In Sadhu Singh Hamdard Trust v. Navsun Holdings Ltd.
(2016 FCA 69), the Court of Appeal set aside
the Federal Court's (2014 FC 1139) decision dismissing Hamdard
Trust's claim of copyright infringement and passing off against
Navsun Holdings and remitted the matter to the Federal Court for
redetermination, with some guidance.
This case involves a dispute over an unregistered trademark used
by a Punjabi subscription daily newspaper, Ajit Daily, published in
India, and by a free weekly newspaper, Ajit Weekly, published in
Canada. Hamdard Trust, which operates Ajit Daily, sued Navsun
Holdings, which operates Ajit Weekly, for use of a similarly
stylized "Ajit" logo in its masthead.
Passing Off Claim
A plaintiff asserting a passing off claim must establish
It possesses goodwill in the trademark;
The defendant deceived the public in the misrepresentation
(i.e., the defendant's mark is likely to be confused with the
plaintiff's distinctive mark), and
The plaintiff suffered actual or potential damage through the
defendant's actions (Kirkbi, 2005 SCC 65 at para 66).
In this case, the Federal Court dismissed Hamdard Trust's
claim for passing off, finding that it had failed to establish any
of the elements for a claim of passing off.
The Federal Court of Appeal set aside this decision, finding
that the lower court made several palpable and overriding errors in
evaluating the evidence on each element of the test.
On the first element, the Federal Court of Appeal found the
lower court erred in assessing Hamdard Trust's goodwill solely
from the perspective of the seven Ajit Daily subscribers in Canada,
without considering whether the Ajit Daily had garnered the
requisite goodwill in the Canadian market through its website and
general reputation. Since the use of a trademark in Canada is not a
necessary precondition for the existence of goodwill in the
Canadian market under Canadian law, the lower court's failure
to engage in this analysis was an error.
On the second element, the lower court held that Hamdard Trust
had failed to establish confusion because it found that the mark
lacked distinctiveness. The lower court found that "Ajit"
is a common Punjabi word and the mark was simply written in a
Punjabi font. However, the Federal Court of Appeal held that the
lower court erred in failing to consider additional factors central
to the issue of the mark's distinctiveness, including that the
stylized font was developed by a Hamdard Trust employee and subject
to copyright, as well as the evidence of the reputation of the Ajit
Daily newspaper, which can contribute to the mark's
On the third element, the lower court found the Hamdard Trust
had not established that it suffered any damages. However, that was
in part due to its finding that Hamdard Trust did not possess
goodwill in Canada. The Federal Court of Appeal held that if
Hamdard Trust did possess the requisite goodwill under the first
element of the test, then it could establish damages by showing
loss of control over reputation, image, and goodwill. Therefore,
due to the previously identified error, the lower court's
findings on damages were likewise set aside.
The lower court dismissed the copyright infringement action
because the two parties had entered into a partial settlement
agreement in the United States which permitted the use of the
masthead after October 1, 2009. The lower court also held, on its
own motion, that any dispute under the agreement ought to be
decided by a court in the United States.
The Federal Court of Appeal, in setting aside the dismissal of
the lower court, held that since the copyright claim extends back
to July 2007, the settlement agreement is not relevant to the Ajit
Daily's claim for infringement prior to October 1, 2009.
Further, since the parties attorned to the jurisdiction of the
Federal Court and the alleged infringement occurred in Canada, the
Federal Court was not permitted to decline jurisdiction on its own
This case reaffirms important elements of the law on passing off
as well as private international law. In today's globalized
world, where brand recognition and reputation is not necessarily
restricted to those places where the brand operates, the protection
of IP rights in international markets is a significant concern to
foreign companies. The law in Canada is capable of taking into
account and protecting reputations earned through participation in
global commerce. The factors identified by the Federal Court of
Appeal in this case serve as a useful guide to the types of
evidence that parties and courts should consider, in this case and
beyond, in determining whether a mark merits protection in
The Federal Court dismissed a motion by Apotex seeking particulars from Allergan's pleading relating to the prior art, inventive concept, promised utility and sound prediction of utility of the patents at issue.
Last year we saw the Canadian Courts release trademark decisions that granted a rare interlocutory injunction, issued jailed sentences for failure to comply with injunctive relief, grappled with trademark and internet issues...
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