Prepared with AI assistance and reviewed by Craig Wilson and Company before publication.* Decisions released October 16 to October 31, 2026.

In this edition, we summarize one decision. The Federal Court of Appeal upheld the expungement of two SEA TOW trademark registrations, confirming when a registered mark is “adopted” for the five-year incontestability rule and that one test for distinctiveness applies in oppositions and expungement proceedings alike.

We did not identify any qualifying intellectual property decisions of the Federal Court in this period.

The Supreme Court of Canada released no intellectual property judgment, but on October 22, 2026 it granted leave to appeal in ProSlide Technology Inc. v. Whitewater West Industries, Ltd. from 2026 FCA 59, a patent case concerning, among other issues, overbreadth as a ground of invalidity.

Key takeaways from Sea Tow

• Refiling and incontestability: Where an earlier trademark application is abandoned and a later application matures to registration, the earlier application cannot be used to establish an earlier adoption date for s. 17(2) protection; knowledge of prior use is assessed by reference to the application that resulted in the registration (Sea Tow Services International, Inc. v. C-Tow Marine Assistance Ltd. (2026 FCA 177)).
• Chain of title: Imperfections or short gaps in historical trademark ownership evidence are not necessarily fatal where the evidence as a whole permits the Court to infer succession in title on a balance of probabilities (Sea Tow Services International, Inc. v. C-Tow Marine Assistance Ltd. (2026 FCA 177)).

Federal Court of Appeal Decisions

Sea Tow Services International, Inc. v. C-Tow Marine Assistance Ltd.

• Citation: 2026 FCA 177
• Court: Federal Court of Appeal
• Decision date: 2026-10-23 (heard 2026-05-28, Ottawa)
• Court file numbers: A-47-25 (lead), A-48-25, A-117-25 (lead), A-118-25
• Judges: Roussel, Heckman and Walker JJ.A. (reasons by Walker J.A.; Roussel and Heckman JJ.A. concurring)
• Area: Trademark
• Classification: Substantive IP Decision
• Legislation and provisions considered: Trademarks Act, ss. 2 (“distinctive”), 3, 17(2), 18(1)(b), (c), (d) and (e), 21, 38(2)(d), 57(1); Trade-marks Act (as in force December 31, 2008 to December 30, 2013), ss. 16(2), 30(d)
• Related decisions or appeal status: Dismisses the appeals from 2025 FC 27 (the trademark decision) and 2025 FC 335 (the costs decision), both per Southcott J. The time to seek leave to appeal to the Supreme Court of Canada had not expired as of 2026-11-02; no application verified.

Summary

Sea Tow, a US company, owns Canadian Registration Nos. TMA870561 (SEA TOW & DESIGN) and TMA870562 (SEA TOW), registered February 3, 2014 from applications filed September 9, 2010 on the basis of US registration and use under s. 16(2) of the Act as it then stood. Its earlier 2002 proposed-use applications were abandoned in September 2010 [5], [21], [37]–[38]. C-Tow, a British Columbia company, claims use of the C-TOW marks through predecessors since the mid-1980s, and the parties largely agreed the marks are confusing [6]–[7]. C-Tow applied under s. 57(1) to expunge the registrations for non-entitlement (s. 18(1)(d)), bad faith (s. 18(1)(e)) and non-distinctiveness (s. 18(1)(b)). Sea Tow sued for infringement and passing off and moved for summary judgment, arguing that its registrations were incontestable under s. 17(2) [8]–[11]. The Federal Court invalidated the registrations under ss. 18(1)(b) and (d), rejected bad faith, granted summary judgment in C-Tow’s favour, and awarded lump-sum costs of $85,000 (motion) and $327,000 (application) [13]–[14], [20]. The appeals raised the interpretation of s. 3 with s. 17(2), the test for non-distinctiveness in expungement proceedings, and costs [23].

The Court of Appeal dismissed all four appeals. For s. 17(2), the date on which the registrant “adopted” the mark under s. 3 is tied to the specific application that matured into the registration, here September 9, 2010; a registrant cannot rely on an earlier abandoned application to fix an earlier adoption date [43]–[45]. The words “commenced to use it in Canada” connote use that has continued, so Sea Tow’s 1987–89 use through a franchisee, later abandoned, could not ground adoption [53]–[55], [60]–[62]. Since Sea Tow had knowledge of C-Tow’s use no later than 1992, the registrations were not incontestable and the non-entitlement finding stood [63], [69]. On distinctiveness, the Court held that a single test, from Bojangles’ International LLC v. Bojangles Café Ltd., 2006 FC 657 at para. 34, governs both oppositions and expungement proceedings, and rejected the narrower “so devoid of distinctiveness” formulation Sea Tow proposed; only the burden of proof differs [71]–[73], [77]. The Court also upheld the finding that C-Tow had a significantly stronger and more sustained marketplace presence in Canada than Sea Tow and that the C-Tow marks had become sufficiently known to negate the distinctiveness of the Sea Tow marks; no palpable and overriding error was shown in the factual findings [66]–[69], [83]–[85], and no error in principle in the costs awards [88]–[99]. In practice, the decision means that abandoning and refiling an application can move the date at which the owner’s knowledge of a prior user is tested for incontestability.

Key holdings

• For s. 17(2), whether the person who adopted the registered mark did so with knowledge of prior use is assessed at the s. 3 adoption date tied to the application that resulted in the registration; an earlier abandoned application cannot be used to shield a later registration [43]–[45], [63].
• “Commenced to use it in Canada” in s. 3 connotes use that has continued. Use that has been abandoned cannot ground adoption for s. 17(2) purposes, and this reading does not make s. 18(1)(c) redundant [54]–[55], [59]–[60].
• Abandonment requires both cessation of use and an intention to abandon, and the intention may be inferred from long disuse [61]–[62].
• There is one test for distinctiveness, from Bojangles at para. 34, in both opposition and expungement proceedings; in expungement, the burden of establishing non-distinctiveness rests on the party seeking expungement [72]–[73], [79]–[80].
• Despite imperfections and short gaps in the historical evidence, it was open to the Federal Court to infer on a balance of probabilities that C-Tow was successor in title to users of the C-TOW marks dating back to 1985 [66]–[69].

Result

Appeals A-47-25, A-48-25, A-117-25 and A-118-25 dismissed. The Federal Court’s costs awards to C-Tow ($85,000 on the motion and $327,000 on the application) stand. Costs of the appeals to C-Tow in the lump sum of $20,500 plus applicable taxes, with the security bond posted by Sea Tow to be released in C-Tow’s favour [99]–[103].

How these decisions may affect you

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Previous edition: IP Decisions Digest Canada – 2026-10-15

* AI disclaimer: We prepared this digest with the assistance of artificial intelligence (AI) tools, and it was reviewed by Craig Wilson and Company before publication. It summarizes publicly available decisions of the Federal Court, the Federal Court of Appeal and the Supreme Court of Canada. This post is general information only. It is not professional advice and does not establish an agent-client relationship. Summaries may not capture every aspect of a decision; consult the official reasons, linked in each entry, before relying on any part of this digest, including its summaries, key holdings and results.