In Vancouver Community College v. Vancouver Career College
(Burnaby) Inc., the Supreme Court of British Columbia issued a
decision which addressed at length, for one of the first times in
Canada, the issue of keyword advertising in the context of an
action for passing off. Consistent with previous cases which
addressed similar issues, such as the use of a competitor's
mark in metatags, the Court found that the use of a
competitor's trademark in keyword advertising did not
constitute passing off. In doing so, the Court rejected the idea of
initial interest confusion as a basis for a finding of a likelihood
As background, search engines, such as Google or Yahoo!, offer a
service whereby website operators can pay to have links to their
website appear in search results as sponsored links alongside the
search engine's organic results. Website owners can bid on
certain keywords, including the trademarks of others, which then
act as a trigger when searched causing a sponsored link to appear
in the search results. The sponsored links are displayed in a
prominent but separate section from the search engine's organic
The central issue in the case was whether the defendant's
use of the mark VCC in its keyword advertising constituted passing
off of the defendant's services for those of the plaintiff. The
evidence at trial was that the plaintiff had used the VCC trademark
between 1965 and 1990 at which time use of the mark ceased until
2013 when use recommenced. In the meantime, in February 2009,
the defendant started a marketing campaign aimed at increasing the
profile of the college. As part of the campaign, the defendant
purchased VCC as a keyword for the search engines Google and
Yahoo!, although it did not otherwise use this term in its public
materials and the term was not visible in the search results.
Ultimately, the plaintiff failed to satisfy the first element of
the test for passing off which requires that the plaintiff
establish goodwill or reputation in the VCC mark. However, the most
interesting part of the decision comes from the Court's
analysis of the second element of the test whereby a plaintiff must
establish that the defendant caused confusion through a
In considering this issue, the Court looked at what happens when
a person searches online for career training institutions in
British Columbia. When such a search is conducted, the user enters
a search term into a search engine such as Google or Yahoo! and,
rather than being taken directly to a specific website, the user is
presented with a list of search results which contain both organic
and sponsored results. The user is then able to review the
search results before making a decision to click on an organic or
sponsored link and be taken to a specific website.
It is well-known that the issue of confusion is to be considered
from the perspective of the "first impression" of an
ordinary consumer of the goods or services of the parties. In the
Court's opinion this "first impression" cannot arise
when the user is presented with the search results but can only
arise when the user accesses a website identified by the search.
The Court held that the relevant consumer understands that it is
necessary to actually see a website in order to determine whose
site it is. In this case, when a user reached the defendant's
site, it was clearly identified as such and there was no use of the
plaintiff's marks on the site. As such, there was no likelihood
of confusion based on the user's "first impression."
In so finding, the Court rejected the concept of initial interest
confusion, the essence of which is that confusion can arise in the
mind of the consumer before a good or service is actually
This decision follows the recent decision from the Federal Court
in Red Label Vacations Inc. v. 411 Travel Buys Limited
2015 FC 19, where the Court found that the use of a
competitor's trademarks in metatags did not constitute passing
off or trademark infringement. Despite these findings there remains
a level of uncertainty as to how a court may treat keywords in
Canada on a case-by-case basis, be it in the visible or non-visible
form. The precedential value of this case may be somewhat limited
given the fact scenario and resulting analysis. Accordingly, it is
unlikely that the issue of keyword advertising in Canada has been
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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