A big part of establishing a successful start-up business is developing a meaningful brand. To many, this simply means using an online service to create a catchy name and graphic for your business, and marketing it from there.
But did you know you can also get exclusive rights to use your brand if you register it as a trademark? Did you also know that if you do not check to see what else is out there, there is a risk your newly developed brand could be infringing on another entity's existing trademark rights?
In addition, there are other issues to consider in developing a brand that qualifies for trademark protection. The article below sets out in detail what a trademark is, what trademark rights consist of, what trademarks are registrable, and the process for applying to register a trademark.
What is a trademark?
A trademark, broadly speaking, is any word, symbol, design, slogan, sound or combination of these elements that distinguishes your business' goods or services from those of others in the marketplace.
A trademark allows a consumer to link a good or service with its source. It also can be a badge of quality based on the goodwill and reputation a source has acquired. A trademark, particularly a registered trademark, can add value to a business and help leverage goodwill for new product lines or services.
Trademark rights
Simply by using a trademark, under Canadian law trademark owners are generally considered to acquire certain rights in the trademark. These are often referred to as "common law" trademark rights. These rights are often geographically limited in scope and can be difficult to enforce.
Registering a trademark gives you more robust rights and protections, meaning it is easier to enforce. If you obtain a trademark registration in Canada, you have the right to exclusive use of the trademark throughout Canada for a period of 15 years. This means you can stop other people anywhere in Canada from using a trademark that is the same as or that is confusingly similar to your trademark, even if you have not established a local reputation for your trademark in the specific area of Canada where the other party is using its mark.
You must apply to the Canadian Intellectual Property Office to register a trademark. The application process in Canada can take approximately 1-2 years. You can also file concurrent applications to register your trademark in other countries and jurisdictions, where you will get similar protection according to the laws of those other countries and jurisdictions.
EFF: I'm Emilie Feil-Fraser, an intellectual property lawyer at Gowling WLG based in Vancouver, BC.
LH: I'm Lori Hall, Trademark Partner at Gowling WLG based in Hamilton, Ontario. Welcome to our GoXL Module on Trademark Basics for Startups.
EFF: If you're running a small business, you've likely developed a business name or brand to establish and distinguish your goods and services in the marketplace.
LH: It's not all about fancy logo design though... Did you know you can get exclusive rights to use your brand in Canada if you register it as a trademark?
Did you also know that if you don't check to see what else is out there, there is a risk your newly developed brand could be infringing on another entity's existing trademark rights?
EFF: Today we're going to guide you through the following topics:
* First, we'll give you a brief overview of trademark law and what's important for your business;
* Then, we'll walk through the steps for developing a strong trademark, including the due diligence you should conduct;
* And finally, we'll give you a checklist of what you'll need to put together a trademark application.
LH: Trademark due diligence and protection might seem like a low priority when there's so much on your business' to-do list. But putting in a little effort now will likely save you lots of time – and money – down the road.
Slide: What is a trademark
EFF: First of all, what is a trademark?
Generally speaking, a trademark is any word, symbol, design, slogan, sound or combination of these elements that distinguishes your business' goods or services from those of others in the marketplace. Google, Kodak, Sony, Nike – these are a few examples of trademarks that immediately call to mind the goods and services they are associated with.
A trademark allows a consumer to link a good or service with its source, and can also be a badge of quality based on the goodwill and reputation the source has acquired. A trademark, particularly a registered trademark, adds value to a business and can help leverage goodwill for new product lines or services.
Slide: What are my trademark rights
LH: What kind of rights come with a trademark? Simply by using a trademark, under Canadian trademark law owners are generally considered to acquire certain rights in the trademark. These are usually called "common law" trademark rights because they are acquired automatically through use. However, these rights are often geographically limited in scope and can be difficult to enforce.
EFF: By contrast, registering a trademark gives you robust rights and protections. If you obtain a trademark registration in Canada, you have the right to exclusive use of the trademark throughout Canada in perpetuity provided the trademark continues to be in proper use, and renewal fees are paid every ten years. This means you can stop other people anywhere in Canada from using a trademark that is the same or confusingly similar to your trademark.
How do I apply for a trademark?
