Date: 20000622
Docket: T-1852-97
IN THE MATTER OF proceedings under Section 45 of the Trade Marks Act respecting the trade-mark COMFORT-FIT, registration number 401-488
Between:
A & A JEWELLERS LIMITED,
Applicant
- and -
MESSRS. MALCOLM JOHNSTON & ASSOCIATES,
Respondent.
REASONS FOR DECISION
ON APPEAL
[1] The applicant/appellant appeals, pursuant to section 56 of the Trade-marks Act, R.S.C. 1985, Chap. T-13, from the decision of the Registrar of Trade-marks, dated June 27, 1997 whereby the Registrar expunged registration N0 401,488. The registration had been granted for the trade-mark COMFORT-FIT in association with the wares "jewellery".
[2] By its solicitors, the appellant expressed the following grounds of appeal:
| (i) the Registrar erred in fact and in law in concluding as he did that the trade-mark should be expunged, |
| (ii) in particular, in view of the supplementary evidence filed herewith, it is apparent that the registrar erred when he concluded that there is no evidence showing use of the trade-mark by the registered owner or by others whereby the use accrues to the registered owner. |
The applicant further calls attention to the pleadings and proceedings herein, the Trade-marks Office's file or registration n0 401,488, Neil Travis' "solemn affidavit" dated August 22, 1997 filed herein, and, such other material as may be permitted.
[3] Counsel for the respondent made no appearance before the Court, so the hearing proceeded in the absence of any such counsel.
[4] This appeal finds its way hither pursuant to subsection 56.1 of the Trade-marks Act, which prescribes that "an appeal lies to the Federal Court from any decision of the Registrar under this Act". Subsection 24.(1) of the Federal Court Act provides that "the Trial Division has exclusive original jurisdiction to hear and determine all appeals that under any Act of Parliament may be taken to the [Federal] Court." This latter provision is bolstered by subsection 26.(1): "The Trial Division has original jurisdiction in respect of any matter, not allocated specifically to the Court of Appeal, in respect of which jurisdiction has been conferred by any Act of Parliament on the Federal Court, whether referred to as such or as the Exchequer Court of Canada."
[5] In response to this Court's question as to whether the Court could properly receive evidence which had not been presented to the Registrar of Trade-marks in eliciting the impugned decision of June 27, 1997, the appellant's counsel relied on subsection 56.(5) of the Act. It provides:
| (5) On an appeal under subsection (1), evidence in addition to that adduced before the Registrar may be adduced and the Federal Court may exercise any discretion vested in the Registrar. |
Counsel further cited the case of Lewis Thomson & Sons Ltd. v. Rogers, Bereskin & Parr, (1988) 21 C.P.R. (3d) 483 (F.C.T.D.) and in particular, the last full paragraph on p. 485, a decision of Strayer, J., in which he wrote, inter alia, "The fact that this evidence was not put before the registrar.... is a proper matter for consideration with respect to costs but not otherwise."
[6] The Registrar's decision about which the appellant complains was issued on June 27, 1997, long ago in terms of these matters, and the notice of appeal was filed and is dated on August 27, 1997. The very existence of these proceedings was "rescued" by order of the learned prothonotary Peter A.K. Giles, Esq. on August 9, 1999, in which he ordered that:
| - this proceeding should continue as a specially managed proceeding; and |
| - that the appellant shall file its record before August 31, 1999, and apply for a hearing date within 30 days thereafter. |
So, the appeal lives.
