Canada: Trademark Protection In Canada: Are You Official Or Are You "Famous"

A substantially similar article was originally published in IP & Technology Programme, October 2006.

At first glance, official marks and famous marks appear to have little in common. In spite of a seeming lack of commonality, however, they do share one very important attribute: they both constitute unusual categories of trademarks that can, and have, tripped up trademark owners, applicants and practitioners. We hope that this paper will shed some light on these two types of trademarks and provide some practical advice in their regard.

Official marks are unique to Canada and thus can cause practitioners some headaches in trying to help foreign clients understand why a seemingly innocuous mark that is not necessarily identical, and certainly not used in association with similar wares or services, is preventing them from not only registering a mark, but also using the mark.

The concept of famous marks is one that has not been wholeheartedly embraced by the courts in Canada. The recent Supreme Court of Canada decisions have made that very clear. How do you explain to your client that although its mark might be considered famous in its home country, it is unlikely to enjoy the same privilege here?

This article is a primer in both types of marks. It explains the background, recent decisions and the resultant conundrums facing trademark holders and their counsel today in Canada.

Official Marks

Official marks and trademarks are similar in principle. They are both used to brand an organization and its products and services so that they are recognized by the public. However, official marks make up a special category of mark in the Trade-marks Act1 (the Act) and there are important legal differences between the two. In general, an official mark is easier to obtain, maintain and protect than a trademark. Because the Act contains no provisions for expunging, cancelling or revoking an official mark, it has often been said that such marks are invincible. Therefore, official marks are either loved or loathed depending on the viewer’s position. For an organization eligible to obtain an official mark, it is often more advantageous to do so than to register a trademark. On the other hand, an organization either holding or applying for a trademark that is encroached on by an official mark is often frustrated by the limited means available to defend its mark. We discuss here some of the significant legal issues surrounding official marks, beginning with a description of their statutory basis.

What Is an Official Mark?

Official marks are one type of special marks that are prohibited for use as trademarks under section 9 of the Act. Section 9 marks are prohibited either automatically or after public notice of their adoption and use is given by the Registrar of Trade-marks (Registrar). Marks automatically prohibited are listed in section 9(1) and include the marks or emblems of the royal family, the Red Cross, the United Nations and the Royal Canadian Mounted Police. Official marks are among those that are prohibited after public notice is requested by a public authority of their adopted use as set out in section 9(1)(n). Other marks that are prohibited after public notice is given include the arms, crests and flags of Canada, its provinces and municipalities (9(1)(e)), marks of the Canadian Armed Forces, universities (9(1)(n)) and marks of other countries that are members of the Paris Convention and World Trade Organization (9(1)(i.3)).

Section 9(1)(n)(iii) which specifically protects official marks reads as follows:

9. (1) No person shall adopt in connection with a business, as a trade-mark or otherwise, any mark consisting of, or so nearly resembling as to be likely to be mistaken for,

(n) any badge, crest, emblem or mark

(iii) adopted and used by any public authority, in Canada as an official mark for wares or services,

in respect of which the Registrar has, at the request of … [the] public authority … given public notice of its adoption and use;

Consequently, before an official mark can attain the elevated status of a prohibited mark, three requirements must be met: (1) public notice must be given of the mark’s adoption and use; (2) the mark must have been adopted and used by the party requesting that public notice be given; and (3) the requesting party must be a public authority. Each of these requirements will be discussed in more detail below.

Section 12(1)(e) further prohibits the registration of any mark protected by section 9. And Section 11 prohibits the use of any such mark as a trademark.

Applying for an Official Mark

Providing public notice of an official mark’s adoption and use is quite different from the steps involved in registering a trademark. To register a trademark, an applicant must make an application to the Trade-marks Office. That application is examined to determine whether such a mark is already on the register of trademarks, whether the mark is distinctive and whether the mark meets the criteria for registration as set out in section 12, such as whether it would cause confusion with a registered trademark. The requirements for seeking public notice of an official mark, by contrast, are quite different. A public authority bypasses this application process when adopting an official mark. It need not satisfy the ordinary registrability criteria. It need only provide a letter to the Registrar requesting notice of the adoption and use of the mark (along with the prescribed fee). The Registrar has no discretion to refuse the public notice of an official mark.2

No specific form is required to request public notice of an official mark. The public authority simply writes to the Registrar requesting that public notice be given. In so doing, the name of the holder must be set out, as well as a statement that the official mark is in use in Canada. It is not sufficient if the mark is proposed for some future use. Actual evidence of the adoption and use of the mark is not required. Universities are an exception in that they are not required to adopt and use the mark prior to publication.

"Public authority" is not defined in the Act. However, evidence must be provided to show that the requesting party qualifies as a public authority. This can be a fairly substantial task. An example of what constitutes evidence may include the articles of incorporation or the legislative Act creating or organizing the public authority – for example, in the case of a hospital, copies of the legislation that creates the hospital should be attached. Any other evidence of how and to what degree the government exercises control over the public authority should also be attached. This, in turn, could include such information as submissions made to the government for approval to exercise certain duties, copies of government subsidy agreements, or other evidence of the public authority’s receipt of government funding.

The letter requesting public notice need not contain a statement of the products and/or services in association with which the mark is being used nor the date of the mark’s first use. This is irrelevant, since an official mark can be used in association with any products and services.

These letters requesting public notice are maintained as confidential. In this manner, they are not the same as applications for the registration of trademarks, which can be viewed on a public and searchable index of pending applications. The first knowledge the public has of an official mark is when the public notice is published in the Trade-marks Journal.

