Bereskin & Parr's Trademark Basics for Businesses series introduces entrepreneurs and business professionals to the fundamentals of trademarks in Canada and focuses on key concepts such as trademark selection, registration, use, and enforcement in the context of starting and running a successful business.
Ownership of a trademark registration in Canada provides your business with several benefits. However, it also creates responsibilities that should influence the strategies and practices adopted by your business. This entry in the series discusses the basics of trademark use and enforcement.
If I register my business's trademark in Canada, is my business required to use it?
Once your business's trademark has been registered for three years, the registration can become vulnerable to cancellation if the mark has not been in use in Canada with the associated goods and services. A third party can file a request pursuant to section 45 of the Trademarks Act for the Registrar of Trademarks to demand evidence of use. If your business fails to respond, or, if the Registrar determines that the registered mark has not been in use in Canada during the three years preceding the date on which the proceeding was commenced, the registration will be amended or cancelled altogether, depending on whether the lack of use relates to some or all of the goods and services covered by the registration.
While it is sometimes possible to establish that special circumstances prevented your business from using its mark, this can be difficult to do. Accordingly, businesses should ensure that their registered trademarks are in use in Canada.
What counts as "use" of my business's trademark?
Generally, a trademark is used in association with goods if it appears on the goods or their packaging so that consumers are notified of the relationship between the mark and the goods, and there has been a transfer of property of the goods, i.e., a sale of the goods. A trademark is used in association with services if it is used or displayed in the performance or advertising of the services for example, on company vehicles or employee uniforms.
What can I do to protect my business's trademark registration against a non-use attack?
One strategy for protecting a trademark registration is to keep detailed records and samples related to the registered trademark dating back several years, including packaging or advertising materials, dated and itemized invoices displaying the mark and the address of a customer or client in Canada, and copies of contracts or correspondence with customers or clients that refer to the mark and the goods or services. Another strategy is to use the ® symbol with your business's registered trademarks and use statements such as "ABC is a registered trademark of XYZ Inc." If use is under license, notice of such licensed use is also recommended, and the trademark owner should control the character or quality of the goods sold or services provided under such licensed use.
Businesses would also be well advised to exercise caution when deciding to use variations of the registered trademark, as the registration could be cancelled if the business cannot show the use of the same mark that was registered. While some minor variations may be permissible if the dominant impression conveyed by the mark is the same, relying on the use of a mark that differs from the mark as registered can still increase the risk of an unfavourable outcome.
What is trademark infringement?
In Canada, the term 'infringement' is applied specifically to an action relating to a registered mark, whereas a claim involving an unregistered mark is referred to as a "passing-off" action. Trademark infringement occurs when another party uses either your business's registered trademark or another trademark that is confusing with your business's registered trademark, in association with any of the goods or services covered by the registration. On the other hand, a passing-off action at common law generally requires the existence of goodwill or a reputation in the trademark, deception of the public due to a misrepresentation, and actual or potential damage to the plaintiff.
The question of whether a third-party trademark is "confusing" with your business's registered trademark is a legal question. It is based on a number of factors, including the degree of resemblance between the marks in appearance, sound, and ideas suggested, the inherent distinctiveness of the marks and the extent to which each has become known in Canada, the length of time the marks have been in use, the nature of the goods and/or services, and the nature of the trade. Confusion is assessed from the perspective of the average or everyday consumer in Canada.
What should I do if I believe someone is infringing my business's registered trademark?
In these circumstances, the best strategy is often to retain a qualified lawyer or trademark agent as soon as possible. Your business's lawyer or trademark agent will be able to help you understand the various options available to your business in the circumstances, as well as the benefits, drawbacks, and costs associated with each alternative.
For businesses operating on an online marketplace such as Amazon, ownership of a registered trademark may grant your business access to anti-counterfeiting and other reporting tools for addressing intellectual property infringement. In these circumstances, your business may be able to take effective action using these types of tools.
Businesses would be well advised to routinely monitor competitors' activities in the marketplace. Allowing one or more competitors to infringe your registered trademark for an extended period can have significant consequences. It is generally unwise to assume that your business does not need to act, or that taking action is not worth the costs. You may have worked hard to secure a favourable position in the market—one that is worth protecting.
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.
