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Trade Mark Newsletter - Fall 2010

November 1, 2010

In This Issue

  1. Bereskin & Parr Represents INTA in the Supreme Court of Canada
    Partners Daniel R. Bereskin and Mark L. Robbins to represent the International Trademark Association (INTA) in the Supreme Court of Canada appeal concerning Masterpiece Inc. v. Alavida Lifestyles Inc.
  2. Consultations on Changes to Trademark Opposition Practice and Fees
    Cynthia Rowden discusses the Canadian Intellectual Property Office’s (CIPO) “pre-consultations” dealing with fees and Regulations that impact opposition proceedings.
  3. The Strategic Use of Trademark & Design Protection for Trade Dress
    Justine Wiebe and Jonathan Burkinshaw discuss the benefits of using a coordinated strategy that includes both trademark and design protection to obtain immediate and comprehensive rights in 3D product and packaging shapes.
  4. Opposition Board Rewards Good Faith 'Swamping'
    Mark L. Robbins and Peter Woods discuss the Trade-mark Opposition Board’s iReward decision and how the it shows that there can be unusual circumstances in which a proposed use trademark application is not a fully secure placeholder.

Bereskin & Parr Represents INTA in the Supreme Court of Canada

Bereskin & Parr LLP recently has obtained an order from the Supreme Court of Canada granting intervener status to the International Trademark Association (INTA) in Masterpiece Inc. v. Alavida Lifestyles Inc.  The Masterpiece case relates to an unsuccessful attempt to cancel a trademark registration based on alleged prior use of a confusing mark.  INTA is interested in the confusion test applied by the Federal Court of Appeal, which is believed to be at odds with the plain language of the Trade-marks Act and case law, and which could cause substantial difficulty for trademark owners and the profession unless reversed.  Bereskin & Parr partners Dan Bereskin and Mark Robbins prepared the material for the successful motion for leave to intervene, and will represent the INTA in the Supreme Court of Canada appeal.

Daniel R. Bereskin, B.Sc. (Eng. Phys.), LL.B., is a founding partner of Bereskin & Parr LLP and is a member of the firm’s Trade Mark Practice group. Dan can be reached in Toronto at 416.957.1673 or .

Mark L. Robbins, B.A., LL.B., is a partner with Bereskin & Parr LLP's Trade Mark Practice group. Mark can be reached in Toronto at 416.957.1605 or .

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Consultations on Changes to Trademark Opposition Practice and Fees

The Canadian Intellectual Property Office (CIPO) recently published two “pre-consultations,” dealing with fees (www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr02572.html), and with Regulations that impact opposition proceedings (www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr02519.html). The comment term has now closed for both, and further action from CIPO is expected shortly.

Proposed fee changes

The fee review paper was open-ended, and requested comments on a fee structure that is designed to ensure “established” service standards, spread expenses out over each stage of processing, take into account international norms, improve efficiency, and encourage complete applications and use of online filing. This wording suggests that CIPO is considering changing the current structure of payment of fees on filing, registration and renewal, to perhaps incorporate fees for examination, advertisement or to pay a maintenance fee before the formal renewal deadline.  In addition, while there is currently a fee incentive to file an application electronically, CIPO may be thinking about other online fee incentives.

Canada’s filing fees are currently amongst the lowest in the world, particularly since Canada does not use the classification system.  Accordingly, there is a single filing, registration and renewal fee regardless of the number of wares/services.  CIPO needs to focus on a fee structure that ensures quality examination, improves access to online information (such as application files and correspondence), and a searchable database of opposition and non-use cancellation decisions.  Furthermore, in the current economy, it is hoped that CIPO will avoid any fee increases that discourage trademark applications, particularly for Canadian small-medium enterprises.

Proposed changes relating to oppositions

The Pre-Consultation on Regulations relating to opposition proceedings suggested changes claimed to simplify and streamline opposition proceedings. However, caution should be taken to ensure that the changes do not take away fundamental rights of the parties, or shift a full review of evidence and argument away from the Opposition Board to the Federal Court on appeal, given that new evidence can be filed by both parties on appeal.