Challenging an Official Mark

The trademark owner with a mark similar, or even identical, to a new official mark cannot oppose the new official mark the way it can for another trademark application; nor can it pursue expungement proceedings. None of the traditional remedies available to challenge a trademark are available to those seeking to challenge an official mark. The reason is simply that an official mark is not a mark included on the register of trademarks. This has led trademark owners to challenge official marks by way of judicial review proceedings seeking to reverse the decision of the Registrar to give public notice of the adoption and use of an official mark. The grounds for such a proceeding tend to be creative to take advantage of the limited language of section 9(1)(n).

Much of the case law with respect to official marks is the result of three principal challenges. One of these challenges questions the status of the official mark holder as a "public authority". The second questions whether the official mark was in use when notice was given, as required by the Act. The third seeks the continued existence of the mark in a limited capacity. Each of these three challenges is discussed below in more depth.

Who Is a "Public Authority"?

Official marks can be held only by those organizations deemed a "public authority". The test for determining what constitutes a public authority has evolved over time. The original test used by the Registrar was a three-part test adopted from English jurisprudence. To be a public authority under this test, (a) it must have had a duty to the public; (b) it must have been subject to a significant degree of governmental control; and (c) any profit earned must have been for the benefit of the public and not for private benefit.3

In Registrar of Trade-marks v. Canadian Olympic Association (COA), the Federal Court of Appeal found that this test was not a proper test for determining a "public authority" under the Act. The Court determined that this test placed undue emphasis on the public nature of the authority rather than on whether the organization is, itself, an authority. The Court went on to find that it was unnecessary to consider whether the authority exhibited a public duty or an obligation for the purposes of the Act.4 This test was confirmed as a two-part test in Ontario Association of Architects v. Association of Architectural Technologists of Ontario. 5 In that case, the Federal Court of Appeal rephrased the remaining two elements of the test as requiring that the activities of the body, (a) be subject to significant degree of control by the appropriate government; and (b) benefit the public. The Court stated that any public duty owed by the organization could be considered under the second element of the test.6 The Architects test is now the test used by the Registrar in considering whether an organization is a public authority eligible to hold an official mark.7

The first element of this two-part test — the requirement for government control — has proved pivotal in deciding whether an organization is a public authority. As a preliminary consideration, the Federal Court of Appeal determined in Canada Post Corp. v. United States Postal Service that government control means Canadian government control.8 In that case, Canada Post challenged the status of the United States Postal Service as a public authority. The Court found that while the United States Postal Service was a public authority in the United States, it was not subject to any control by the Canadian government and so was not a public authority for the purposes of the Act.9 Beyond this, determining whether an organization is subjected to sufficient government control is a finding of fact to be made in the context of a given situation. It may be useful to canvass the leading cases on this issue involving a wide variety of organizations before drawing any conclusions.

In the COA case, the Court concluded that there was sufficient government control as shown by the existence of five factors. First, the COA had a degree of government control imposed on it as an incorporated non-profit association. Second, if the COA surrendered its charter, its assets were to be disposed of by the Canadian government in cooperation with the International Olympic Committee. Third, a substantial portion of the COA’s funding came from the public funds of Canada. Fourth, the Canadian government’s ability to prevail on the COA not to compete in the 1980 Olympic Games indicated the government’s "rather substantial degree of influence" in COA decision making. Fifth, there was a close relationship between the COA and the Directorate of Fitness and Amateur Sport and Sport Canada.10

In Magnotta Winery Corp. v. Vintners Quality Alliance, the Court found, on the basis of the following factors, that the Vintners Quality Alliance (VQA) was subject to sufficient government control. The VQA was federally incorporated as a non-profit organization. The founders intended that the VQA would work closely with provincial and federal governments to establish and administer standards for wines produced in Canada. In June 2000, the VQA undertook not to challenge the marks of the Vintners Quality Association of Ontario at the request of the Ontario government and in January 2001, it withdrew previously adopted official marks at the request of the federal government. These factors showed a significant degree of government influence on the organization’s decision-making ability.11

By way of contrast, in Big Sisters Association of Ontario v. Big Brothers of Canada, the Court found that the two organizations were not subjected to sufficient government control to be considered public authorities. Both were incorporated non-profit organizations. However, there was no evidence that either was subject to any significant degree of governmental control beyond this.12

In College of Chiropodists of Ontario v. Canadian Podiatric Medical Association, the Court found that the Canadian Podiatric Medical Association (CPMA) was not the subject of sufficient government control. There was no evidence that the Canadian government could review or intervene in the operations of the CPMA. The assets of the CPMA were not available to the public in the event that the organization was wound up. Its affairs were not subject to any statutory control or regulation. Furthermore, a requirement of membership in a provincial podiatry association that may or may not exercise regulatory authority did not lead the Court to the conclusion that the CPMA is a public authority. The Court said that the organization was more accurately described as a professional association that promotes the interests of its members without any government control.13

Finally, in the Architects case, the Court found that the Association of Architectural Technologists of Ontario (AATO) was not subject to sufficient government control. The AATO was created by a statute that can be amended and repealed by the Ontario government. However, this kind of control by the legislature was insufficient for AATO to be considered a public authority because it was not a power that enabled the government to exercise a degree of ongoing influence in the body’s governance and decision making similar to that found in other statutory bodies governing a profession such as the Law Society of Upper Canada.14

This review of case law on the issue of sufficient government control leads to three principal conclusions on the issue of whether an organization constitutes a public authority. First, control by means of legislation is not sufficient; there must be actual influence on the management and administration of the organization. The statutory requirements imposed by the incorporation of a non-profit organization are not considered sufficient government control. It is also not sufficient that the organization is created by statute if the government has no more power over the organization than to amend or annul its enabling legislation. Second, government influence on the management of the organization need not be formalized. Both the COA and the VQA were able to show evidence of government influence in the decision making of the organization even though no formal connection existed between government and the organization. Third, evidence that an organization receives a substantial amount of its funding from a public source can support a conclusion of sufficient government control.

