Canada: Looking After Your Brands

Last Updated: February 15 2006

By Kamleh Nicola, Andrea Kokonis and Lisa Allegro

Originally published in Canada IP Focus 2006, Managing Intellectual Property, February 2006.

Branding is the key to protecting a company’s corporate identity. Successful branding often requires a unique and identifiable symbol or name that distinguishes the business and its products or services from those of others. Trade mark law protects these branding efforts.

In Canada, statutory trade mark law is dealt with at the federal level through the Trade-marks Act. The common law also protects trade marks irrespective of whether the mark is registered under the Act. However, registered marks are easier to enforce and have a number of important advantages. This article offers a brief overview of trade mark prosecution in Canada, outlining the registrability of trade marks, the registration procedure, opposition proceedings, issues arising after registration and new developments in Canadian trade mark law.

Registrable Trade Marks in Canada

Traditional trade marks consist of words or designs that are used to designate the source of wares or services. The Act defines the types of marks that are not registrable. Clearly descriptive trade marks (for example "sweet and cold" for ice-cream) and deceptively misdescriptive trade marks (for example "air express" for a courier service that uses ground transportation) are not eligible for trade mark protection. Composite trade marks are also subject to this exclusion and may not be registrable if the dominant feature contains word elements that, when sounded, are clearly descriptive or deceptively misdescriptive. A trade mark that is confusingly similar to a registered mark is not registrable if used in association with similar wares or services. A purely functional trade mark is also not registrable – the stud design of the Lego building block toy was not afforded trade mark protection.

Certain marks may be afforded protection as official marks – the Canadian flag, the emblem of the Red Cross – regardless of the underlying wares and services. Official mark protection is available only to public authorities and similar applicants. An applicant is qualified as a public authority if it is subject to a significant degree of governmental control and dedicates any profit it earns to the public benefit.

Famous marks are not afforded any additional protection in Canada. The fame of the applicant’s trade mark alone does not give it legal protection against vendors who sell products or services that are different from the products or services with which the famous mark is associated. For instance, although Mattel’s Barbie dolls are well-known across Canada, Mattel was unable to prevent a restaurateur from using the same trade mark in association with her restaurants. Similarly, one may not be surprised to see Lexus shampoo or Kodak orange juice on the market in Canada.

Non-traditional trade marks

Possible forms of non-traditional trade marks include colours, sounds, motions, scents and three-dimensional shapes.

Colour can be protectable when applied to the surface of a device, such as a pharmaceutical tablet or a telephone. Colour alone, however, is not appropriate subject matter for trade mark protection. Sound marks, motion marks and scents are not registrable in Canada. For three-dimensional shapes, the protection afforded by trade mark law is not as clear. The Act provides for the registration of the three-dimensional aspects of a product or its packaging, known as the distinguishing guise, provided that it has become distinctive in Canada on the date the trade mark application is filed. However, a distinguishing guise is not registrable if it is likely to "unreasonably ... limit the development of any art or industry". A registration cannot interfere with the use by others of utilitarian features of the shape. Thus, the doctrine of functionality often prevents such guises from receiving trade mark protection.

Trade marks, Quebec and French translations

The province of Quebec generally requires that information used in commerce and business be displayed in French. However, an English trade mark is valid in Quebec and does not need to be translated. The Quebec Charter of the French Language specifically makes an exception for a trade mark that is registered under the Act. Note, however, that Canada’s bilingual status affects the test regarding confusion: the test is whether an anglophone, a francophone or a bilingual consumer would be confused by a particular trade mark because of the way it reads and sounds or the ideas it suggests.

The Registration Process

The Canadian Intellectual Property Office (CIPO) is responsible for the administration and registration of trade marks. The registration process typically takes 18 to 24 months.

The registration of a trade mark may be obtained by filing an application in the proper form and submitting the appropriate fee. Companies, individuals, partnerships, trade unions and lawful associations may obtain registration of their trade marks. Unlike the US or the UK, Canada does not use a classification system for trade marks. Applicants are instead required to submit a statement using ordinary commercial language to describe the specific wares or services in association with which the mark has been or is proposed to be used.

Canada is a signatory to the Paris Convention. Thus a person who has filed a trade mark application in one of the member states has the right to claim that priority date of the first filed application provided the subsequent application is filed within six months and a claim to convention priority is made at the time the application is filed.

Once an application has been filed and verified as being in proper form and content, an examiner at CIPO conducts a substantive examination. This includes searches of the CIPO records to find any other trade marks that may be confusingly similar and an assessment of the proposed mark’s registrability. The applicant is given an opportunity to file submissions to overcome any objection made by CIPO.

If the trade mark is allowed, the application is then advertised to give notice to potential opponents to the application.

An opposition proceeding is a method to challenge a proposed trade mark. Grounds of opposition include non-compliance with the proper form and content of the application, non-registrability, non-permissible mark, non-entitlement and non-distinctiveness; however, these grounds usually relate to issues of confusion raised by competitors. Oppositions suspend the registration process and can take many months or years to resolve.