[7] The Registrar's impugned decision includes the following passages:
Trade Marks COMFORT-FIT
Registration No.: TMA 401,488
| On September 28, 1995, at the request of the firm Malcolm Johnston & Associates, the Registrar forwarded a Section 45 Notice to A & A Jewellers Limited, the registered owner of the above-referenced trade-mark registration. The trade-mark COMFORT-FIT is registered for use in association with the wares "jewellery". |
| In response to the Section 45 Notice, the registrar furnished the statutory declaration of Neil Travis, Executive Vice-President of the registrant company. Both the requesting party and the registrant made written submissions in regard to the present proceedings. An oral hearing was not conducted. |
| Prior to January 1, 1996, Section 45 of the Trade-Marks Act R.S.C. 1985, c. T-13 (hereinafter "the Act") required the registered owner to demonstrate use of its trade-mark at any time during the two years preceding the date of Notice. However, Section 45 as amended by the World Trade Organization Agreement Implementation Act now requires the registrant to demonstrate use at any time during the three year period preceding the date of the Notice for each of the registered wares and/or services. The Trade-Marks Opposition Board applies Section 45 as amended to all Section 45 cases whether they were commenced before or after January 1, 1996. Consequently, the relevant period in this case is between September 28, 1992 and September 28, 1995. If the registrant cannot show use within this period, it is required to show the date of last use of the mark and provide the reason for the absence of use since such date. |
| In his statutory declaration, Neil Travis states that First Jewellery Company of Canada Inc. (hereinafter "First Jewellery") and A & A Jewellers Corporation (hereinafter "AAJ Corp.") are wholly owned subsidiaries of the registrant, and that said companies have been and continue to use the subject mark with the authorization of the registrant, as licensees. According to Mr. Travis, First Jewellery markets jewellery bearing the mark to smaller retailers, while AAJ Corp. markets jewellery bearing the mark to major retailers. |
| In the present case, there is no evidence of use of the trade-mark COMFORT-FIT by the registrant, A & A Jewellers Limited. Rather, any use shown is by First Jewellery and AAJ Corp., which companies have been identified by Mr. Travis as licensees of the registrant. However, copies of the license agreements, from which I might have been able to determine that the registrant had control over the character and quality of the wares under the license, have not been submitted in evidence. Also, there has been no assertion as to the requisite control by the registered owner, nor can any evidence of control be found in the Exhibits. The fact that First Jewellery and AAJ Corp. are wholly owned subsidiaries of the registrant is not in itself sufficient to simply with s. 50(1) of the Act (see Dynatech Automation Systems Inc. v. Dynatech Corp. (1995), 64 C.P.R. (3d) 101 and MCI Communications Corp. v. MCI Multinet Communications Inc. (1995), 61 C.P.R. (rd) 245 (T.M.O.B.). Furthermore, the evidence does not reveal that public notice was given of the fact that the mark was used under license and of the identity of the registrant; accordingly, the presumption set out in s. 50(2) of the Act does not arise in this case. Consequently, I am unable to conclude that any use of the Trade-mark by First Jewellery or AAJ Corp. does not accrue to the registrant. |
| As I have concluded that any use shown by the evidence does not accrue to the registered owner, I have no alternative but to conclude that the trade-mark COMFORT-FIT ought to be expunged. Accordingly, and in the absence of an appeal from this decision pursuant to the provisions of s. 56 of the Act, Registration No. TMA 401,488 will be expunged from the register. |
[7] In the present appeal the appellant's case is once again supported by Neil Trevis' deposition, on affidavit, this time sworn on August 22, 1997. He swore:
| 3. During the time stated by the Hearing Officer [i.e. the Registrar] to be relevant for the purposes of these proceedings, namely from September 28, 1992 to September 28, 1995 (the Relevant Time), all jewellery sold in Canada by AAJ or its wholly owned subsidiaries was manufactured for AAJ by E.B. Harvey & Company, Inc. of Chattanooga, Tennessee. |
| 4. In particular, that jewellery was manufactured to the specification of AAJ, which thereby had full control of the character and quality of the jewellery so manufactured for it. Upon receipt from time to time of shipments of such jewellery from E.B. Harvey & Company, Inc., AAJ regularly inspected such jewellery to ensure that it was of a character and quality acceptable for marking with the COMFORT-FIT brand. |
| 5. Where I stated at paragraph 3 of my March 14, 1996 Declaration that First Jewellery, the wholly owned subsidiary of AAJ, had used the trade-mark COMFORT-FIT with the authorization of AAJ, as licensee, I perhaps spoke in the vernacular rather than in a strict legal sense. It may be that First Jewellery should more properly be characterized as a distributor, and so thereby had permission or authority to do what it did. |
| 6. In particular, as I stated in my March 14, 1996 Declaration, First Jewellery is the entity by which the COMFORT-FIT brand (among others) is, and was in the Relevant Time, marketed and distributed to small retailers. First Jewellery does not manufacture the COMFORT-FIT brand jewellery. |
| 7. As indicated, First Jewellery is a distributor to small retailers. Such retailers include businesses such as Jewellery International in Oshawa, Van Custom Goldsmithing and Jewelry in Kitchener, European Jewellery Boutique in Toronto, Guildcrest Jewellers in Guelph and so on. Typically, now and during the Relevant Time, when a shipment of COMFORT-FIT rings are [sic] made from First Jewellery to such small retailers, the shipment includes |
| (i) items of jewellery such as rings; |
| (ii) tags which are attached to each item of jewellery by AAJ prior to shipment; and |
| (iii) display stands and point-of-purchase materials which are intended for in-store-display by such small retailers. |
| 9. Based upon my knowledge and experience in this market, I can fairly state that the bulk of COMFORT-FIT jewellery sold by small retailers to the Canadian public in the Relevant Time was sold from display cases marked with the COMFORT-FIT trade-mark, and in close proximity to in-store point-of-purchase displays bearing the COMFORT-FIT trade-mark. |
| 11. Where I stated at paragraph 4 of my March 14, 1996 Declaration that AAJ Corp., the wholly owned subsidiary of AAJ, had used the trade-mark COMFORT-FIT with the authorization of AAJ, as licensee, I perhaps spoke in the vernacular rather than in a strict legal sense. It may be that AAJ Corp. should more properly be characterized as a distributor, and so thereby had permission and authority to do what it did. |
...