The second element of the public authority test – that the organization provides a public benefit – is usually less contentious than those cases that consider an organization’s public authority status. Courts have found a public benefit to exist even where an organization’s activities are directed toward the private benefit of its own members, in addition to the benefits provided to the public. In some cases, the extent of the private benefit was greater than that of the public benefit. In the Architects case, the Court found that the AATO benefited the public by regulating its members, thereby providing professional standards for architectural technologists upon which consumers of their services could trust and rely. The Court stated that this mix of private and public benefits is common to organizations that regulate a profession and is not inconsistent with the concept of a public authority.15 In Magnotta Winery Corp., the Court found that the VQA, an industry body in the Canadian wine business, performed a public benefit in promoting, standardizing and coordinating the Canadian wine industry.16 While this is beneficial to the public, i.e., Canadian wine consumers and the economy, this clearly exhibits a private benefit, i.e., for Canadian wine producers. The organization does not have to perform a public duty in the sense of a government, for example, having legally enforceable duties to the public. This element of the public authority test is not that stringent. It is enough that the organization does something for the benefit of the public.

Was the Mark in Use When Notice Was Given?

Section 9(1)(n) requires that a public authority give notice of the adoption and use of a mark in order for it to be protected as an official mark. In the Big Sisters case, the Court found that the "adoption and use of an official mark for wares and services prior to publication by the Registrar of public notice of adoption and use is a condition precedent to enforceability."17 In that case, the Court found that the marks in question were used before public notice was given. Courts have broadly interpreted "use" in this context. In Magnotta Winery, the Court found that the VQA itself may not have used the mark "Icewine" before its public notice. However, because member wineries of the VQA did do so, this was sufficient to constitute use by the VQA.18 In FileNET Corp. v. Canada (Registrar of Trade-marks), the Canada Customs and Revenue Agency advertised its Netfile Internet-based tax return service before public notice was given. However, the service was not actually available for use until after public notice of the mark was given. The Court found that the advertising of the mark in relation to this service constituted use of the mark.19

Piscitelli v. Ontario (Liquor Control Board) provides an example of a case in which a Court found that the public authority had not used the mark prior to the public notice. In that case, the Court found that the Liquor Control Board of Ontario (LCBO) did not use the mark "Millennium" before it gave public notice of its use and adoption. Public notice was published on December 16, 1998. Before that date, the word "millennium" had been used as a descriptive word in the LCBO’s promotional material in the fall of 1998. However, it was not until September 1999 that the LCBO specifically used "Millennium" as a mark. The Court stated that while a public authority need only assert prior use when it submits its request for public notice to the Registrar, it may be required to provide actual evidence of its use at a later date in the event that a third party seeks to challenge the adoption of an official mark.20 In that case, the LCBO could not prove the mark’s use prior to the public notice and so the Court declared the public notice of the official mark ineffective and "Millennium" lost its status as an official mark.

An interesting query related to this issue of use before the public notice of a mark’s adoption and use is whether continued use of the mark is required after adoption. Although up to now the case law has focused on use before public notice, the Act may be interpreted to require use of an official mark after the public notice as well. There does appear to be injustice when an owner of an official mark does not continue to use that mark yet can still prohibit others from using that mark as a trademark. This is particularly acute because official marks are infinite and not subject to administrative expungement proceedings as contemplated by section 45 of the Act and neither does the Act bestow upon the Registrar any supervisory function over official marks. By contrast, a trademark owner must continue to use its mark to maintain its registration. The public policy reason for such a discrepancy is not readily apparent and may be the subject of a future challenge.

Can a Trademark and Official Mark Co-exist?

If a party challenging the status of an official mark is not successful then that party could seek, in the alternative, to have its trademark co-exist with the official mark. This can be difficult because an official mark is different from a trademark in that it is not necessarily used in association with a specific product or service. It can be used across a spectrum of products and services. Regardless of which, the public notice of an official mark is powerful protection since the mark holder can prevent anyone from using a mark that "closely resembles" the official mark. If a party holds a trademark before the public notice of a similar official mark, it can continue to use that mark in association with the products or services listed in its registration. However, the use of that trademark cannot be broadened to new products and services in the future. This was established in Canadian Olympic Association v. Allied Corp., in which Allied Corp. had used the trademark "Olympian" for the typeface of its font several years before the COA gave public notice of "Olympian" as its official mark. The Court held that Allied Corp. could continue to use the mark for its established use.21 The Court in the FileNET case reached the same conclusion where the two marks in issue were slightly different (though the difference was not an issue in the case). The Canada Customs and Revenue Agency adopted and began using the official mark "Netfile" for its Internet-based tax filing system. The Court held that FileNet was restricted in the use of its trademark to its existing business of computer software, software and automated systems.22

