Date: 20110630
Docket: T-1642-10
Citation: 2011
FC 805
Ottawa, Ontario, June 30, 2011
PRESENT: The Honourable Mr. Justice Scott
BETWEEN:
|
|
SPIRITS INTERNATIONAL B.V.
|
|
|
|
Applicant
|
|
and
|
|
|
BCF S.E.N.C.R.L. and THE ATTORNEY
GENERAL OF CANADA
|
|
|
|
Respondents
|
|
|
|
|
REASONS FOR JUDGMENT AND
JUDGMENT
[1] This is an appeal by Spirits International B.V. [Spirits]
brought under section 56 of the Trade-marks Act,
RSC 1985, c T-13 [Act]. Spirits challenges a decision of the Registrar of
trade-marks [Registrar] dated August 10, 2010, to expunge its Canadian
trade-mark registration TMA 208,808 for the trade-mark MOSKOVSKAYA RUSSIAN
VODKA & Design. Spirits says that the Registrar erred in its legal
approach, and that in any event, new evidence before the Court on this appeal
cures any deficiencies in the evidence that was before the Registrar.
I. Background
Factual
Background
[2] Spirits owns trade-mark registration TMA 208,808 MOSKOVSKAYA
RUSSIAN VODKA & Design [MOSKOVSKAYA trade-mark] for the following mark,
which is registered for use with vodka:
[3] On June 18,
2008, the Registrar, acting under section 45 of the Act at the request of the
Respondent BCF S.E.N.C.R.L. [BCF], gave notice to Spirits requiring it to show
that the MOSKOVSKAYA trade-mark had been used with vodka in Canada between June
18, 2005 and June 18, 2008 [the relevant period].
[4] In response,
Spirits relied on two affidavits: one from Mr. Pavel Fedoryna, the “Acting
Manager of the Swiss branch” of Spirits, and another from Dr. Michael Mulvey, a
marketing professor.
[5] In his
affidavit, Mr. Fedoryna asserted that “MY COMPANY”, defined as including
“S.P.I. Group and its affiliate companies as well as Spirits International
B.V.’s acquired rights in 1999 from Closed Joint Stock Company Sojuzplodimport
and its predecessors” had direct or indirect control over the character and
quality of the vodka sold in association with the MOSKOVSKAYA trade-mark in
Canada. Attached, as an exhibit to the Fedoryna Affidavit, was a corporate
certificate, which meant to explain the relationship amongst several corporate
entities. This document explained that S.P.I. Group SA was the sole or majority
shareholder of Spirits, Spirits Product International Intellectual Property BV,
ZAO Sojuzplodimport, and S.P.I. Spirits (Cyprus) Limited. The Fedoryna
Affidavit also asserted that a label, which Mr. Fedoryna claimed bore the
MOSKOVSKAYA trade-mark, had been affixed to bottles of vodka sold in Canada during the
relevant period.
[6] The Mulvey Affidavit was tendered as an expert
opinion on consumer impressions and maintained that any differences between the
MOSKOVSKAYA trade-mark as used and as registered were not significant. However,
for the reasons that appear below, the Registrar saw no need to consider the
Mulvey Affidavit in its decision.
A. Impugned
Decision
[7] The Registrar first noted that because Spirits’
entire evidence of use of the MOSKOVSKAYA trade-mark was based on that of “MY
COMPANY”, as defined in the Fedoryna Affidavit, it was necessary to determine
if such use enured to the benefit of Spirits, the registered owner.
[8] The Registrar observed that in order to satisfy
the requirements of subsection 50(1) of the Act, a registrant or licensee
needed to clearly state that the control required by section 50 of the Act
exists, or alternatively, provide a description of the control or a copy of the
licence agreement containing provisions pertaining to control. The Registrar
further noted that while the requirements of section 50 may be satisfied if
there is a common directing mind of both a corporate registrant and the user of
the registered trade-mark, the corporate structure alone does not allow the
Registrar to make the inference that a registered owner has control over the
character or quality of the wares and services used in association with a
licensed trade-mark.
[9] In this case, the Registrar noted that Mr.
