Court Examines Allegation of Trade-Mark Infringement in Perkopolis Case

2016-05-04

ROBIC,LLPwww.robic.ca
info@robic.com
MONTREAL1001Square-Victoria-BlocE-8thFloor
Montreal,Quebec,CanadaH2Z2B7
Tel.:+1514987-6242Fax:+1514845-7874QUEBEC2828LaurierBoulevard,Tower1,Suite925
Quebec,Quebec,CanadaG1V0B9
Tel.:+1418653-1888Fax.:+1418653-0006

COURTEXAMINESALLEGATIONOFTRADE-MARKINFRINGEMENTIN
PERKOPOLISCASE

BARRYGAMACHE*
ROBIC,LLP
L
AWYERS,PATENT&TRADEMARKAGENTS

Inadecisionthatunderlinestherisksofusingandregisteringtrade-markshaving
littleinherentdistinctiveness,Canada’sFederalCourtdismissedclaimsoftrade-mark
infringementbroughtbyacompanywhoownedthetrade-marksWORKPERKS,
ADPERKS,MEMBERPERKSandCUSTOMERPERKSagainsttheuserofthetrade-
markPERKOPOLIS(VenngoInc.vConciergeConnectionInc.etal.,2015FC1338
(F.C.MansonJ.,December3,2015)).
PlaintiffVenngoInc.(“Venngo”orthe“Plaintiff”)isknownasa“CommercialProgram
Provider”thatoffersdiscount,benefitandincentiveprogramstoitscustomers,
namelyCanadiancompaniesandprofessionalorganizations,whosigncontractswith
Venngosotheycanofferthesediscountsonvariousproductsandservices(for
examplemovietickets,carrentals,fitnessclubs,etc.)totheiremployeesasbenefits
inadditiontowagesorsalaries(paragraph2oftheCourt’sreasons).Venngowas
foundedin2000andin2007,itadoptedthetrade-marksWORKPERKS,
MEMBERPERKSandADPERKStopromoteitsdiscountprograms.Applicationsfor
thesetrade-markswerefiledin2007andregistrationwaseventuallysecuredforthe
marksbetweenApril2009andFebruary2011forvariousgoodsandservices
includingprovidingpackagedemployeesavingandaddedvalueprogramsdelivered
onlineandthroughprintedpublications.
DefendantConciergeConnectionInc.(“CCI”orthe“Defendant”)wasincorporatedin
2001andisinthebusinessofofferingan“EmployeeDiscountTicketandAttraction
Program”toitscustomers.Asearlyas2002,itusedtheword“perks”todescribethe
discountsitofferedtoitsclients.In2005or2006,VenngoapproachedCCIand
proposedthatthepartiescollaboratetoofferCCI’sservicesonVenngo’swebsite.
Ms.MorganMarlowe,PresidentandFounderofCCI,metwithMr.BrentStucke,the
ChairmanandFounderofVeengo.Nodealwasconcludedatthattime,norlaterin
July2010whenMr.StuckeofferedtopartnerwithMs.Marlowe.

OnNovember28,2008,CCIappliedtoregisterthetrade-markPERKOPOLISonthe
basisofproposeduseandregistrationofthemarkwassecuredonMarch1,2011in

©CIPS,2015.*OfROBIC,LLP,afirmoflawyers,andpatentandtrademarkagents.Publishedina2016issueofWorl
IntellectualPropertyReport.Publication142.306.

2
associationwith“Entertainmentticketsales,andHotelbookingservices”.Useofthe
PERKOPOLIStrade-markbyCCIcommencedinFebruaryof2009.

Venngobecameawareoftheactivitiesassociatedwiththetrade-markPERKOPOLIS
in2009.In2011,VenngofileditssuitinFederalCourtandclaimedthatCCIalong
withMs.MarloweinfringeditsrightsinitsfamilyofregisteredCanadiantrade-marks
endingin“PERKS”throughtheuseofthetrade-markPERKOPOLIS.Italsoalleged
passingoffalongwithdepreciationofVenngo’sgoodwill.

Insupportofitsclaim,Venngopointedtocircumstancesofallegedactualconfusion
fromitscustomersandend-usersthatcommencedasearlyasJanuary2010.For
example,Venngoprovidedtestimonyfromathirdpartywitnessdealingwithhuman
resourcesprofessionalswhobelievedthatthemarksWORKPERKSand
MEMBERPERKSwereconnectedtoPERKOPOLISduetothecommon
characteristicbetweenthem,namely“perk”or“perks”.Anotherexampleofconfusion
betweenWORKPERKSandPERKOPOLIScamefromhumanresources
professionalsatMagnaInternational.
Inhisreasons,Mr.JusticeMansonfirstdealtwiththeclaimagainstMs.Marlowe.On
thisissue,theCourtreferredtothetestthatmustbesatisfiedforfindinganofficeror
directorofacorporationpersonallyliable,namelytheidentificationofsomeconduct
onthepartofthedirectingmindthatiseithertortiousinitselforexhibitsaseparate
identityorinterestfromthatofthecorporationsuchastomaketheactsorconduct
complainedofthoseofthedirectingmind(TommyHilfigerLicensingIncvProduitsde
QualitéIMDInc,2005FC10atparagraphs140-142).Nosuchfindingwasmadein
thiscase.Ms.Marlowe’sactionsconcerningtheadoptionofthePERKOPOLIStrade-
markdidnotsuggestanybadfaithonherpartandtheclaimagainstherwas
dismissed.
TheCourtthenconsideredtheissueofallegedconfusionbetweenVenngo’strade-
marksandCCI’sPERKOPOLIStrade-mark.TheCourtasked,asamatteroffirst
impression,whethertherelevantpublic(primarilytheHRdecisionmakersofthe
parties’customers,butalsoend-usersoftheservicesofferedbytheparties)would
beconfusedorlikelytobeconfusedintothinkingthatthesourceoftheservices
underthetrade-markPERKOPOLISwasthesameasorassociatedwiththesource
ofVenngo’sservicesofferedundertheWORKPERKS,ADPERKS,
CUSTOMERPERKSorMEMBERPERKStrade-marks(paragraph105oftheCourt’s
reasons).
TheCourtfirstexaminedtheissueofthedegreeofresemblancebetweenthemarks
whichCanada’sSupremeCourtidentifiedasthefactormostlikelytohavethe
greatesteffectontheconfusionanalysis(MasterpeaceIncvAlavidaLifestylesInc,
2011SCC27atparagraph49).
TheCourtproceededtoexaminethemarksgloballyastherelevantconsumers
wouldencounterthem.However,atthesametime,theCourtindicateditcouldand

