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Trademarks - 'Passing Off'. Samsung Bioepis Co., Ltd. v. Novartis AG
In Samsung Bioepis Co., Ltd. v. Novartis AG (Fed CA, 2025) the Federal Court of Appeal dismissed a two trademark appeals (and two cross-appeals), this where the main appeals were against orders which "enjoin() the appellants and their licensees from using their trademark BYOOVIZ in association with a drug for use in ophthalmology and the prevention and treatment of ocular disorders and diseases, and awards the respondents (collectively, Novartis) $20,000 in nominal damages".
Here the lower court considers trademark 'passing-off' [TMA s.7(b) 'Unfair Competition and Prohibited Signs - Prohibitions']:B. The application judge found that the appellants contravened subsection 7(b)
[70] The application judge repeated the test for passing off. She stated that Novartis must establish that it possesses goodwill in the BEOVU mark, that the appellants deceived the public by misrepresentation, and that Novartis suffered actual or potential damage through the appellants’ actions.
[71] As for the first element, she found that Novartis had established that it possesses goodwill in the BEOVU trademark. The BEOVU trademark had been used in association with an anti-VEGF drug for more than three years and it is well known by ophthalmologists. In response to the appellants’ argument that any goodwill associated with BEOVU had been diminished as a result of the safety concerns, she stated that the tort of passing off is not limited to trademarks with a sterling reputation. Negative publicity may have reduced the goodwill in the BEOVU mark, but did not extinguish it.
[72] As for the second element, misrepresentation, she noted that this element will be met if Novartis established that the appellants had used a trademark that was likely to be confused with the BEOVU mark. She stated that for the reasons she had set out, Novartis had established a likelihood of confusion.
[73] As for the third element, she found that Novartis had established actual or potential damage as a result of the appellants’ actions: loss of control of the BEOVU trademark by use of a confusingly similar trademark was sufficient to establish actual or potential damage. . Samsung Bioepis Co., Ltd. v. Novartis AG
In Samsung Bioepis Co., Ltd. v. Novartis AG (Fed CA, 2025) the Federal Court of Appeal dismissed a two trademark appeals (and two cross-appeals), this where the main appeals were against orders which "enjoin() the appellants and their licensees from using their trademark BYOOVIZ in association with a drug for use in ophthalmology and the prevention and treatment of ocular disorders and diseases, and awards the respondents (collectively, Novartis) $20,000 in nominal damages".
The court considered aspects of trademark law, here particularly confusion and passing-off:[6] A trademark is "“a sign or combination of signs that is used or proposed to be used by a person for the purpose of distinguishing […] their goods or services from those of others”": TMA, s. 2. Registration of a trademark grants its owner "“the exclusive right to the use throughout Canada of the trademark”": TMA, s. 19.
(1) Trademark infringement under subsection 20(1)
[7] A trademark is infringed where any person who is not otherwise entitled to do so under the TMA sells, distributes or advertises any goods or services in association with a confusing trademark or trade name: TMA, s. 20(1)(a).
[8] A trademark is "“confusing”" with another under s. 20(1)(a) if "“the use of both trademarks in the same area would be likely to lead to the inference that the goods or services associated with those trademarks are manufactured, sold, leased, hired or performed by the same person”": TMA, s. 6(2).
[9] The test for confusion 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 [they have] no more than an imperfect recollection of the [prior] trade-marks, and [do] not pause to give the matter any detailed consideration or scrutiny, nor […] examine closely the similarities and differences between the marks”": Masterpiece Inc. v. Alavida Lifestyles Inc., 2011 SCC 27 at para. 40[Masterpiece]; Veuve Clicquot Ponsardin v. Boutiques Cliquot Ltée, 2006 SCC 23 at para. 20 [Veuve Clicquot].
[10] In determining whether trademarks are confusing, courts are required to "“have regard to all the surrounding circumstances”": TMA, s. 6(5). These surrounding circumstances include, but are not limited to, those set out in that provision:(a) the inherent distinctiveness of the trademarks or trade names and the extent to which they have become known;
(b) the length of time the trademarks or trade names have been in use;
(c) the nature of the goods, services or business;
(d) the nature of the trade; and
(e) the degree of resemblance between the trademarks or trade names, including in appearance or sound or in the ideas suggested by them. [11] The assessment is context-specific; different circumstances will be given different weight: Veuve Clicquot at para. 21.
(2) Passing off under para. 7(b)
[12] As set out by the Supreme Court in Kirkbi AG v. Ritvik Holdings Inc., 2005 SCC 65 at para. 66, to succeed in a claim for passing off under s. 7(b), a claimant must establish three elements:(1) the plaintiff (or applicant) possesses goodwill in the trademark;
(2) the defendant deceived the public by misrepresentation; and
(3) the plaintiff suffered actual or potential damage through the defendant’s actions. [13] Misrepresentation for the purposes of the second element of passing off is established if the defendant’s trademark is likely to be confused with a trademark owner’s trademark: Sadhu Singh Hamdard Trust v. Navsun Holdings Ltd., 2016 FCA 69 at para. 21. . Dragona Carpet Supplies Mississauga Inc. v. Dragona Carpet Supplies Ltd.
