Federal Court Rejects Argument That Trade-Mark Confusion Analysis Should Consider “Hypothetical” Channels Of Trade

Bridgestone Corporation v Campagnolo SRL, 2014 FC 37, a recent decision of Justice McVeigh of the Federal Court, presents interesting insights into the types of “channels of trade” to be considered in deciding whether a mark is confusing with an existing registered trade-mark. The case involved an appeal by Bridgestone Corporation of a decision of the Trade-marks Opposition Board from an application by Campagnolo SRL, a manufacturer of high-end bicycle equipment, to register the trade-mark POTENZA in association with a wide range of bicycle parts and accessories. The application contained an extensive list of wares in association with which the applicant sought to register the POTENZA mark; however, it specifically excluded bicycle tires, brakes, wheels, rims and spokes. Bridgestone, which is primarily known for manufacturing automotive products, opposed the application. It owns the mark POTENZA, registered in association with tires, tubes and wheels, and the mark POTENZA RE92, registered in association with tires and inner tubes. It argued that Campagnolo’s proposed trade-mark was not registrable because consumers would confuse it with Bridgestone’s POTENZA marks. The appeal to the Federal Court centered on two grounds. The first was that Campagnolo’s trade-mark would confuse consumers because Bridgestone and Campagnolo sell similar types of products. The Board rejected this argument, finding that Campagnolo’s trade-mark would not confuse consumers because the bicycle components are “fundamentally different” from the types of products that bear Bridgestone’s POTENZA trade-mark. Significantly, it noted that Campagnolo’s trade-mark application did not include tires, brakes, wheels, rims and spokes. Justice McVeigh held that these conclusions of the Board were justified. The second prong of Bridgestone’s argument was that both companies’ trade-marked wares could be sold in similar channels of trade. Bridgestone produced affidavit evidence indicating that it is common for stores to sell both car tires and bicycle tires and accessories. It argued that, although Campagnolo currently only sells its products in high-end sporting goods stores, because its trade-mark application did not contain limitations on channels of trade, there was nothing to prevent it from selling those products in the same stores that sell Bridgestone’s products. The Board had dismissed this argument, noting that, on the evidence before it, Campagnolo was unlikely ever to sell its products in the types of stores that would sell Bridgestone’s products. In the Federal Court, Bridgestone argued that the Board erred by considering only the current channels of trade, and should have also considered any channels to which Campagnolo could expand in the future. Justice McVeigh rejected this argument, holding that when analyzing whether a proposed trade-mark may cause confusion with trade-marked products sold by another company, the Board should only consider the “predictable and usual” channels of trade in which the applicant would sell its products, rather than “all hypothetical channels” in which it could do so. Summary by: Kathryn May