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Retailers and the International Trademark Association prevail in Québec’s French Charter proceeding

On April 9, 2014, the Québec Superior Court issued its long-awaited decision in the matter of the interpretation of Québec’s Charter of the French language (the “French Charter”) and its interplay with trademarks. The Court confirmed that businesses can continue to use their registered trademarks on public signs outside their premises in the without the need to add French generic language. François Guay, Christian Bolduc and Jean-Sébastien Dupont of the office of Smart & Biggar successfully represented the International Trademark Association (“INTA”) as an intervener in this proceeding.

In Québec, the French Charter requires that public signs and posters and commercial advertising be predominantly in French, while providing for the Government to enact exceptions to that general rule by way of regulations. In 1993, Québec introduced an exception in the French Charter Regulation, specifically allowing “recognized trademarks” within the meaning of the Trademarks Act to appear exclusively in a language other than French.

For nearly two decades, the Office québécois de la langue française (“OQLF”), the governmental body in charge of applying and enforcing the French Charter, allowed businesses to display their registered trademarks on public signs in a language other than French without the need to add French generic language.

However, starting in 2010, the OQLF changed its position (without any legislative change) such that any trademark appearing on a public sign in Québec would be considered a trade name use and different provisions of the French Charter and its Regulation applied, requiring their translation into French or the addition of French generic language.

In October 2012, several retailers (Best Buy, Costco, Gap, Old Navy, Guess, Walmart, Toys “R” Us and Curves) filed a motion for declaratory judgment in the Québec Superior Court seeking to have the Court confirm the previous interpretation of the trademark exception. INTA, a not-for-profit association composed of trademark owners, trademark professionals and academics from around the world, was granted leave to intervene in this matter to raise important trademark law issues and policies.

Mr. Justice Yergeau, in a thorough and well-reasoned decision, rejected all the arguments put forward by the OQLF, represented by the Attorney General of Québec. He held that the French Charter and its Regulation could hardly be clearer and that there was no doubt as to its proper interpretation.

Importantly for trademark owners doing business in Québec, and as advocated by INTA in its intervention, the Court noted a clear distinction among trademarks, trade names (under the Trademarks Act) and “firm names” in the French Charter, which the Judge equated with “raison sociale” or corporate name. The Court concluded that trademarks are a distinct legal concept, which are clearly different from trade names and corporate names and are governed by their own set of rules.

On that basis, the Court rejected the OQLF’s submission that trademarks displayed by retailers and other businesses on public signs outside their premises are used as trade names or corporate names, which would require the addition of French generic language.

Interestingly, the Court also noted that the French Charter and its Regulation create a distinct niche for trademarks. The trademark exception to the requirement that public signs and commercial advertising be predominantly in French, as well as other related trademark exceptions provided for in the Regulation, confirms that the Government chose to recognize a special status of recognized trademarks in the French Charter.

In conclusion, the Court refused to endorse the OQLF’s recent interpretation where the French Charter and its Regulation are clear and have been supported by a consistent legislative interpretation for two decades by the body in charge of applying these provisions. It is for Québec’s legislature to intervene and decide whether legislative changes are necessary to protect Québec’s French language landscape against trademarks displayed in other languages, and particularly in English.

However, should Québec’s newly-elected Government decide to amend the French Charter, it will need to take into consideration the inherent challenges associated with trademark law, which is a subject-matter of Federal jurisdiction in Canada and is also governed by various international treaties to which Canada is a party.

The OQLF has until May 9, 2014 to appeal from that decision to the Court of Appeal.

For further information, please contact a member of our firm’s Trademarks group.

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