Fedoryna’s sworn statements and the corporate certificate appended as an
exhibit to his affidavit were the only statements of control furnished by
Spirits. This evidence only showed that Spirits is merely one of the many
corporate entities grouped under “MY COMPANY”. The Registrar found that no
description of the control allegedly exercised had been provided, no copy of
the licence agreement had been furnished, nor were any details provided
regarding the presidents, directors and officers of the entities involved in
“MY COMPANY”. The Registrar found that this was not sufficient evidence of
control to allow it to conclude that the sales of the registered wares in
association with the MOSKOVSKAYA trade-mark by “MY COMPANY”, or any of the
affiliated companies, would enure to the benefit of Spirits.
[10] The Registrar concluded that since no other
evidence of use had been provided, and that Spirits failed to clearly confirm
its control over the quality or character of the registered wares sold during
the relevant period, there was no need to assess the remaining evidence
regarding use of the MOSKOVSKAYA trade-mark.
[11] The Registrar rejected Spirits’ submission that
consideration of section 50 was not within the scope of a section 45
proceeding. The Registrar observed that “use” as defined in section 4 of the
Act means use by the owner of the trade-mark or an entity licensed by or with
the authority of the owner of the trade-mark under section 50.
[12] For these reasons, the Registrar ordered the
MOSKOVSKAYA trade-mark expunged pursuant to section 45 of the Act. It is from
this decision that Spirits brings the present appeal.
B. Legislative
Background
[13] Appeals from expungement decisions made by the Registrar
under section 45 of the Act are brought to this Court by way of application
pursuant to subsection 56(1) of the Act and Rule 300(d) of the Federal
Courts Rules, SOR/98-106. By virtue of subsection 56(5) of the Act,
additional evidence may be adduced on an appeal from a decision of the
Registrar, and this Court may exercise “any discretion vested in the Registrar”
in disposing of the appeal.
Relevant
sections of the Act are
appended to this decision.
C. Additional
Evidence Presented to the Court on this Appeal
[14] On this appeal, Spirits submitted an additional
affidavit sworn by the Head of the Legal Department of S.P.I. Spirits (Cyprus)
Limited, Mr. Dmitry Denisov, to address the Registrar’s concerns, to clarify
the evidence with respect to control over the trade-marked wares during the
relevant period, and to supplement the Fedoryna Affidavit. The Denisov
affidavit asserts that:
(1)
Spirits
is a member of the SPI group of companies;
(2)
S.P.I.
Spirits (Cyprus) Limited
provides “legal support” to all of the members of the SPI group of companies in
“commercial and corporate areas”;
(3)
S.P.I.
Spirits (Cyprus) Limited was
licensed by Spirits to use the MOSKOVSKAYA trade-mark in association with vodka
in Canada during the
relevant period;
(4)
Spirits
set the standards of character and quality of vodka labelled with the
MOSKOVSKAYA trade-mark sold in Canada during the relevant period;
(5)
Under
licence, Spirits delegated to members of the SPI Group of companies “the
conduct of periodic testing” for compliance with the standards of character and
quality that it had set; and
(6)
Attached
as exhibits to the Denisov Affidavit were invoices which were purportedly for
the sale of vodka by S.P.I. Spirits (Cyprus) Limited in Canada which had
been tested, had met Spirits’ established standards, and had been subsequently
labelled with the trade-mark.
II. Issues
[15] The Court states the issues in this case, as
follows:
(1)
Did
the Registrar err in requiring Spirits to show that it or its licensee had used
the subject trade-mark?
(2)
Did
the Registrar err in finding that use of the trade-mark by Spirits or its
licensee had not been shown?
(3)
In
any event, would use of the trade-mark as allegedly used have constituted use
of the trade-mark as registered?
III. Standard
of Review and Burden of Proof
[16] The
standard of review for an appeal under section 56 of the Act was set out by the
Federal Court of Appeal in Molson Breweries v John Labatt Ltd, [2000] 3
FC 145, 252 NR 91 (CA). The Court adopts the following comments of Justice
Marshall Rothstein, when he wrote for the majority of the Court, at paragraph
51 of that decision:
[51] …Even
though there is an express appeal provision in the Trade-marks Act to the
Federal Court, expertise on the part of the Registrar has been recognized as
requiring some deference. Having regard to the Registrar's expertise, in the
absence of additional evidence adduced in the Trial Division, I am of the
opinion that decisions of the Registrar, whether of fact, law or discretion,
within his area of expertise, are to be reviewed on a standard of
reasonableness simpliciter. However, where additional evidence is adduced in
the Trial Division that would have materially affected the Registrar's findings
of fact or the exercise of his discretion, the Trial Division judge must come
to his or her own conclusion as to the correctness of the Registrar's decision.
