A trademark registration can be a powerful tool for preventing competitors from trading on one's goodwill. A trademark registration gives rise to a presumption that trademark rights exist, and that those rights are held by the owner of that registration. Further, several trademark causes of action are only available to those who own trademark registrations. These include actions for infringement and deemed infringement pursuant to sections 19 and 20 of the Trademarks Act ("Act"), as well as actions for depreciation of goodwill (dilution) pursuant to section 22 of the Act.
All these benefits of owning a trademark registration also give good cause for a business to attack the trademark registrations of its competitors. For example, a company may wish to use a trademark that is the same as, or similar to, a trademark registered by a competitor. In such a case, that company may be able to clear the way for its use by having the registration expunged. Similarly, a company already using a trademark may wish to attack a competitor's registration for the same or a similar mark to pre-empt an infringement action. Finally, a defendant in a trademark action may wish to attack a registration being asserted against it, either in defence or by way of counterclaim.
This article discusses the means by which one can attack a trademark registration with the aim of having that registration declared invalid or expunged.
Proceedings before the Trademarks Office. The most frequently used means to attack a trademark registration is through a non-use expungement proceeding pursuant to section 45 of the Act. Section 45 sets out a summary procedure by which any party may request that the Office issue a notice requiring the registrant to file affidavit evidence demonstrating that the registrant has used its trademark in association with each of the listed goods and services within the three-year period immediately preceding the issuance of the notice. If the registrant does not file such evidence of use and does not demonstrate truly special circumstances justifying such non-use, the registration will be expunged.
Section 45 proceedings are attractive because they are inexpensive, relatively quick, and place the burden on the registrant to prove its continued entitlement to the registration, rather than the burden being on the attacking party to prove that the registration is invalid.
Proceedings before the courts. Section 18 of the Act sets out the grounds for invalidating a trademark registration. While any court may declare a registration invalid and therefore unenforceable, pursuant to section 57 of the Act, only the Federal Court may strike an invalid trademark from the Register.
Section 18 sets out the following four grounds for invalidating a trademark registration:
- Unregistrability. A registration is invalid if the subject trademark was not registrable at the date of registration. Section 12 of the Act sets out the requirements for a registrable mark. Briefly stated, a trademark is registrable if it is not:
- primarily merely the name or surname of an individual;
- clearly descriptive or deceptively misdescriptive of the character or quality of the listed goods or services, or of their place of origin;
- the name in any language of the listed goods or services;
- confusing with a registered mark; or
- likely to be mistaken for an official mark.
If a party can show that the trademark ran afoul of any of these criteria as of the date of registration, the registration can be declared invalid.
- Non-distinctiveness. A registration can also be invalidated if it can be shown that the trademark is not distinctive of the registrant's goods or services at the time proceedings bringing the registration's validity into question are commenced. A registered trademark is distinctive if it distinguishes the goods and services of the registrant from the goods and services of others. Although distinctiveness is a requirement for registration in the first place, distinctiveness of a mark can be lost over time, for example, by permitting parties other than the registrant to use the trademark or similar trademarks. Such situations arise most frequently where the mark is used by another party pursuant to an improper license, or where the registrant fails to properly enforce its exclusive rights against infringers.
- Abandonment. A registration can also be invalidated if it can be shown that the trademark has been abandoned. To do so, an attacking party must show that:
- the mark is no longer in use in Canada; and
- the owner intended to abandon the mark.
Intent to abandon a mark can sometimes be inferred from lengthy non-use, acquiescence to infringement by others, or adoption of a new "replacement" mark.
- Non-entitlement. A registration is invalid if it can be shown that the registrant was not the person entitled to secure the registration. A court may conclude that the registrant was not the person entitled to secure the registration if, for example, the trademark was confusing with:
- a trademark previously used or made known by another person in Canada;
- a trademark in respect of which another person had previously filed a trademark application in Canada; or
- a trade name that had previously been used by another person in Canada.
Another example of non-entitlement is where the registrant was in fact not the person who owned the trademark. Such a situation may arise where a distributor or retailer secures registration of a trademark owned by a manufacturer, or where a licensee secures registration of a trademark owned by a licensor.
Other grounds. In addition to the four grounds explicitly set out in section 18 of the Act, Canadian courts have also invalidated registrations on the basis of two further grounds, namely material misstatements and fraudulent misrepresentations made during prosecution of the application leading to the registration.
A material misstatement is a false statement (or omission) made by an applicant in the course of communications made with the Trademarks Office, which causes the applicant to obtain a registration that it could not have acquired had the statement been truthful. An example of a material misstatement is where the registrant incorrectly states, either in the application as filed or in a Declaration of Use, that it has used the trademark in Canada. A misstatement that is not material, such as an incorrect date of first use that does not affect entitlement, is not cause for invalidity. A material misstatement need not be intentional. An innocent or even negligent misstatement that fundamentally affects the registration will be grounds for invalidating the registration.
Fraudulent misrepresentation is much more difficult to prove, as the party claiming invalidity must show that the applicant intended to deceive the Trademarks Office.
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