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2 Protecting Your Brand: Understanding the Implications of the Masterpiece Inc. v. Alavida Lifestyles Inc. Decision October 18 th, 2011 Presented By: Kelly Gill, Partner, Gowling Lafleur Henderson LLP Jennifer Morton, Partner, Gowling Lafleur Henderson LLP
3 Overview of Trade-mark Law in Canada The Common Law of Passing Off The Trade-marks Act 3
4 Key Distinctions Between Passing Off and the Act Proof of Rights Geographic Scope of Rights Defences 4
5 Overview of the Masterpiece Decisions Factual Background geographic areas of use trade-mark application issues second to file failed to oppose 5
6 Impact of the Registration Rights Granted to the Registered User not restricted geographically absolute exclusivity 6
7 Necessity for Court Action Need to Invalidate the Registration The Primary Grounds of Invalidity non-entitlement to registration due to prior use 7
8 The Trial and Court of Appeal Decisions Registration Valid No Likelihood of Confusion different geographic areas of use distinguishing designs used with the trade-marks 8
9 The Supreme Court of Canada Decision Registration Invalid The Proper Test for Confusion The Result registration invalid not first to use but neither are necessarily entitled to a registration 9
10 The Real Reason We Register Exclusivity We seek to maintain a monopoly in a brand a word a logo a slogan a colour applied to a shape (for a pill) a unique packaging concept the shape of a liquor or perfume bottle 10
11 The Real Reason We Register Intellectual Property theft is as old as the hills.really Ancient cave dwellers used forms of branding to indicate source Bread branding tools used by bakers are often referred to as one of the earliest examples of competitive branding 11
12 The Real Reason We Register Third parties will choose a highly similar brand, logo, the same colours of your packaging 12
13 The Real Reason We Register Registration of a trade-mark grants the owner of that mark in Canada, the right to its exclusive use throughout Canada for the goods/services covered by the registration 13
14 The Real Reason We Register Many benefits: the certificate is evidence of your exclusive entitlement it provides you with the right to sue unauthorized users for infringement broadens the geographic reach of your rights from local rights to national rights without the registration required to prove earlier use and reputation much easier to secure registration in the first place 14
15 The Real Reason We Register Many benefits: administrative policing of your rights by the Trademarks Office at no cost your registration stands on the public register to give notice of your rights to third parties in their clearance corporate registry will reject the proposed new name if it appears to conflict with your registered mark 15
16 The Real Reason We Register Many benefits: all benefits available for approximately $2000 Cdn, sometimes less, and protection extends for 15 years but there is a catch and it s a big one you must ensure that you obtain a valid registration. A valid registration is one that has been properly registered, is technically valid and is enforceable 16
17 The Real Reason We Register Flaw occasioned by an inexperienced trademark practitioner Poorly conducted or no initial clearance efforts that failed to recognize the danger associated with an earlier common law user Consider the risk to your business if your trade-mark registration were to be expunged in the course of an enforcement effort 17
18 Brand Strategy seek trade-mark protection at the right time through experienced professionals, after an initial and thorough clearance search seek protection before you go too far with your new marketing plan reach out to your IP counsel it may not yet be the appropriate time for full clearance searches but it is the appropriate time to get rid of unprotectable choices and pare down the list of viable options 18
19 Brand Strategy What Are Terrible Choices? identical marks exist your own GOOGLE searches reveal 11 million hits for the word in your field of use Your marketing department should be directed to come to in-house counsel at this early stage to get feedback on inherent registrability or protectability 19
20 Brand Strategy Inherently protectable and registrable? 20
21 Brand Strategy Before you expose the brand or brands to any outside source, customer or supplier you should have conducted full clearance searches to ensure availability trade-mark applications should have been filed 21
22 Brand Strategy Clearance searches Trade-marks Office and business name registries in Canada registered domain names the Internet and available trade directories/ references 22
23 Brand Strategy The Canadian Trade-marks Act provides for confusion between a trade-mark and a trade name prior use in Canada of a trade name that is involved in a similar business offering or product creates MASTERPIECE-type risk 23
24 Brand Strategy Earlier user has the means to successfully oppose your application on a likelihood of confusion and/or non-distinctiveness they still have the right to expunge your registration on the basis of their prior use for the first 5 years in the life of your registration after that date, if they can prove you adopted the mark with knowledge of their prior rights 24
25 Brand Strategy The location of that common law business does not matter from the perspective of entitlement of the trade-mark or trade name 25
26 Brand Strategy There can be extenuating circumstances 26
27 Brand Strategy You may have never technically used your mark in Canada but you may have making known rights or reputation in Canada All of this is another good reason to register in Canada early 27
28 Brand Strategy Your trade-mark professional should be able to assist you in further corporate searches and considerations to more accurately gauge the extent of risk posed by a relevant finding 28
29 Brand Strategy Should you be rushing to register to beat out the common law user identified in your clearance searches? that strategy does not work 29
30 Brand Strategy Assess the relevance of the finding against the importance of the brand for your company Is the level of risk unacceptable? Have a fallback position or strategy 30
31 Brand Strategy The registration process in Canada and the US provides a mechanism for reserving a brand for use well before your product launch 31
32 Brand Strategy Place your application on file at the earliest opportunity. Trade-mark applications are examined in filing date order, notwithstanding any claim of earlier first use by the other Opposition procedure provides the means to sort out entitlement issues 32
33 Brand Strategy Seek registration through professionals that know what they are doing 33
34 Brand Strategy Who else had a similar business name or mark at the time of your adoption? 34
35 Approach to Brand Protection Bottom line seek feedback early in the brand adoption process regarding your ability to protect and enforce rights in the trade-marks before your investment in clearance, protection and marketing 35
36 Approach to Brand Protection conduct a full clearance search including a review of existing business names and other common law uses in Canada have a strategy in place, if needed, to reconcile or distinguish earlier users, notwithstanding their location in Canada 36
37 Approach to Brand Protection file an application at the earliest opportunity and before you expose the brand to any outside source 37
38 Approach to Brand Protection utilize the assistance of competent professionals to register your trade-marks in Canada. Do not risk your rights to a trade-mark invalidation proceeding 38
39 Approach to Brand Protection Finally educate your business and marketing people to alert you to changes made to your brands Including: the addition of words, slogans, designs, modernization of a logo, or changes in design features appropriate steps should be taken to ensure your current use supports your existing registration in Canada or whether additional protections should be considered 39
40 Questions?
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