Chris Bennett outlines common trademark mistakes companies face in Canada, providing tips on how to deal with upcoming changes to the country’s new law.
Hockey players are taught a fundamental lesson at an early age: keep your head up when you have the puck or you could end up in a world of hurt. Improper trademark usage and protection in Canada can lead to a similar result. Below are some common Canadian trademark mistakes, as well as summaries of some upcoming changes to Canadian law.
Not doing searches
The fact that a mark is available for use in another country does not mean it is available for use in Canada. It is therefore important to conduct Canadian clearance searches before using or applying to register a trademark in Canada. These searches can identify potential issues in advance and could help you avoid unnecessary legal fees, rebranding fees and damages.
Your mark must be registered in Canada to be fully protected in Canada. Registrations in other countries provide no protection in Canada. Using your mark extensively in Canada might give you some common law trademark rights in the cities where your mark has become well known. However, this will not stop competitors from using the mark in other cities. In contrast, registration will protect your mark throughout Canada, regardless of where you have used it. Registration also provides a complete defence if you get sued for trademark infringement.
Your trademark rights in Canada could be diminished or destroyed if a third party uses your mark without a proper licence agreement. Canadian law requires you to have that agreement in place with any third party who uses your mark and requires you to have control over the character and quality of the products and services offered in connection with your mark. This rule applies to arm’s length third parties as well as to intercompany agreements with affiliates and subsidiaries, which are often overlooked.
Your Canadian registration can be expunged if you do not use your mark in Canada in association with the goods and services in your registration for at least three consecutive years. Your mark can also be expunged if there are material differences between the registered version of the mark and the actual version of the mark you are using.
Forgetting copyright and moral rights
Logos and design marks can be protected in Canada by both trademark law and copyright law. However, registering your logo as a trademark does not give you any rights under copyright law. If the logo was created by a contractor or any third party other than an employee in the course of his or her employment, then the contractor or third party will own the copyright in the logo, even if you paid them to create it. You will therefore want the contractor and third parties to transfer ownership to you. This must be done in writing.
Ignoring the upcoming changes to Canada’s trademark laws
Canada’s trademark laws are about to change in a big way, likely in late 2017 or 2018. Some of the changes will benefit registrants, but others will provide some significant challenges. For example, Canada will implement the Madrid Protocol, allowing foreign applicants to extend their international applications into Canada, and allowing Canadian applicants to extend their applications internationally. It will also implement the Nice Agreement, which will require applicants to group their goods and services into international classes. Canada is currently one of the few countries that does not charge filing fees based on the numbers of classes of goods and services in an application, and this could change with the implementation of Nice.
One of the most controversial changes to the law is that applicants will no longer be required to use their marks in Canada as a prerequisite to registering their marks in Canada. This change will significantly increase the number of conflicting marks on the Canadian register. It will also increase the number of trademark conflicts in Canada and will make trademark clearance more difficult and expensive. There will be new grounds of opposition, one of which could slightly mellow the impact of the changes to the use requirements. In particular, an opponent will be able to oppose an application on the basis that the applicant wasn’t using the mark and didn’t intend to use the mark in Canada as of the filing date.
Among the other changes, examiners will be able to object to an application on the basis of distinctiveness and may require applicants to submit evidence of a mark’s distinctiveness. The changes will also permit applicants to divide their applications, which is particularly useful if there is a problem with only some of the goods and services in the application. Further, the length of a trademark registration in Canada will be reduced from 15 years to 10 years.
The prospect of these upcoming changes should encourage many applicants to file their Canadian applications soon to avoid the undesirable changes in the new legislation, while still taking advantage of the positive changes that will apply after the applications have been examined and allowed.