| 15. Based upon my knowledge and experience in this market, I can fairly state that the bulk of COMFORT-FIT jewellery sold by large retailers to the Canadian public in the Relevant Time was sold from display cases marked with the COMFORT-FIT trade-mark, bearing COMFORT-FIT tags and in close proximity to in-store point-of-purchase displays bearing the COMFORT-FIT trade-mark. |
| 16. In any event, AAJ has always closely controlled every aspect of the distribution of its COMFORT-FIT brand jewellery by AAJ Corp., including the character and quality of the goods and the manner and methods by which the COMFORT-FIT trade-mark is associated with them, inc;including by such tags, display cases and point-of-purchase materials. |
| 18. Attached hereto as Exhibit "D" is a copy of the front page and a relevant inner page of the 1995 Consumers Distributing catalogue, depicting the trade-mark COMFORT-FIT and the associated AAJ rings as supplied by AAJ Corp. In all such cases, materials such as those of Exhibit "D" were pre-approved by AAJ, or by AAJ Corp. acting on the instructions of AAJ. |
Mr. Travis' affidavit is too long to recite in these reasons.
[8] By reason of an amendment to the Trade-marks Act, introduced by the World Trade Organization Agreement Implementation Act, S.C. 1994, Chap. 47, the two-year time limit exacted under section 45 of the Act was enlarged to three years. This is the time within which the appellant must show use of the trade-mark. The evidence of Neil Travis, as now clarified, demonstrates:
| (i) the trade-mark COMFORT-FIT has been used in Canada in association with jewellery; |
| (ii) COMFORT-FIT has been so used in the three years preceding September 28, 1995; and |
| (iii) that trade-mark has been used in Canada by the registered owner. |
[9] The use of the trade-mark in Canada is shown by the point-of-purchase materials displayed by small retailers, and the tags and point-of-purchase materials used by large retailers, along with purchase orders and invoices for products sold in the pertinent time. All of this is illustrated in Mr. Travis' affidavit, paragraphs 7, 8, 14 and 15, and his declaration, paragraphs 11 and 12 and appropriate exhibits. Point-of-purchase displays show trade-mark use. Registered trade-mark users could effect some minor savings by adhering to the principles enunciated regarding hyphenated words or compound words in the case of Christopher P. Brett v. Burns Foods (1985) Ltd. (1999) TRICO registration N0 TMA 128,972, July 9, 1999
[10] The Registrar held that she was unable to determine, from Mr. Travis' declaration, that the registered owner had exercised the requisite degree of control over the character and quality of the wares in compliance with subsection 50.(1) of the Act, which would have enabled such use by "licensees" to accrue to the benefit of the registrant. Mr. Travis has explained that his expression of the term "licensee" in regard to First Jewellery and AAJ Corp. was a vernacular use of that word, as distinct from a precisely legal meaning of it. Mr. Travis goes on to say as a fact, in paragraphs 5 and 11 of his affidavit, that First Jewellery and AAJ Corp., were merely distributors.
[11] In its record, filed, the appellant argues as follows, at pp. 77 and 78:
| 19. In particular, Mr. Travis clearly explains that the goods... marked with and sold in association with the trade-mark COMFORT-FIT were at all relevant timed manufactured for the registrant by E.B. Harvey & Company, Inc. of Tennessee, in accordance with the specification and under the inspection of the registrant as to their character and quality. |
| 20. In further particular, First Jewellery is identified as the distributor to smaller retailers, while AAJ Corp. is the distributor to larger retailers. |
| 21. Mr. Travis makes it clear that the registrant, as opposed to the distributor, tags each item of jewellery prior to shipment. This includes those tags, attached to jewellery destined for large retailers, which include tags bearing the trade-mark. |
[12] In the result, the appellant - the registrant - has now filed evidence, in compliance with section 45 of the Act, which demonstrates that its trade-mark COMFORT-FIT was in use in Canada during the relevant three-year period, and that its use accrued to the benefit of the registrant which has shown a commercial interest in its said trade-mark. Therefore the Registrar's decision shall be, and it is hereby, reversed. Registration N0 401,488 shall be maintained in good standing on the Trade-marks' Register, in the name of A & A Jewellers Limited.
[13] When asked if the appellant is seeking costs, its counsel responded in the negative. The appeal languished for a long time, finally being forced into status review proceedings, and being ordered to submit to case management. It would be unjust to levy costs against the respondent, so the appeal is allowed without costs.
Judge
Ottawa, Ontario, June 23, 2000