SECTION 45 PROCEEDINGS
TRADE-MARK: COHIBA & Design
REGISTRATION NO.: 373,446
On October 13, 2000 at the request of Shapiro Cohen, the Registrar forwarded the Notice prescribed under Section 45 of the Trade-marks Act to Empresa Cubana Del Tabaco Trading also as Cubatabaco, the registered owner of the above-referenced trade-mark during the relevant period (hereinafter “the registrant”). On December 26, 2005 the trade-mark was assigned to Corporacion Habanos, S.A. The transfer was recorded on the trade-mark register on April 5, 2006.
The trade-mark COHIBA & Design (shown below) is registered for use in association with the following wares:
“Raw tobacco, cigars, cigarillos, cigarettes, cut tobacco, rappee, manufactured
tobacco of all kinds, matches, tobacco pipes, pipe holders, ashtrays, match boxes,
cigar cases and humidors”.
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Section 45 of the Trade-marks Act requires the registered owner of the trade-mark to show whether the trade-mark has been used in Canada in association with each of the wares and/or services listed on the registration at any time within the three-year period immediately preceding the date of the notice, and if not, the date when it was last in use and the reason for the absence of use since that date. The relevant period in this case is any time between October l3, 1997 and October 13, 2000.
In response to the notice, the affidavit of Abel Gonzalez Ortego together with exhibits has been furnished. The requesting party filed a written argument. The registrant requested and was granted a retroactive extension of time pursuant to s-s. 47(2) of the Act to file additional evidence consisting of the affidavit of Adargelio Garrido De La Grana sworn February 19, 2002 together with Exhibit A consisting of a licence agreement. The registrant’s written argument also accompanied the additional evidence. The requesting party filed a supplemental written argument directed to the additional evidence. Both parties attended the oral hearing.
Prior to the hearing, the registrant sought to obtain another retroactive extension of time under s-s. 47(2) of the Act for the filing of supplementary evidence in the form of an affidavit of Adargelio Garrido de la Grana sworn May 9, 2007 enclosing a copy of the Licence Agreement in the Spanish Language and a true certified translation of such licence agreement. However, for the reasons provided in the official letter of May 30, 2007, the registrant’s request was refused. Consequently, the affidavit sworn May 9, 2007 and the certified translation of the licence agreement are not of record in this proceeding.
Abel Gonzalez Ortego is the Commercial Manager of Havana House Cigar & Tobacco Merchants Ltd., the exclusive Canadian wholesale importer and distributor for the registrant. He submits that he has reviewed the relevant records of his company and has knowledge of the facts deposed in his affidavit.
He indicates that the registrant has been selling cigars and cigarillos under the design-mark COHIBA in Canada for at least 10 years; that the manufactured tobacco for smoking in the form of cigars and cigarillos are manufactured by the registrant and are distributed throughout the world via Habanos S.A., the exclusive export licensee of the registrant, from where the cigars and cigarillos destined for the Canadian market are obtained by his company for resale to retailers across Canada. He specifies that at the time of sale, the cigars and the boxes in which they are sold are either marked or carry labelling on which the trade-mark COHIBA and its design elements are prominently displayed. He provides the number of cigars sold in each of the years 1997, 1998, 1999, and 2000. As Exhibit A he attaches Canadian sales receipts for cigars and cigarillos including those sold under the COHIBA design mark; as Exhibit B he provides the wholesale price list for COHIBA cigars and cigarillos for Canadian clients; as Exhibit C he provides two original COHIBA design mark labels which are aplied to boxes of COHIBA brand cigars and cigarillos.
Adargelio Garrido De La Grana is identified as Legal Director and General Secretary of Corporacion Habanos S.A. doing business as Habanos S.A. He states that Habanos S.A. was granted a licence in 1994 by Empresa Cubana Del Tabaco trading as Cubatabaco to use its trade-marks and export its tobacco products. As Exhibit A, he attaches what he refers to as a true copy of the licence agreement between Habanos S.A. and the registrant. I would note here that although I agree with the requesting party that the document attached thereto is a translation of the licence agreement rather than a true copy of the licence agreement I conclude that nothing turns on this issue.
With respect to the evidence furnished, I note that the registrant has conceded in the last paragraph of its written argument that there has been no use in association with the wares “raw tobacco, cigarettes, cut tobacco, rappee, manfuactured tobacco of al kinds, matches, tobacco pipes, pipe holders, ashtrays, match boxes, cigar cases and humidors”. Consequently, these wares will be deleted from the trade-mark registration.
Concerning “cigars and cigarillos”, I accept that the evidence shows use by Habanos S.A., a licensee.
The main issues, in my view, are:
Does the use by Habanos S.A. accrue to the registrant pursuant to s. 50 of the Act;
Does the trade-mark shown to be in use constitute use of the registered trade-mark.
Concerning the trade-mark shown to be in use, I find that it constitutes use of the registered trade-mark as the differences between the marks are not substantial and as the trade-mark has not lost its identity and remains recognizable (Promafil Canada Ltee v. Munsingwear, 44 C.P.R. (3d) at 59 ).
Concerning the fact that the use is licensed use, Section 50 of the Act states the following:
50(1). For the purposes of this Act, if an entity is licensed by or with the authority of the owner of a trade-mark to use the trade-mark in a country and the owner has, under the licence, direct or indirect control of the character or quality of the wares or services, then the use, advertisement or display of the trade-mark in that country as or in a trade-mark, trade-name or otherwise by that entity has, and is deemed always to have had, the same effect as such a use, advertisement or display of the trade-mark in that country by the owner.
