Author: David McLauchlan

About David McLauchlan

David McLauchlan is an associate within the Intellectual Property Practice Group. He works chiefly in the areas of health and life sciences. He advises clients on drafting and negotiating research agreements, as well as on issues related to regulatory responsibility, ethics and compliance.

One Good Term Deserves Another: 60+ New Cannabis Terms for Canadian Trademark Applicants

In May 2021, CIPO added upwards of 60 cannabis- and marijuana-related terms to the Goods and Services Manual (the “Manual”).

Most of the new terms fall into Nice Classes 3 (non-medicated toiletry preparations), 5 (pharmaceuticals), and 30 (foodstuffs of plant origin). However, new terms have also been added in Class 16 (namely “printed publications in the field of cannabis”), 42 (“scientific research in the field of cannabis”) and 45 (“legal research in the field of cannabis”).

Many of the new terms describe medicinal uses of cannabis or marijuana, including the form in which the product is provided and the use covered by the description. Examples in this category include “marijuana oil for the relief of nausea”, “cannabis salve for the treatment of psoriasis”, and “cannabis capsules as a sleep aid”. The new entries in Nice Class 30 relate to snack foods containing cannabis, such as chocolate, cookies and granola.

Terms in the Goods and Services Manual are pre-approved by CIPO, meaning that they will be accepted without further specification if selected. This may help applicants avoid objections under s. 30(2)(a) of the Trademarks Act, which requires that applications contain “a statement in ordinary commercial terms of the goods or services in association with which the trademark is used or proposed to be use”. The level of specificity required may come as a surprise to foreign applicants, as they go beyond that which is required in many other countries.

In the absence of a pre-approved term, applicants and their trademark agents must rely on their judgment and more general criteria in order to define the goods or services covered by an application, such as analogies with other pre-approved terms or recently accepted applications. The addition of these terms may therefore remove a cloud of uncertainty faced by applicants in the cannabis space.

In adding these terms to the Manual, CIPO demonstrates its continued openness to facilitating filings related to cannabis and marijuana. Pre-defined terms for cannabis products date back to January 2018, when “dried cannabis” and “live cannabis plants” were added to the Manual, in the lead-up to the legalization of recreational cannabis in October of that year. 

Fasken’s team of experienced professionals are available to assist you with the full range of cannabis-related legal issues, including trademark matters.

Learn more about our Cannabis practice or Trademark practice.

The Case of the ‘Missing S’

At What Point Can Trademark Owners Claim Damages When a Registered Mark Infringes?

Under section 19 of the Canadian Trademarks Act, “… the registration of a trademark in respect of any goods or services, unless shown to be invalid, gives to the owner of the trademark the exclusive right to the use throughout Canada of the trademark in respect of those goods or services.” (our emphasis) That exclusive right is said to be infringed if another person, among other things, sells goods in association with a confusingly similar trademark or trade name. (s. 20(1)(a)) The owner can then institute legal proceedings against the allegedly infringing party (s. 52 ff) and, if they are successful, obtain monetary compensation or other remedies.

But what happens if a registered trademark is later expunged and the use of that mark is held to be infringing another trademark owner’s trademark rights? When does the protection of section 19 cease? In other words,  when can another registered trademark owner obtain damages for that infringing use?

In its recent decision in Group III International Ltd. v. Travelway Group International Ltd., the Canadian Federal Court of Appeal has provided some guidance. According to this decision, in the absence of misrepresentation or bad faith, there can be no damages for the period prior to expungement.

The first decision in the case was issued in 2013, and involved the registered trademarks of GROUP III INTERNATIONAL LTD., HOLIDAY GROUP INC. and WENGER S.A. (collectively “GROUP III”), namely the “Wenger Cross Logo” as well as related marks with the words “WENGER” or “SWISSGEAR”  registered in association with luggage and bags.

GROUP III alleged trademark infringement and passing off by TRAVELWAY GROUP INTERNATIONAL LTD. (“Travelway”) with respect to the use of Travelway’s registered trademarks  on its luggage related products:

In this first judgement, the Federal Court ruled that Travelway’s registered marks were not confusingly similar to GROUP III’s, and therefore, that there was no infringement. Similarly, GROUP III’s claim that  Travelway had attempted to pass of their goods as those of the GROUP IIIs failed.

On appeal, however, the Federal Court of Appeal ruled that the trial judge had misapplied the test for confusion, overemphasizing the resemblance of the logos, and ruled that there was indeed confusion and passing off. The issues of whether  Travelway’s registered marks ought to be expunged, and the applicable quantum of damages were referred back to the Federal Court.

In 2019, the Federal Court ordered Travelway’s trademarks expunged, but refused to grant  GROUP III compensation as there could only be damages after the expungement of Travelway’s marks. At this stage GROUP III attempted to rely on the judge’s discretionary power with respect to remedies, alleging that  Travelways had blatantly infringed  GROUP III’s marks. Under the circumstances, they claimed, there was “no basis to deny compensation altogether.” According to GROUP III, the expungement should have rendered Travelway’s marks invalid from the beginning (e.g. void ab initio) and as such, the shield of Section 19 should never had existed.  However, the judge agreed with Travelway, and followed the precedent established in Remo Imports Ltd v Jaguar Cars Limited, which held that absent a finding of bad faith, a registration would not be deemed void ab initio. The judge noted that in the present case, the Travelway had “ceased all sales on the date of the Judgement of the Federal Court of Appeal,” and that there had in fact been no finding of bad faith.  Damages were only available after the expungement of the mark, not prior thereto.

