As the 2010 Winter Olympic and Paralympic Games (the “2010 Games”) in Vancouver/Whistler approach, construction crews continue to work on massive infrastructure and facilities projects. The various committees responsible for hosting and staging the 2010 Games, namely the Canadian Olympic Committee (“COC”), the Canadian Paralympic Committee (“CPC”) and the Vancouver Organizing Committee for the 2010 Olympic and Paralympic Winter Games (“VANOC”), are also continuing with their efforts to stem an anticipated increased flow of trade-mark infringement through counterfeit goods, knockoffs and ambush marketing.

Ambush marketing, in particular, has become more of an issue in recent Olympic games and other major sporting events such as the FIFA World Cup. Ambush marketing occurs when an entity that is not an official sponsor of the event promotes itself or its products or services in a manner that falsely suggests some association with that event. For example, a high-profile Olympic athlete may become a spokesperson for a company’s products, though that company is not itself a sponsor to the Olympics.

Official sponsors pay many millions of dollars for the privilege of sponsoring the Olympics, with such monies going to partially offset the huge cost of staging an Olympics. To the extent there is a shortfall in funding, taxpayers in the host country, province or city may end up footing the bill. The payoff to the sponsor is potentially massive through high profile exposure of its trade-marks to a huge worldwide audience. Therefore it is important to both the host community and the sponsors to minimize or eliminate any marketing by non-sponsors that could be construed as ambush marketing, as well as any other infringing activities.

Traditionally, the COC/CPC and local organizing committees, in Montreal in 1976 and Calgary in 1988, have relied heavily on Section 9 of the Trademarks Act (Canada) (the “Act”), to enforce their trade-mark rights. For the most part, Section 9 has proven to be a very effective tool .

Under Section 9 of the Act, an Official Mark is a mark, adopted and used by a public authority in Canada, such as the Crown, governmental entities and universities, where public notice of such adoption and use has been advertised in the Trade-marks Journal. The Act prohibits the adoption, use or registration of a trade-mark which consists of, or so nearly resembles as to be mistaken for, an Official Mark. An Official Mark grants broader rights than those for a trade-mark as the “owner” of an Official Mark has exclusivity for all wares and services, in contrast to trade-marks which tie exclusivity to specific wares and services. Official Marks do not need to be renewed and can only be challenged through an application for judicial review.

In assessing trade-marks and Official Marks, the test is one of resemblance and of first impression and imperfect recollection (rather than a straight comparison test) i.e. whether a person, on first impression, knowing the Official Mark and having an imperfect recollection of it, would likely be deceived or confused. This is to be contrasted with the test for trade-mark infringement, which is confusion, requiring an analysis of a number of surrounding circumstances.

In the lead up to 2010, the COC/CPC and VANOC are once again relying heavily on Section 9 protection, having requested that the Registrar advertise the adoption and use by such entities of dozens of Official Marks relating to the 2010 Games. While difficult to challenge because they are not subject to the rules of registrability or to opposition proceedings, there are still several hurdles that must be met. In a recent case in point, the COC asked the Registrar to publish notice of its adoption and use of the Official Marks, SEE YOU IN TORINO, SEE YOU IN BEIJING and SEE YOU IN VANCOUVER. The effect of such publication was to bar the registration of these marks as regular trade-marks by an unrelated entity whose goal was to raise funds for prospective Olympic athletes. This entity had used these marks and applied to register them before the COC had made its Section 9 Requests but final registration had not issued when publication of the COC’s Official Mark Requests occurred. Such advertisement effectively barred the Registrar from permitting those applications from proceeding to final registration.

The applicant applied to the Federal Court by way of request for judicial review to have publication of the Registrar’s notice quashed. The Federal Court granted the applicant’s request on the basis that the Registrar could not have been satisfied that the COC had adopted and used those marks at the time the request was submitted, since the COC had filed no evidence of such adoption and use with its request.

This approach of the Court marks a departure from prior practice wherein the Registrar has rarely, if ever, asked that such evidence of prior adoption and use be provided as a condition of advertising a Section 9 Request. Unless this decision is successfully appealed, the Registrar will likely now start asking for such evidence in every case. The end result was a rare setback for the COC but one that may be temporary as an appeal has been filed.

