This article first appeared in World Trademark Review.

A recent decision of the Federal Court held that official marks do not insulate their holders from claims by third parties.

In Quality Program Services Inc. v Canada, 2018 FC 971, Her Majesty the Queen in Right of Ontario as represented by the Minister of Energy (“Ontario”) argued that the status of its emPOWERme mark as an official mark afforded a complete defence to claims of infringement, passing off, and depreciation of goodwill by Quality Program Services Inc. (“QPS”).

QPS has offered a program focused on energy awareness, conservation, and efficiency using the trademark Empower Me since April 20, 2013 and subsequently obtained a registration for the mark in 2014. In November 2013, Ontario announced that it was launching a website with the name emPOWERme to educate Ontarians about electricity generation, distribution, measurement, and conversation aspects of the province’s electricity system. After QPS commenced legal action against Ontario in 2016, Ontario wrote to the Registrar of Trade-marks (“Registrar”), requesting that it give public notice of adoption and use by the Ministry of Energy of emPOWERme as an official mark. The Registrar gave such notice in January 2018.

Official marks are unique to Canada and offer broad protection to public authorities under section 9(1)(n)(iii) of theTrade-marks Act, which states that:

[n]o person shall adopt in connection with a business, as a trade-mark or otherwise, any mark consisting of, or so nearly resembling as to be likely to be mistaken for any badge, crest, emblem or mark adopted and used by any public authority, in Canada as an official mark for goods or services, in respect of which the Registrar has, at the request of Her Majesty or of the university or public authority, as the case may be, given public notice of its adoption and use.

Official marks are not subject to examination and public notice can be granted despite the fact that the official mark may be confusing with a pre-existing registration. There is no requirement that official marks be renewed and they may only be challenged through an application for judicial review of the Registrar’s decision to provide public notice of the official mark.

Given the broad protection afforded to official marks, Ontario took the position that section 9(1)(n)(iii) offered it absolute protection against QPS’s claims, relying on case law which affirmed the entitlement of public authorities to adopt official marks which have been previously registered by third parties. QPS argued that this position is distinct from the question of whether the adoption and use of an official mark by a public authority could constitute infringement, passing off, or depreciation of goodwill. Justice Southcott agreed with QPS that the Court should not adopt an interpretation of section 9(1)(n)(iii) that confers statutory immunity upon public authorities without explicit language and determined that there was nothing in this section of the Act which eliminates rights already bestowed upon the owner of a registered trademark.

Because the Court did not accept Ontario’s defence and determined the marks to be confusing, Ontario was found to have infringed QPS’s EmPower Me registration. The claims of passing off and depreciation of goodwill were dismissed on the basis that QPS was not able to demonstrate damage to its goodwill in British Columbia resulting from Ontario’s use of a confusing mark in Ontario. While official marks have previously been considered “hardy and virtually unexpungeable”[1], the Federal Court has recognised with this decision that use of these marks does not preclude another party from successfully asserting claims of infringement, passing off, and depreciation of goodwill. Trade-mark owners in Canada can therefore still consider protecting their marks against any public authorities who adopt confusing official marks.