LH: So how do you apply for a trademark? You must apply to the Canadian Intellectual Property Office to register a trademark. The application process in Canada usually takes about two years, and there are quite a few steps involved, which is why it is a good idea to get a lawyer or trademark agent to help you. Your lawyer or agent can also help you file corresponding trademark applications in other countries, where once registered you will get similar protection according to the laws of those jurisdictions.
Slide: Is my trademark registrable
EFF: Not all trademarks are available or registrable. For example, if another entity is using or has registered a trademark in Canada that is the same or confusingly similar to your trademark, and is associated with goods or services that might overlap with yours, your trademark will not likely be registrable.
LH: There are other reasons a trademark might not be registerable. For example, if the mark is "primarily merely" a surname, if it is clearly descriptive of the associated goods or services, if it is a geographic location and is clearly descriptive or misdescriptive of the origin of the associated goods or services, or if the mark is a superlative, it might not be registrable. Marks like FRASER'S FOODS, VANCOUVER CLOTHES, or THE BEST would not likely be registrable without evidence these marks had acquired distinctiveness in Canada. There are also certain other marks that relate to universities or government bodies which are prohibited.
Slide: Trademark Due Diligence
EFF: That's why it's very important to do some due diligence on your trademark up front before you invest lots of time and money into developing it as a brand. Firstly, you want to know whether it might be infringing on other entities' existing trademark rights, and secondly whether it is likely registrable.
Usually, this due diligence takes the form of searches – searches of the trademarks registers of the countries you will do business in, Google searches, domain name searches, and searches of company directories, among other things. When searching, you are looking for marks that are confusing with, similar to, or identical to your proposed mark that are being used in the same area of business that you are currently in or that you plan to enter in the future.
LH: It's a good idea to get a lawyer or trademark agent to help you with these searches because setting the proper search parameters can be tricky, and it can be difficult to find design marks or marks that are phonetically similar but spelled differently than your mark. Depending on the results, you may find you have to tweak or pivot to a different trademark because the one you are searching for is already in use.
Slide: how can I increase likelihood of registrability?
EFF: The field is more likely to be clear the more your trademark is distinctive. Keep it simple, memorable, and most of all, unique. It can be tempting to use descriptive trademarks because they tend to tell the consumer more about who you are, what goods or services you are offering, and/or where you are located. But the more descriptive the trademark, the more obstacles to registration there can be. For example, the trademark JOE'S MARINA PUB has the benefit of telling the consumer exactly who, what, and where you are, but it is a weak brand and may not be registrable as a trademark. By contrast, coined words like KODAK, GOOGLE, NIKE and SONY are the strongest trademarks as they are inherently distinctive, but you may have to invest more at the outset educating consumers what kind of goods or services you offer. I certainly didn't know what a "GOOGLE" was the first time I heard that word.
Slide: 6 steps for developing a trademark
LH: Here are six quick steps for developing your trademark and determining whether it likely meets the criteria for registrability.
* First, identify all markets and channels of trade your business is currently in and potentially will be in, including in other countries if applicable.
* Next, identify all products and services your business intends to sell or provide. Include areas you may expand into in the future. For example will you one day sell branded apparel? Provide consulting services? Make sure to include those in the list.
* EFF: Third, prioritize how much you want to communicate who you are and what you do by way of your trademark, versus how strong of a brand you want to develop. Are you a JOE'S MARINA PUB or are you the next KODAK?
* LH: Fourth, brainstorm the brand elements you want to convey. Do you want to include design elements or make a logo out of your brand? Are there specific colours, words, ideas or elements you want to communicate?
* Once you have a shortlist of proposed trademarks, consult with a legal professional and conduct searches to determine whether other entities' trademarks overlap with your proposed trademarks or if there are other registrability obstacles. If there are, be flexible about pivoting or reimagining your desired trademark.
* EFF: When you are ready, engage a legal professional to file a trademark application on your behalf. Remember, it takes a couple years for a trademark to issue to registration in Canada and there can be various hurdles along the way. If you are not currently using your trademark, the most important date to establish your rights is your filing date. Alternatively, if you are already using your trademark, your rights will be a combination of your first use date and your filing date. In any event, it's a good idea to file as early as you can.
Slide: Trademark application process and checklist
LH: Once you have settled on your chosen trademark, and you are confident that all potential risks have been uncovered, you are now ready to prepare and file a trademark application.