3
shouldhaveregardtoadominantcomponentinthemarkifthatcomponentis
particularlystriking,suchthatitaffectstheoverallimpressionoftheaverage
consumer(paragraph108oftheCourt’sreasons).TheCourtfoundthatthe
expressions“perk”or“perks”asusedinVenngo’strade-markswerehighly
suggestiveandhardlydistinctive.TheCourtcomparedeachofVenngo’strade-marks
withthetrade-markPERKOPOLISasusedbyCCIandconcludedthatitwasreadily
apparentthattherewaslittleresemblanceineitherappearance,soundorinthe
ideassuggestedbyeachmark.Forexample,eachofVenngo’smarkssuggested
perksbeingofferedtoaspecificgrouporinaspecificcircumstancewhile
PERKOPOLISdidnotsuggestanygroupthatwouldbenefitfromtheperks.Finally,
theelementofresemblancebetweentheparties’respectivetrade-markswasthe
word“perk”whosemeaningincludesemployeebenefits,rewardsandextras
(paragraph114oftheCourt’sreasons).
TheCourtthenconsideredtheinherentdistinctivenessofVenngo’strade-marksand
concludedthattheywereatbesthighlysuggestive,ifnotdescriptive,ofthebenefits
andloyaltydiscountservicesofferedbythePlaintiff.Furthermore,theCourtdecided
thattherewasnothingremarkableoruniqueabouttheuseof“perk”ineachof
Venngo’strade-marks,oritscombinationwithwordsindicatingtowhomtheperks
wereoffered(paragraph117oftheCourt’sreasons).OfVenngo’strade-marks,the
Courtwroteatparagraph119ofitsreasons:“Assuch,eachofthese[marks]haslittle
inherentdistinctivenessandareaffordedanarrowambitofprotection(Office
CleaningServicesvWestminsterWindowandGeneralCleaningLtd,[1946]63RPC
30at42,43).ThisfactorfavourstheDefendantsinthatthecaselawsupportsthe
viewthatweakmarkscanenablesmalldifferencestoresultinalackofalikelihoodof
confusion(MolsonCosvJohnLabattLtd,[1994]FCJNo1792atparas5,6(FCA)
[Molson];KelloggSaladaCanadaIncvCanada(RegistrarofTradeMarks),[1992]3
FC442(FCA))”.
TheCourteasilydeterminedthatthenatureoftheparties’respectivebusinessesdid
overlapandthatVenngo’suseofitstrade-markswaslongerthanCCI’suseofits
PERKOPOLIStrade-mark.
Asothersurroundingcircumstances,Venngoraisedtheissueoftheexamplesof
actualconfusionthatallegedlysupporteditsclaimofinfringement.WhiletheCourt
didexaminetheissueofactualconfusion,itappearedreluctantofprovidingbroad
protectiontoatrade-mark,suchastheonesownedbyVenngo,thatuseddescriptive
orhighlysuggestivewordsasabasisforaclaimofdistinctivenessandalleged
confusion(paragraph124oftheCourt’sreasons).TheCourtdidnotattributemuch
weighttothecasesofallegedactualconfusionastheseinstancesdidnotsufficiently
negateoroutweightheotherfactorsthatsupportedCCI’sdefensethattheparties’
trade-markswerenotsourceofconfusion.Inotherwords,actualconfusionwasnota
“trumpcard”thatoverridestheotherfactorsthatmustbeexaminedinaconfusion
analysis(paragraph125oftheCourt’sreasons).

4
Intheend,thelimitedevidenceofconfusionwasinsufficienttoconvincetheCourt
thatthecasualconsumersomewhatinahurrywouldconfusetheVenngoandCCI
trade-markssincebothpartiesadoptedagenerictermwithintheirmarksandthat
thesemarkscanonlybegrantedaverynarrowambitofprotection.Venngo’sclaim
wasaccordinglydismissed.Theotherclaimsbasedonpassingoffanddepreciation
werealsodismissedastheevidentiaryburdenineachcasewasnotsatisfied.

Whilebusinesseshaveaninterestinchoosingtrade-marksthatconveyaclear
message,oncetheychooseatrade-markthatisdescriptiveofthenatureoftheir
trade,itwillbedifficulttoenforcesuchtrade-markagainstcompetitorswhousethe
samewordorexpressionaspartoftheirowntrade-marksinassociationwithsimilar
activities.Asageneralprinciple,suchwordsorexpressionsshouldremainavailable
toallandunlessthetrade-marksatissuearevirtuallyidentical,smalldifferences
betweenthemarksshouldbesufficienttoavoidanylikelihoodofconfusion.