Trademark Case Studies
Proper Trademark Usage – Part 2
In Part 1 of our ongoing series on Proper Trademark Usage, we discussed the use of trademark symbols. Part 2 of our series discusses a number of reasons why trademarks should be used consistently and as registered:
1. To maintain brand identity
A trademark is a shortcut that helps consumers distinguish your products and services from those of your competitors. If your mark is frequently changing, it will be more difficult for consumers to make the mental association with your products and services.
Having a brand manual or style guide that outlines exactly how a mark should be used is a good idea, particularly when you are licensing your mark for use by different entities. See Twitter’s Trademark and Content Display Policy as an example: https://twitter.com/logo.
2. To protect the validity of your trademark registration
If the trademark you are currently using has significantly deviated from the mark that you registered, your registration is at risk of being expunged for non-use.
If your mark doesn’t match what appears on your Certificate of Registration, consider filing a new application for the updated version of the mark.
3. To protect your ability to enforce your trademark rights
Trademark disputes are often decided based on who has earlier rights in a mark.
If, in the past, you were using one mark, and over time you added, removed, changed, or rearranged elements of the mark, you may have actually lost any rights in the original mark.
In that case, you will not be able to claim rights dating back to that original use, and your entitlement date will stem from when you started using the latest version of the mark. A later entitlement date may put you at a disadvantage in a trademark dispute.
Filing a new application each time your mark is updated will ensure that there are no gaps in your trademark protection.
How much deviation is acceptable?
Most brands will at one time or another go through some form of an update, whether it is a simple tweak, a refresh, or a complete brand overhaul. Whether the new look will support an old registration depends on the extent of the change.
Have the dominant features of the mark been preserved? Are the differences so unimportant that a consumer would still assume that the marks identify goods of a common origin? If so, your old registration should offer sufficient protection.
In a well known Canadian trademark case, the use of a “slim” penguin was sufficient to maintain a registration for a noticeably more rotund penguin, where the dominant features of the mark were retained (see Promafil Canada Ltée v. Munsingwear Inc. (1992), 44 C.P.R. (3d) 59 (FCA)).
In another case, the Board found that use of a design mark in which the word SUN appeared above the word EXOTIC within a sun and rectangle design was not use of the registered word mark SUNEXOTIC because “the trade-mark had lost its identity and did not remain recognizable in the form as used” (see Oyen Wiggs Green & Mutala v. Rubicon Products Ltd. (2007), 65 C.P.R. (4th) 54 (TMOB)).
Changing the colour of a trademark will not impact the validity of a trademark registration that was filed in black and white. However, if your registration included a colour claim, it may be necessary to re-file if you have changed your mark’s colour scheme.
Predicting what the Trademarks Office will consider an “acceptable deviation” is not an exact science. When in doubt, the safest approach is to re-file.
Brand identity and maintenance of trademark rights are good reasons to avoid altering your trademark. However, when it is ultimately time for a brand refresh, having a trademark filing strategy in place will safeguard your rights during the transition and beyond.
Case Law Update: Foreign Use & Registration Claims in Canadian Trademark Applications
In Canada, applicants may rely on one or more bases when filing a trademark application, including use in Canada, proposed use in Canada, and foreign application/registration and use. The latter basis permits foreign applicants who own a corresponding registration in their country of origin and who have used the trademark in any foreign country to obtain a registration in Canada without having used the trademark in Canada. The material date for establishing use abroad has been a source of debate amongst trademark practitioners, and was recently addressed by the Federal Court in The Thymes, LLC v. Reitmans (Canada) Limited, 2013 FC 127.
Before addressing the court’s decision, it may be helpful to review the relevant legislation.
Section 16(2) of the Trade-marks Act reads as follows:
(2) Any applicant who has filed an application in accordance with section 30 for registration of a trade-mark that is registrable and that the applicant or the applicant’s predecessor in title has duly registered in or for the country of origin of the applicant and has used in association with wares or services is entitled, subject to section 38, to secure its registration in respect of the wares or services in association with which it is registered in that country and has been used, unless at the date of filing of the application in accordance with section 30 it was confusing with
(a) a trade-mark that had been previously used in Canada or made known in Canada by any other person;
(b) a trade-mark in respect of which an application for registration had been previously filed in Canada by any other person; or
(c) a trade-name that had been previously used in Canada by any other person.
Section 30 of the Act reads as follows:
30. An applicant for the registration of a trade-mark shall file with the Registrar an application containing
(d) in the case of a trade-mark that is the subject in or for another country of the Union of a registration or an application for registration by the applicant or the applicant’s named predecessor in title on which the applicant bases the applicant’s right to registration, particulars of the application or registration and, if the trade-mark has neither been used in Canada nor made known in Canada, the name of a country in which the trade-mark has been used by the applicant or the applicant’s named predecessor in title, if any, in association with each of the general classes of wares or services described in the application;
In Thymes, the applicant filed an application in Canada claiming a) proposed use and b) use and application in the United States. The Federal Court upheld the decision of the Opposition Board to reject the second filing basis, as the applicant was unable to establish use in the United States as of the Canadian filing date.
In explaining the Court’s decision, Justice Manson noted that “the material date for determining compliance with section 30 of the Act is the date the application was filed” and stated the following in reference to Section 16(2) of the Act:
“There is no doubt a proper reading of that section requires that, at the time of filing the application, if an applicant relies on registration or application and use abroad pursuant to that section, there must have been use of the trade-mark at the time of the application to rely on this section as a valid basis to obtain registration in Canada.”
