BOSTON PIZZA denies BOSTON MARKET a slice of the action

The Canadian Trademarks Office has upheld an opposition action and refused an application by Global Restaurant Operations of Ireland Limited to register the mark BOSTON MARKET for use in association with restaurant goods and services, including prepared foods (Application 0775170). The examiner refused the application on the basis that the mark was confusingly similar to the registered mark BOSTON PIZZA owned by the opponent, Boston Pizza International Inc (BPI).

A significant portion of the decision, however, focused on a recent financial transaction in which BPI transferred ownership of its BOSTON PIZZA marks to Boston Pizza Royalties Limited Partnership (BPLP). Interestingly, the assignment specifically excluded the transfer of the goodwill associated with the marks. BPLP subsequently licensed the use of the marks back to BPI, and BPI was given the right to sublicense the marks to Boston Pizza franchisees. The transaction was designed to leave the accumulated goodwill associated with the BOSTON PIZZA trademarks with BPI, while at the same time allowing subsequently acquired goodwill and reputation to accrue to the benefit of BPLP as the owner and licensor of the marks.

Global Restaurant asserted that because the goodwill associated with the mark BOSTON PIZZA prior to the assignment was owned by BPI, the registered trademark had been rendered non-distinctive as two or more persons were able to exercise rights in the same or confusing marks. The examiner disagreed and found that while the pre-assignment goodwill did reside with BPI, BPI was not exercising any independent rights in the mark, and from the date of the assignment any use by BPI as a licensee of the mark accrued to the benefit of BPLP. Thus, there were not two separate entities exercising rights in the same trademark. Furthermore, BPI had taken active steps to educate the public as to the change in ownership of the mark to forestall any loss of distinctiveness. At the time of the hearing, it had only been two and half years since the assignment to BPLP. The examiner, however, held that due to the consistent use of the BOSTON PIZZA mark during that time, under a regime established by BPLP, the distinctiveness of the mark had not been affected.

The assignment of the BOSTON PIZZA trademarks to BPLP without the associated goodwill also influenced the examiner's findings on the issue of confusion. In determining the extent to which the registered mark BOSTON PIZZA had become known in Canada, the examiner only took into consideration the use of the mark by BPLP from the date of the assignment to the date of the hearing. Although the period of time the mark had been in use had been considerably shortened, the examiner found that because of the number of Boston Pizza franchisees operating across Canada during that period, BOSTON PIZZA was well known.

Melissa E Fisher, Osler Hoskin & Harcourt LLP, Ottawa