In Bluefoot Ventures Inc. v. Ticketmaster
(c.o.b. CitySearch), the Ontario Superior Court of
Justice recently had the opportunity to consider the question
of whether, in the ordinary course of trade-mark licensing, it
can be said that a trade-mark licensee owes a fiduciary duty to
the trade-mark licensor.
The Statement of Claim in Bluefoot Ventures
asserted a number of claims arising from a licensing agreement
entered into between predecessors of both the plaintiff and the
defendant. The plaintiff, Bluefoot Ventures Inc., is the
current owner of certain rights in and to the registered mark
CITYSEARCH. The previous owner of those trade-mark rights
had granted an exclusive license (limited to certain
applications and as to geographic reach) to the predecessors of
the defendants. Through a series of name changes and
mergers, the named defendants (referred to collectively herein
as Ticketmaster) were the current beneficiaries of the licensed
rights. Stikeman Elliott is counsel to Ticketmaster in
In granting Ticketmaster's motion to strike those
portions of the Statement of Claim alleging that Ticketmaster
owed a fiduciary duty to Bluefoot, and that such fiduciary duty
had been breached, Lederer J. reviewed the case law for
determining the circumstances in which a fiduciary relationship
Lederer J. identified the fundamental hallmark required to
establish a fiduciary relationship as evidence of a
"mutual understanding that one party has relinquished its
own self-interest and agreed to act solely on behalf of the
other party." The Court noted that on the face of
it, a contractual relationship would not be expected to lead to
a fiduciary relationship, because in a negotiated contract, it
is clear that the parties look after their own self-interests,
and not the interests of the other side.
On the facts, the Court found that the contract under
consideration in the claim reflected a purely commercial
relationship. The contract, which created a license
permitting Ticketmaster to use intellectual property owned by
Bluefoot, sets out the rights of Ticketmaster and the
consideration that Ticketmaster owed to Bluefoot in
return. The Court held that the contract "does not
create the duty of loyalty which is the fundamental
characteristic of a fiduciary relationship." The
Court also cautioned that "to recognize the possibility of
a fiduciary relationship existing on the facts presented [in
this case] is to acknowledge that the Court could fall into the
trap of too easily recognizing the presence of these
obligations where, properly understood, they ought to be found
not to exist."
The Court also soundly rejected the proposition that the
Trade-marks Act creates a fiduciary relationship
between licensor and licensee, holding that "the
Trade-marks Act and the registration of a trade-mark
under that Act do not in and of themselves create a
fiduciary relationship." While the Court
acknowledged that there may be circumstances in which a
fiduciary duty may exist in the presence of a concern arising
out of the registration or use of a trade-mark, such a duty did
not arise as a result of the registered trade-mark, but as a
result of the underlying relationships between the
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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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