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Forget Paris – Federal Court rules that there must have been trademark use in applicant’s country of origin at the Canadian filing date to rely on its country of origin registration as a basis for registration in Canada

19/03/2013

As in the United States, Canadian trademark applications must contain a basis for registration (a claim to the right to register). Amongst these possible bases is use and registration in applicant’s country of origin pursuant to the provisions of Section 16(2) of the Trademarks Act. Unlike The United States, or for that matter any jurisdiction we are aware of, the Act requires that in order to rely on a country of origin registration as a basis for registration in Canada the mark must also have been used.  The formal application requirements attaching to a Section 16(2) basis for registration are set out in Section 30(d).

The critical date for this use requirement has long been a topic of discussion. That the foreign application need not issue to registration until publication in Canada is agreed. As to when the requisite use must be in place is keenly debated – is it the date of application, or prior to publication? The Canadian Trademarks Office has routinely accepted the addition of a basis for registration relying on use and application or registration in applicant’s country of origin at any time prior to publication. Note, however, that the basis is not in acceptable form unless it contains the required assertion of use and the name of a country of use. The Examination Section does not query when the use commenced, perhaps because the critical date for such use has not been clearly established. There has been no ruling by the Courts on the matter, until now.

The Thymes, LLC and Reitmans (Canada) Limited (T-1423-11, FCTD, February 6, 2013), is an appeal to the Federal Court from a Registrar’s decision in Opposition Proceedings. Amongst other issues, an issue to be resolved was whether the Registrar erred “in concluding that use of a trademark registered or applied for in a foreign jurisdiction was required in a foreign country as of the filing date of the application in Canada in order to be a valid filing basis under 16(2) of the Act“. The Court has upheld the Registrar’s decision that the critical date for the required use is the filing date of the Canadian application. The decision further states at paragraph 19 it is clear that the required use must be in the country of origin of the applicant.

In reaching the former decision, the judge found that the critical date for determining compliance with Section 30(d) is the filing date of the Canadian application. Many in the Canadian profession will find this a wrong conclusion, pointing to the fact that Trademark Regulations permit for the addition of the basis after filing but before publication.  However, while neither the Act or Rules state that the use must have been on or before the Canadian filing date, nor do they or the trademark application forms set out in the Rules provide for an assertion of country of origin application or registration coupled with the statement that an applicant has not yet used or intends to use (and will commence the required use prior to publication). The Rules also permit for the deletion of a “use in Canada” or “making known in Canada” or “use and registration in a country of origin” basis and replacement with a “proposed use in Canada” basis following filing and before publication. In a line of thinking contrary to the Court’s this would mean that the application is valid even if the applicant did not have a bona fide intention to use in Canada at the Canadian filing date. Moreover, the bases for registration set out in Section 16 confer an effective “entitlement date”. Absent an earlier priority filing date, those dates are the date of first use or making known in Canada in the case of an application based on “use” or “making known” in Canada  and the Canadian filing date in the cases of applications based on “use and registration in the country of origin” and “proposed use in Canada”. It is perhaps bizarre to find that trademark rights flow from the date of filing in Canada when the clear requirement for securing the right, namely use somewhere, was not in place at that time.

The Court’s ruling begs the question of vulnerability to invalidity of issued registrations based solely on use and registration in a country of origin where the use commenced after filing in Canada. There is authority that a Canadian registration cannot be held invalid on the ground that the application from which it proceeded was not in compliance with Section 30 by way of misstatements, unless there has been fraudulent misrepresentation. We therefore do not see a risk to current registrations (absent fraud) but would caution that registrations issuing from future applications that issue based only on use and registration abroad where use was not in place at the Canadian filing may be more vulnerable.

The latter finding that the use must have been in the applicant’s country of origin is quite wrong and, perhaps, an unintended phrasing. The earlier Opposition Board decision did not so find and Mr. Justice Manson at other parts of his decision speaks of the use being “required in a foreign country” and “use abroad”. It is commonly accepted that the required use may be made anywhere, including Canada (although some would argue that Canadian use does not qualify – a debate for another day).

An appeal may follow. Unless and until such decision alters the Federal Court ruling of February 6, 2013 we strongly recommend that any application for registration in Canada not based on use or making known in Canada but a basis for registration relying on registration in applicant’s country of origin where use commenced after the Canadian filing date and/or in other than applicant’s country of origin also contain a “proposed use in Canada” basis. It is clear from the Court’s ruling that the striking of a country of origin basis for registration for failure to establish use elsewhere as of the Canadian filing date or timely use in other than applicant’s country of origin will not defeat the application providing an alternate valid basis for registration is claimed. As it is also unclear as to whether proceeding to registration on the country of origin and use basis alone where use elsewhere commenced after filing or in other than applicant’s country of origin could comprise an avenue for invalidity, we further strongly recommend that the requirements attaching to a “proposed use in Canada” basis, namely, the commencement of trademark use in Canada and the filing of a Declaration of Use to that effect and required to perfect a “proposed use in Canada” basis be followed through.

This article is for information purposes only and does not constitute legal or professional advice.

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