A recent decision considered whether a trade-mark owner was able
to show it had used its registered mark in association with the
operation of a retail business in response to a notice under
section 45 of the Trade-marks Act.
Section 45 Proceedings
Section 45 provides that the registrar, at any time and at the
written request made after three years from the date of the
registration of a trade-mark by any person who pays the prescribed
fee, must, unless the registrar sees good reason to the contrary,
give notice to the registered owner of the trade-mark requiring the
registered owner to furnish within three months an affidavit or
statutory declaration showing with respect to each of the wares or
services specified in the registration, whether the trade-mark was
in use in Canada at any time during the three-year period
immediately preceding the date of the notice and, if not, the date
when it was last so in use and the reason for the absence of such
use since such date.
The purpose of this section is to provide a summary procedure
for trimming the register of "dead wood". Frequently
proceedings under the section will be instituted by third parties
who are prevented from obtaining a registration for a desired mark
by a registration which is perceived not to be in use.
The registrar must not attempt to resolve any question other
than whether the registration is in use. The procedure under the
section is not intended to create or rescind substantive
The requesting party cannot file evidence or conduct a cross
examination on the affidavit or statutory declaration of the
registered owner. The requesting party is limited to filing written
argument and taking part in an oral hearing to argue that the
registration should be expunged or amended.
The registrant owned the trade-mark HOME ENTERTAINMENT SOURCE
& Design as shown below:
for use in association with the "operation of retail
businesses selling electronic products".
The hearing officer summarized the registrant's evidence as
showing that the registrant did not itself sell electronic products
at the retail level. The registrant appeared to be in the business
of sourcing, buying and re-selling large volumes of brand name
products to retailers who are members of the registrant's
"network". The registrant did not operate a retail
business in a specific geographic location or on the Internet. The
primary purpose of the registrant's main website was to inform
independent retailers that it was a source of products at a good
price for resale to the end consumer. A separate electronic
products website encouraged consumers to buy from independent
retailers who are affiliated with the registrant.
The hearing officer concluded that the "operation of retail
businesses" required that the registrant actually provide
retail store services. Such services can be provided through a
physical "bricks and mortar" store, through mail order or
through the Internet to retail purchasers.
With respect to the Internet, it had by recently found by the
Federal Court on an appeal from a determination under section 45,
that the operation of a website accessible to Canadians that
provided information and pricing concerning specific products, was
sufficient to show use in association with "retail store
When the registrant's evidence was considered from this
perspective the hearing officer concluded that the registrant had
not shown it was providing "retail store services" to the
public and the registration was expunged.
The decision emphasizes the importance of ensuring that the
services or wares are accurately described when an application for
a trade-mark is filed. In addition, in cases where the nature of
the applicant's/registrant's business changes with time, a
new application or extension application should be filed to ensure
it trade-mark rights are adequately protected.
Finally, nothing prevents the registrant in this case from
filing a new application for its mark for use in association with
the wares or services it is actually offering, but the party
originally requesting expungement may attempt to oppose the
application and there will be a period of time when the
applicant's rights are not protected by a registration.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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A recent Saskatchewan Court of Queen's Bench decision allowed a court-appointed receiver to sell and transfer intellectual property rights free and clear of encumbrances, finding that a license to use improvements of an invention was a contractual interest and not a property interest.
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