The Trademark's Rightful Queen
Headlines recently broke that Edmonton based bakery ‘Dauphine Bakery and Bistro’, formerly ‘Queen of Tarts’ Bakery has been found to have infringed another Ontario bakery owner’s trademark.
In a previous blog post we discussed some of the advantages of holding a registered trademark. The Queen of Tarts story is a clear example of how holding a registering your trademark can give significant protection to your business’s brand. This is a case of two local small business owners trying to protect what they worked hard for. We’re not here to dispute either of their intentions. What we can do is use this dispute as a trademark learning-lesson for other new small businesses.
Before looking at some of the lessons that we can learn, here’s a gist of the story Unless otherwise noted, the details are based on the case judgment which was released in August 2011.
The claimant is Ms. Pick who is the Toronto-based registered trademark holder of THE QUEEN OF TARTS and Ms. Kearney, the Edmonton-based unauthorized user of the trademark.
In 1999, Ms. Pick started using the trade-name and trademark THE QUEEN OF TARTS for her baking business. By March 2005, she successfully registered the trademark, THE QUEEN OF TARTS on and in connection with “baked goods, namely, tarts, cookies, cakes, cupcakes, loaves, hand-decorated gingerbread men and holiday cookies, quiches and savoury tarts; wholesale and retail store services specializing in baked goods”. Ms. Pick had used THE QUEEN OF TARTS prominently in the business’s various advertising and promotional materials in various media, including on the business website, package labeling and retail store signage.
(In 2009, Ms. Pick decided to put her business on hold due to family reasons. As of date of publication, Ms. Pick’s business is on hold, but expected to reopen in the near future)
Around November 2010 Ms. Pick found out that Ms. Kearney’s Edmonton store and market stall was using the name ‘Queen of Tarts’ (minus ‘the’) without Pick’s authorization. To cut a long-story short, Pick filed a trademark infringement suit against Kearney.
In May 2011, Ms. Pick served a Statement of Claim to Ms. Kearney for trademark infringement and passing-off. The statement of claim would have details of Pick’s claim, and that there would be court proceedings to test Pick’s claim. Kearney failed to respond with a Statement of Defence.
The court made judgment in August 2011.
The court ordered:
1. $10,000 to Ms. Pick for loss of sales and for damage to reputation/goodwill.
2. Costs of the infringement action to Ms. Pick
3. Declaration – Pick is the trademark holder of ‘QUEEN OF TARTS’
4. Injunction – stopping all of Kearney’s use of the trademark
LESSONS TO LEARN
This case has many learning lessons for the prospective small business owner. Here are five:
1. Do a trademark search before you register your trade name (as a business name or provincial/federal corporation). Even if you don’t have plans to register a trademark, you should still be doing a trademark check. The reason being is that as a potential business owner, you must be careful you are not infringing someone else’s trademark. So, if you’re planning on registering a provincial corporation, only doing a corporate name search is insufficient. Failing to doing a trademark search can lead to future legal nightmares, business advertising/re-branding costs, time and stress. In this respect, the trademark registry serves two purposes. Kearney relied solely on a provincial corporate name check. She had infringed Pick’s trademark because she did not complete a federal trademark check to ensure that she was not infringing someone’s trademark.
2. Once you register your trademark, it is protected across Canada. Even though Pick ran a local Toronto business, as a registered trademark holder, she was still able to protect her trademark from being used by Kearney’s Edmonton business.
3. Proof of actual damage is not required – In order for the court to award monetary damages to an infringed trademark holder, the trademark holder is not required to prove loss of goodwill or loss of sales. In this case, without proving actual damage, the court awarded Pick $10,000 in damages for loss of sales and damage to goodwill/reputation.
4. Do your research – Do your own research and find out what is required to protect your business. Don’t rely on advice from fellow business owners. Take the extra and most vital step to check with direct authorities/business resources. For Toronto, small businesses may find useful Service Ontario and Enterprise Toronto. In Kearney’s case, she believed that incorporating the business was all that she had to do, and that she verified this with other fellow small business owners.
5. A trademark is a vital and valuable asset for a business – A trademark adds much value to a business. The Queen of Tarts case shows us to what lengths a business owner will go through to protect their trademark and how agonizing it can be for another to lose it.
If you can take one of these lessons away with you, it is this: when you’re starting up your business, make sure to check the trademark registries.