (the “Act”). The Court ordered that the trademark be removed from the Register pursuant to subsection 57(1) of the Act.

Background

Blue Seal Inc. (“Blue Seal”) is a leader in the unprocessed synthetic resin field. Blue Seal is an American company that sells and produces surface protectants for the marine industry. Blue Seal produces such protectants in association with the trademarks BLUE SEAL and the BLUE SEAL Design. Blue Seal has sold goods in Canada in connection with these trademarks since 2010.

Lourens Poorter is the managing director of Pollyflake LLC. Pollyflake LLC is also a producer of marine surface protectants. In April 2015, in connection with its production of unprocessed synthetic resins for the marine industry, Lourens Poorter applied for the trademark BLUESEAL. The trademark application was registered on September 20, 2016.

Blue Seal challenged Lourens Poorter’s trademark on the basis that it was confusingly similar to its own trademark.

Issues

There were two issues in this application. First, the Court needed to determine whether Blue Seal had standing as an “interested person” pursuant to subsection 57(1) of the Act. Second, the Court needed to determine whether Lourens Poorter’s trademark registration was invalid.

Does Blue Seal have Standing?

The Court held that Blue Seal had standing to bring this application. The Court relied on CIBC World Markets Inc. v. Stenner for the conclusion that a person who has used a trademark in Canada prior to its registration meets the definition of “interested person” pursuant to section 57 of the Act.

There was clear evidence that Blue Seal had continuously marketed and sold products with the BLUE SEAL wordmark and BLUE SEAL design mark in Canada. There was also no evidence that Blue Seal was aware of the fact that Lourens Poorter was applying for this trademark.

Was the Trademark Registration Valid?

In determining if the trademark was valid, the main issue was whether the two marks were “confusingly similar”, as described in subsection 6(5) of the Act and interpreted in Masterpiece Inc v Alavida Lifestyles Inc. The test for determining whether a trademark is “confusingly similar” is outlined in Masterpiece, as follows:

The test to be applied is a matter of first impression in the mind of a casual consumer somewhat in a hurry who sees the [mark], at a time when he or she has no more than an imperfect recollection of the [prior] trade-marks, and does not pause to give the matter any detailed consideration or scrutiny, nor to examine closely the similarities and differences between the marks.

The Court applied this test and reviewed the relevant factors listed in subsection 6(5) of the Act in coming to the conclusion that Lourens Poorter’s trademark was confusingly similar, and therefore invalid. The Court addressed each of the factors, as follows:

• Degree of Resemblance. The words of the two trademarks were almost identical, the only difference being a space between the two words in Blue Seal’s mark. The Court found that combining the two words did not create a distinction between the two marks.
• Inherent Distinctiveness. The words in the trademark were largely descriptive of the product itself, a blue sealant, and therefore had limited inherent distinctiveness. The Court then looked to the evidence of Blue Seal’s marketing and sales efforts, noting its large volume of annual sales figures in Canada. The Court used this evidence as a basis for finding that Blue Seal’s trademark acquired a degree of distinctiveness in the market.
• Length of Time. Evidence showed that Blue Seal had continuously used the trademarks in Canada since 2010. This factor favoured Blue Seal.
• Nature of the Goods. The Court found it important that the goods were nearly identical and the parties were direct competitors. These factors favoured Blue Seal.

Outcome

The Court declared that Lourens Poorter was not a person entitled to registration pursuant to subsection 16(1) of the Act, as its BLUESEAL trademark was confusingly similar to Blue Seal’s mark. The Court determined that Lourens Poorter’s trademark was invalid pursuant to subsection 18(1) of the Act, and ordered that it be removed from the Register.

Author: Jaclyn Tilak