[17] Thus,
where additional evidence is introduced on appeal that would have materially
affected the Registrar’s findings of fact or the exercise of his discretion,
this Court is required to determine if this new evidence shows use under
section 45 of the Act. Absent such evidence, the Registrar’s decision is to be reviewed
on the reasonableness standard. The oft-cited comments of Justice John McNair
in Philip Morris Inc v Imperial Tobacco Ltd (1987), 13 CPR (3d) 289 at
293, 8 FTR 310 (FCTD) explain both the purpose of section 45 and describe the
type of evidence required to show use under section 45:
It
is well established that the purpose and scope of s. 44 [now s 45] is to
provide a simple, summary and expeditious procedure for clearing the register
of trade marks which are not bona fide claimed by their owners as active trade
marks. The procedure has been aptly described as one for removing
"deadwood" from the register…The Registrar's decision is not one that
finally determines substantive rights but only whether the trade mark entry is
liable to be expunged under s. 44 or not. If use is relied on then the evidence
filed in response to the notice must "show" the use or at least
sufficiently relate the facts from which such use can be inferred. Mere
statutory tracking in the nature of a bare statement that the registrant was
currently using the trade mark in the normal course of trade in association
with the wares is insufficient to establish use unless coupled with facts that
are descriptively corroborative of the same. Evidence of a single sale, whether
wholesale or retail, in the normal course of trade may well suffice so long as
it follows the pattern of a genuine commercial transaction and is not seen as
being deliberately manufactured or contrived to protect the registration of the
trade mark. Evidence in response to a s. 44 notice should be forthcoming in
quality, not quantity, and there is no need nor justification for evidentiary
overkill.
(1) Did the
Registrar err in requiring Spirits to show that it or its licensee had used the
subject trade-mark?
[18] Spirits claims that the
Registrar erred by making a threshold determination as to whether Spirits had
exercised direct or indirect control over the quality or character of the vodka
sold during the relevant period. Because the finding as to control was determinative,
the Registrar saw no need to consider whether the evidence of use proffered by
Spirits was sufficient to demonstrate use of the MOSKOVSKAYA trade-mark, as
registered. Spirits says that the Registrar’s approach was incorrect in light
of the wording of subsection 45(3), the recognized purpose of section 45, and
the scheme of the Act as a whole. In this way, Spirits argues that the
Registrar has created a two-stage procedure whereby the Registrar first decides
whether the registered owner has control over the quality or character of the
wares, and if so, proceeds to determine if there has been use of the mark
during the relevant period. Spirits says, however, that this approach is an
administrative practice that is without any legal basis.
[19] For
its part, BCF submits that in section 45 proceedings, it is settled law that a
registrant is required to show that its registered trade-mark has been used by
the registrant or by another “whose use accrues to the registrant’s benefit”
under the Act, relying on a decision by the Federal Court of Appeal in Marcus
v Quaker Oats Co (1988), 20 CPR (3d) 46 at 51-52, 9 ACWS (3d) 264 (FCA) [Quaker
Oats]. Consequently, BCF concludes that the Registrar was correct to
expunge Spirits’ registration for its failure to show that the trade-mark had
been used by Spirits or its licensee during the relevant period.
[20] It
is certainly true that section 45 proceedings are meant to provide a summary
procedure to trim the register of “dead wood”, and that these proceedings are not
a substitute for other mechanisms in the Act to decide the substantive rights
of parties. However, it is abundantly clear from the scheme of the Act and the
jurisprudence that not just any use of a trade-mark by any person will do for
the purposes of section 45.