GROUP III appealed on the basis that the Federal Court erred and should have found that the infringing marks have always been invalid and never registrable, therefore disentitling Travelway from relying on section 19 and entitling GROUP III to financial compensation from the moment Travelway started using its infringing trademarks. The Federal Court of Appeal ruled that Travelway “could rely on its registrations as protection until such time as the Federal Court expunged its trademarks from the Register.” In reaching this conclusion, it noted that trademark registration is subject to a complex, specialized administrative scheme, which militates against trademarks being deemed invalid from the outset. Furthermore, it distinguished between the time at which a trademark becomes invalid and the time at which it is expunged from the register. The latter, it concluded, must be the starting point for any liability arising from the use of a registered trademark that has been invalidated.

The case underlines the importance of obtaining registered trademarks. They continue to serve the dual purposes of protecting members of the public by allowing them to identify the source of goods and protecting owners’ business interests by preventing others from using their marks. However, they may also serve a defensive purpose: they can protect the owner, in certain circumstances, in infringement claims by third parties. That being said, this protection could, however, be lost where the trademark is obtained fraudulently or in bad faith.

Cease and Desist Letters: Use with Care

Cease and desist letters are an important part of a lawyer’s tool kit: they notify the recipient of a claim, and ideally lead to the client resolving an issue without litigation. However, receiving such a letter can be unpleasant. They may even seem excessive, as if they were intended to achieve the maximum possible threatening effect. In Fluid Energy Group Ltd. v. Exaltexx Inc. (“Fluid v. Exaltexx”), Justice McHaffie of the Federal Court found that that indeed appeared to be the intention of Fluid’s letters, taking the unusual step of issuing an injunction ordering Fluid not to communicate with Exaltexx’s suppliers with respect to such suppliers’ alleged infringement of Fluid’s patents.

Where is the line between an appropriate cease and desist letter and one worthy of an injunction? In the case of letters alleging patent infringement, strangely enough, the answer may lie in section 7(a) the Trademarks Act, which was the basis for Exaltexx’s motion for the interlocutory injunction. That section reads: “No person shall … make a false or misleading statement tending to discredit the business, goods or services of a competitor…” This provision, however, must be read down so as to include only statements relating to the competitor’s intellectual property.

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Destruction and Delivery Up: a Year in Review

Copyright and trade-mark owners whose IP is infringed may seek a variety of remedies against the perpetrators, including damages, injunctive relief and legal costs. Psychologically though, destruction and delivery up may provide the most satisfaction. Specifically provided for in the respective statutes,  these remedies allow the successful plaintiff to either compel the infringer to destroy the counterfeit items under oath or actually take possession of them. In this post, we survey destruction and delivery up orders granted and denied in 2019. Overall, the year’s rulings are mixed, demonstrating that even as the victim of infringement, “you can’t always get what you want.”

Luxury Goods

Luxury goods are common targets for counterfeiters, as this year’s crop of destruction and delivery up orders illustrates. Appearing four times before the Federal Court was Nathalie Marie Tobey, aka Nathalie Henrie. Operating out of a clandestine retail establishment on Old Yonge Street, Ms. Tobey was accused of selling counterfeit Givenchy, Louis Vuitton, Dior and Celine merchandise.  Her defence was essentially that a well-informed member of the public would not confuse the goods she was selling with the plaintiffs’. Justice Norris dismissed this defence as having “no hope of success whatsoever,” before ordering the delivery up of all goods bearing the plaintiff’s subject trademarks, at least, those not already seized by the Toronto Police Service.

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Can Canadian Courts Issue Site-Blocking Orders?

Can Canadian Courts Issue Site-Blocking Orders? Prior to last Friday, it would have been unprecedented. With the Federal Court’s decision in Bell Media Inc v GoldTV Services (2019 FC 1432), that is no longer the case.

Although it is a single trial court decision, owners of Canadian copyrights and their lawyers now have an affirmative answer and even a test to apply to the issue.

The case relates to two websites, GoldTV.biz and GoldTV.ca, which offered an unauthorized subscription service allowing users to stream copyrighted content. The copyright owners and exclusive licensees (Rogers Media Inc., Groupe TVA Inc. and Bell Media Inc.) objected to this, alleging infringement.

Conspicuous by his, her, or their absence were John Doe 1 and John Doe 2, the respective operators of the sites. Despite the plaintiff’s diligent efforts, identifying these entities proved impossible, with the judges in earlier stages of the proceedings commenting that this was likely due to “obvious efforts to remain anonymous and avoid legal action by rights holders…”

Caught in between were the nation’s internet service providers (ISPs). Indeed, in the absence of the defendant and faced with ongoing infringement of their rights, the plaintiffs sought site-blocking orders against eleven major ISPs. Of these, four consented to the order and four took no position. Distributel and Cogeco sought to vary the language of the order, and only TekSavvy opposed the order on the merits.

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