A recent English decision found that a trademark consisting of
three letters, which were an acronym for a descriptive term, was
Since the 1980's a number of organizations in the United
Kingdom have been set up to encourage the development of routes to
higher education for adults. The organizations are known as
"Open College Networks" and operate in specific regions
of the United Kingdom.
In 1987 a national body was set up to coordinate the activities
of the local organizations. This entity was given the name National
Open College Network and it was registered as a charity. The vast
majority of Open College Networks were affiliated with this entity
by way of membership agreements. National Open College Network
subsequently changed its name to NOCN.
Open College Network Credit 4Learning ("Open College")
is an Open College Network. Open College entered into a membership
agreement with NOCN but following disagreements the membership
agreement came to an end.
NOCN owns registered trademarks for:
a) The letters OCN and NOCN;
b) 10 registrations consisting of designs of which the design
set out below is representative:
(collectively the "Swoosh Marks")
After the expiration of its membership Open College continued to
use the business name OCN and the following trademark (the
NOCN objected to Open College's use of the name OCN and the
Defendant's Logo after the expiration of the membership
NOCN brought proceedings for infringement and passing-off
against Open College. The parties were unable to resolve their
respective claims and the action proceeded to trial.
Open College, by way of defence, asserted that NOCN did not own
the goodwill associated with a trademark OCN. The trial judge
agreed with Open College since he did not accept that goodwill ever
subsisted in the letters OCN standing by themselves. The letters
were an inevitable abbreviation of the term "Open College
Network". As a result, they were and remain entirely
descriptive and the OCN mark was not valid.
While NOCN had built up goodwill it could not be attached to a
purely descriptive term. However, goodwill was associated with the
letters NOCN and other badges of origin used by NOCN.
There was no challenge to the validity of the NOCN mark. With
respect to its infringement the only element that was common was
the descriptive acronym OCN and as a result, the judge found that
the defendant did not infringe the NOCN mark.
The Swoosh Marks were in a different category. The judge found
that the Swoosh Marks were infringed by the use of the
Defendant's Logo. There was an overlap between the services
provided and substantial visual similarity between the respective
marks. As a result the plaintiff succeeded on this part of its
For the same reasons, the judge found that the use of the
Defendant's Logo constituted a misrepresentation that the
defendant was associated in the course of its trade with the
plaintiff. As a result, the plaintiff's case for passing-off
succeeded with respect to the use of the Defendant's Logo.
The Canadian Position
Section 12(1)(b) of the Canadian Trademarks Act provides that a
trademark is not registrable if whether depicted, written or
sounded it is either clearly descriptive or deceptively
misdescriptive in the English or French language of the character
or quality of the goods or services in association with which it is
used or proposed to be used.
In a recent decision of the Federal Court an approach similar to
that set out in the English case was taken. In the Canadian case it
was observed that the relevant perspective for determining whether
a mark is clearly descriptive is that of an everyday user of the
services. The judge concluded, on applying this perspective, that
the meaning of the acronyms in issue was readily apparent to
consumers and clearly descriptive.
It seems that if an everyday user of goods or services would
perceive the acronym in issue as a clear abbreviation of a
descriptive term there are concerns about the registrability of the
acronym under the Trademarks Act.
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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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