[21] In
Quaker Oats, above, the Federal Court of Appeal adopted the position set
out by Justice Jean-Eudes Dubé in Lindy v Canada (Registrar of Trade-marks)
(1981), 57 CPR (2d) 127, [1982] 1 FC 241 (TD), where it was held that “Reading
the Act as a whole, the conclusion is inescapable…“use in Canada” means use by
the registered owner or a registered user…Obviously, it cannot be a competitor,
or a stranger…”
[22] The
provisions in the Act requiring registration of licensees as “registered users”
have since been repealed, but the Court believes that the principle adopted in Quaker
Oats is nonetheless applicable under the current legislative scheme and can
be re-stated as follows: “use in Canada” means use by the registered owner or its
licensee.
[23] That
is, where evidence of use of the trade-mark is put before the Registrar in a
section 45 proceeding, it must be shown that it was the registered owner or a
licensee, whose use of the mark accrues to the benefit of the registered owner,
who used it (see e.g. House of Kwong Sang Hong International Ltd v Borden
Ladner Gervais, 2004 FC 554 at para 22; Tucumcari Aero, Inc v Cassels,
Brock & Blackwell LLP, 2010 FC 267 at para 9-10).
[24] Therefore,
it cannot be said that a trade-mark has been used in Canada during the relevant
period if it is used by a competitor, a stranger, or some vaguely-defined
corporate affiliate of the registered owner. As observed by the Registrar in
this case, to hold otherwise would be contrary to the definition of a trade-mark
and the principle that trade-mark rights are acquired through use.
[25] In
light of the Act and the relevant jurisprudence, the Court sees nothing
improper in the approach taken by the Registrar in this case. Spirits was
required to show either that it had used the MOSKOVSKAYA trade-mark, or that it
had direct or indirect control over the use of the mark by another party such
that the licensed use of the mark enured to its benefit.
(2) Did the
Registrar err in finding that use of the trade-mark by Spirits or its licensee
had not been shown?
[26] Spirits
submits that the new and additional evidence in the Denisov Affidavit addresses
the alleged ambiguities in the evidence, and as such would have materially
affected the Registrar’s findings of fact on the determinative issue of
control. Spirits says the Denisov Affidavit specifically describes the
corporate and contractual relationships between Spirits, the SPI Group, and
S.P.I. Spirits (Cyprus) Limited, and details
the licensing and control arrangements which are in place concerning the use of
the MOSKOVSKAYA trade-mark.
[27] Specifically,
Spirits claims that the Denisov Affidavit confirms that Spirits, the registered
owner, had control over the quality or character of the registered wares sold
in Canada during the relevant
period. Consequently, Spirits submits that this Court is required to reach its
own conclusion with respect to the issue of control, in light of the Denisov
Affidavit.
[28] For
its part, BCF submits that the Denisov Affidavit is vague and ambiguous and
would not have materially affected the decision of the Registrar. As such, BCF
says that the decision on this point should be reviewed on the standard of
reasonableness. BCF claims that the Denisov Affidavit is deficient for a number
of reasons, for instance:
(1)
The
role played by S.P.I. Spirits (Cyprus) Limited in the transactions evidenced by the sales
invoices is unclear. While Mr. Denisov states that S.P.I. Spirits (Cyprus) Limited provides
“legal support” to Spirits and others, there is no clear statement that S.P.I.
Spirits (Cyprus) Limited produced or
sold any vodka for Spirits;
(2)
Neither
Mr. Fedoryna nor Mr. Denisov has ever stated who actually produces or sells any
of the vodka in question. The only statement attributing any act of production
to any entity is in paragraph 18 of the Denisov Affidavit, which states that
Spirits has delegated the duty to conduct “periodic testing” to members of the
SPI Group of companies. BCF says that there is no indication of any licence
between these companies, and there is no explanation if any control is being
exercised by those companies to whom this power has been “delegated”;
(3)
If
Spirits is asserting that S.P.I. Spirits (Cyprus) Limited was the party
producing and bottling the vodka in question, this assertion is called into
question by the exhibit to the Denisov Affidavit showing an unknown “bottling
company”. BCF also notes Spirits’ failure to name this company, or explain its
role in the production or distribution of the subject vodka;
(4)
While
Mr. Denisov has made a bare allegation that there is a trade-mark licence
between Spirits and S.P.I. Spirits (Cyprus) Limited, there is no clear
indication as to what S.P.I. Spirits (Cyprus) Limited does under this alleged
licence, and for whatever it does, how this is controlled by Spirits; and
(5)
Even
if one were to assume that S.P.I. Spirits (Cyprus) Limited makes or sells vodka
for Spirits, and that the alleged licence relates to such activities during the
relevant period, there is no statement in the Denisov Affidavit as to when the
alleged licence began or ended. Without particulars, BCF argues that there is
no way to know that the alleged licence is tied to any day, associated with any
sales invoice, put forward in the Fedoryna Affidavit.
