Trade-Marks Act Requires Judge to Consider Fresh Evidence on Appeal

  • November 13, 2015

Cathay Pacific Airways Ltd. v Air Miles International Trading BV, 2015 FCA 253 (Pelletier, J.A.)

November 13, 2015

Steven Garland and Daniel Anthony for Cathay Pacific Airways
Stephen Selznick and Steven Kennedy for Air Miles International Trading

This is an appeal and cross-appeal of a Federal Court (FC) decision, wherein O’Reilly J. allowed an appeal of the Trade-Marks and Opposition Board’s (TMOB) decision dismissing Cathay Pacific’s application for registration of the word ASIA MILES and design.

At the opposition proceeding, the TMOB upheld Air Miles’ opposition primarily on the grounds that Cathay Pacific had not established use of its mark in Canada. The evidence showed that the marks were used by a wholly owned subsidiary of Cathay Pacific. After reviewing the evidence, the TMOB was unable to conclude that Cathay Pacific had “direct or indirect control of the character or quality” of the mark’s use such that the subsidiary’s use of the mark should have been credited to Cathay Pacific.

Cathay Pacific appealed the decision to the FC, where it filed fresh evidence in support of its application for registration of the marks. The FC held that it did not need to review the additional evidence, given that it found the TMOB’s conclusion to be unreasonable. On the basis of the evidence before the TMOB, the FC concluded that the subsidiary’s use of the mark should have been credited to Cathay Pacific. The FC remitted the matter back to the TMOB for reconsideration. The FC’s decision was appealed by Cathay Pacific on the basis that it was entitled to have the Court allow for registration of the marks. The decision was also cross-appealed by Air Miles on the merits.

The Federal Court of Appeal (FCA) held that the FC’s decision must be set aside for two reasons. First, the FC had erred in not considering the additional evidence filed by Cathay Pacific. The FCA stated that the Trade-Marks Act requires the Judge to consider the fresh evidence, bearing in mind that both parties are entitled to submit fresh evidence. Parties are entitled to have a Court consider, in light of the fresh evidence, whether it should decide the case by way of a fresh hearing on the extended record or, alternately, by way of a review of the TMOB’s decision on the record as it was before the TMOB.

Second, the FCA found that, upon re-weighing the evidence, the FC wrongly applied the correctness standard (and not the appropriate reasonableness standard) to the TMOB’s decision. The FCA confirmed that “a decision is not unreasonable because the evidence would support another conclusion”. Given the absence of any reason to believe that the TMOB’s decision was unreasonable, the FCA allowed the cross-appeal and the matter was returned to the FC for redetermination of all issues raised by the appeal.

By: Jillian Brenner, Borden Ladner Gervais LLP