Federal Court of Appeal Confirms Section 57 Application as “Jurisdictional Vehicle” for Amending Trademarks Register

In the recent decision of the Federal Court of Appeal (“FCA”), Hutchingame Growth Capital Corp v Dayton Boot Co Enterprises Ltd. et al, the FCA clarified the importance of initiating an appeal of a Trademarks Office decision under the appropriate “jurisdictional vehicle”.

The Facts

Dayton Enterprises was a Vancouver-based bootmaker, which registered its DAYTON trademark in 2011. An individual named Mr. Risk offered to invest in the DAYTON brand through his firm, Red Cat. In May 2012, Dayton Enterprises and Red Cat entered into an agreement the Federal Court described as “a poorly drafted Asset Acquisition Agreement”, pursuant to which assets including the DAYTON trademark would be transferred to Red Cat for financial consideration. The Agreement was unclear when the transfer of title would occur, and used prospective language (e.g., “will acquire”, “will be granted”).

Shortly after the Agreement was executed, a new Dayton company was created and used the DAYTON trademark with the permission of both Dayton Enterprises and Red Cat, though unclear whose permission was actually needed for such use. By late 2015, Dayton Enterprises and Red Cat were exchanging legal threats, with disagreement over financial obligations Red Cat had purportedly failed to meet. In March 2016, Dayton Enterprises wrote to Red Cat to revoke its “permission” to use the DAYTON trademark. In response, Red Cat asserted that title to the DAYTON trademark had already transferred to it, and advised it would be taking steps to ensure the transfer of the trademark “pursuant to the Agreement”.

Interestingly, by the time of Red Cat’s response, it had already “assigned” the DAYTON trademark to Hutchingame by way of an agreement dated March 2016 – a fact it did not disclose in its response to Dayton Enterprises. Instead, Red Cat asked the Registrar of Trademarks to amend the DAYTON trademark registration to reflect its purported ownership since May 2012. As part of this request, Red Cat included a heavily redacted copy of the Agreement, and did not copy Dayton Enterprises on its correspondence, making the request ex parte. The Registrar recorded the change of ownership and informed Dayton Enterprises by letter in June 2016. Despite Dayton Enterprises’ objection to the change, the Registrar refused to amend the recorded ownership, citing section 57 of the Trademarks Act, which vests the Federal Court with exclusive jurisdiction to order amendment of the trademark register.