[29] In assessing whether new
evidence would have materially affected the Registrar’s findings of fact, the
Court must ask to what extent this evidence has a probative significance that
extends beyond the material that was before the Registrar (Diamant Elinor
Inc v 88766 Canada Inc, 2010 FC 1184 at para 43). If the evidence
“adds nothing of significance, but is merely repetitive of existing evidence
without enhancing its cogency, its presence should not affect the standard of
review applied by the Court on the appeal” (Garbo Group Inc v Harriet Brown
& Co (1999), 3 CPR (4th) 224 at para 37, 176 FTR 80 (TD)).
[30] While
the Denisov Affidavit purports to deal with the question of control over the
quality and character of vodka sold in Canada under the MOSKOVSKAYA trade-mark, the Court is of
the view that this evidence would not have materially affected the Registrar’s
findings of fact on this issue.
[31] The
Registrar found that the Fedoryna Affidavit was deficient because:
(1)
While
the requirements of section 50 may be satisfied if there is a common directing
mind of both a corporate registrant and the user of the registered trade-mark,
corporate structure alone does not allow the Registrar to make the inference
that a registered owner has control over the use of a licensed trade-mark;
(2)
In
this case, the evidence showed that Spirits was one of several corporate
entities grouped under “MY COMPANY”, as defined by Mr. Fedoryna; but
(3)
No
description of the purported control exercised by Spirits had been provided, no
copy or description of the licence agreement between Spirits and S.P.I. Spirits
(Cyprus) Limited had been furnished, and Spirits had not put forward any
details regarding the presidents, directors and officers of the various
entities involved in “MY COMPANY” to show a common directing mind of Spirits,
the corporate registrant, and the purported users of the MOSKOVSKAYA
trade-mark.
[32] Having reviewed the Denisov Affidavit, the Court
does not think that it resolves the deficiencies in the Fedoryna Affidavit, nor
does it have a probative significance extending beyond the material that was in
front of the Registrar. Rather, the Court agrees with the Respondent that
instead of addressing unanswered questions, the Denisov Affidavit raises
additional ones.
[33] While Mr. Denisov alleges that there is a
licence between Spirits and S.P.I. Spirits (Cyprus) Limited,
what the latter company does under this licence is unclear. Mr. Denisov states
that S.P.I. Spirits (Cyprus) Limited provides “legal support” to other
entities in the SPI Group of companies. It is not clear from the Denisov
Affidavit that S.P.I. Spirits (Cyprus) Limited produces or sells vodka for
Spirits under the MOSKOVSKAYA trade-mark. Rather, the evidence of Mr. Denisov
is that there is an unnamed “bottling company” which is affiliated with the SPI
Group. The evidence does not establish that Spirits exercises control over the
production, labelling or selling of vodka through its licence with S.P.I.
Spirits (Cyprus) Limited,
the bottling company, or both.
[34] Moreover, the Respondent is correct to point out
that in the absence of a clear statement as to the beginning or end of the
license between Spirits and S.P.I. Spirits (Cyprus) Limited, it is not possible
to temporally link the licence, or any actions taken thereunder, to the sales
invoices put forward in the Fedoryna Affidavit.
[35] Finally, the statement in the Denisov Affidavit
about the delegation of authority by Spirits for the “testing” of vodka
according to prescribed “standards” is similarly vague, and does not assist in
establishing that Spirits exercised control over the nature and character of
vodka sold under the MOSKOVSKAYA trade-mark in Canada during the
relevant period.
[36] Simply put, the Denisov Affidavit fails to
resolve the Registrar’s stated concerns with the Fedoryna Affidavit because the
evidence does not clearly establish Spirits’ control over the use of the
MOSKOVSKAYA trade-mark.
