Distinctly (not) distinctive

The Supreme Court of Canada recently denied leave to appeal from the Federal Court of Appeal’s (the “FCA”) decision in Sadhu Singh Hamdard Trust v. Navsun Holdings Ltd., 2019 FCA 10 (CanLII). Caroline Camp writes about the implications of the case. Most interesting is that the FCA confirmed that intervening use of a mark by a third party, even if that use amounts to infringement of a registered trademark, can be sufficient to cause the registered mark to lose its distinctiveness and therefore become unenforceable. So the mantra “use it or lose it” is actually “use it and enforce it or lose it” in Canadian trademark practice. Read her complete article here.

LIVE is dead in the water – The Federal Court tackles another thorny trademark use decision

In a recent Federal Court Trial Division decision, the trademark registration for LIVE, registered in association with, among other things, hotel, entertainment and advertising services, was expunged for non-use during the relevant three year period.  The Court reviewed a number of conflicting decisions on the use of marks in Canada in the context of non-use cancellation proceedings, where the primary service is performed outside of Canada – for example, the relevant hotel or entertainment establishment is physically located outside Canada – but some ancillary or related aspect of the services could be said to be performed in Canada – for example reservations for the hotel or for tickets to the entertainment venue could be made by Canadians while physically located in Canada.

The Court reiterated that in order for there to be use of a mark in Canada, it is essential that some aspect of the services must be offered directly to Canadians or performed in Canada and that it must be demonstrated that people in Canada obtained “some tangible, meaningful, benefit” from the use of the Mark in association with the registered service.  In expunging the registration, the Court found that “simply holding a reservation for a hotel in the US is not a tangible and meaningful benefit enjoyed in Canada, despite that it may ensure that a room will be available upon arrival.  The tangible benefit occurs only once the person leaves Canada and travels to the US and fulfills the reservation.”  A similar conclusion was arrived at in relation to entertainment services.  The advertising services were not performed for any third party, meaning there was no trademark use.

Barring an appeal, the decision is noteworthy as it appears to be counter to a recent Federal Court decision involving hotel services provided in very similar circumstances.  In this case, the Judge distinguished the earlier decision, on the basis that “Unlike in Hilton, there are no rewards points that can be used in Canada. …Rewards points could not be earned in Canada or redeemed in Canada. There is no evidence of a tangible, meaningful benefit enjoyed in Canada from making an online reservation.

Canadian Trademark eFiling Systems Outage from June 13 to 17, 2019 – What you need to be aware of

The Canadian Intellectual Property Office will be taking its efiling systems for trademarks down from Thursday, June 13, 2019, at 00:00 EDT to Monday, June 17, 2019, at 06:00 EDT, for system upgrades and enhancements.

How does this affect Applicants and owners of  trademark Registrations in Canada?  Among other things, this outage will affect:
• e-Filing of new Trademark Applications;
• Registration of pending Applications; and
• Renewal of existing Registrations

Long awaited and significant changes to Canadian Trademark law – many of which have been previously discussed in this Blog – don’t come into force until June 17, 2019 (the CIF Date).  However, with the above systems outage, anyone hoping to file a new application or to renew an existing registration – with the intent of doing so under the current, lower pricing that is not tied to the number of Nice classes of goods/services covered – will need to do so prior to midnight (EDT) on June 12, 2019.  The same time limit applies to anyone hoping to finalize registration of an allowed application with the intent of obtaining a 15 year term, rather than the 10 year term available for registrations that issue after the CIF Date.

Please contact the author for more information or advice on the above.

Royal Assent Received for Most Recent Amendments to Canada’s IP Legislation

Bill C-86, the Budget Implementation Act, 2018 (the “Act”), received Royal Assent on December 13, 2018, after moving through Parliament at a blistering pace. In all, less than two months elapsed between the tabling of the bill and its passage.

These amendments will affect the Trade-marks Act, the Patent Act and the Copyright Act.  In addition, a new regulatory body for Canadian Patent and Trade-mark Agents will be created pursuant to the College of Patent and Trade-mark Agents Act. 

The most significant amendments to Trade-marks Act are as follows:

Read more

Trader Joe’s trying to make Pirate Joe’s “walk the plank” in U.S. trade-mark case

In the ongoing dispute between Michael Hallatt, a Vancouver businessman, and U.S. based retailer Trader Joe’s, the United States Court of Appeals for the Ninth Circuit (the “Ninth Circuit”) has overruled the 2013 decision of the U.S. District Court for the Western District of Washington (the “District Court”) not to hear Trader Joe’s claim against Hallatt for, among other things, trade-mark infringement, dilution, unfair competition and false advertising.

The dispute arose out of Hallatt’s purchase of products from Trader Joe’s stores in the U.S., particularly in the state of Washington, for resale in Canada (there are no Trader Joe’s stores in Canada).  Hallatt has and continues to mark up and re-sell Trader Joe’s products at his store in Vancouver, named Pirate Joe’s.

The goods are not counterfeit, and the source of the products being sold is not in dispute – the packaging on the products bears Trader Joe’s trade-marks, and Hallatt states on his website that he sells Trader Joe’s products.  Hallatt expressly states on his website that he is not an authorized or affiliated distributor or reseller of Trader Joe’s.  Nevertheless, Trader Joe’s took the view that Hallatt’s conduct violated its U.S. trade-mark rights under the U.S. Lanham Act, and in 2013 it brought a claim against Hallatt in the District Court.