He went on to say that “further, the last portion of section 16(2) of the Act, namely: ‘unless at the date of filing of the application in accordance with section 30’, also supports the view that both section 16 and section 30 requirements must exist and be reviewed as at the date of filing the application.”
It is difficult to argue with the decision as it relates to the particular facts of this case – in Thymes, the 16(2) claim was made before there had been any use of the mark in the US. What is notable is the breadth of the language used by Justice Manson, as it may be interpreted to mean that use as of the Canadian filing date is required for a valid 16(2) claim, regardless of when the claim is made.
It has been common practice for many Canadian trademark practitioners to amend applications after filing to make a claim under 16(2) in situations where foreign use commences after filing but before advertisement. In that case, the applicant can credibly claim foreign use and application/registration prior to the filing date of the revised application. The Federal Court’s decision casts doubt on whether such claims will hold up in an opposition proceeding.
At Coastal, it has long been our practice to only rely on use and registration abroad when the following conditions are met at the filing date of the Canadian application (or priority date, if applicable):
i) a corresponding application or registration exists in the applicant’s country of origin, and
ii) the applicant has used the mark with the wares and/or services in any country.
At least until the scope of the Thymes decision is tested, a cautious approach will help safeguard clients’ applications and registrations from opposition or cancellation for invalid 16(2) claims.
Trademarks: dos and don’ts
Trademarks are often considered a business’s most valuable asset, far outweighing the value of manufacturing facilities, machinery or equipment. There are business owners who recognize this and take the protection of their trademarks seriously and there are those who don’t.
I recently came across this news article, which demonstrates these two extremes. The article is about two small business owners using the same name for similar services. One owner took the time to register her trademark and protect her brand. The other owner started her business without the expert advice and research recommended to move forward with use of a trademark.
According to the news article, Stephanie Pick first opened her Queen of Tarts pastry shop in Toronto, Ontario, in 1998. On the advice of her businessman father, who felt it was essential she protect her brand, the trademark Queen of Tarts was registered.
Small business owner, Linda Kearney, decided to put her life savings into opening a new café in Edmonton, Alberta. Her granddaughter came up with a clever name for her new business. Unfortunately, three months after she opened up her Queen of Tarts café Mrs. Kearney found herself in a legal nightmare with Ontario pastry chef Stephanie Pick. The Federal Court, in a default judgment, ordered Mrs. Kearney to pay Ms. Pick damages for trademark infringement in the amount of $10,000.00, plus court costs. She also had to cease using the trademark Queen of Tarts.
The legal situation these business owners found themselves in makes obvious three things: (1) there are benefits to registering a trademark; (2) there is value in hiring an expert to assist you; and (3) there is worth in trademark searching.
Many times clients have enquired whether a trademark search is necessary before they apply for a trademark registration, or use a mark. In most instances my answer is yes. Although searches are optional, they are generally recommended. The cost of the search is often far less than the cost to later change the mark, if it is determined that there exists a prior user in a related field. Mrs. Kearney, regrettably, learned this the hard way.
Had Mrs. Kearney requested a trademark search from a registered trademark agent or trademark lawyer, she could have avoided the legal nightmare she found herself in three months after opening shop. She could also have avoided the costs she incurred in doing so. A proper trademark search would have disclosed that the trademark Queen of Tarts was owned by Ms. Pick. This should have dissuaded Mrs. Kearney from moving forward with that name. Instead, Mrs. Kearney is required to transition to a new name and shell out the costs associated with this transition.
I often have clients ask me whether or not they could perform their own search or file their own application. The answer is yes, but like any industry, if you are not an expert in the field it is not recommended you do it on your own. A registered trademark agent is a professional who has been apprenticed, examined, and approved by the Trademarks Office to represent trademark applicants and registrants. A registered trademark agent can save business owners time and money by avoiding problems caused by issues like a poorly prepared application or inadequate research.
Had Mrs. Kearney sought the services of a registered trademark agent, she would have likely been directed to do a search. The search would have revealed the existence of Ms. Pick’s trademark registration and she would have been advised to come up with a new name. Instead, she now finds herself with the expense of having to change her business name and re-brand, not to mention the fees in damages and court costs.
Ms. Pick, on the other hand, took the time to hire an expert to assist her with the registration and protection of her mark. This small investment clearly paid off as she was able to assert her rights and protect her brand.
Many clients I come across are under the mistaken belief that registering their trade name with the Registrar of Companies, or incorporating their business provincially or federally affords them all-encompassing rights in that name, including trademark rights. Unfortunately, this is not the case. What many people do not realize, as appears to be the situation for Mrs. Kearney, is that federal trademark registration is often superior to federal or provincial company registration.
One of the main benefits of trademark registration is protection of the mark throughout Canada, regardless of where the mark is being used. Although Ms. Pick’s use of her trademark was limited to the province of Ontario, her rights in the trademark were not. As a result she was able to stop Mrs. Kearney from using the trademark Queen of Tarts in Alberta.
As well, having a registered trademark provided Ms. Pick the right to sue for trademark infringement before the Federal Court. Ms. Pick was not required to establish a reputation in her trademark. In fact she had temporarily stopped using the mark. Registration of the mark, Queen of Tarts, was evidence enough for her to successfully assert her rights.
As noted above, and as demonstrated in the Queen of Tarts case, there are obvious benefits to registering a trademark, there is definitely value in hiring an expert to assist you and there is undoubtedly worth in trademark searching. Any business that advertises services or sells products under a distinctive mark should consider protecting that mark with trademark registration. In today’s marketplace, branding is essential and protection should be too.