[37] Since
the Court concludes that the Denisov Affidavit would not have materially
affected the Registrar’s decision, it must be asked whether the Registrar’s
finding that there was no demonstrated use of the MOSKOVSKAYA trade-mark by
Spirits or its licensee was in any event reasonable.
[38] Review
according to the reasonableness standard is concerned with the existence of
transparency, intelligibility and justification in decision-making. Decisions
should not be disturbed by a reviewing court unless the reasoning process used
was flawed such that the resulting decision falls outside the range of
possible, acceptable outcomes, defensible on the facts and in law (Dunsmuir
v New Brunswick, 2008 SCC 9 at para 47).
[39] In
the case of use by a licensee, it is not necessary to produce a formal
licensing agreement to prove the existence of licensed use of a trade-mark for
the purposes of the Act (Well’s Dairy, Inc v UL Canada Inc (2000), 7 CPR
(4th) 77 at para 38, 98 ACWS (3d) 189 (FCTD)). However, the mere fact that
there is some common control between a registered trade-mark owner and other
corporate entities is not sufficient to establish that the use of the
trade-mark was controlled such that a licensing agreement can be inferred from
the facts. Clear evidence of control has to be adduced (3082833 Nova Scotia
Co v Lang Michener LLP, 2009 FC 928 at para 32).
[40] The
Registrar found that it could not be determined from the Fedoryna Affidavit
that Spirits had exercised the requisite degree of control over the character
and quality of the wares in compliance with section 50 of the Act, which would
have enabled such use by Spirits or its licensees to accrue to the benefit of
Spirits, the registered owner. In reaching this conclusion, the Registrar made
specific reference to Mr. Fedoryna’s sworn statements and the corporate
certificate appended to his affidavit. The Registrar explained that control
could not be demonstrated on the basis of these corporate structures alone,
especially in the absence of a description of the control purportedly exercised
or a copy of any license agreement containing provisions as to control.
[41] On
the basis of the evidence before it, it cannot be said that the Registrar’s
conclusion in this regard was unreasonable.
(3) In
any event, would use of the trade-mark as allegedly used have constituted use
of the trade-mark as registered?
[42] As a preliminary matter, Spirits submits that since the
Registrar did not deal with the question of use, because it concluded that the
evidence of control was insufficient, the matter should be referred back to the
Registrar for determination on this issue. In support of its position that it
is not for this Court to hear an appeal on a decision not taken by the
Registrar, Spirits relies on decisions of this Court in Canadian Pacific Ltd
v Intra Canada Telecommunications Ltd (1988), 19 CPR (3d) 314 at para 12,
18 FTR 309 (TD) and Tradition Fine Foods Ltd v Kraft General Foods Canada
Inc (1991), 35 CPR (3d) 564 at para 11, 43 FTR 257 (TD).
[43] BCF
is opposed to this request, and submits that subsection 56(5) of the Act
provides that on an appeal such as this one, “the Federal Court may exercise any
discretion vested in the Registrar” [emphasis added]. BCF also notes that this
appeal is taken from the Registrar’s decision to expunge the
registration – not from the Registrar’s reasoning for expunging the
registration. Additionally, BCF claims that even if there is discretion to
refer the matter back, it would be inappropriate to do so given that section 45
proceedings are intended to be of a summary nature, and in any event, this
Court is as well-placed as the Registrar to review the record and make the
required decision.
[44] In
the Court’s view, the cases cited by Spirits in support of its request to have
the question of whether the MOSKOVSKAYA trade-mark had been used as registered
referred back to the Registrar are distinguishable. None of the cited cases
involved a section 45 proceeding.
[45] In
any event, the clear wording of subsection 56(5) of the Act provides the
authority for this Court to “exercise any discretion vested in the Registrar”
on an appeal such as this. In cases where new evidence is put before the Court
as to the significance of deviations in marks as used and as registered, the
Court is required to make final determinations on these issues. Spirits has not
pointed to any clear authority or made any compelling argument for why this
issue could not be finally determined by this Court at this time.
