BC Court Awards Damages For False And Misleading Amazon Infringement Notices

On January 15, 2024, in Keezio Group, LLC v The Shrunks’ Family Toy Company Inc., 2024 BCSC 64, the Supreme Court of British Columbia (the Court) awarded damages for false and misleading trademark and copyright infringement complaints filed with Amazon.

This summary trial relates to a dispute between two competitors who both sell inflatable beds for children on Amazon.

Keezio Group, LLC (Keezio) alleged that The Shrunks’ Family Toy Company Inc. (The Shrunks) had made unfounded trademark and copyright infringement complaints to Amazon.  As a result of these complaints, Amazon delisted Keezio’s product listings, causing Keezio to lose business.

The Court determined that both the trademark and copyright complaints were false because Keezio’s actions did not constitute infringement. The trademark complaint related to a comparative chart displayed by Keezio which outlined comparative information about the parties’ products and displayed The Shrunks’ registered trademark, THE SHRUNKS.  The Court noted that the use of a competitor’s trademark for comparison purposes does not constitute trademark infringement within the meaning of the Trademarks Act.

With respect to the copyright claim, the Shrunks relied on Keezio’s reproduction of their inflatable bed’s design to support an allegation for copyright infringement. However, the Court, in referring to section 64(2) of the Copyright Act, stated that there is an exception to copyright infringement where the copyright relates to the design of a useful article that is reproduced in a quantity of more than fifty.  It was clear to the Court that The Shrunks’ inflatable beds had been reproduced more than fifty times, and therefore, the Court concluded that the allegation of copyright infringement was also false and misleading.

The Court awarded damages amounting to $24,450 USD, based on the loss of profit for the lost sales during the delisting period.

Summary By: Michelle Noonan