Legal issues for teachers and students with background information and teaching resources.
Intellectual property law is designed to protect original ideas, inventions and symbols or words that identify a particular brand or company. The backgrounder has described a case in which a business was denied the right to use a name because it infringed on prior rights established by an organization, namely the IOC. This problem arises in many circumstances. Provided here are a number of case studies that you can give to your students. Their task is to determine what a court decision might be, given what they have learned from the Backgrounder. We have provided case references and a brief summary of the court decision for the teacher’s use
1. Lexus Foods, a Quebec company that produces canned fruit and vegetables was sued by Toyota Motor Corporation in the Federal Court of Canada in 2001. The car company asked the court to order the Quebec company to stop using the name Lexus, arguing that most Canadians would associate the name with its luxury car. The Court had to decide whether the Registrar of Trademarks had been correct in registering the Lexus Foods Trademark when Toyota had already named its Lexus car. What do you think the Courts decision was and why?
Toyota v. Lexus Foods Inc.  2 F.C. 15 - In this case the court decided that people were unlikely to confuse a can of fruit juice with a luxury car. It was found that trademark protection must be related to “certain wares or services” because confusion is less likely when the products in question are markedly different.
2. In this case, the plaintiff carried on a real estate business as “Upper Beach Village Limited,” and a competitor started a similar business in the same area. It was at first called “Upper Beach Village Estates Limited.” After complaints from the plaintiff, this was changed to Upper Beach Estates. Still not satisfied the plaintiff brought an action to the court seeking an injunction to prevent the defendant from using that name. Keep in mind that the words upper beach described the area in which both parties were operating their businesses. What do you think should be the decision in this case?
Upper Beach Village Ltd. v. Upper Beach Village Estates Ltd. (2000), as reported in Lawyers Weekly, Vol. 20 May 2000 (Ont. S.C.). The judge refused to grant an injunction on the grounds that the words were descriptive rather than distinctive and there was no evidence that the plaintiff would suffer any irreparable harm if the injunction were not granted
3. Reynolds applied to register the trademark, “Here’s Johnny” with respect to portable fiberglass toilets he developed to be used at construction sites and other temporary locations. Johnny Carson, the popular TV personality of the time, who was always introduced by his co-host with the words, “Here’s Johnny opposed the registration of the trademark. Do you think the portable toilet manufacturer should be allowed to register the trademark? Why or why not?
Carson v. Reynolds (1980), 115 D.L.R. (3d) 139 (F.C.T.D.) In this case the Registrar refused to register the trademark because it suggested that there was a connection between the toilets and the entertainer, when that was not true.
4. Motel 6, Inc. is a U.S. firm operating motels all over the States, but not in Canada. They do, however, take bookings from Canada and advertise in Canada. The Canadian defendant operated three motels in British Columbia under the Motel 6 name and had registered the Motel 6 trademark in this country. They also used a logo that was very similar to the U.S. Company’s logo. The American firm brought this actions. What is the nature of their complaint? Indicate any arguments that can be used by the Canadian firm in its defence.
Motel 6, Inc. v. No. 6 Motel Ltd. et al (1981), 127 D.L.R. (3d) 267 (F.C.T.D.) After hearing the case the court decided that because it was a tort action (passing off) it should have been taken to the BC Superior Court rather than the Federal Court. But the Federal Court did find that registering this trademark name was improper and so it withdrew the right of the BC company to use the name
After completing the case studies, have your students draw up a list of precautions a business person should keep in mind when thinking of a name for their company.
Case studies were adapted from books by Richard Yates, Business Law in Canada and Legal Fundamentals of Canadian Business, published by Pearson Education Inc, Toronto, in 2004 and 2005 respectively.