A federal judge recently ruled that a Vancouver dispensary formerly named Herbs “R” Us Wellness Society will have to pay Toys “R” Us for damaging the ‘’good will’’ of the Toys “R” Us name.
In the decision, posted June 11, 2020, the Judge ruled that Herbs “R” Us Wellness Society had used the registered trademark of Toys “R” Us by using he “R Us” phrase in their name in a way that diminished Toys “R” Us’ brand, ordering the dispensary to destroy any packaging, advertising materials or labels and pay $15,000 in damages to cover the cost of the case.
The Judge did not agree with Toys “R” Us’ claim that the dispensary name was a trademark violation, only a trademark infringement that diminished the company’s good will. He also did not agree with Toys “R” Us’ demand of $50,000 in punitive damages.
The court records state that Toys “R” Us had demanded the dispensary stop using the “R Us” in their name and branding, without compliance.
I am satisfied that Toys “R” Us has established that the use of the HERBS R US design mark is likely to depreciate the goodwill attaching to the registered trademark TOYS R US & Design… I conclude that Toys “R” Us is entitled to an injunction to prevent use of the HERBS R US trademark and trade name and is entitled to nominal but not punitive damages, as well as its costs of this application.
However, I conclude that Toys “R” Us has not established trademark infringement under section 20 or passing off under subsection 7(b) of the Trademarks Act. Although the similarities between the trademarks are evident, the pronounced differences between the goods and services of Herbs “R” Us and those of Toys “R” Us are such that I cannot conclude that a consumer – even a casual one somewhat in a hurry with an imperfect recollection of the TOYS R US marks – would infer that they were manufactured, sold or performed by the same person.Mr. Justice McHaffie
A business at the same location is currently open, with the Herbs R Us logo still on the store windows, although they are now operating as Herbs on Broadway. According to a news report from May 2019, the city of Vancouver said the business would likely be targeted for legal action for operating in the city without a licence following a court case that affirmed the city’s efforts to close cannabis dispensaries without a business licence.
Although many unlicensed dispensaries in Vancouver have voluntarily closed since legalization, the city and the province’s Community Safety Unit has been slow to target many Vancouver dispensaries thus far. The CSU carries out compliance and enforcement activities against unlicensed cannabis retailers and other illegal sellers in BC. A source close to the issue says the Herbs R Us location has had product seized in the past.
An active Instagram account for a dispensary doing business at 108-223 W. Broadway called Herbs on Broadway says they are formerly known as Herbs R Us. The business’ Facebook account has not ben active since 2018. Calls to the number associated with the location have gone unanswered.
Toys “R” Us Inc. announced in early 2018 March that it would close all 735 of its U.S. stores, although Toys “R” Us Canada has been thriving.
Featured image via Google Maps