If there are no oppositions, or if these are overcome, the application will proceed to registration. In addition to the filing fee, applications that are filed on the basis of proposed use must file a Declaration of Use once the application has cleared the advertisement stage.

Trade mark applications based on actual use should be filed as soon as possible. As a result of a recent court decision, applications will be examined on a first-come, first-served basis. When there are two or more co-pending applications for confusing trade marks, the application filed first will be accepted, regardless of whether one application is based on actual use of a mark whose date of first use precedes the filing date of another application based on proposed use. The applicant of a later-filed application based on actual use, however, may commence opposition proceedings against the earlier-filed application to prove that it has prior rights in the trade mark.

Life After Registration

Term, renewal and termination

A Canadian trade mark registration is valid for 15 years and may be renewed indefinitely for further 15-year periods on payment of a renewal fee. If the renewal fee is not paid within six months of the end of the 15-year term, the registration will be expunged. Expungement of a registration for failure to renew will not affect any common law rights, prejudice the owner’s right to file a fresh trade mark application nor be considered an abandonment of the mark. However, expungement would be a waste and should be avoided.

Amendments

A registered trade mark owner may apply to amend its registration in various ways – for example, to amend the statement of wares or services or to update information about the registered owner or the appointed representative for service.

Non-use cancellation proceedings

Failing to use a registered mark for a period of three years makes the trade mark vulnerable to attack from competitors, who can initiate a summary procedure to cancel or amend the registration. Any person may send a written request to CIPO requesting the trade mark owner to file evidence of use of its trade mark. If use is not established by the owner, CIPO may cancel the trade mark entirely or amend the registration (e.g., to narrow the scope of wares or services). CIPO, on its own, may initiate these proceedings. Non-use cancellation proceedings are intended to be summary and expeditious. Therefore, evidence on the question of use of the mark is furnished by the trade mark owner alone and the party challenging the use may not file its own evidence.

Expungement for invalidity

A trade mark registration may be expunged by an application to the Federal Court if the registration is found to be invalid by reason of non-registrability, non-distinctiveness, abandonment or non-entitlement. This requires the participation of the trade mark owner. The unsuccessful party may be required to pay the successful party’s costs.

Commercial activities

A trade mark owner may license its trade mark. It is also possible to assign or transfer a trade mark registration, either entirely or for some of the registered wares or services. CIPO records licence agreements, but it has refused to take any position regarding the legal effect of recording such documents. Finally, a security interest may be acquired in a registered trade mark.

New Developments

The Madrid Protocol

In February 2005, CIPO released proposals relating to the modernization of the Trade-marks Act and its Regulations, which are intended to align Canada’s trade mark legislation with the provisions of the Madrid Protocol, to which Canada is currently not a party – the only major industrialized country not a signatory. There are three main proposals: (i) implementing administrative changes; (ii) adopting the Nice Classification system for the classification of goods and services; and (iii) establishing a new approach to Canada’s use requirement for trade marks to address the disadvantage that Canadian applicants face relative to foreign applicants.

The proposals have not yet been adopted. The Intellectual Property Institute of Canada is not wholly supportive of CIPO’s proposals, suggesting that the existing trade mark system serves the interests of Canadian applicants well. The International Trademark Association and other international organizations, however, support the proposals and are actively encouraging Canada to harmonize its laws and become fully integrated with the international trade mark community.

Examination procedure at CIPO

There has been a shift at CIPO regarding the procedure undertaken during the examination process. At the examination stage, CIPO will no longer consider the dates of first use or making known as a relevant consideration that the proposed trade mark application is confusing with another pending trade mark application. This represents a departure from the practice that has been in place for the past 50 years. Previously, when CIPO was faced with competing or confusing trade marks in co-pending applications, it would reject an earlier application on the basis of proposed use in favour of a later application based on actual use if the date of first use in the later application preceded the file date of the earlier application. Currently, owners are encouraged to win the race to CIPO and file quickly.

Health Canada’s look-alike, sound-alike policy

In addition to CIPO’s review, the branding of health products is now subject to review by Health Canada, which has no jurisdiction over trade marks. It is therefore not surprising that Health Canada had no policy concerning the branding of drugs. However, a new look-alike, sound-alike policy enables Health Canada to approve or disapprove the brand name of any health product on the basis of confusion. The purpose of the policy is to address the errors in prescribing, dispensing or administering a product caused by names that are similar when written or spoken.

Prescription drugs became subject to the policy on January 1 2006, and over-the-counter drugs, natural health products and all other health products with a drug identification number are scheduled to be become subject to the policy on July 1 2006.

Review Your Brand Portfolio

In this age of increased global competition, it is important that companies protect the value of their brands. Registration of trade marks can be vital to this protection and result in more powerful options for enforcement. Now, with Canada’s shift to give preference to applications on a first-to-file basis, it is more important than ever for a business to review its brand portfolio to ensure the registration of all brands possible.

The authors would like to thank Andrew Shaughnessy for his assistance and advice on this article.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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