[46] Spirits
did not make submissions on the issue of whether the trade-mark as used
constituted use of the MOSKOVSKAYA trade-mark, but instead, relied on its
written submissions put before the Registrar. In those submissions, Spirits
argued that the trade-mark as used during the relevant period was substantially
identical to the trade-mark as registered.
[47] In
particular, Spirits argued that an unaware purchaser purchasing liquor and
seeing the two trade-marks would no doubt identify both as MOSKOVSKAYA RUSSIAN
VODKA labels, and would determine that both had the same origin. In support of
its position, Spirits relied heavily on the evidence of Dr. Mulvey, as to
consumer impressions.
[48] For
its part, BCF submits that Spirits does not rely on use of the registered mark,
but rather on the alleged use of a different mark which is materially different
from the mark as registered. BCF notes that the Applicant’s own evidence is
that the mark allegedly used differs from that registered, in important ways,
and that the deviations from registration were made for important reasons and
had a significant effect on consumers and within the marketplace. BCF notes
that the evidence from the Fedoryna Affidavit is that:
(1)
the
original registered mark led to problems with counterfeiting and knock-off
brands;
(2)
this
created important health concerns associated with the counterfeit products;
(3)
the
trade-mark was revised as a “precautionary identification measure”; and
(4)
the
goal was to reduce the risk of knock-off brands using a counterfeit label.
[49] BCF
also notes that the evidence of Mr. Fedoryna is that changes were made to
identify a change of ownership. However, BCF submits that when the mark as used
is compared to the registered mark, the change of ownership message is
confusing. That is, while the registered mark states that the vodka is
distilled and bottled for “v/o SOJUZPLODIMPORT”, the mark as allegedly used
states that the vodka is “imported” for or by an entity named “SPI”. BCF says
that nowhere in the evidence is there any explanation for who these companies
are or how they relate to Spirits.
[50] The
mark as allegedly used (“Fedoryna Exhibit B2”) and the mark as registered are
reproduced below:
[51] In
my opinion, the concerns raised by BCF about the motivations for and
implications of the changes to the trade-mark as allegedly used go more to the
question of control, addressed earlier, rather than the question of whether the
trade-mark as used constitutes use of the trade-mark as registered. The test
for determining what deviations from registration are permitted has been stated
by the Federal Court of Appeal in Registrar of Trade-marks v Compagnie
Internationale Pour L’Informatique CII Honeywell Bull Societe Anonyme,
[1985] 1 FC 406, 4 CPR (3d) 523 at 525, (CA) as follows:
The
practical test to be applied in order to resolve a case of this nature is to
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.
[52] The
test has been articulated slightly differently in other cases, relying on the
decision of the Trade-marks Opposition Board in Nightingale Interloc Ltd v
Prodesign Ltd (1984), 2 CPR (3d) 535 at para 8, [1984] TMOB No 52 (QL),
where it was said that: “A particular trade mark will be considered as being
used if the trade mark actually used is not substantially different and the
deviations are not such as to deceive or injure the public in any way.”
[53] Applying
these tests to the case at hand, the mark as allegedly used retains all of the
major graphic elements of the mark as registered, in the Court’s view. While
there are indeed some differences between the two, for instance some font
changes, the altered globe logo, the use of bilingualism, the spacing of the
medallions, and the removal of the words “COOL BEFORE DRINKING”, the Court does
not find that any of these deviations are significant or that an unaware
purchaser would be unable to infer that both, in spite of these differences,
have the same origin.
[54] As
noted in the discussion above, however, the identity of that common origin is
very much in doubt. Without clear evidence that use of the MOSKOVSKAYA
trade-mark, in its registered form or otherwise, accrues to Spirits’ benefit,
there can be no evidence of use of the mark for the purposes of section 45. It
is the failure of Spirits to conclusively answer this crucial question of
control which has caused its mark to be expunged in the proceedings before the
Registrar, and why its appeal to this Court must fail as well.
IV. Conclusion
and Disposition
[55] For
these reasons, this appeal is dismissed with costs awarded to BCF, fixed in the
amount of $2000.
JUDGMENT
THIS COURT’S JUDGMENT
is that
- The
appeal is dismissed.
- Costs
are fixed in the amount of $2000.
“André F. J. Scott”
Email this Content