Federal Court of Appeal Upholds Finding That Providing “Hotel Services” Does Not Require A “Bricks And Mortar” Hotel In Canada

On September 9, 2020, in Miller Thomson LLP v Hilton Worldwide Holding LLP, 2020 FCA 134, the Federal Court of Appeal of Canada (FCA) dismissed an appeal from the Federal Court (FC), finding that Hilton Worldwide Holding LLP (Hilton) had used its trademark WALDORF ASTORIA in association with “hotel services” in Canada, despite the fact that there was no “bricks and mortar” hotel under the name.

Previously, the FC set aside the decision of the Registrar of Trademarks to expunge the WALDORF ASTORIA mark.  The FC concluded that a “bricks and mortar” hotel was not necessary to establish “use”, so long as Canadians obtained some tangible, meaningful benefit from the services in Canada (as previously reported by the E-TIPS® newsletter here).

On appeal, the FCA held that the FC had not committed any palpable and overriding errors in its decision, and therefore, the FCA dismissed the appeal.  The FCA concluded that the FC correctly stated the test for “use” for non-use cancellation proceedings, and that the FC did not err in finding that “hotel services” included incidental or ancillary services, such as reservation or payment services. 

In concluding that Hilton had established that Canadians derived a meaningful benefit from Hilton’s “hotel services”, the FCA noted that trademark “use” requirements “must adapt to accord with 21st century commercial practices”.  The FCA stated that to establish “use” with online services, “[t]here must, at a minimum, be a sufficient degree of interactivity between trademark owner and Canadian consumer”, and that passive viewing of content on a foreign website will be insufficient to constitute use.

The FCA further highlighted that cases dealing with the question of “use” will turn on the quality of the evidence provided.  The FCA provided the following examples of evidence that may be persuasive in such cases:

• website metrics showing the number of times a website was accessed by people in Canada;
• evidence that content offered by a website is stored on servers located in Canada;
• sales figures for services provided to Canadians online; and
• evidence that prices are listed in Canadian dollars.

Summary By: Michelle Noonan