EFF: It is so important that all information on your trademark application is accurate. Filing a trademark application with errors could result in your inability to enforce your rights in your trademark down the road.
LH: Let's go through a checklist of the key things you'll need to include in your trademark application, and some common mistakes to avoid. You can access the full checklist in the link below this presentation.
EFF: Name and Address
The first thing you need is the applicant's full name and address. If the applicant is a company, this means the full legal name, including the corporate signifier like inc. or ltd. If your business structure includes subsidiaries or other related companies, make sure the applicant is the entity within your structure that you want to own the intellectual property. After filing, you can fix a clerical error in the applicant's name fairly easily by way of an affidavit, but it is more complicated to fix an application filed in the name of the wrong entity.
LH: Visual Representation of the trademark
Your application must include a visual representation or description of the trademark. If your trademark is a standard character mark, which means it is comprised only of words, letters, numbers, punctuation marks or other standard characters you might find on a keyboard, your application must include a visual representation of the trademark in black on a white background and a statement that it is a standard character mark.
If your trademark is a design mark, which means it includes a logo, stylized characters or other design elements, your application must include a picture of the mark not exceeding 8 cm x 8 cm. If the design mark includes colour, the names of the colours must be specifically described and the visual representation must be in those colours.
EFF: Don't file an application for the wrong trademark! If you file the wrong spelling of your trademark or the wrong logo design, your trademark could be cancelled for non-use. Similarly, if you wish to sue another party for infringement, and you discover that the trademark on your registration document is not consistent with how you have used your trademark, it could be much more difficult for you to enforce your rights using that registration. You can't correct the visual representation of the trademark once it's filed; if it's wrong you have to start fresh with a new application.
LH: If you plan to use your trademark in both a standard character and a design format – in other words, you have both a word mark and a logo – you may want to consider filing multiple trademark applications, for example, one for the word and one for the logo. As each type of trademark will entitle you to a different scope of protection and a different set of registrability criteria, we recommend asking your lawyer or trademark agent for help with these strategic decisions.
EFF: Goods and Services
Your application must include a statement in ordinary commercial terms describing the goods and services your trademark is associated with. This includes goods and services your business currently offers as well as goods and services your business may offer in the future. Remember, you can always narrow the scope of your trademark application, but you can never expand it.
LH: Your statement must also be very specific. A statement that your trademark is associated with "clothing" fore example is not enough, you'll need to list the specific types of clothing you plan to brand your trademark with. Your lawyer or trademark agent can help you draft a compliant statement of goods and services in ordinary commercial terms.
EFF: Classification and fees
As of June 17, 2019, the goods and services in all Canadian trademark applications must be classified according to an international classification system called the Nice Classification. Your lawyer or trademark agent can help you categorize each of your goods and services into the proper Nice class.
LH: The fees associated with your trademark application will depend on the number of Nice classes in your application. The base fee charged by the Canadian Intellectual Property Office is $330 for the first class of goods and services, and $100 for each additional class. These numbers exclude legal fees and disbursements. As these fees can add up quickly, it's better to have a focused application that is practical about the goods and services you are claiming, rather than an application that's overbroad. This will also help prevent your registration from being cancelled down the road if it turns out you are not using the trademark on the goods and services specified in your registration.
EFF: Priority applications in foreign countries
Canada may not be the only country you want to seek trademark protection in. Luckily, there's an international treaty called the Madrid Protocol that streamlines the process of filing concurrent trademark applications in other member countries. Many key strategic jurisdictions are members of the Madrid Protocol, including the United States, the European Union, and the United Kingdom.
LH: If you file in other countries within six months of filing your Canadian application, you can claim priority in the foreign jurisdictions to your Canadian filing date.
If you're not ready to file trademark applications in foreign jurisdictions that soon, you can always file them after the six month window is up. It just means that you won't be able to claim the benefit of the earlier Canadian filing date. Instead, the filing date will be designated as the date your foreign application is actually filed.
Whether you're claiming priority or not, be aware that other jurisdictions may require additional application criteria, such as proving use of your trademark in that country before your trademark is registered.
Slide: Additional Resources
EFF: Thanks for joining us today. Lori and I hope that we have been able to provide you with some guidance on the selection of trademarks, the risks involved, and some practical tips for filing a trademark application.
