Date:
20160408
Docket:
A-122-15
Citation: 2016 FCA 109
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CORAM:
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PELLETIER J.A.
GAUTHIER J.A.
SCOTT J.A.
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BETWEEN:
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THE ONE GROUP
LLC
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Appellant
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And
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GOUVERNEUR INC.
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Respondent
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REASONS FOR JUDGMENT
SCOTT J.A.
[1]
I am of the opinion that this appeal should be
allowed.
[2]
The decision that gave rise to this appeal was
made by a Hearing Officer of the Trade-marks Opposition Board of the Canadian
Intellectual Property Office (the Registrar) who refused to expunge the
appellant’s trade-mark registration of STK for non-use in the three years preceding
the request for evidence of use filed under section 45 of the Trade-marks
Act, R.S.C. (1985), c. T-13 (the Act).
[3]
The One Group LLC (the appellant) is a company
that operates many high-end restaurants under the name STK. On September 4, it
registered the trade-mark STK in association with “bar services; restaurants” in preparation for a restaurant opening in Toronto.
[4]
During the three years following the
registration of its trade-mark, the appellant successively held discussions
with first one hotel chain and then another, for the purpose of entering into
an agreement to secure a location for its restaurant in hotels that were to be
built. In both cases, one after the other, the developers aborted their plans
to build hotels. The appellant therefore had to resume the process during the
remainder of the required period and it entered into discussions with real
estate developers and other hotel chains to find a location for its restaurant.
On October 3, 2011, when the notice was filed pursuant to section 45 of the
Act, the appellant stated that it was close to coming to an agreement with a
luxury hotel chain to open its restaurant in Toronto.
[5]
In light of those facts, the Registrar concluded
that the appellant’s trade-mark should not be expunged because there were
special circumstances that excused the non-use of the trade‑mark STK.
[6]
In reaching this conclusion, the Registrar referred
to this Court’s decision in Canada (Registrar of Trade Marks) v. Harris
Knitting Mills Ltd., [1985] F.C.J. No 226, 60 N.R. 380 (F.C.A.) (QL). He
identified the following three criteria that apply when determining whether
special circumstances exist to justify not expunging the trade-mark:
1)
the length of time during which the trade-mark
has not been used;
2)
whether the reasons for non-use were beyond the
registered owner’s control; and
3)
whether the registered owner has a serious
intention to shortly resume use of the trade-mark.
[7]
Moreover, the Registrar noted that this Court’s
decision in Scott Paper Limited v. Smart & Biggar, 2008 FCA 129, 291
D.L.R. (4th) 660 (QL) [Scott Paper] clarified the scope of the analysis
with regard to the three criteria identified above. In this case, he felt that
the second criterion was decisive. The other two could not by themselves
justify a finding of special circumstances. The Registrar considered the
principles from Scott Paper and concluded the following:
[translation]
[21] As a
result, in my view, because of their cumulative nature, the circumstances of
the present case are “unusual, uncommon and exceptional” and constitute
“circumstances not found in most cases of absence of use of the mark.” (See Scott
Paper, supra).
[8]
On appeal, the Federal Court judge described the
context and summarized the reasons for the Registrar’s decision. Then, she
stated that the reasonableness standard of review applied to the Registrar’s
decision.
[9]
Since it was alleged that the Registrar erred in
law, the judge referred to the principles stated in the case law and found that
even if the Registrar had erroneously described the test, he still applied the
correct principles of law.
[10]
The judge then acknowledged that her role was
not to reassess the evidence and substitute her own appreciation for that of
the Registrar and that the burden was not very heavy. She still found that the
evidence did not support the Registrar’s decision.
[11]
The judge thus allowed the appeal and ordered
the registrar to expunge the trade-mark STK bearing registration number TMA
722,923 from the trade-marks register (2015 FC 128).
[12]
Since the judge identified the correct standard
of review in this matter, this Court must review the Registrar’s decision to
determine whether the judge correctly applied the standard of reasonableness (Monster
Cable Products, Inc. v. Monster Daddy, LLC, 2013 FCA 137 at paragraph 4; Agraira
v. Canada (Public Safety and Emergency Preparedness), 2013 SCC 36, [2013] 2
S.C.R. 559 at paragraphs 45 to 47).
[13]
Like the Federal Court judge, I am not convinced
that the Registrar erred in law in his application of the legal tests. Although
his statement of the applicable principles is somewhat lacking in clarity, it
seems clear to me that he considered the applicable case law and that he
focused on the true issue, that is, whether there were special circumstances
that excused the non‑use of the Mark.
[14]
Even though the criteria to be assessed is set
out in the case law, it should be recalled that the Registrar is applying his home
statute and that he must be considered as having expertise with respect to
trade-marks. Thus, deference must be shown towards the findings of fact he
draws from that evidence before him. This is especially true, given that the
wording of subsection 45(3) of the Act that does not define the term “special circumstances”, thus giving broad discretion to
the Registrar to consider that evidence specific to each situation:
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Trade-marks Act, R.S.C., 1985,
c. T-13
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Loi sur les marques de commerce, L.R.C. (1985), ch. T-13
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45. …
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45. […]
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(3) Where, by reason of the evidence furnished to the Registrar or
the failure to furnish any evidence, it appears to the Registrar that a
trade-mark, either with respect to all of the goods or services specified in
the registration or with respect to any of those goods or services, was not
used in Canada at any time during the three year period immediately preceding
the date of the notice and that the absence of use has not been due to
special circumstances that excuse the absence of use, the registration of
the trade-mark is liable to be expunged or amended accordingly.
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(3) Lorsqu’il apparaît au registraire, en raison de la preuve qui
lui est fournie ou du défaut de fournir une telle preuve, que la marque de
commerce, soit à l’égard de la totalité des produits ou services spécifiés
dans l’enregistrement, soit à l’égard de l’un de ces produits ou de l’un de
ces services, n’a été employée au Canada à aucun moment au cours des trois
ans précédant la date de l’avis et que le défaut d’emploi n’a pas été
attribuable à des circonstances spéciales qui le justifient,
l’enregistrement de cette marque de commerce est susceptible de radiation ou
de modification en conséquence.
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[My emphasis]
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[Mes soulignements]
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[15]
Despite the respondent’s numerous arguments
against the Registrar’s decision, when applying the standard of reasonableness,
I am not satisfied that the Registrar committed an error in his appreciation of
the evidence on the record that justified the judge’s intervention.
[16]
The evidence could support the Registrar’s
finding that the appellant met its burden of proving that there were special
circumstances that prevented it from using its trade-mark at any time during
the three year period immediately preceding October 3, 2011. The Registrar acknowledged
that the period of non-use was minimal. He also considered an imminent agreement
with a hotel chain. Last, he determined that the circumstances in this case complied
with the further clarifications set out in Scott Paper, the special circumstances
explained the absence of use and were the reason for it. Moreover, the non-use
was beyond the control of the holder of the Mark alone. Given that his analysis
considers every factor set out in the case law and that it is based on the
whole of the evidence submitted to him, I find that the Registrar’s conclusion falls
within the range of possible outcomes.
[17]
For theses reasons, I am of the opinion that I
should allow the appeal and render the decision that the judge should have
rendered, namely to confirm the Registrar’s decision to maintain the trade-mark
STK bearing registration number TMA 722,923 on the register, with costs.
“A.F. Scott”
“I agree.
J.D. Denis Pelletier, J.A.”
“I agree.
Johanne Gauthier, J.A.”
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