Appeal of the Registrar’s decision to expunge a trademark for failure to use it in the preceding three years

Dimock Stratton’s Intellectual Property Law Newsletter

By: Dimock Stratton

I.5 — Trademarks — expungement proceeding — licence to use software considered "goods"

This was an appeal of the Registrar's decision to expunge the trademark "MEDINET", registered in association with the goods "computer software programs", for failing to use the mark in the preceding three years. The Federal Court allowed the appeal and ordered the Registrar to maintain the registration.

As noted by the Court, "[a]t its heart, this dispute arises as a result of technological change". In particular, Specialty Software sells software used by hospitals and physicians to track patient's medications, which it used to distribute on physical disks. More recently, the software is provided over the internet, such that users access the software directly from Specialty Software's computer servers instead of using a disk. The party challenging the trademark argued that in light of this change, Specialty Software was now offering a service (i.e. access to a website), rather than a good — which was the subject of the trademark registration.

The Court found that in both methods of distribution, Specialty Software was really selling a licence to use the software, which is an intangible good. Accordingly, the nature of Specialty Software's use of the trademark MEDINET in association with the licences had not changed.

The evidence supported a finding that the trademark MEDINET had been used in a manner that gave notice to purchasers of the goods (i.e. the licence) of an association between the trademark MEDINET and the goods. In particular, the transfer of the goods took place through granting access to the software, the user paying a subscription fee, and in the form of log in credentials. The MEDINET mark was visible before, during and after the transfer.

Specialty Software Inc. v. Bewatec Kommunikationstechnik GmbH (2016), 2016 CarswellNat 579, 2016 FC 223 (F.C.); February 18, 2016; O'Reilly J.