If you want to learn more, check out my article Trademark Basics for Startups, which summarizes the key principles we talked about today. You'll find the link to the article above this presentation, as well as a downloadable PDF copy of the trademark application checklist we went over today, and copies of this slide deck.
LH: And don't hesitate to get in touch with either one of us directly if you have any questions, we're here for you and happy to help.
EFF: If you'd like to explore other intellectual property topics, we encourage you to visit our Go-XL homepage to gain early access to other videos like ours on our virtual IP Platform. Thanks again!
Trademark registrability
Not all trademarks are registrable. If there is another trademark on the Trademarks Register that is the same as or confusingly similar to your trademark, taking into account all relevant considerations, including whether the earlier mark is applied for in association with goods and services that are the same as or similar to yours, your trademark will not likely be registrable. Similarly, if someone is using a trademark that is the same or similar to yours in Canada and in association with the same or similar goods or services to yours, your trademark may not be registrable and the earlier trademark user may have grounds to oppose your trademark application.
There are other reasons that a trademark might not be registrable. For example, if the mark is "primarily merely" a surname, if the mark is clearly descriptive of the associated goods or services, if the mark is a geographic location and is clearly descriptive of the origin of the associated goods or services, or if the mark is a superlative it might not be registrable. For example, marks like FRASER'S FOODS, OKANAGAN, or THE BEST would not likely be registrable without evidence that the marks had acquired distinctiveness in Canada. There are also certain other marks that relate to the government, universities, etc. which are prohibited.
In general, it is wise not to invest time and money into developing a trademark without first taking the time to determine whether it is likely registrable.
In particular, be careful using logo-maker websites. These can be great creative tools, but by no means do they guarantee your ability to use and/or register the logo you create as a trademark. Similarly, if you hire a graphic designer to help design a trademark, make sure they are aware of trademark registrability and availability considerations. If they are not, make sure you take ownership over that responsibility, as the user of the mark (rather than the person or entity who designed the mark or logo) is the one who is liable for trademark infringement.
Even if you do not plan on registering your trademark anytime soon, it is a good idea to make sure that your trademark is not the same or confusingly similar with any other existing trademarks. If it is, you could be infringing on other entities' trademark rights.
What makes a good trademark?
Some trademarks are stronger than others from a branding perspective, and some trademarks have a better chance of registration than others.
A strong trademark is:
- Short, simple and memorable
- Timeless, consistent, instantly recognizable
- Flexible - allows you to expand into different jurisdictions and different lines of products or services
A weak trademark is:
- Not distinctive
- Descriptive of the goods and services it is associated with
- Makes use of words or symbols common in the channel of trade
- Confusingly similar with other trademarks
Descriptive vs. distinctive trademarks
It can be tempting to use descriptive trademarks because they tend to tell the consumer more about who you are, what goods or services you are offering, and/or where you are located. But the more descriptive the trademark, the weaker the brand and the more obstacles to registration there can be. For example, the trademark JOE'S MARINA PUB has the benefit of telling the consumer exactly who, what, and where you are, but it is a weak brand and may not be a registrable trademark.
Distinctive trademarks make for the strongest brands in the long run, and pose the least obstacles to registration. Coined words are the strongest trademarks (e.g. KODAK, GOOGLE, NIKE, SONY) as they are inherently distinctive. Sometimes these trademarks present marketing challenges at the outset because consumers are unfamiliar with the goods/services you offer.
Words that are not typically associated with the goods/services you offer (e.g. APPLE for computers; INDIGO for bookstores) can also be strong trademarks because you may quickly become the primary source that product is associated with. Marks that are suggestive of some aspect of the goods/services you offer can also become good trademarks (e.g. SANDALS for resorts, CHAPTERS for bookstores).
Marks with descriptive, laudatory, or commonly used elements are weak. Think about how many companies use elements like GOLDEN, GLOBAL, WESTERN, PACIFIC, BEST, etc. These elements do not add distinctiveness to your trademark.
Ultimately you have to make a business decision - prioritize how much you want to communicate to consumers who you are and what you do by way of your trademark, versus how strong of a brand you want to develop. Are you a JOE'S MARINA PUB or the next SONY?
Word marks vs. design marks and scope of protection
There are a number of different types of trademarks. The most common are word marks (e.g. NIKE), design marks (e.g. the NIKE swoosh) and word & design marks (e.g. NIKE with the NIKE swoosh). All of these marks are independently registrable.