Where the two marks are not the same, the official mark holder can claim confusion. This test is a different test from that for trademarks under section 6 of the Act. Whereas a trademark can be used only for the products and services described in its application, an official mark can be used and claimed for any product or service. This means the holder of an official mark can claim confusion against anyone who uses its mark in any endeavour. However, while the potential reach is broad, the application of the test is narrow. For official marks, "[t]he question must be determined in the context of whether a person who, on a first impression, knowing one mark only and having an imperfect recollection of it, would likely be deceived or confused."23 In comparison to the issue of confusion in a trademark case, the degree of resemblance is the only factor to consider. In comparing "Big Brothers and Sisters of Canada" and "Big Sisters of Ontario," the Court held that the marks do not so closely resemble each other as to be likely to cause people to mistake or confuse one for the other.24 This case illustrates the high degree of resemblance (perhaps indenticality) that the Trade-marks Opposition Board (Board) requires when considering issues of confusion. Other examples abound.

In Whistler Resort Association v. Ramsbottom the Board compared "Whistler International Mozart Festival" and "Whistler Conference Centre" and found that they were not similar.25 In Ontario Federation of Anglers & Hunters v. Murphy, the Board compared two marks that were both depictions of a loon. The Board said that the two depictions had a "fairly high degree of resemblance" but they were not identical. In addition, the applicant’s mark had the word "loon" behind the drawing, which helped to distinguish the two.26 In Ontario Federation of Anglers & Hunters v. F.W. Woolworth Co. the Board again compared two depictions of a loon. This time, however, the Board held that the marks were confusing because the "two marks comprise almost identical representations of a loon, the only difference being that one is the mirror image of the other."27

The Board has suggested that the scope of protection of an official mark and the test for resemblance may effectively be broadened if the official mark holder owns a family or series of marks. In such cases, the family of marks expresses a central idea that all the marks in the family share. In Canadian Olympic Association v. Bio-Lab Canada Inc. the Board found that a group of 49 images of stick figures playing a variety of sports adopted as official marks by the COA constituted a family of marks, so that another mark would be confusing so long as it resembled the family of marks in general, rather than one in particular. In that case, however, the word "Bioguard" appeared in the applicant’s mark in addition to a stick figure and the Board found the applicant’s mark was not sufficiently similar for that reason. The Board stated that if the applicant’s mark comprised only the stick figure, it would have been sufficiently similar to be confusing.28 The Board cited Bio-Lab in its decision in Hope International Development Agency v. Aga Khan Foundation Canada. In that case, the Aga Khan Foundation owned a number of marks containing the word "hope" and involving Third World development initiatives, the principal one discussed in this case was the mark "Hope Seeing Our World Through New Eyes". The applicant wanted to register the mark "Espoir Voir Le Monde Sous Un Jour Nouveau". The Board said the two phrases were not similar in look or sound. However, the ideas expressed by the two were essentially identical, and the activities in association with which they were used were similar. The applicant’s mark was accordingly considered to be one that would likely be confused for the official mark.29


Famous Marks

Traditionally, businesses used trademarks as a way of distinguishing their goods from those of a competitor so that consumers would know what they were buying. Today, a trademark is much more than that. It is at the centre of a company’s branding strategy. For a company that invests in creating a strong brand image, the trademark represents more than its goods. It also represents the image and attributes associated with those goods. "Swatch" and "Rolex", for example, are two watch trademarks that do much more than distinguish. Each watch company has cultivated its own distinct brand image. Rolex projects a classic and luxurious image for the mature consumer. Swatch projects a bold and youthful image for the young consumer. By symbolizing a brand image, a famous trademark does more than distinguish goods, it increases consumer awareness of a company’s products, drives sales and promotes brand loyalty. For a company that enters a new product category, a popular and respected brand name can immediately give a new product the kind of credibility with consumers that an unknown company would take years to build. For example, the Sony Playstation was an instant hit in the video game market on the basis of goodwill toward Sony’s brand image in electronics. With an even wider array of products, Virgin uses its brand image to sell everything from compact discs to plane tickets to cell phones.

The value of a brand to a company’s sales makes protecting the distinctiveness and character of a brand paramount. At the same time, lesser known businesses may want to borrow the appeal and image of a brand to increase their own sales. Often this is done through licensing agreements. At other times the reference to the famous brand is indirect; a business may try to take advantage of the trademark without copying it. The famous marks cases discussed here are variations of this situation.

Famous marks per se are not protected by the Act. The extent of a mark’s fame has instead become a factor in considering distinctiveness and confusion. The degree to which a famous trademark is protected in Canadian law compared with an ordinary mark is the subject of legal debate. The Supreme Court of Canada recently decided two cases in this area: Mattel, Inc. v. 3894207 Canada Inc.30 and Veuve Clicquot Ponsardin v. Boutiques Cliquot Ltée.31 We discuss these two Supreme Court decisions with respect to the degree to which a famous mark influences the test for confusion and the degree to which the Act protects brand equity. We also discuss the use and impact of surveys in famous mark cases, because this is a key evidentiary tool in proving "famousness".

