Background

As a brand owner, you understand the importance and value of your proprietary brands, whether they be words, logos, tag lines, unique packaging or distinctive uses of colour. You may have also taken steps to apply for Federal trademark protection for your marks, or you have registered domain names containing elements of your trademarks. While you were wise to take these steps, doing so may also have brought your intellectual property assets to the attention of fraudsters who may seek to scam you. This article will alert you to the types of scams that are commonly perpetrated on brand owners, and will tell you how to avoid falling victim to them.

How do fraudsters get your information?

In Canada, as in most countries, it is necessary to provide a physical business address when submitting an application for a trademark. A simple search of the Canadian Intellectual Property Office (CIPO) or the United States Patent and Trademark Office (USPTO) online trademark registries will reveal the mailing address of all pending trademark applicants and registered owners. Even if the applicant has their outside trademark professional file on their behalf, their business address is made public. Scammers will send fraudulent correspondence and invoices directly to the trademark applicant, bypassing their trademark agent entirely. In the case of domain names, a simple search of the Whois.com database will reveal the identity of the owner as well as the administrative and technical contacts of any domain names.

Trademark scams:

Typically, these scams involve sending brand owners what appear to be official notices from a trademark office, which contain an invoice or seek payment of a fee. Official trademark offices are aware of these scams and have issued warnings—view the warning notices from CIPO and the USPTO. There are many different types of scams. Some seek payment of a fee for advertising the trademark in an official publication, some include an invoice from an international trademark office or the World Intellectual Property Office (WIPO), some state that your application will be cancelled or will expire unless a renewal fee is paid, and others offer to add the trademark to a non-existent directory or offer some other bogus service. A few examples of these notices are attached to this article. Many of them incorporate language from a legitimate source and use letterhead that is designed to look official. Most fraudulent notices and invoices are received by regular mail, but some do arrive via email.

Domain name scams:

These scams can be harder to detect, as they are not necessarily seeking payment of a fraudulent invoice. However, they still prey on the fears of brand owners that their valuable intellectual property rights may be in jeopardy. Typically, domain name scams involve receipt of an email claiming that important domain names are in jeopardy of being registered by cybersquatters or competitors. Often, these emails come from foreign jurisdictions, where you do not have country-level domain names registered and where you may not have any trademark protection at all. In most cases, the fraudsters purport to be a domain name registrar, a government agency, or even a law firm, and they seek instructions to retain them to fight a potential third-party registration, or use their services to register your domains in that country.

Some scams ask for money to deny a third party’s request for a domain name registration containing your mark, even though no such request was ever made. Others may ask you for a list of domains that you wish to protect, only to have the fraudster register those domains themselves and try to sell them back to you, or simply take your money and not register the names at all. In countries with a first-to-file system like China, this type of scam is common.

How to avoid scams:

There are several things that you can do to avoid falling victim to these scams:

  1. Never pay an invoice without consulting your trademark professional or otherwise confirming that it is legitimate. If you have hired a trademark professional, any requests for payment of fees, including official government fees, will come directly from them and not directly from a government office or third party
  2. Inform your staff about these scams and have them be vigilant. Often, fraudsters send invoices and emails directly to marketing or technical personnel, or directly to an accounts payable department, to avoid the scrutiny of a legal team or senior management.
  3. Do not reply to suspicious emails, even to indicate a lack of interest. Scammers use these replies to gather additional information about your company, and to identify which companies they will continue to target.
  4. Report fraudulent invoices and correspondence to CIPO and attach a copy of what you received.
  5. Take steps to ensure that your valuable brands are properly protected through trademark registrations in the appropriate jurisdictions and through adequate domain name registrations. Consult with a trusted trademarks advisor.
  6. Be aware that in Canada, trademark laws are changing and it will soon be possible to register a trademark in the country without ever having used it in Canada or anywhere else in the world. This will leave any of your unregistered brands open for exploitation by trademark squatters and pirates. Consider registering the marks that are important to you.