In Dragona Carpet Supplies Mississauga Inc. v. Dragona Carpet Supplies Ltd. (Fed CA, 2023) the Federal Court of Appeal considered (and dismissed) an appeal from a denied claim that sought: "a declaration that the respondents had passed off its trademark, contrary to both the common law and subsection 7(b) of the Trademarks Act, R.S.C., 1985, c. T-13 (Act), an injunction and damages".
In these quotes the court considered 'passing off' [aka 'misrepresentation', here under TA 7(b)], as opposed to 'competition':Misrepresentation
[41] There are three components that must be established to succeed in a passing off action under subsection 7(b) of the Act (set out in Annex A at the end of these reasons): the existence of goodwill, deception of the public due to a misrepresentation and actual or potential damage (Ciba-Geigy at para. 33). Again, in light of the finding that all goodwill resided with Dragona Scarborough under the licence, Dragona Mississauga cannot establish the existence of its own goodwill, and its claim fails at the outset. However, even if there were no licence in place and the appellant established its own goodwill, it is readily apparent that the misrepresentation argument cannot succeed, and the passing off claim still fails.
[42] Given Dragona Scarborough’s goodwill in Mississauga, though, there can be no misrepresentation—even if there were no licence found. Dragona Scarborough had every right to use the mark west of the illusory Yonge Street boundary. Any resulting confusion from the use of the DRAGONA trademark in Mississauga is just the result of the respondents “making a truthful statement of fact which [they] ha[ve] a legitimate interest in making” (J.A. McMillan Ltd. v. McMillan Press Ltd., 1989 CanLII 7816 (N.B.C.A.), 27 C.P.R. (3d) 390 at 397 [J.A. McMillan] at para. 25, citing Turton v. Turton (1889), 42 Ch.D. 128, 38 W.R. 22 (C.A.) at para. 153).
[43] The conflict in this case arises from the use of overlapping marks and the legitimate use of the mark by its owner, Dragona Scarborough. The resulting conflict is not misrepresentation, but competition. Competition and passing off are two discrete concepts.
[44] Competition is two parties (lawfully) acting independently to secure the business of a third party and passing off is representing your goods as those of another (J.A. McMillan at paras. 16-17). Where as here, a party has a right to use a name it is not its responsibility if some misapprehend its legitimate use. By using the DRAGONA trademark in Mississauga, Dragona Scarborough was making a truthful statement of fact, arising from its ownership right and its right to use its goodwill associated with the DRAGONA trademark throughout the GTA.
[45] The appellant attempts to distinguish the misrepresentation cases cited by the Federal Court mainly on the ground that the respondents in this case have changed the nature of their use of the DRAGONA trademark by opening a physical location in Mississauga. However, the concurrent use of a mark, creating some confusion, is not sufficient to establish passing off. A misrepresentation does not arise in the absence of “improper filching” of another’s business (J.A. McMillan at paras. 22-23). That did not arise here—Dragona Scarborough was simply exercising its right to use the DRAGONA trademark in Mississauga, a location where it had existing goodwill. Misrepresentation requires more than mere confusion; a party must misrepresent their goods to be that of another.
[46] The appellant contends that the judge erred in his understanding of the law governing concurrent, overlapping uses. I do not agree. Relying on Edward Chapman Ladies' Shop Limited v. Edward Chapman Limited, 2007 BCCA 370, 72 C.P.R. (4th) 45 at para. 50 (Chapman), the judge concluded that where the parties have jointly used and jointly benefited from the use of a mark, neither can exclude the other from using it in association with their respective business (Federal Court decision at para. 157).
[47] Chapman held that a joint owner of a name cannot take steps that increase the risk of confusion, which in Chapman arose when there were changes to the trade name that made it more similar to the other competing name (Chapman at para. 23). Chapman is distinguishable as there were no changes in trade name, the name was associated with the same services and critically, Dragona Scarborough had an existing right to use the DRAGONA trademark in Mississauga due to its standing goodwill in Mississauga.
[48] Given the Federal Court’s finding that Dragona Scarborough was known throughout the GTA prior to 1992, and continued to sell throughout the GTA, it was entitled to the use of the DRAGONA trademark throughout the GTA. The Federal Court did not limit its findings of Dragona Scarborough’s use of the DRAGONA trademark to some “distant point in the past”, rather assessing its “longstanding and continuous use… throughout the GTA” (Respondents’ Memorandum of Fact and Law at para. 56). Given this continuing ability to use the DRAGONA trademark in Mississauga and beyond, there was, and could be, no misrepresentation by the respondents that their goods or services were those of the appellant.
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