The Mattel and Veuve Clicquot Cases

Mattel involved the well-known and iconic "Barbie" doll and a small chain of restaurants in suburban Montreal named "Barbie’s". The first of three Barbie’s restaurants, owned by 3894207 Canada Inc., opened for business and began using the mark "Barbie’s" in 1992. The restaurants are bar and grill operations. The menu prominently features barbecued items cooked on the "barbie-Q" along with alcoholic beverages. The target market of the restaurant is directed toward an adult clientele. In 1993, 3894207 Canada Inc. applied for the mark "Barbie’s" for restaurant, take-out, catering and banquet services. Mattel opposed the application on the grounds that the mark would likely be confused with its Barbie mark, which Mattel stated had become famous. The Barbie mark is primarily associated with children’s dolls, though Mattel showed evidence that it had expanded the use of its mark to clothing and also a wide array of accessories, such as lunch bags. The primary target market for Barbie is young girls.32

The Supreme Court held that 3894207 Canada Inc. was entitled to a registration for its "Barbie’s" mark in association with its restaurant services since there was no likelihood of confusion with Mattel’s Barbie doll. In coming to this decision, the Court used the test for confusion set out in section 6 of the Act. It held that regard must be given to all factors and no single factor is determinative, including the relative fame of a mark. In this particular case, the differences in the goods and services for which the marks were used, combined with the significant difference in the target market of the two businesses, overshadowed the fame and broad appeal of Mattel’s mark.33

Veuve Clicquot involved the famous champagne maker Veuve Clicquot and a small chain of women’s clothing stores in Quebec and Ontario named "Cliquot". Veuve Clicquot makes high-quality alcoholic beverages, notably champagne, sold in association with the mark "Veuve Clicquot". It does not make any other products nor use its mark in association with any other product or service, except for certain promotional items not currently offered for sale in Canada. However, Veuve Clicquot is known generally as a brand that connotes luxury. On the other hand, the Cliquot clothing store is a mid-priced clothing chain aimed at career women. It sells third party brands of clothes, not its own. "Cliquot" is not marked on the clothing – only on the stores’ name, bags, wrapping, and business cards. The owner of the Cliquot stores testified that the words "Veuve Clicquot" influenced the origins of the stores’ name. She saw an advertisement for the champagne in a magazine and it reminded her of the French saying, "ça clique" – meaning "this is great" – so she combined the two words.34 As in Mattel, the Court considered whether the two marks would cause confusion under section 6. The Court found that, considering all the factors, the difference in the goods and services of the two companies and the difference in the channels of trade outweighed the fame of Veuve Clicquot champagne so confusion was unlikely.35 Veuve Clicquot also argued that the use of the Cliquot mark had depreciated the goodwill of its brand, pursuant to section 22 of the Act. ("Depreciation of goodwill – (1) No person shall use a trade-mark registered by another person in a manner that is likely to have the effect of depreciating the value of the goodwill attaching thereto.") The Court disagreed because there was no evidence that the ordinary consumer at the Cliquot stores would make a connection with Veuve Clicquot champagne – there being no evidence to support a likelihood of such depreciation taking place.36

Famous Marks and the Test for Confusion

The primary means of protecting a trademark is to bring an action claiming that another trademark or trademark application would likely be confused with that of the challenger. The applicable test is set out in section 6 of the Act, which reads as follows:

6. (1) For the purposes of this Act, a trade-mark or trade-name is confusing with another trade-mark or trade-name if the use of the first mentioned trade-mark or trade-name would cause confusion with the last mentioned trade-mark or trade-name in the manner and circumstances described in this section.

(5) In determining whether trade-marks or trade-names are confusing, the court or the Registrar, as the case may be, shall have regard to all the surrounding circumstances including

(a) the inherent distinctiveness of the trade-marks or trade-names and the extent to which they have become known;

(b) the length of time the trade-marks or trade-names have been in use;

(c) the nature of the wares, services or business;

(d) the nature of the trade; and

(e) the degree of resemblance between the trade-marks or trade-names in appearance or sound or in the ideas suggested by them.

The famousness of a trademark is not an explicit factor in this test. However, it is important as an implicit element in considering these factors. Debate has revolved around how the fame of a mark affects the application of the test. Some believe that the fame of a mark should weigh heavily in the analysis because famous marks are better known by the public and therefore more likely to be confused when other companies "borrow" or trade in association with such marks. Others believe that famous marks are just the same as other trademarks and should be treated as such in the analysis so all factors weigh equally.

Prior to the recent Supreme Court decisions, United Artists Corp. v. Pink Panther Beauty Corp.37 was the leading case on the test for confusion involving a famous mark. In that case a beauty salon applied to register "Pink Panther" as a trademark for its business. It was opposed by United Artists, which owned the trademark "Pink Panther" in relation to the famous movie and cartoon series of that name. United Artists argued that the famous nature of its mark, combined with a general trend of corporate diversification in the kinds of products the famous mark was licensed to be associated with, suggested that any use would be logically connected to the famous mark and therefore likely cause confusion among consumers, no matter the extent of the difference between the products.38

The Court found against this argument, saying that "where no connection exists [between the goods] a finding of confusion will be rare."39 On the facts of the case, the Court held that there was no connection whatsoever between the products of the two companies. It held that any argument based on corporate diversification should be based on potential expansion of existing operations.

In analyzing all the section 6(5) factors, the Court concluded that no confusion existed. It found the trademark owned by United Artists was clearly famous and distinct, having been used in Canada for more than 30 years. The two marks were not identical: United Artists Corp. held the mark "The Pink Panther" and the beauty salon had applied for "Pink Panther" but the two marks were still very similar. However, there were large differences in the nature of the wares and the nature of the trade of the two marks. The differences were described as "not a fissure but a chasm."40 The Court held the difference was such that there was no likelihood of confusion on the part of the consumer.

