The Requirement to Consider Fresh Evidence on Trade-Marks Appeals

Cathay Pacific Airways Limited v Air Miles International Trading B.V., 2015 FCA 253 addressed the issue of fresh evidence on appeals relating to trade-mark applications.

Cathay Pacific Airways applied for five registered trade-marks and designs, each of which incorporated the words “ASIA MILES”. Air Miles International Trading opposed the applications on thirteen grounds, including non-compliance with technical requirements of the Trade-Marks Act, lack of use of the marks in Canada, and a number of grounds relating to distinctiveness and confusion.

The Trade-Marks Opposition Board  found that the evidence did not support Cathay’s claim that it was using the marks in Canada. Thus, Cathay could not rebut numerous grounds of opposition and the applications for registration were dismissed.

Cathay appealed to the Federal Court where both parties filed new evidence, as permitted by s. 56 of the Trade-Marks Act. Justice O’Reilly of the Federal Court held that the Court need not review the additional evidence and decided the matter on the record that was before the TMOB. The Court held that the TMOB’s conclusion was unreasonable on the evidence before it, allowed the appeal and returned the matter to the TMOB for reconsideration.

Cathay appealed that decision, arguing that it was entitled to have the Federal Court allow the registration rather than simply send it back for reconsideration. Air Miles cross-appealed on the merits.

The Court of Appeal  held that the Federal Court erred in not considering the newly filed evidence. It reviewed the decision and noted that the question which the Federal Court seemed to ask itself was: “Why do I need to consider the fresh evidence if it is possible for me to decide the case in favour of the appellant on the original record on the standard of review most favourable to the respondent? In such a case, is the appellant’s fresh evidence not surplus to requirements?”

However, the FCA held 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. What may be surplus to requirements for one party may be critical to the outcome for the other. The parties are entitled to have the Federal 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.

The FCA also found that, since the Federal Court re-assessed and re-weighed evidence, it had improperly applied the correctness standard when it ought to have applied the reasonableness standard to the TMOB’s decision. The FCA found there was no reason to believe the TMOB’s decision was unreasonable and affirmed that “a decision is not unreasonable because the evidence would support another conclusion. The question is whether the decision-maker’s conclusion falls within the range of acceptable and defensible outcomes, having regard to the facts and the law.”

The FCA allowed Air Miles’ cross-appeal and the matter was returned to the Federal Court for redetermination of all issues raised by the appeal.

A copy of the FCA’s decision may be found here.