Fairweather achieves aim in TARGET APPAREL appeal

The Federal Court of Canada has allowed an appeal against the trademark registrar's decision to cancel the mark TARGET APPAREL for clothing, even though the mark was not in use at the date that the cancellation proceedings were commenced.

Fairweather Ltd had acquired the registration for TARGET APPAREL, covering a range of clothing items, late in 2001, as part of an acquisition of assets from a well-known Canadian clothing retailer that had become bankrupt. It was unknown when Fairweather's predecessor had last used the mark TARGET APPAREL.

About six months after the acquisition, cancellation proceedings were commenced by an undisclosed third party under the provisions of Section 45 of the Canadian Trademarks Act. This is a summary and expeditious proceeding that permits the cancellation of registrations that have not been used at any time during the three-year period prior to the commencement of the cancellation proceeding, unless the registered owner can establish that there were exceptional circumstances justifying non-use of the registered mark.

In the initial proceedings at the Trademarks Office, Fairweather filed evidence which outlined that it was delayed in commencing use of the mark in view of the numerous issues involved in acquiring the rights to the mark. It also indicated that it fully intended to recommence use of the mark in the near future. The hearing officer at the Trademarks Office ruled that this evidence was not sufficient to maintain the registration as it was necessary to establish that concrete steps were taken by Fairweather to commence using the mark during the short period of time between the date that the mark was acquired and the cancellation proceedings were commenced.

As permitted on appeal, Fairweather filed additional evidence, including evidence of artwork for hang tags and labels for TARGET APPAREL clothing that had been created by its related and licensed sister company shortly before the commencement of the cancellation proceedings.

Primarily in view of this evidence, the Federal Court held that Fairweather had established a serious intention to resume use of the mark TARGET APPAREL by taking this concrete step. The Federal Court therefore maintained the registration, even though sales of TARGET APPAREL clothing did not actually occur until the year after the cancellation proceedings were commenced.

While Fairweather was successful in maintaining this registration, this decision underscores the necessity for companies acquiring registered marks in Canada not to delay in assessing whether the mark has been used recently in Canada and, if not recently used, promptly taking concrete steps to recommence such use.

Mark Evans, Smart & Biggar/Fetherstonhaugh, Toronto