In any event, it appears that the COC, CPC and VANOC will soon have a new and even more powerful instrument at their disposal, in the form of Bill C-47, the Olympic and Paralympic Marks Act, (“Bill C-47”) introduced in the House of Commons on March 2, 2007. This legislation is similar to legislation introduced in Australia, Italy, China and the UK in time for their respective Olympic Games. Bill C-47 recently passed third reading in the House of Commons, received Royal Assent and will come into force upon an order of the Governor in Council being issued.

Additional protection for Olympic and Paralympic marks under Bill C-47 includes a prohibition against any person promoting or otherwise directing public attention to their business, wares or services in a manner that misleads or is likely to mislead the public into believing that the person’s business, wares or services are approved, authorized or endorsed by an organizing committee, the COC or CPC or that a business association exists between the person’s business and the Olympic games, Paralympic games, an organizing committee, the COC or the CPC.

In determining whether a person has acted contrary to the above misleading promotion provisions, the Court shall take into account any evidence that the person has used, in any language, a combination of expressions set out in Part 1 of Schedule 3 to Bill C-47, including “games”, “2010”, “21st”, “10th” and “medals”, or the combination of an expression in Part 1 of Schedule 3 with an expression set out in Part 2 of Schedule 3 – including “winter”, “Vancouver”, “Whistler” and “sponsor” – for example, the combination of “winter” and “10th” may be prohibited.

Bill C-47 also provides protection for a number of specified Olympic and Paralympic Marks in Schedules 1 and 2. This protection mirrors Section 9 Official Mark protection. The marks in Schedule 2 are specific to the 2010 Games, while the marks in Schedule 1 are applicable to any Olympic Games and the international Olympic community. Bill C-47 provides that both Schedules 2 and 3 (but not Schedule 1) will be repealed on December 31, 2010. Interestingly, the Bill provides that new marks and expressions can be added to Schedules 2 and 3 by order of the Governor in Council. In effect, new marks can obtain protection equivalent to that found under Section 9 of the Act without Official Mark Requests being made to the Registrar of Trade-marks. Similarly, additional expressions that may be considered by the Court in determining whether ambush marketing has occurred can also be added by order of the Governor in Council.

If a Court finds that an act has been done contrary to the above provisions it may make any order it considers appropriate, including relief by way of an injunction. If an interim or interlocutory injunction is sought, the applicant (again, COC/CPC or VANOC) is not required to prove that it will suffer irreparable harm. This latter provision is perhaps the most controversial as it creates a much lower standard for obtaining an injunction than has ever been the case.

There you are, tearing around your local shopping mall desperately looking to buy a birthday gift for a significant female in your life. You spot what appears to be a very nice quilted Chanel tote bag for $75. You hesitate. Seems rather affordable for a luxury brand but then again the sales assistant did seem very genuine, assuring you that all their merchandise was “real”. Later on, as you gingerly proffer the gift, you observe a gamut of emotions. The expression on her face changes from that of eager anticipation to an incredulous frown, to a look of abject disgust. She realizes the gift is nothing more than a cheesy knockoff.

You’re not the only one who could be in hot water. Companies with high-end luxury brands are now going after the landlords of markets and shopping centers when their tenants engage in the sale of counterfeit goods.

Counterfeit reproductions are imitation goods which deceptively represent their content and origin and commonly display fake labels of real trademark owners. The idea is to fool consumers into believing that the goods are genuine and this results in substantial losses to companies who have invested significant time and expense in the development and marketing of their products.

The counterfeit trade has been a long source of frustration for intellectual property owners. Traditionally, the fight against the sale of fake designer products has been directed towards the retailers, but retailers often have little or no assets worth pursuing through the courts or, in some instances, they simply disappear before the case goes to trial. As a result, intellectual property owners are now looking to deeper pockets by seeking to impose liability on landlords for the infringing acts of their tenants.