Subsequent courts have interpreted Pink Panther as requiring a connection between the products of the two marks. In Toyota Motor Corp. v. Lexus Foods Inc., the Federal Court of Appeal allowed an application for the trademark "Lexus" for canned fruit over the objection of Toyota because no connection existed between canned fruit and cars.41 In a very recent decision of the Federal Court, Remo Imports Ltd. v. Jaguar Cars Ltd., there was a finding of confusion on the basis that Remo Imports made luggage with the "Jaguar" trademark and Jaguar Cars Ltd., though primarily a car company, has been known in Canada for making some items of luggage and personal accessories since 1950.42

The Supreme Court in Mattel and Veuve Clicquot clarified this issue somewhat. In Mattel, the Court softened the wording of Pink Panther test. Binnie J., speaking for the Court, stated his agreement with the appellant that "the ‘exceptional circumstances …if ever’ test puts the bar too high and may be seen as an attempt to impose rigidity where none exists."43 He went on to say:

I believe Linden J.A. misspoke to the extent he suggested that, for confusion to occur, there must be "some resemblance or linkage to the wares in question", i.e. to the wares for which registration of a trade-mark is sought. Resemblance is clearly not a requirement under s. 6.44

However, the Supreme Court also stated that this case did not depart from the ‘totality of the circumstances test’ found in section 6 of the Act as the Court did have regard for all the factors. The Supreme Court went on to say that, in its view, Linden J.A. was disputing the argument that fame "trumps" all other factors and it agreed with the Federal Court of Appeal on this point.45

Despite the Supreme Court’s clarification as to the principles and description of the test for confusion, it is noteworthy that the disposition of both the Mattel and the Veuve Clicquot cases was similar to that of Pink Panther. Just as in Pink Panther, the Supreme Court found in both cases that the companies opposing the newer marks were famous marks and that they were very similar, though not identical, to those of the restaurant and the clothing store respectively. However, as in Pink Panther, the Court found that there were large differences in the nature of the goods and services, the target markets and the trade channels in which they were provided. Therefore, these decisions are ultimately consistent with the Pink Panther case.

Although the Supreme Court emphasized that there is a possibility that a trademark could be so famous that it does not require a connection to the goods of an applicant to create a likelihood of confusion, it would be an overstatement to say that the existence of this possibility would be "rare". However, the disposition of these cases suggests that a finding of confusion without a connection between the goods involved might, in fact, be an extremely rare result. The Supreme Court mentions Virgin in its decisions as an example of a company whose use of its trademark is so diversified that any new use could cause confusion.46 Virgin’s eclectic mix of virtually unrelated businesses from music stores to airlines to cell phones all under some version of the same Virgin mark is quite unique in the world of commerce. If this is the model, there may be few companies that fit the mould. Generally in branding, one would attach the same brand name to similar products to extend a certain product image and break with that brand name if a new product image is desired. For example, McDonald’s does not use its brand name in connection with its Chipotle Mexican restaurant chain because it is targeting a significantly different market and the use of its traditional mark would not benefit that business. Well-known companies such as Disney and Nike use their trademarks on many products cohesively around a single theme, children’s entertainment and athletics, respectively. It would appear open to a court, based on the Pink Panther, Mattel, and Veuve Clicquot cases, to find an applicant’s use of these trademarks outside that theme as not creating a likelihood of confusion because the nature of the goods or services, the target markets and the channels through which they are sold, are sufficiently different. It is uncertain how courts will interpret these cases in the future.

Brand Equity and Trademark Protection

Brand equity is the value of a brand. It can be valued by comparing the expected future revenues of a branded product with the expected future revenues of an equivalent non-branded product. Thus, the concept of brand equity relies on consumers’ positive impressions of a particular brand that would make them want to buy that branded product rather than another product in the future. As discussed above, in modern business, a trademark is more than just a distinguishing mark on a product, it is a symbol of a company’s brand image. This is particularly true of marks that the owner promotes widely enough to be considered famous.

In both Mattel and Veuve Clicquot, the Supreme Court acknowledged that an important motivation for both the companies defending their famous marks was to protect their brand equity from dilution or depreciation from the sale of unauthorized, disparate and lower-quality goods. Moreover, in Veuve Clicquot, the story of the origins of "Clicquot" show that the owners of the store were tapping into the brand equity of Veuve Clicquot by using a play on the words to project an elegant image in their stores. Similarly, in Lexus, the owner of the canned fruit business chose "Lexus" because it suggested quality – no doubt due to the promotion of Lexus as a luxury automobile brand.47As the courts have sometimes noted, there is something unjust about companies being able to benefit from the brand equity of another with impunity.48

However, the Supreme Court makes clear in Mattel and Veuve Clicquot that the purpose of the Trade-marks Act is to protect consumers and not trademark owners. In Mattel, the Court stated, "Whatever their commercial evolution, the legal purpose of trade marks continues to be their use by the owner ‘to distinguish wares or services manufactured, sold, leased, hired, or performed by him from those manufactured, sold, leased, hired or performed by others.’"49 Later in the decision the Court said of the trademark owner:

Its claim to monopoly rests not on conferring a benefit to the public in the sense of patents or copyrights but on serving an important public interest in assuring consumers that they are buying from the source from whom they think they are buying and receiving the quality which they associate with that particular trade-mark.50

This purpose does not help the protection of brand equity, which rests not just in the distinguishing mark that prevents confusion, but in the brand image that this mark represents. Section 22 may provide this protection. In Veuve Clicquot, the Supreme Court specifically addressed section 22 of the Act and observed that Canadian courts have yet to be called upon to test the limits of this section.

