Federal Court Confirms That Use of a Trademark Variant May Demonstrate Use of a Trademark

Federal Court Confirms That Use of a Trademark Variant May Demonstrate Use of a Trademark

Geox SPA v De Luca, 2018 FC 855

In this decision, the Federal Court (“FC”) confirms that variants of a trademark used by a licensee may establish use of a trademark in certain circumstances.

The FC upheld the registrar of Trade-marks’ (“Registrar”) decision, concluding that the Registrar did not err in its analysis. The Registrar’s findings that the use of a variant of Mr. Giuseppe De Luca’s (“De Luca”) Mark by a licensee complied with section 50 of the Trade-Marks Act and that the Mark was used in association with the goods “boots” were reasonable. The FC found that its intervention was not warranted, and it dismissed Geox S.p.A’s (“Geox”) appeal. [1,4]

Background

At the request of Geox, the Registrar issued a notice pursuant to section 45 of the Trade-Marks Act to De Luca for his trademark ANFIBIO & Dessin (Canadian trademark registration no TMA 375,888). Pursuant to the notice, De Luca needed to provide sufficient evidence that his Mark was in use in the period of three years immediately preceding the notice (“Relevant Period”). [1] The Registrar found that the Mark had been used in such a way that it remained recognizable despite some differences between the form in which it was registered and the form in which it was used. Although the exclusive use agreement between De Luca and its licensee Chaussures De Luca Montréal Inc. (“Chaussures De Luca”) did not specifically allow the use of a variant of the Mark, the variant used was “still the same trade-mark as the Mark”. The Registrar was satisfied with De Luca’s evidence that a label bearing the Mark was attached to the boots during the Relevant Period. The Registrar further found that the copyright notices referring to a third party on the licensee’s website did not contradict the evidence of the Mark’s use by De Luca or the licensee during the Relevant Period. [5-8]

The Registrar found that De Luca had provided sufficient evidence that his Mark had been in use in association with the goods “bottes” (boots) within the Relevant Period, but not in association with the goods “souliers” (shoes). The Registrar therefore deleted the goods “shoes” from the statement of goods but refused to expunge the Mark. [1] Geox appealed the Registrar’s decision, arguing that Chaussures De Luca used a variant of the trademark rather than the registered Mark, and that it did not use the Mark in association with the goods “boots”. [2]

The Variant Mark Retained the Dominant Features of the Trademark

The main issues before the FC were whether the Registrar erred in finding that the variant of the Mark complied with section 50 of the Trade-Marks Act; whether the Registrar erred in finding that the Mark was used in association with the goods “boots” during the Relevant Period; and whether De Luca failed to show use of the Mark benefiting him, such that the registration should be expunged. [9]

The FC first notes that in section 45 proceedings under the Trade-marks Act, there must be evidence that the Mark owner used the Mark or “use that enures to the benefit of the owner”, like use of the Mark by a licensee, contemplated by section 50. [14] Section 50 provides that a licensee’s use of the Mark is to have the same effect as use by the owner, if the registered owner maintains direct or indirect control over the quality of goods and services. [15]

Geox argued that using a variant of the Mark does not amount to use of the Mark itself. [16] The FC cites Pizzaiolo Restaurants Inc v Les Restaurants La Pizzaiolle Inc, 2016 FCA 265, stating that deviations from the registered design must not change the distinctiveness of the Mark and that it must retain its dominant features. The FC then relies on the test set out in Canada (Registrar of Trade Marks) v Cie internationale pour l’informatique CII Honeywell Bull SA, [1985] 1 FC 406: “… compare the trade mark as it is registered with the trade mark as it is used and determine whether the differences between these two marks are so unimportant that an unaware purchaser would be likely to infer that both, in spite of their differences, identify goods having the same origin.”  [18]

Applying the test to the matter at hand, the FC concludes that even though the Mark was “slightly modified by the Licensee”, it still retained the dominant features of the registered Mark: a penguin on the left side of the logo, facing towards the right, with the word ANFIBIO written in capital letters. [22] The FC then analysed whether De Luca retained control over the quality of the goods or services. The FC cites Empresa Cubana Del Tabaco Trading v Shapiro Cohen2011 FC 102 [Empresa], in which the FC mentioned there are three ways in which the registered owner of a trademark can demonstrate the control required to benefit from section 50: 1) they can clearly swear to the fact that they exert the requisite control; 2) they can provide evidence that demonstrates they exert the requisite control; or 3) they can provide a copy of a license agreement that explicitly provides for the requisite control. [24] The FC finds that the Registrar rightfully found there were sufficient elements establishing the owner’s control over the quality of the goods bearing the Mark, such as De Luca’s implicit approval of the variant. [30-31]

As for Geox’s argument that De Luca did not provide satisfactory evidence demonstrating use of the Mark, the FC indicates that subsection 4(1) of the Trade-marks Act states: “A trade-mark is deemed to be used in association with wares if […] it is marked on the goods themselves or on the packages in which they are distributed or it is in any manner associated with the goods […]”. [33, 37] The Affidavit of Mr. Franco Rota (Director, Treasurer and Controller of Chaussures De Luca) states that labels (which were shown in pictures) were attached to the goods, and that boxes containing the Mark were sent to retailers during the Relevant Period. [38] The FC found that the Registrar’s conclusion that De Luca had shown use of the Mark was reasonable. [40]

The FC stated that given its findings that De Luca had shown use of its Mark, it did not need to address the question whether De Luca failed to show use of the Mark benefiting him, such that the registration should be expunged. The FC nonetheless addressed Geox’s argument that a third party’s copyright notice appearing on the website during the Relevant Period created sufficient ambiguity regarding the Mark’s use. [41] The FC indicated that even if there was unauthorized use of the Mark by a third party during the Relevant Period, “this does not contradict the rest of the evidence that clearly shows that the Mark was used by the licensee in accordance with the License Agreement during the Relevant Period. Unauthorized use by a third party can easily co-exist with authorized use by the licensee.” [44] Having found the Registrar’s decision reasonable, Geox’s appeal was dismissed. [47]

Commentary

Trademark owners should remember that while they can issue licenses for the use of their trademark, they must maintain direct or indirect control over the quality of the goods and services. In this decision, De Luca’s licensee, Chaussures De Luca, was using a variant of the trademark, but the FC found that in this situation, the use of the variant of the trademark still constituted use of the trademark. The FC reminded that “Canadian law does not incorporate a linear view of trademark registration but can tolerate multiple variants of a mark”. [17] A variant of the Mark may be used as long as deviations from the registered design do not change the distinctiveness of the Mark, and it must retain its dominant features. [18] Trademarks owners should therefore keep this in mind when issuing license agreements, and make sure they are able to demonstrate that they keep the requisite control, as stated in Empresa. It is equally important for trademark owners to consult their agents or IP lawyers to obtain their opinion and advice to make sure that their trademark rights are protected.

trademark law