A few years ago, anyone walking down Canal Street in New York City could expect to be accosted by a variety of stall vendors offering fake goods from any designer worth coveting, including Gucci, Versace and Louis Vuitton. Not any more. In 2005, Louis Vuitton obtained a preliminary injunction against the owner of seven Canal Street properties alleging that the landlord, Richard E. Carroll, was contributory liable for counterfeit sales by its tenants, benefited financially therefrom and had proactively relocated tenants from one property to another to greater conceal infringing activity. The injunction ordered Carroll to: (i) evict all tenants found selling counterfeit Louis Vuitton goods; (ii) include a specific rider in all new leases prohibiting the sale of counterfeit goods; and (iii) require tenants to submit to random spot-checks of their stores to detect infringing activity.

Similarly in China, the international brands Burberry, Chanel, Gucci, Louis Vuitton and Prada were successful in their joint legal proceedings against the landlord of the Beijing Silk Street Market. The court found that by virtue of operating the market, the landlord had provided a convenience for its tenants to engage in counterfeit sales and that as soon as the landlord became aware of the counterfeit sales there was an obligation to eliminate all such activity.

However, a recent decision of the Australian Federal Court has taken a different approach. In Louis Vuitton Malletier SA v. Toea Pty Ltd, the Court held that manufacturers and suppliers cannot reasonably expect a landlord to police trademark infringement, nor can they expect a landlord to be able to distinguish between counterfeit and authentic goods. The Court distinguished between the legal right of a landlord to control the range of goods being sold on its premises and the physical ability to prevent all infringing sales. The Court stated that it is impossible for a landlord to permanently control the actions of its tenant vendors to prevent infringement, except in the case of the most blatant misconduct and, in the absence of evidence of a common purpose to cause damage, liability will not attach to a landlord.

This decision makes common sense and it is one which a Canadian court would likely adopt. In Canada, there is currently no specific legal authority for the assertion that a landlord is liable for the actions of its tenant, whether jointly, vicariously or otherwise. A tort will only be imputed to joint tortfeasors where there is a concerted action to a common end or a conspiracy with all participants acting in furtherance of the wrong. Furthermore, the Ontario Superior Court addressed this issue in Davisco International Inc. v. Protase Separations Inc., holding that if a landlord derives benefits by leasing premises to a tenant where infringement occurs, that does not mean the landlord has derived benefits from the infringing activities. An examination of the business relationship between the parties is key when determining whether a landlord and tenant could be considered to be operating a joint venture. As such, in the absence of some further act of complicity between the parties, the act of being a landlord alone is not enough to infer liability for infringement committed by a tenant.

Nonetheless, landlords should be on notice of the possibility of being named as joint defendants, alongside rogue tenants trading in counterfeit goods. Many landlords may wish to take proactive steps so as to ensure that no infringing activities take place on their premises. In particular, landlords should consider specific warnings to tenants that such activities may lead to default proceedings under the terms of their leases. Landlords should also consider including restrictive covenants in lease agreements prohibiting all actions that infringe third party intellectual property rights. Turning a blind eye to such illegal activities could be viewed as willful acquiescence on the part of a landlord. On receipt of “cease and desist” notices from intellectual property owners, landlords should immediately consult with legal counsel to discuss the best course of action and, if possible, avoid a court action.

Here in British Columbia, while a case of this kind has yet to come before the courts, retail landlords have already reported receiving “cease and desist” type notices from trademark owners, signaling the increased efforts being made to step up the fight against the global counterfeit trade.

DotAsia Organisation Ltd. announced that the registration for .asia domain names will be commence in October 2007. The phased Sunrise Period will open October 9, 2007 for governments and trademark owners until October 30, 2007. Commencing November 13, 2007 to January 15, 2008, registration will be open to companies. The Landrush Period is targeted to begin February 2008.

Asia domain eligibility requirements stipulate that at least one of the domain contacts (registrant, administrative, technical or billing) associated with the domain name must be a legal entity in the DotAsia Community (which includes Australia and New Zealand). The DotAsia Organisation adopted the boundaries defined by ICANN for Asia/Australia/Pacific (AP) region as basis for its scope of eligibility. (See http://www.icann.org/montreal/geo-regions-topic.htm for a list of the countries included in the Asia/Australia/Pacific (AP) region.)

ADD/REMOVE FROM MAILING LIST