In Canada, simple and inexpensive trademark expungement proceedings are available to cancel trademarks that are not in use for more than three years. Any interested party who wants to expunge a trademark can do so by filing a section 45 request with the Registrar of Trademarks, once a trademark has been registered for three or more years. The owner then has to file evidence of trademark use in commerce for the prior three years to sustain its trademark.
A trademark can be saved if special circumstances are proven that excuse non-use, although those have to be exceptional – it will depend on the duration of non-use, whether the non-use was beyond the owner's control and if there is a serious intention to shortly resume use of the mark.
The Federal Court's recent judgment in Centric Brands Holdings LLC v. Stikeman Elliott LLP, 2024 FC 204 has clarified that an intention to use a trademark at a future date is not a special circumstance excusing the mark's non-use.
Proceedings were initiated against Centric Brands for the AVIREX trademark for leather jackets (worn by Tom Cruise in the 1986 Top Gun film). On appeal to the Federal Court, only the issue of special circumstances was raised, given the clear evidence of non-use during the relevant three-year period.
Centric Brands had purchased the trademark only a few weeks after the relevant time period, as part of a $1.4-billion transaction involving hundreds of trademarks. While the law generally recognizes that a new owner will need some time to start use of an acquired mark, in this case the transaction was an impediment. Licensing deals for the trademark that were in progress halted when news of the transaction was made public. The delay of the release of Top Gun: Maverick from 2019 to 2022 was also cited as a reasonable explanation for the delay.
The court, while sympathetic to the brand owner, held that while there had been good faith intentions to resume using the mark, the fact that it hadn't been used since 2011 was determinative.
Given the above, in brand-centric transactions, consider due diligence and representations and warranties that confirm that a brand has not been abandoned and that it has been used in commerce in the last three years.
The Trademarks & Branding Group at Aird & Berlis LLP is made up of experienced trademark experts available to provide tailored advice and guidance. Please contact a member of the group if you have any questions or require assistance in regards to trademark expungement.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
