Supreme Court Of Canada Denies Leave To Appeal In Travelway Group International Inc v Group III International Ltd

• Published date: 08 October 2021
• Subject Matter: Intellectual Property, Litigation, Mediation & Arbitration, Trademark, Trials & Appeals & Compensation
• Law Firm: Smart & Biggar
• Author: Ms Tierney Deluzio and Graham Hood

SCC decision highlights the importance of obtaining a trademark registration to guard against claims of infringement and passing off

The Supreme Court of Canada has now put an end to a dispute between Wenger SA, Group III International Ltd and Holiday Group Inc (collectively, "Wenger") and Travelway Group International Inc ("Travelway") dating back to 2013.

Both Wenger, the Swiss company behind the "Swiss Army Knife", and Travelway, a Canadian luggage distributor, owned Canadian trademark registrations for logos featuring a cross reminiscent of the Swiss flag, which they both used in association with luggage and bags.

At first instance, Wenger's application alleging trademark infringement and passing off, and seeking expungement of Travelway's registered trademarks, was dismissed by the Federal Court (2016 FC 347). As detailed in a previous IP Update, the Federal Court of Appeal subsequently allowed Wenger's appeal, finding both infringement and passing off, and remanding the issues of expungement and damages to the Federal Court for further adjudication (2017 FCA 215). In 2019, the Federal Court granted a judgment expunging Travelway's trademarks, but dismissing Wenger's claim for damages (2019 FC 1104).

Wenger appealed, and the sole issue before the Federal Court of Appeal was whether Wenger was entitled to monetary compensation for Travelway's pre-expungement use of its registered yet infringing trademarks (2020 FCA 210). The Court of Appeal held that Travelway was not liable for damages for infringement for the period in which its own trademark registrations were in effect. Absent fraud, wilful misrepresentation or bad faith, a registered trademark is presumed to be valid, and the owner thereof has the rights to its exclusive use in Canada and cannot be liable for use that falls within the scope of such rights.

The Federal Court of Appeal also confirmed that the same is true in relation to passing off; that is, registration is a complete defence to an action for passing off. However, as between the parties, the Court...