Section 22 may serve the purpose of protecting brand equity since it prevents others from using a registered trademark in a manner likely to depreciate the value of the goodwill attached to it. The Supreme Court has laid out the four elements of the provision: (1) that a claimant’s registered trademark was used by the defendant; (2) that the claimant’s trademark is sufficiently well-known to have significant goodwill attached to it; (3) the claimant’s mark was used in a manner likely to have to have an effect on the goodwill; and (4) that the likely effect would be the depreciation of the value of the goodwill.51

Section 22 has not been raised very often in Canadian courts. The Supreme Court conjectured that this could be because of the difficulty in proving the likelihood of the depreciation of goodwill.52This was a problem for Veuve Clicquot in making out its claim. Particularly, there was no evidence that Cliquot shoppers made a connection between the two brands while shopping at the store. In addition, there was no evidence that Cliquot’s use depreciated the goodwill of Veuve Clicquot.53

The United States has similar legislation under the federal Trademark Anti-Dilution Act. It requires that a mark be famous according to criteria set out in that Act, as well as proof that there has been a depreciation of goodwill. This law has been prosecuted to greater degree than our section 22. From this jurisprudence, it has become clearer what kind of survey and financial evidence is required to prove dilution and depreciation of goodwill.54 The Court in Veuve Clicquot discussed a variety of U.S. cases on this issue in its decision and suggested that these U.S. cases may assist Canadian courts facing similar issues. It noted that Veuve Clicquot brought forward very little evidence on this point.

Perhaps the Supreme Court’s guidance with respect to section 22 will elevate the importance of this section in the future for the purpose of protecting brand equity where there is no confusion according to the present test and yet there is a "siphoning" of the value of the brand equity of a famous mark by another company for its own unlicensed benefit through indirect association. The test for confusion under section 6 of the Act does not provide such protection either in principle or in effect. Provisions prohibiting the depreciation, or even use without demonstrable depreciation, of a company’s brand equity through intentional unlicensed use would be beneficial in recognizing a trademark’s place in creating brand equity in the modern business world.


A review of the Mattel and Veuve Clicquot cases would not be complete without some commentary on the importance of a well-designed survey and the importance of its role in these cases.

Surveys are a key evidentiary tool in a case for confusion. A survey of consumers is the best way of proving whether a mark is famous and whether there is any likelihood (or actual) confusion between the two marks. A well-conducted and designed survey can be persuasive to a court, but a poorly conducted or designed survey can leave holes in the evidence that an opposing counsel can use to his or her advantage by negating the survey’s credibility. At a minimum, a good survey must be statistically sound, meaning that the sample population surveyed is a sufficiently random sample within the appropriate target group and large enough for the purpose required. Its questions must be accurately asked so that the answer cannot be skewed and questioned at trial. The questions must also be open-ended and not suggestive of the answers that are sought. In addition, the survey must be conducted close to the date when confusion is claimed to have existed. A survey conducted years later may not accurately capture this past moment in time.55

The survey conducted by Mattel to show confusion is a good example of a poorly conducted survey. It said that the survey produced the following results: for 57% of participants, Barbie dolls came to mind when they saw the Barbie’s restaurant logo; 36% of participants believed that the company that manufactured Barbie dolls might have something to do with the logo of Barbie’s restaurant; 99.3% of participants were familiar with Barbie dolls. The Court questioned the relevance of the survey, given the questions that were asked. While the issue at the opposition hearing was the likelihood of confusion, the survey question that was asked ("Do you believe that the company that makes Barbie dolls might have anything to do with this sign or logo?") was not responsive at all and was not found to be useful. As the Court pointed out, this question asks about a possibility rather than a likelihood, which constitutes a much lower degree of connection in the survey respondent’s mind. Some of those who said that Mattel might be connected to the restaurant would not have said Mattel is likely connected to the restaurant. Because of the way in which the question was phrased, there was no way to determine how many people would probably think the restaurant and the doll are likely to be connected. The Court also found fault with the survey population because it excluded anyone who was aware of the Barbie’s restaurants. This meant that the survey did not constitute a fully random sample of those living in the area and the less than random sample was probably skewed in favor of Mattel because those who were aware of the restaurant chain would think it less likely that there was a connection between the two. The survey methodology also revealed some suggestive questions. The Court found the survey, at most, was useful in establishing that the Barbie trademark was famous.56

Similarly, the Veuve Clicquot case shows that an imperfect survey equates to having no survey at all. A key reason why Veuve Clicquot lost its section 22 claim was that it could not prove that shoppers at the Cliquot stores made a link between the store and the famous champagne.57 A well-crafted survey could have put Veuve Clicquot in a stronger evidentiary position to make its legal arguments.


Trademark practitioners must navigate their way through the complex maze of case law in which the Trade-marks Act is dissected with particular care, when dealing with both official marks and potentially famous marks. Clients who wish to benefit from the fame of others may be able to do so, but must tread carefully. Similarly, taking on an official marks holder can be a challenge that not all applicants have the stomach for. However, for those that do, some very interesting questions are still to be determined by the courts.

Both official marks and famous marks can be powerful tools in the protection of brand equity. An organization that qualifies for the designation of an official mark should not hesitate to request that public notice be given. Once a mark has attained the status of an official mark, any challenge to that status is illusive and fraught with difficulty. On the other hand, the path to fame itself remains illusive. Given the right circumstances, however, a famous mark, by virtue of its fame – the extent to which the mark has become recognized – can translate to an elevated level of protection in the same manner as for official marks, where a connection between competing products and or services becomes irrelevant.


