Metallic over-ear headphones

IQ trademark invalidated by Federal court tips for business owners and trademark

By James Wan

What you need to know (in a nutshell)

  1. The case of Gentec v Nuheara is a rare Canadian trademark case that has invalidated a registered trademark for lack of distinctiveness.
  2. The case provides important guidance on the law of distinctiveness and related litigation and business strategy considerations.
  3. Trademark owners should take note that marketplace evidence and media evidence are sufficient to prove non-distinctiveness and should police both the Canadian marketplace and the Canadian trademark register to prevent the widespread adoption of a mark by third parties. Trademark challengers should also consider all possible sources of evidence when preparing for trial.

Full Article

In the unusual and high-stakes Canadian trademark case Gentec v Nuheara, a registered trademark was invalidated due to its lack of distinctiveness. The court determined that the term “IQ,” used by Gentec for their consumer electronics, had become too generic. Evidence from surveys, admissions during prosecution, and media sources contributed to this conclusion. This decision offers insights into various aspects of trademarks, including litigation strategies and leveraging marketplace data to demonstrate non-distinctiveness.

In this lawsuit, Australian company Nuheara, known for its award-winning “IQbuds” hearables—smart earphones with advanced technology that enhance hearing capabilities—faced plaintiff Gentec, a company with a range of IQ-branded products that include wireless earbuds without such features and at lower price points. Gentec accused Nuheara of using the IQbuds trademark in a manner that would be confusing with Gentec’s registered trademarks for IQ, which covered headphones, among other items. In response, Nuheara not only contested the potential confusion but also sought to remove Gentec’s registration due to its lack of distinctiveness. The Federal Court ultimately found no likelihood of confusion and expunged Gentec’s IQ registration due to insufficient distinction.

Nuheara argued that the term “IQ” was not distinctive to any particular electronics company but was used by various marketers to signify advanced product features. Nuheara presented evidence of multiple third parties selling consumer electronic goods with IQ incorporated into their branding, implying that the term was not unique to Gentec. Distinctiveness is essential in trademark law, allowing trademarks to differentiate one business’s offerings from another’s. If a term cannot be deemed distinctive, it is not eligible for legal protection.

The court found that surveys are not required to prove distinctiveness (or lack thereof) and ruled that the evidence presented by Nuheara was sufficient to conclude that the word IQ lacked any distinctive quality in the consumer electronics sector. Consequently, Gentec’s registration was ordered to be struck from the register. This case underscores the importance of trademark owners being vigilant in monitoring Canadian Trademark Registers and marketplace operations to avoid third-party adoption.

Nuheara’s victory was secured by its legal team’s thorough preparation, which involved cross-referencing media reviews with admissions made by Gentec’s trademark agents and examining evidence proving Canadian circulation or visibility for the relevant media sources. This case study demonstrates that attention to detail and diligent work is crucial in achieving a successful litigation outcome.