BC Court Of Appeal Tackles Online Trademarks In Keywords And Domain Names

The BC Court of Appeal has unanimously reversed what was the leading Canadian trial judgment to address Internet keyword advertising, clarifying the law of trademarks on the Internet. In Vancouver Community College v Vancouver Career College, 2017 BCCA 41, the court confirmed that trademark confusion must be assessed when a consumer first encounters the trademark online, including in Google search results and not merely when the user reaches the target website. The court also reconciled competing decisions regarding the use of trademarks in domain names.

Confusion arises on first impression—even online

Most importantly, the court found that consumer confusion must be assessed when a consumer first encounters a trademark online, whether in a domain name or advertisement. The court overturned the trial judge's finding that the "first impression" cannot arise on a Google search until the searcher has visited the advertiser's website. The court also disagreed with an earlier Federal Court decision that touched on this issue in the context of metatags: see Red Label Vacations Inc. v 411 Travel Buys Limited, 2015 FC 18 at para. 115, aff'd 2015 FCA 290.

Here, the defendant's advertisements using the domain name VCCollege.ca, displayed by search engines alongside search results for VCC, were found to create confusion and amount to passing off.

This finding requires that advertisers will need to pay the same attention in preparing online advertisements—including sponsored links—as other advertising content, to ensure that such advertising does not create a likelihood of confusion.

Domain names can create confusion

The Court of Appeal also reconciled two existing lines of authority regarding domain names. The court confirmed that the use of a trademark in a domain name is unlawful unless a portion of the domain allows consumers to distinguish between the owner of the trademark and the owner of the domain name, without reference to the underlying website.

By doing so, the court reconciled three earlier decisions. The first two, BCAA v Office and Professional Employees' Int. Union, 2001 BCSC 156, addressing "bcaaonstrike.com," and Insurance Corporation of British Columbia v Stainton Ventures Ltd., 2014 BCCA 296, addressing "icbcadvice.com," involved passing off claims that were both dismissed. In those cases the additional domain suffix"onstrike" and "advice" respectivelypermitted consumers to distinguish those websites from the websites of the owners...