In a recent decision, the Federal Court of Appeal set some
ground rules for relief that can be ordered in trade-mark
expungement applications. The court also considered whether
ancillary relief can be ordered when not expressly requested in the
Notice of Application. In addition, it cautioned against issuing
sweeping orders where the respondent has no notice of the relief
Spirits International B.V. was the owner of various STOLICHNAYA
trade-marks for alcohol. It sought to expunge the STALINSKAYA
trade-mark registration of S.C. Prodal 94 SRL. Under the
Trade-marks Act, the court can order that an entry in the
register be struck out or amended on the ground that at the date of
the application, the entry on the register does not accurately
express the existing rights of the registered owner.
Prior to the expungement proceeding, Prodal voluntarily
cancelled its existing STALINSKAYA mark and applied for a fresh
STALINSKAYA trade-mark for alcohol. Having cancelled the trade-mark
at issue in the expungement proceeding, Prodal did not file a
Notice of Appearance and did not participate in the hearing.
In its memorandum of law to the court, Spirits requested a stay
of proceedings and an injunction prohibiting the registrar from
considering the other pending trade-mark application for
STALINSKAYA (forms of relief not requested in its Notice of
First Call: The Trial Court Giveth
At the hearing, the application judge declared that Prodal's
trade-mark STALINSKAYA was not distinctive because it was confusing
with the Spirits' registered STOLICHNAYA trade-marks. With
respect to Prodal's new, pending application for STALINSKAYA,
the court granted the stay and injunction requested in Spirits'
memorandum of law.
Last Call: The Appeal Court Taketh Away
Court could not grant relief that was not requested
On appeal, the Court of Appeal overturned the lower court by
first declaring that "[t]hat which does not exist cannot be
Furthermore, the court noted that Spirits' Notice of
Application did not include a request for a stay or an injunction,
nor was that relief ancillary to the relief requested in the Notice
of Application. Consequently, the judge had no authority to grant
The court also found that Spirits' "basket clause"
request in its Notice of Application for "such other relief as
counsel may advise and this Honourable Court deems just" was
insufficient to encompass the relief requested in Spirits'
memorandum. There was no support that the basket clause should be
extended to the granting of stays, mandatory injunctions or orders
of prohibition, the court found.
The Court of Appeal pointed to other errors of law in the lower
court's decision: in order to obtain a stay, Spirits needed to
satisfy the tripartite test established by the jurisprudence, but
the test was not even addressed, much less satisfied. Also, a
mandatory injunction requires one to act positively and thus a
mandatory injunction and a stay could not co-exist, contrary to the
application judge's order.
Failure to file Notice of Appearance not fatal
By way of a separate preliminary motion, Spirits sought to quash
Prodal's appeal on the basis that Prodal had failed to file a
Notice of Appearance on the application. However, the Court of
Appeal was not persuaded that Prodal had acquiesced to the granting
of relief in circumstances where it did not have notice of the
relief being requested.
Moreover, as a result of having failed to file a Notice of
Appearance, Prodal was unaware of the relief Spirits requested in
its factum. The Court of Appeal cautioned that, in circumstances
where a respondent party does not have notice of the relief being
requested, such relief should not be granted until notice is given
and the respondent is offered the opportunity to respond.
McCarthy Tétrault Notes:
The case highlights the importance of seeking the appropriate
relief in the Notice of Application, instead of relying on a
catch-all basket clause to encompass any and all relief.
The decision also has implications for cases in which the
respondent does not signal an intention to oppose the application.
In such a case, the applicant may well be advised to provide the
named respondent with notice of precisely what is being sought and
what is being argued (e.g., by serving the respondent with all
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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