Introduction
Amendments to Canada's Trademarks Act and its regulations will come into force on April 1, 2025 (the Amendments). The Amendments include provisions that will:
- allow costs to be awarded against parties that engage in undesirable or inefficient behaviours in trademark proceedings before the Trademarks Opposition Board (the TMOB);
- promote the disclosure of confidential information in trademark proceedings before the TMOB by allowing the issuance of confidentiality orders;
- authorize the Registrar of Trademarks (the Registrar) to case manage proceedings before the TMOB;
- require proof of use (or the existence of special circumstances excusing the absence of such use) of a trademark in trademark infringement proceedings if the trademark registration was obtained less than three years prior;
- remove the automatic right to file additional evidence when appealing the TMOB's decisions at the Federal Court; and
- provide greater opportunity to challenge official marks.
Cost awards
Cost awards are a mechanism used by many courts and tribunals in Canada to, among other things, discourage inefficient behaviours. Cost awards are currently unavailable in proceedings before the TMOB. However, the Amendments will provide the Registrar with the authority to award costs against a party who exhibits undesirable and inefficient behaviours in the following two circumstances, in any proceeding before the TMOB:
- Late cancellation (not rescheduling) of hearing: where a party withdraws a request for a hearing less than 14 days before the day on which the hearing is scheduled to take place; or
- Unreasonable conduct: where a party engages in unreasonable conduct that causes undue delay or expense in the proceeding, such as the failure to attend a hearing or cross-examination and a lack of cooperation between parties for scheduling cross-examination.
In the circumstances of an opposition proceeding before the TMOB, costs may also be awarded in the following two circumstances:
- Bad faith ground of opposition: where a Party's application for trademark registration is refused on the grounds that it was filed in bad faith with respect to any goods or services; or
- Divisional applications: where a party files a divisional application on or after the day on which the original application is advertised.
In order to award costs, the Registrar must first receive a request for costs which includes the reasons for the request and the specific facts or circumstances surrounding the request. The severity of the cost award will vary depending on the nature of the request being made, with claims relating to the bad faith ground of opposition carrying the possibility for a cost award of up to 10 times the prescribed fee of filing a statement of opposition.
Unlike in some other dispute resolution adjudication processes, the Amendments are not intended to compensate a party for successful proceedings by requiring that the losing party pay some portion of the costs of the winning party. Rather, the Amendments are strictly aimed at discouraging undesirable behaviour and promoting the efficient advancement of proceedings before the TMOB.
The process for requesting costs will include an opportunity for both parties to provide submissions before a decision is made. The Registrar's decision on costs will be included in the final disposition of the proceeding and may be appealed by application to the Federal Court.
Confidentiality orders
Currently, all documents submitted to the Registrar in proceedings before the TMOB (such as affidavits, written representations, etc.) are publicly disclosed and accessible via the Canadian Intellectual Property Office's website.
The Amendments will introduce provisions granting the Registrar the power to keep certain evidence confidential by issuing confidentiality orders. Upon request by a party that evidence be kept confidential, the Registrar will seek comments and submissions from the other parties and will then issue or refuse to issue a confidentiality order. In deciding whether or not to grant the order, the Registrar must consider the public interest in open and accessible proceedings.
The following information will be required in making a request that evidence be kept confidential:
- a description of the evidence that the party wishes to be kept confidential;
- a statement that the evidence has not been made public;
- the reasons why the evidence should be kept confidential; and
- an indication of whether the other party consents to the request.
The Registrar may amend or revoke the confidentiality order at any time during the proceeding if it considers it appropriate to do so or if the Registrar is no longer satisfied that the evidence should be kept confidential.
Case management
The Amendments will provide the Registrar with the ability to order that a TMOB proceeding continue as a case-managed proceeding, which is intended to result in a more efficient and cost-saving resolution of cases. Examples of case management include extending deadlines to align multiple related proceedings, hearing related files together or consecutively, convening a conference call with parties to address scheduling and accommodations at a hearing or other issues that could delay a proceeding. The Registrar will not use case management to make substantive rulings, e.g., finding that a party failed to meet their evidential burden on a ground of opposition.
The power to designate a proceeding as a case-managed proceeding will only be exercised in exceptional circumstances, after considering all the surrounding circumstances, including the extent of intervention by the Registrar that the proceeding is likely to require for matters to be dealt with in an efficient and cost-effective manner, the complexity of the proceeding and whether substantial delay has occurred or is anticipated to occur in the conduct of the proceeding.
Requirement of use
The Amendments will also introduce a new obligation on trademark owners to show that they have used their trademark within three years of registering such mark (or demonstrate that special circumstances exist to excuse the absence of such use), if their trademark registration was obtained less than three years ago and they wish to bring an application claiming that an act has been done contrary to section 19, 20 or 22 of the Trademarks Act (i.e. relating to trademark infringement or the depreciation of the value of a registered trademark's goodwill). This amendment aims to prevent market participants from sitting on unused trademarks and then using those trademarks as the basis on which to prevent third parties from using the same or similar marks in Canada.
Filing additional evidence on appeal
Prior to the Amendments coming into force, applicants had an automatic right to file additional evidence when appealing the TMOB's decisions before the Federal Court. The Amendments will remove this guaranteed ability and will require that the Federal Court expressly grant leave for new evidence to be filed on appeal.
Official marks
An official mark is any badge, crest, emblem or mark adopted and used by a "public authority" in Canada. To qualify as a public authority, the government must exercise a significant degree of control over the activities of the organization and the activities of the organization must benefit the public. In order to obtain an official mark, the public authority must request that the Registrar give public notice of the public authority's adoption and use of the subject trademark. Once the notice is published in Canada's Trademarks Journal, the trademark becomes an official mark and third parties are prohibited from using it or any other trademark that so nearly resembles it as to be mistaken for it, in association with any goods or services and across any field and industry (making it essentially a kind of "super" trademark).
Official marks are not subject to any renewal requirements. The broad protections afforded to official marks coupled with their essentially indefinite lifespan has resulted in many objections being made to applications for registration of trademarks on the basis of a pre-existing official mark. The Amendments, once in force, will provide an administrative mechanism whereby the Registrar, on its own initiative or at the request of a person who pays a prescribed fee (CA$325), can give public notice that the trademark protections afforded under subparagraph 9(1)(n)(iii) of the Regulations do not apply where the holder of the mark is not (or is no longer) a public authority or no longer exists. This amendment aims to reduce barriers created by the existence of official marks (to the extent an official mark holder is not a public authority or no longer exists) without having to seek relief from the Federal Court and thus simplify the trademark registration process.
About Dentons
Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries. www.dentons.com
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. Specific Questions relating to this article should be addressed directly to the author.
