Divert Inc. v Resource Recovery Fund Board Inc., 2022 FC 1650
Why Is This Case Important?
This case clarifies the evidentiary burden in trademark opposition proceedings under paragraph 30(b) of the Trademarks Act, particularly when challenging the claimed date of first use. It reinforces that an opponent must show a “clear inconsistency” in the applicant’s evidence to shift the burden of proof. The decision also distinguishes between evidentiary standards in opposition proceedings and summary expungement under section 45, and confirms that mere disagreement with the Registrar’s factual conclusions does not amount to a legal error. The ruling affirms the limited scope of judicial review in appeals where no new evidence is filed.
Summary
Resource Recovery Fund Board Inc. (RRFB) applied to register the trademark DIVERT NS for services related to waste diversion, claiming use since May 16, 2016. Divert Inc. opposed the application, arguing that RRFB had not used the mark until May 17, 2016, and therefore the application did not comply with paragraph 30(b) of the Trademarks Act, which requires the applicant to state the correct date of first use.
Divert submitted no evidence regarding RRFB’s use and relied solely on RRFB’s materials. RRFB submitted an affidavit from its CEO, asserting continuous use of the mark since May 16, 2016, and attached documents showing brand development and internal communications about rebranding.
One of these documents was an internal RRFB email thread on May 17, 2016, that included statements from RRFB employees: e.g., “[i]t’s official, we can now refer to ourselves as Divert NS”. The employee’s email also stated that the company had “launched a new landing page for our website” that day. RRFB’s CEO was not cross-examined, and there was no statement that the first use of the DIVERT NS trademark occurred via the website. To the contrary, also part of RRFB’s CEO’s affidavit were samples of RRFB’s use of the trademark on letterhead, cheques, promotional and educational materials, and outdoor displays, with a statement that these materials were representative of the use of DIVERT NS “since May 2016 and continuously since that time”. The services in the application were also not limited to being provided online. The Registrar was not prepared to assume that RRFB’s first use was only via the website.
Upon reviewing the totality of the evidence, the Registrar rejected Divert’s opposition, finding that RRFB’s evidence was not clearly inconsistent with its claimed date of first use and therefore Divert had not met its initial evidential burden. Divert appealed to the Federal Court, arguing that the Registrar erred in law and misapplied the definition of “use” under section 4 of the Trademarks Act.
Court Finding
The Federal Court dismissed the appeal. It held that Divert’s arguments involved questions of mixed fact and law, not pure legal errors, and were therefore subject to the “palpable and overriding error” standard of review. The Court found that the Registrar had correctly stated the legal principles governing opposition under paragraph 30(b), including the light evidentiary burden on opponents and the requirement to show a clear inconsistency in the applicant’s evidence.
The Court further rejected Divert’s claim that RRFB’s internal communications and website launch on May 17, 2016, proved non-use on May 16. It found that the Registrar was entitled to conclude that RRFB’s evidence was not clearly inconsistent with the claimed date. The Court also clarified that, unlike in section 45 proceedings, applicants in opposition proceedings do not have an obligation to file evidence of use unless the opponent first meets its light evidentiary burden.
Key Takeaway
In opposition proceedings under paragraph 30(b) of the Trademarks Act, opponents must show a clear inconsistency in the applicant’s evidence to trigger any obligation on the applicant to prove its claimed first use date. Simply pointing to ambiguity is not enough. If the opponent fails to meet its initial evidential threshold, the applicant has no obligation to substantiate its claimed date of first use. Courts will defer to the Registrar’s factual findings unless a palpable and overriding error is shown.
