BMW Achieves Divided Success in Federal Court Over Use of Single-Letter Trade-Mark

Single letter marks have generally been thought to afford a limited degree of protection on the assumption that it would be difficult to develop goodwill and consumer recognition in relation to them. However, recent trade-mark litigation in the Federal Court of Canada involving automotive brands has proven to be the exception to that rule. BMW Canada Inc (BMW) launched an action against Nissan Canada Inc (Nissan) for trade-mark infringement, depreciation of goodwill and passing off of BMW's M, M3, M5, M6 and M & Design trade-marks. Of these, M3, M5, and M & Design were registered; the others were the subject of applications to register. BMW alleged a likelihood of confusion as to source as a result of Nissan's use of the marks M and M6, in advertising, promoting, offering for sale and selling automobiles, parts and accessories. In a decision released March 7, 2007, the Court held that Nissan had neither infringed nor depreciated the goodwill of BMW's registered M marks; however, the Court found that the use the marks M and M6 for Nissan's Infiniti line of automobiles amounted to passing off, contrary to sub-section 7(b) of the Trade-Marks Act. The Court ruled that by using M and M6 as trade-marks, similar in form to the same trade-marks of BMW for generally similar wares in essentially the same trade or business, Nissan had created a likelihood of confusion between the sources of the wares. Whether it was intended or not, said the Court, that confusion was likely to arise because of Nissan's actions. For the full reasons for judgment in BMW Canada Inc and Bayerische Motoren Werke Aktiengesellshaft v Nissan Canada Inc, 2007 FC 262, see: http://decisions.fct-cf.gc.ca/en/2007/2007fc262/2007fc262.html [Note: The judgement has been stayed on an interim basis, pending an appeal (see http://decisions.fca-caf.gc.ca/en/2007/2007fca111/2007fca111.html). In the stay decision, Sexton JA stated: "It is arguable that the decision of MacKay DJ to allow the claim for passing off is inconsistent with his finding regarding the evidence and his dismissal of BMW's claim regarding trade-mark infringement and depreciation of goodwill."] Summary by: Katharine McGinnis