Trademark Prosecution Tips and Traps: Navigating Canada’s Trademark System One Year After the Major Changes
June 29, 2020
On June 17, 2019, the most significant changes to Canada’s trademark system in over 60 years took effect. At the one-year anniversary of the changes, we are assessing the impact that they have had on Canadian trademark practice. We will provide some practical tips and also identify some traps in dealing with the altered trademark landscape, in this case, as it relates to prosecution and maintenance.
Show Some Class
The changes made in June 2019 introduced the mandatory requirement that all goods and services be categorized according to the Nice Classification system. Classification must take place at the following times:
|Status of Application/Registration||Timing of Mandatory Classification|
|Applications filed on or after June 17, 2019||At the time of filing|
|Applications filed but not yet advertised prior to June 17, 2019||Prior to approval for advertisement|
|Applications advertised or registered prior to June 17, 2019||At the time of renewal|
One unique aspect of classification in Canada is that grouping under the Nice Classification system has no legal impact on a trademark owner’s rights in Canada. The Trademarks Act clearly states that confusion between two marks, or between a mark and a trade name, only arises if use of both in the same area would likely lead to lead an inference that the associated goods or services have a common source “whether or not the goods or services are of the same general class or appear in the same class of the Nice Classification”. Similarly, it appears that non-use cancellation challenges will remain focused on the actual goods or services claimed in the registration, without regard to their class.
Applicants should also remember that the need to classify has not removed or altered the Canadian Intellectual Property Office’s (“CIPO”) strict requirement that goods and services be described in “ordinary commercial terms”. This requirement often mandates a level of specificity far more detailed than what is acceptable under Nice or in many intellectual property offices around the world.
With respect to fees, CIPO has also taken a different approach than most intellectual property offices in other countries. For an application, fees are paid based on the list of goods or services included in the application at the time of filing, regardless of whether certain items are subsequently deleted. For example, if an applicant files an application with a list of goods which it believes only covers 2 classes, but CIPO takes the position that the goods cover 10 classes, the applicant must pay the fees for all 10 classes. The applicant cannot avoid these extra fees by deleting the “extra” 8 classes.
Similarly, renewal fees are due based on the number of classes included in the registration at the renewal date, even if an owner decides not to renew certain classes of goods or services. In order to avoid unnecessary fees, an owner should delete classes which it does not want renewed before a request for renewal is made. If the goods and services for a registration are not yet classified, they should be classified before the renewal deadline, so that unwanted classes can be deleted to avoid unnecessary fees.
Extensions of Time
On January 17, 2020, CIPO revised its practice with respect to extensions of time to respond to Examiner’s reports. Specifically, applicants must establish “exceptional circumstances” to justify any extension of time beyond the initial six-month response period. CIPO has outlined various examples of “exceptional circumstances”, such as a circumstance beyond the control of the applicant. Importantly, CIPO has recognized that it will be an exceptional circumstance if the applicant requires additional time to consider an objection related to registrability, entitlement, or distinctiveness.
Another significant change is that CIPO will now allow applications to be divided. This can be an effective strategy in circumstances where a subset of goods or services are being contested by an Examiner or are subject to an opposition proceeding. The owner can file a divisional application to cover the uncontested goods or services which can then proceed to registration unimpeded. For the original application, the owner can then address the issues pertaining to the contested goods or services.
For Canadian applications filed through the Madrid Protocol, it is important to consider appointing a Canadian trademark agent. CIPO will not issue substantive correspondence regarding the application to the WIPO representative unless the representative is a registered Canadian trademark agent or has a Canadian address. If the WIPO representative is not a Canadian trademark agent, or does not have a Canadian address, CIPO will send a single courtesy notice to the representative advising of this policy. Thereafter, CIPO will send all correspondence to the applicant directly. Accordingly, if non-Canadian agents wish to avoid CIPO contacting the applicant directly, a Canadian trademark agent should be appointed.
Objections Based on a Lack of Distinctiveness
It has always been the case that, for a trademark to be registrable in Canada, it must be distinctive. “Distinctive” means that a trademark actually distinguishes or is adapted to distinguish the goods or services in association with which it is used by its owner from the goods or services of others. While historically distinctiveness was not raised during prosecution of a trademark application, that changed in June 2019. Examiners now have broad powers to object to an application if, in the Examiner’s preliminary view, the mark is not inherently distinctive. Certain types of trademarks are generally considered to lack inherent distinctiveness, such as:
- geographic locations, names of colours in relation to goods that would normally or typically be that colour, laudatory words/phrases, phone numbers and one or two-letter or number trademarks;
- most “non-traditional” marks, including the shapes of goods, sounds, colour per se, tastes, scents, and textures; and
- marks which are primarily merely surnames or are clearly descriptive.
For marks outside of the above categories, however, there was a fair degree of uncertainty as Examiners began issuing non-distinctiveness objections. There was uncertainty regarding both the criteria to assess what renders a mark distinctive or not inherently distinctive, and the research that Examiners were conducting to make such a determination. For example, many Examiners appeared to be relying on Internet searches which did not appear to be limited to Canada or to any particular good or service. While the Canadian Trademarks Examination Manual now contains guidelines for dealing with non-distinctiveness objections, it remains difficult to predict the likelihood of encountering a non-distinctiveness objection and to anticipate the outcome.
Canada now accepts applications for a wide variety of “non-traditional” trademarks, including colour, three-dimensional marks, positioning of a sign, holograms, motions, sounds, tastes, scents, textures and a mode of packaging goods. Unfortunately, the vast majority of applications for non-traditional marks to date have been filed incorrectly. Many have been filed by self-represented applicants who clearly misunderstood the process. Although there will, no doubt, be a steep learning curve as applicants and CIPO become accustomed to applications for non-traditional marks, the availability of protection for these categories of marks represents an enormous opportunity for businesses.
In a recent decision arising from an appeal of a decision of the Trademarks Opposition Board, the Federal Court commented on when a retailer can establish use of a trademark on goods when the retailer is not the “source” of the goods. Specifically, if a retailer simply affixes its own trademark to goods manufactured by a third party, does that constitute use of the retailer’s trademark in association with those goods.
Interlocutory injunctions in Canadian trademark cases are rare. The decision at first instance to grant a motion for an interlocutory injunction in a dispute related to the “Bombay Frankie” trademark therefore made headlines, at least in trademark circles, for two reasons. First, the fact that the injunction had been granted was in itself noteworthy. Second, many in the intellectual property bar were of the view that the decision misapplied certain fundamental principles of trademark law and therefore introduced uncertainty into the law.
Canada continues to make news (the wrong kind) when it comes to the slow pace of its examination of trademark applications. Despite repeated promises by the Canadian Intellectual Property Office (“CIPO”) to speed things up, the problem is only getting worse. However, there are some promising signs.