1. Trade-marks Act, R.S.C. 1985, c. T-13.

2. Insurance Corp. of British Columbia v. Canada (Registrar of Trade-marks) (1979), 44 C.P.R. (2d) 1 at 12 (F.C.T.D.).

3. Registrar of Trade-marks v. Canadian Olympic Association, [1983] 1 F.C. 692 at 699 (C.A.) [COA].

4. Ibid. at 703-704.

5. Ontario Association of Architects v. Association of Architectural Technologists of Ontario, [2002] F.C.J. No. 813 (C.A.), leave to appeal to S.C.C. refused [Architects].

6. Ibid. at para. 58.

7. "Public Notice: Public Authority Status under Sub-paragraph 9(1)(n)(iii)," Trade-marks Office, June 14, 2004. (online:, last visited: June 28, 2006)

8. Canada Post Corp. v. United States Postal Service (2005), 47 C.P.R (4th) 177 at para. 55 (F.C.T.D).

9. Ibid. at paras. 38-58.

10. Supra note 3 at 704.

11. Magnotta Winery Corp. v. Vintners Quality Alliance (2001), 17 C.P.R. (4th) 45 at paras. 50-52 (F.C.T.D.) [Magnotta Winery Corp.].

12. Big Sisters Association of Ontario v. Big Brothers of Canada (1997), 75 C.P.R. (3d) 177 at 215-216 (F.C.T.D.), aff’d (1999), 86 C.P.R. (3d) 504 (F.C.A.) [Big Sisters].

13. College of Chiropodists of Ontario v. Canadian Podiatric Medical Association (2004), 37 C.P.R. (4th) 219 at paras. 68-71 (F.C.T.D.).

14. Supra note 5 at paras. 57-64.

15. Supra note 5 at paras. 65-73.

16. Supra note 11 at paras. 49-51.

17. Supra note 12 (1997) at 222.

18. Supra note 11 at paras. 58-59.

19. FileNET Corp. v. Canada (Registrar of Trade-marks) (2001), 13 C.P.R. (4th) 385,aff'd (2002), 22 C.P.R. (4th) 328 (F.C.A.).

20. Piscitelli v. Ontario (Liquor Control Board) (2001), 14 C.P.R. (4th) 181 at paras. 25-47 (F.C.T.D.).

21. Canadian Olympic Association v. Allied Corp. (1989), 28 C.P.R. (3d) 161 (F.C.A.).

22. Supra note 19 (2001), FileNET Corp. v. Canada (Registrar of Trade-marks) (2001) at para. 32.

23. Supra note 12 (1997) at 217.

24. Ibid. at 219-220.

25. Whistler Resort Association v. Ramsbottom (1996), 66 C.P.R. (3d) 550 (T.M.O.B.).

26. Ontario Federation of Anglers & Hunters v. Murphy (1990), 34 C.P.R. (3d) 496 (T.M.O.B.).

27. Ontario Federation of Anglers & Hunters v. F.W. Woolworth Co. (1991), 39 C.P.R. (3d) 272 9 (T.M.O.B.).

28. Canadian Olympic Association v. Bio-Lab Canada Inc. (1993), 48 C.P.R. (3d) 388 (T.M.O.B.) [Bio-Lab].

29. Hope International Development Agency v. Aga Khan Foundation Canada (1996), 71 C.P.R. (3d) 407 (T.M.O.B.).

30. Mattel, Inc. v. 3894207 Canada Inc., 2006 SCC 22 [Mattel].

31. Veuve Clicquot Ponsardin v. Boutiques Cliquot Ltée, 2006 SCC 23 [Veuve Clicquot].

32. Supra note 30 at paras. 11-13.

33. Ibid. at paras. 74-89.

34. Supra note 31 at paras. 3-7.

35. Supra note 31 at paras. 28-37.

36. Supra note 31 at paras. 67-69.

37. United Artists Corp. v. Pink Panther Beauty Corp. (1998), 80 C.P.R. (3d) 247 (F.C.A.) [Pink Panther].

38. Ibid. at paras. 51-53.

39. Ibid. at para. 51.

40. Ibid. at para. 50.

41. Toyota Motor Corp. v. Lexus Foods Inc. (1999), 9 C.P.R. (4th) 297 (F.C.A.), leave to appeal to S.C.C. refused.

42. Remo Imports Ltd. v. Jaguar Cars Ltd., [2006] F.C.J. No. 47 at para. 304 (T.D.).

43. Supra note 30 at para. 63.

44. Ibid. at para. 65.

45. Ibid. at paras. 68-69.

46. Ibid. at para. 30.

47. Supra note 41 at para. 26.

48. Supra note 30 at para. 90; supra note 37, dissent of McDonald J.A. at para. 2.

49. Ibid. at para. 2.

50. Ibid. at para. 21.

51. Supra note 31 at para. 46.

52. Ibid.

53. Ibid. at paras. 47-69.

54. "Quantifying Brand Image: Empirical Evidence of Trademark Dilution" (2006 Spring) 23 American Business Law Journal, 1.

55. Supra note 30 at para. 46; supra note 42 at paras. 130; 179-181.

56. Supra note 30 at paras. 42-50.

57. Supra note 31 at paras. 56-61.

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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