Summary
Registered trademarks may not be kept indefinitely while sitting idle on the Canadian Trademarks Register, even if renewal fees are paid. Section 45 of the Trademarks Act provides an important tool to clear the trademark register of unused trademarks, which effectively puts them back “on the market” to be claimed and used by a new registrant. Section 45 proceedings aim to provide a simple and expeditious procedure for expunging unused registered trademarks.
Discussion
Pursuant to s. 45(1) of the Trademarks Act, a trademark owner may, upon notice from the Trademark Registrar, be required to show that the registered trademark has been used in Canada in association with the goods and/or services indicated on the registration during the three years preceding the date of the notice to avoid having the registration cancelled/expunged. Such notice, which is issued at the request of a third party, can only be issued in respect of a trademark that has been registered for at least three years.
When to Initiate a Section 45 Proceeding
A third party’s motivation to initiate a s. 45 proceeding is typically motivated by their desire to use and register a trademark that is already registered and that may be confusingly similar with the desired trademark. The third party, referred to as the requesting party, can file a request that the obstructing registration be expunged on the grounds that the trademark has fallen into disuse or that the trademark as used is different from the trademark as registered. The request to the Registrar to initiate the s. 45 proceeding is not accompanied by any evidence, just a prescribed fee.
What to do if a s. 45 Proceeding is Initiated Against You
Upon receipt of a s. 45 Notice from the Registrar, the registrant–the party whose trademark is the subject of the proceeding–has a four-month window to file evidence in response. This evidence is generally filed in the form of one or more affidavits, but the evidence need not necessarily have to be from the trademark owner. Affidavits can be sworn by licensees, distributors or others on behalf of the trademark owner, so long as the affiant has personal knowledge of the facts set out in the affidavit, or the affiant is in a position to introduce business records.
The evidence should aim to prove the use of the trademark (refer to our previous article: Proving Use: Show Off Your Marks!) in Canada at any time within the three years immediately preceding the date of the s. 45 Notice. The trademark need not necessarily be used by the trademark registrant/owner; use by licensees and related companies may also qualify as proof of use to avoid expungement. If a trademark owner relies on use by a licensee, the owner must demonstrate control over the use of the trademark by the licensee — see IP Update “Federal Court of Appeal confirms the importance of a licensor’s control over finished products and services” for a recent case discussing this issue.
How to Avoid Expungement of a Trademark Registration
To avoid expungement through s. 45, registered trademark owners should:
- “Use” their mark as registered in association with all, or as many as possible, goods and/or services listed in the registration.
- Ensure the trademark stands out — examples of a trademark failing to stand out include when the trademark has the same size and lettering as the other elements of the corporate name or always include some other element in the trademark, such as attaching “Limited” to the trademark.
- Avoid altering the trademark from what was registered — examples of problematic differences between trademarks as registered and used include reversing the order of a trademark, splitting a trademark into two words (note that the inverse — merging words — has been allowed), attaching the trademark to descriptive words, or omitting elements of a trademark.
Appeal
The Registrar has three options when deciding a s. 45 proceeding: 1) uphold the registration as a whole; 2) amend the registration to delete and goods and services for which there is no evidence of use; and expunge the registration in its entirety.
The decision of the Registrar may be appealed by the registered owner or by the requesting party to the Federal Court of Canada under s. 56 of the Act.
On such an appeal, the registered owner may file new evidence regardless if it submitted evidence before the Registrar. Such new evidence may be in response to the Registrar’s decision. The downside to filing new evidence on appeal is that the requesting party has an opportunity to cross-examine on the new evidence.
At no time, whether before the Registrar or on appeal, can the requesting party submit any evidence.
Take Away
It is important for owners of Canadian trademark registrations to be aware of any risks to their registration.