50(2). For the purposes of this Act, to the extent that public notice is given of the fact that the use of a trade-mark is a licensed use and of the identity of the owner, it shall be presumed, unless the contrary is proven, that the use is licensed by the owner of the trade-mark and the character or quality of the wares or services is under the control of the owner.
The requesting party submits that the use shown fails to meet the requirements of s. 50 of the Act. It argues that the conditions dictated by s-s. 50(1) of the Act with respect to quality control are not satisfied. Further, it submits that as there is no evidence of public notice having been given of the fact that the use of the trade-mark is licensed use and of the identity of the owner, the presumption dictated by s-s. 50(2) of the Act does not arise.
The registrant on the other hand, submits that the use shown complies with the requirements of s. 50 of the Act. It argues that the statement made in the Ortego affidavit to the effect that the cigars and cigarillos are manufactured by the registrant and are distributed throughout the world via Habanos S.A., the exclusive export licensee, and the statement in the De La Grana affidavit that “Habanos S.A. was granted a licence in 1994 by Empresa Cubana Del Tabaco, trading as Cubatabaco to use its trade-marks, and export its tobacco products” lead to the conclusion that the registrant is the only entity engaged in the manufacture of the cigars and cigarillos and that Habanos S.A. merely acts in the capacity of its exporting arm. In the circumstances, it submits that there can be no doubt that the registrant has control of the character and quality of the wares it produces. The registrant also relies on the case Havana House Cigar & Tobacco Merchants Ltd. et al v. Skyway Cigar Store, 81 C.P.R. (3d) 203, in support of its argument that the registrant is the manufacturer of the wares.
Concerning the case Havana House v. Skyway Cigar, as I indicated at the hearing the registrant can rely on case law for the principles of law they set out but not for evidentiary purpose. Consequently, the case is of no help to the registrant in this proceeding.
Concerning Mr. Ortego’s allegation, I agree with the requesting party that it constitutes inadmissible hearsay evidence with respect to the manufacturing of the wares. Mr. Ortego is not an Officer or Director of the registrant and nowhere is it indicated that his statement is based on “personal knowledge”. Further no reasons were given as to why a person having direct knowledge regarding the manufacturing of the wares could not have provided the information in question.
Concerning Mr. De La Grana’s statement that a licence has been granted to Habanos S.A. to export the registrant’s products and the argument that Habanos S.A. merely acts as the registrant’s exporting arm, I am of the view, given the wording in the licence contract, that the licensee is more than a mere exporter. I reproduce below some of the statements found in the licence contract:
DECLARE
I. - That CUBATABACO holds all industrial property rights for all trademarks registered, applied for or available in Cuba and other countries throughout the world in Class 34 and others of the International Products and Services Classifier.
II. - That the Cuban company CORPORACION HABANOS, S.A, (HABANOS, S.A.) is empowered, within its social objective, to market Cuban tobacco products, both inside and outside Cuba.
III. - That, in order that HABANOS, S.A. might market Cuban tobacco trademarks in all countries in which they are registered, applied for or available through CUBATABACO, it was agreed that that organization grant a licence for the use of such trademarks to HABANOS, S.A., which is done through this Contract, in accordance with the following:
STIPULATIONS
ONE - THE LICENSOR grants to the LICENSEE, which accepts it, an exclusive use licence, without limitation of any kind, for all Cuban tobacco trademarks registered, applied for or available in Cuba or in other countries, to be used for producing, selling and marketing products included in Class 34 and others of the International Products and Services Classifier.
(my emphasis)
FIVE - The LICENSEE shall be solely and directly responsible for the production, sale and distribution of the projects covered by the licence. (my emphasis)
SIX - The LICENSEE may grant sub-licences for the production and distribution of the products covered by this licence, subject to authorization by the LICENSOR. Sub-licences for the production of twisted tobacco products may only be granted to Cuban companies for production in Cuba of Havana cigars and in other countries for the production of other products included in Class 34 or other classes of the International Products and Services Classifier.
(my emphasis)
It may be that the licensee could just sell and market the wares, however, given the wording in the licence contract the assumption would be that the licensee would be doing all three that is “producing, selling and marketing” the wares.
Further, as the evidence shows that the labels applied to the packaging for the wares bear the name Habanos S.A. and not the name of the registrant, this is more consistent with the licensee producing the wares.
Consequently, in the absence of admissible evidence showing that the registrant was the manufacturer of the wares sold in Canada during the relevant period, I am not prepared to conclude that the registrant produced the wares exported into Canada by Habanos S.A. and therefore had control of their character and quality pursuant to s-s. 50(1) of the Act. Further, as pointed out by the requesting party, the presumption dictated by s-s. 50(2) does not arise as there is no evidence showing that public notice was given of the fact that the use was licensed use and of the identity of the owner.
In view of the above, I conclude that the use shown by the evidence does not enure to the benefit of the registrant and therefore, the trade-mark ought to be expunged.
Registration No. 373,446 will be expunged in compliance with the provisions of Section 45(5) of the Act.
DATED AT GATINEAU, QUEBEC, THIS 13TH DAY OF SEPTEMBER 2007.
D. Savard
Senior Hearing Officer
Section 45 Division