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Newspaper Wins Passing Off Claim, Loses Infringement Claim


July 13, 2021

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A decade-long legal battle surrounding the use of the Punjabi term AJIT in the logos of two separate newspapers may finally be over. In Sadhu Singh Hamdard Trust v Navsun Holdings Ltd, 2021 FC 602, the Federal Court redetermined the issues of passing off and trademark infringement for a second time.


The Court ruled in favour of Sadhu Singh Hamdard Trust (“Hamdard Trust”) in its claim of passing off under the Trademarks Act (the “Act”), but Hamdard Trust’s claims for infringement and depreciation of goodwill against Navsun Holdings Ltd. (“Navsun”) were dismissed.


Background


AJIT is the Pubjabi term for “unconquerable” or “invincible”. Hamdard Trust publishes a Punjabi-language newspaper, the Daily Ajit, that is widely-read in India and has a modest readership in Canada. Since 1984, Daily Ajit has featured a logo with the Punjabi word AJIT in a red, stylized form (“Hamdard Trust’s Logo”):

Unique features of the logo include the “hook” above the word AJIT and the flattened bottom of the final letter. This logo has been registered in Canada since September 2015.


Navsun publishes the Weekly Ajit, a newspaper targeted to the Punjabi community in Canada. Similar to the Daily Ajit, the Weekly Ajit features the word AJIT with a “hook”, a flattened bottom of the final letter, and the words AJIT WEEKLY underneath (“Navsun’s Original Logo”):

The logo was used since 1993 and was registered in March 2005, before being cancelled in 2010.


Since September 2009, Navsun has used a modified logo with the word AJIT in green (“Navsun’s Modified Logo”), pursuant to a Partial Settlement Agreement (“PSA”) between Hamdard Trust and Navsun:

The present action was commenced in July 2010 by Hamdard Trust, which alleged that Navsun’s Original Logo and Navsun’s Modified Logo caused confusion with, infringed upon, and depreciated the value of Hamdard Trust’s Logo. Several decisions from the Trademarks Opposition Board, the Federal Court and the Federal Court of Appeal followed, eventually resulting in the present second redetermination of the matter.


Key Issues


1. Did Navsun engage in passing off within the meaning of section 7(b) of the Act?


2. Did Navsun infringe Hamdard Trust’s Logo within the meaning of section 19 or section 20 of the Act?


3. Did Navsun depreciate the goodwill attached to Hamdard Trust’s Logo within the meaning of section 22 of the Act?


Decision


Passing Off – Section 7(b)


The Federal Court found that Navsun engaged in passing off with respect to Navsun’s Original Logo, but not with respect to Navsun’s Modified Logo.


For a claim under section 7(b) to succeed, a plaintiff must establish three elements: (i) existence of goodwill; (ii) deception to the public because of a misrepresentation; and (iii) actual or potential damage to the plaintiff.


As it relates to Navsun’s Original Logo, the Federal Court found that, in 1993, Hamdard Trust had a protectable right and sufficient goodwill in Canada to support a claim for passing off. Further, the Court found that the design element of Navsun’s Original Logo was identical to Hamdard Trust’s Logo and that its use resulted in a loss of control for Hamdard Trust over the impact of its trade name in Canada. All three criteria for a claim of passing off were therefore met.


Hamdard Trust did not meet the threshold distinctiveness required for a passing off claim in regards to Navsun’s Modified Logo. In the PSA, both parties agreed that Navsun’s Modified Logo was “clearly distinguishable to the average person” from Hamdard Trust’s Logo, notably because of its form, letter thickness, and colour. Further, there was no evidence that a substantial portion of Punjabi-language readers in Canada associated it with Hamdard Trust’s Logo.


Infringement Claims – Sections 19 and 20


The Federal Court ruled that Hamdard Trust’s trademark infringement claim under section 19 of the Act could not succeed. For a section 19 claim to be successful, Navsun’s Modified Logo needed to be identical to Hamdard Trust’s Logo. While the Court recognized the logos were similar, they were not considered identical, as required by section 19.


Hamdard Trust’s infringement claim under section 20 of the Act was also unsuccessful because the Court saw no likelihood of confusion. In assessing the section 20 claim, the Federal Court had to determine whether Navsun’s Modified Logo was “confusingly similar” to Hamdard Trust’s Logo. Navsun’s Modified Logo had become distinctive among the target market given the volume of its readership by 2014.


Depreciation of Goodwill – Section 22


The Federal Court concluded that Hamdard Trust’s Logo did not have sufficient goodwill in Canada at the relevant time to support a claim of depreciation of that goodwill. Hamdard Trust needed to demonstrate the two logos were sufficiently similar to evoke a mental association, thereby depreciating the value of the goodwill attached to Hamdard Trust’s Logo. While the logo enjoyed a high degree of recognition in 1993 to support a passing off claim in regards to Navsun’s Original Logo, it did not continue to enjoy sufficient goodwill in 2015 and beyond.


Remedies and Costs


The Federal Court ruled that Navsun was liable to Hamdard Trust for passing off with respect to Navsun’s Original Logo and was ordered to pay $10,000 as compensatory damages. The Court dismissed all other claims.


Given the divided success of the second redetermination of the matter, the Court did not award costs to either party.

Authors: Jennifer Linde and Meghan King

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