Case information

Intellectual property — Trademarks — Expungement for non-use — Whether “special circumstances” referenced in s. 45(3) of the Trademarks Act can relieve a trademark owner from the requirement to, in response to a notice pursuant to s. 45(1), furnish evidence of “whether the trademark was in use in Canada at any time during the three-year period immediately preceding the date of a notice and, if not, the date when it was last so in use and the reason for the absence of such use since that date” — Trademarks Act, R.S.C. 1985, c. T-13, s. 45.

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At the request of the applicant, Stikeman Elliott LLP, the Registrar of Trademarks issued a notice under s. 45 of the Trademarks Act, R.S.C. 1985, c. T-13, to KVZ International Ltd, the owner of the trademark AVIREX. The notice required the owner to furnish evidence demonstrating use of the mark within the relevant period or, if unable to do so, to provide the date when the mark was last used in Canada and the reason for absence of use since that date. The trademark was acquired by the respondent, Centric Brands Holding LLC (“Centric”), from KVZ International Ltd. shortly after the date of the s. 45 notice, and the trademark was transferred to Centric prior to the date of the notice by means of a Purchase and Sale Agreement. The Registrar of Trademarks expunged the trademark registration, concluding that there was no evidence of use in Canada during the relevant period, and that Centric had not demonstrated special circumstances excusing the non-use.

The Federal Court dismissed Centric’s appeal. The court accepted the jurisprudence according to which where there has been a recent assignment of a trademark, the period of non-use for the purposes of determining if special circumstances excuse the non-use will generally be considered starting from the date of the assignment. However, it found that since Centric had acquired the trademark after the issuance of the s. 45 notice, the relevant period for the purpose of the s. 45 proceedings would not begin with the acquisition. The Federal Court of Appeal unanimously set aside the Federal Court’s decision and the expungement of the registration of the trademark. The court found that the Federal Court erred by finding that it could not apply the jurisprudence concerning recent assignment of a trademark on the basis that the transaction by Centric closed after the s. 45 notice was issued.