Each type of mark affords a different scope of protection and ease of registration:
- Word marks are generally considered to afford the broadest scope of protection, because anytime someone uses or reproduces the registered word(s) in any font, colour, size, etc., it is considered use of a word mark.
- Marks involving a design element may be easier to register because they may provide additional elements of distinctiveness as compared to word marks. However, such marks including a design element are generally considered to offer a more limited scope of protection because in order to infringe, another party may need to use the same or similar design elements in order to be considered confusingly similar to a registered design mark.
- Note that marks containing a design element may also be automatically protected by copyright law, irrespective of trademark registration. Word trademarks are generally not protected by copyright. This may afford an extra layer of protection for marks that incorporate design elements.
Some companies choose to register both word marks and design marks (for example, Nike has registered all three of the above-referenced marks). This can be a strategic choice - you may not need registrations for everything at the outset of your business, and you may be able to register additional marks later (the risk being that someone else applies to register a confusingly similar trademark in the meantime). There are additional costs involved with each application, so the decision should include a careful cost-benefit analysis for your business.
Trademark searches
Once you have identified a trademark you would like to register, it's time to conduct some searches. Searches will help you determine whether your trademark is registrable and whether your trademark infringes on other entities' existing trademark rights. You may also wish to conduct searches that canvas foreign jurisdictions if you plan to expand your business into other countries.
Your searches can include searches of the Trademarks Register, Google, domain names, and company directories, among other information repositories. When searching, you are looking for marks that are confusing with, similar to, or identical to your proposed mark that are (a) applied for or registered on the national trademark database in your jurisdiction of interest; and/or (b) being used in the same scope of business as you or that you plan to enter in the future.
The scope of goods and services in your search for is relevant, because the same or similar trademarks can co-exist if they are in different industries.
In addition to regular Google searches, the following are free search tools:
Getting help from a legal professional when conducting searches is highly recommended. Though many search tools are free, effective searching require a nuanced approach taking into account several different parameters in order to reveal all relevant results. Also, searching for logos and design marks can be difficult through the above-referenced search databases. Gowling WLG employs specialized search agents that can perform extremely in-depth searches for you.
Six quick steps for developing your trademark
- Identify all markets and channels of trade your business is in and potentially will be in, including abroad in other countries and jurisdictions.
- Identify all products and services your business intends to sell or provide. Include areas you may expand into in the future (e.g. will you be selling branded apparel? Providing consulting services?).
- A good exercise is to make a list of the marks you instantly recognize and regard highly (e.g. BMW, SONY, NIKE, GOOGLE etc.).
- Brainstorm the brand elements you want to convey, decide whether you wish to include design elements, descriptive elements, suggestive words, or coined terms. Prioritize how much you want to communicate who you are and what you do by way of your trademark, versus how strong of a brand you want to develop.
- Consult with a legal professional and conduct searches of the relevant trademark databases to see whether other entities' trademarks may overlap with or cause issues for your proposed trademark(s).
- When you are ready, engage a legal professional to file a trademark application on your behalf. Remember, it takes 1-2 years for a trademark application to issue to registration (in Canada, though the time to obtain a registration varies from country to country), and there can be various hurdles along the way. It's a good idea to file as early as you can.
Questions?
Gowling WLG is an international law firm that specializes in protecting intellectual property, such as trademarks. I am happy to answer any questions you may have about trademark protection or brand strategy in general.
[] In June 2019, non-traditional marks such as colours, holograms, animated images, and scents will also be considered trademarks under the amended Canadian Trademarks Act.
[] In June 2019, sweeping changes to the Canadian Trademarks Act will change the registrability period from 15 years to 10 years.
[] As of June 2019, changes to the Canadian Trademarks Act will add more grounds for refusing a trademark application, including if the trademark lacks distinctiveness.
[] There are also important copyright law issues that may come up when using logo-maker websites or working with graphic designers, which are outside the scope of this article. The key takeaway is to make sure that at the end of the day, you own the copyright in any logo or design mark you intend to use in association with your business.
[] As of June 2019, the changes to the Canadian Trademarks Act there will be additional obstacles to registration if a trademark is descriptive and/or if it lacks distinctiveness.