Taking the view that any unlawful conduct by Hallatt would have taken place in Canada rather than the U.S., and that Hallatt’s activities did not cause a cognizable injury to Trader Joe’s in the U.S. or an effect on American foreign commerce, the District Court judge decided in October 2013 that the Court had no subject matter jurisdiction to hear Trader Joe’s claims.  Trader Joe’s appealed that decision to the Ninth Circuit.

The Ninth Circuit disagreed with the District Court judge, opining instead that Hallatt’s activities could affect the goodwill and value of the Trader Joe’s brand in the U.S., and accordingly, its U.S. trade-mark rights.  The Ninth Circuit concluded that the Lanham Act does apply to Hallatt’s allegedly infringing conduct, and in the result, remanded the case back to the District Court for further proceedings.

We will be keeping an eye on this trade-mark case that is likely of particular interest to cross-border shoppers.

In no mood for charity: Federal Court confirms that charities are not necessarily public authorities

The Federal Court of Canada recently confirmed in Starbucks (HK) Limited v. Trinity Television Inc., 2016 FC 790 (the “Decision”) that status as a charity is, in and of itself, insufficient to constitute an entity as a public authority for the purpose of obtaining an official mark.

(For a discussion about official marks and their interplay with regular trade-marks, please see this previous post on our blog.)

The facts leading up to the Decision are straightforward: in 2013, Starbucks (HK) Limited (“Starbucks”) filed an application to register the trade-mark NOW TV & Design.  During prosecution, an official mark for NOWTV, owned by Trinity Television Inc. (“Trinity”), was cited against the Starbucks application.  In response, Starbucks commenced a judicial review application against the Registrar’s decision – made in June 2001 – to give public notice of the adoption and use of NOWTV as an official mark.

In the result, the Court quashed the Registrar’s decision to grant NOWTV as an official mark to Trinity, clearing the path for Starbucks to move ahead with its application.  Of particular interest were the following points made by the Court:

– the law is now clear that status as a charity is, in and of itself, insufficient to constitute an entity as a public authority; and

– it would be patently unfair and completely contrary to the interest of justice if an entity that is not a public authority was permitted to enjoy the exceptional rights conferred on the holder of an official mark.

As a potential point of distinction when it comes to the precedential value of this case, it is noteworthy that Trinity did not participate in the judicial review application; indeed, the Court was advised by counsel for Starbucks that a former president and director of Trinity had advised that Trinity had sold its business to Rogers in 2005.  That being said, given how easily the Court arrived at the conclusion that charitable status does not necessarily equate to being a public authority, it seems unlikely that Trinity’s participation would have changed the result.

From a practical perspective, the Decision serves as a timely reminder to trade-mark applicants that, while robust, official marks can nevertheless be challenged and removed under the right circumstances.  Where an official mark has been cited during prosecution of a regular trade-mark application, it is important to carefully scrutinize the official mark, in order to ascertain any potential vulnerabilities that could lead to its removal.

On the other hand, the Decision is also a reminder to charities holding official marks that those official marks may potentially be at risk, if challenged via judicial review.  To mitigate that risk, those charities ought to consider filing regular applications to register their trade-marks.

What’s Your Evidence? The Danger of Hearsay Evidence in IP Litigation

In Pfizer Canada Inc. v. Teva Canada Limited, 2016 FCA 161, the Federal Court of Appeal (“FCA”) recently overturned a substantial damages award in a pharmaceutical patented medicines action on the basis that the trial judge admitted improper hearsay evidence. This is an important reminder that the hearsay rule of evidence is alive and well.

At trial, only one witness was called to testify in support of damages and he did not have actual firsthand knowledge of the purported facts to which he was testifying. Instead the witness could only testify to the oral and written statements of others.  The FCA ruled that this evidence was hearsay, and therefore inadmissible.

Hearsay evidence is an oral or written statement made by a party who has not come to court to testify. An example of oral hearsay is a witness testifying that “John told me he would give me $100”. This is hearsay because the author or speaker of these statements is not present in court to testify to the truth of the statement. Whether or not the statement is admissible depends on the use of that statement. If the purpose of calling the hearsay evidence is to prove the truth of the statement, then the statement is inadmissible. Therefore, in this example, the proper way to prove that John would give the witness $100 is to call John as a witness to testify to the truth of that statement; otherwise, the statement cannot be used to prove that John would have given the witness any money.

Despite the recent trend of some courts and tribunals to relax the rules of evidence regarding the admissibility of hearsay evidence to allow for more flexibility, here, the Federal Court took a more strict and traditional analysis.

As a result, parties to intellectual property disputes must be aware of the potential inadmissibility of hearsay when collecting evidence. This is particularly germane in trade-mark disputes where evidence of confusion generally comes from second hand sources. The proper collection and documentation of this evidence can make or break a successful infringement or opposition proceeding.

Trade-mark holders should be proactive when presented with evidence of confusion. It may not be enough for a representative of the company to swear an affidavit that the company received phone calls from those who say they confused the company’s trade-mark with another. The better evidence is directly from each of those callers who can testify first hand to their confusion. Where feasible, trade-mark holders should have a process in place to document the names and contact information of witnesses and the details of any evidence of confusion. This way, individuals able to give first hand evidence can be contacted if the matter proceeds to litigation or an opposition proceeding. If such evidence is not properly preserved, a trade-mark holder may be left with no admissible evidence to prove its claim.