The main areas of proposed change are that:

1.
Cross-examination would occur after both parties file evidence (and not after each party completes its evidence).  This would bring opposition practice in line with Federal Court practice. In addition, any cross-examination would have to be completed within three months. Parties should have the right to easily file new evidence to address issues raised by cross-examination, a point not addressed in the proposal;
2.
An opponent would no longer have the right to file reply evidence. CIPO estimates that reply evidence is filed in less than one percent of all cases.  Eliminating the reply evidence stage would speed up opposition proceedings, but should only be done if parties are not fettered in filing relevant new evidence at any stage of the opposition; and
3.
The opponent would first file its written argument, followed by the applicant. Currently, parties do not have access to the other’s argument until both are filed, or one party indicates that it is not filing an argument. This proposal would permit the applicant’s argument to more effectively respond to that of the opponent.  It would be preferred, however, for opponents to also have the right to file a “rebuttal.”

Overall, the changes are designed to speed up opposition proceedings, which currently often drag on for years.  At the same time, the parties should have full opportunity to file evidence and cross-examine, taking into consideration the realities of time demands on businesses.  If parties resort to “leave” requests for evidence or additional argument, the result may be longer, and not shorter, proceedings. Increased speed should not be an excuse to deny parties the opportunity to fully present their cases in a venue that is supposed to be more informal and less expensive than the Courts.

Additional miscellaneous changes are proposed to encourage more use of online filing, clarify service rules, and confirm responsibility and timing of filing of transcripts.

The deadline for comments on both pre-consultations has now ended. It is expected that more formal consultations will follow later in 2010.

Cynthia Rowden, B.A., LL. B., is the leader of Bereskin & Parr LLP's Trade Mark Practice group. Cynthia can be reached in Toronto at 416.957.1617 or .

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The Strategic Use of Trademark & Design Protection for Trade Dress

In order to obtain immediate and comprehensive rights in 3D product and packaging shapes, one should employ a coordinated strategy that incorporates both trademark and design protection.

Trademark Protection

Trademark protection for 3D product and packaging shapes is highly desirable, since it offers potentially indefinite protection, and registration offers multiple legal grounds on which to sue a would-be infringer.

However, in order to obtain trademark protection, the shape must not be confusingly similar to a trademark that is the subject of a prior trademark application or registration, or one that has been previously used by another in Canada. (In Canada, it is possible to establish common law trademark simply by using and advertising a mark.)

Typically, one also must be able to prove that the shape: has acquired distinctiveness as a trademark through extensive use in Canada; is not primarily functional; and is not likely to unreasonably limit the development of any art or industry. The reason for this is that in Canada, 3D product and packaging shapes are likely to fall within the statutory definition of a “distinguishing guise” trademark.

Industrial Design Protection

In Canada, a design that consists of or incorporates features of shape, configuration, pattern or ornament that “appeal to and are judged solely by the eye" can be registered as an industrial design provided the following conditions are met: the design is not identical to, or so similar as to be confounded with, a registered design, and the design is original; and the design has not been publicly disclosed anywhere within one year prior to the date on which a Canadian industrial design application is filed.

Industrial design registration does not protect “features applied to a useful article that are dictated “solely” by a utilitarian function of the article,” nor “any method or principle of manufacture or construction”.

An industrial design registration is valid for 10 years, provided a maintenance fee is paid within five years of the date of registration. Importantly, recent case law has confirmed that industrial design protection does not preclude protection of the same design as a trademark.

Integrated Protection Strategies

For new 3D product and packaging shapes, one should first consider filing an industrial design application. As discussed above, the threshold for novelty is relatively low and the threshold of permitted functionality is relatively high. Moreover, successful registration will provide a ten-year monopoly, during which trademark distinctiveness can be acquired.

The second step should be to establish common law trademark rights in the 3D shape. The shape should be treated as a trademark, and appropriate marking and trademark legends and notices should be used.

Then, once trademark distinctiveness can be shown in a significant region of Canada, a distinguishing guise application should be filed.

In conclusion, by seeking both trademark and industrial design protection, it is possible to obtain immediate protection, and an overlay of rights offering multiple legal grounds on which to enforce one’s rights.

Please note that while additional protection by copyright has not been discussed in this paper, it may also be available and useful in some cases. Any reasonable steps to secure title to copyright in works embedded in the product or package are likely to be worthwhile, and registering copyright may also be considered as part of an overall strategy.

Justine Wiebe, B.A., LL.B.

Jonathan Burkinshaw, B.A., M.A., J.D., is an associate with Bereskin & Parr LLP's Trade Mark Practice group. Jonathan can be reached in Toronto at 416.957.1623 or .

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Opposition Board Rewards Good Faith 'Swamping'

 

You’ve done a trademark clearance search, and the results look good. So you file a trademark application based on your intention to use the mark. You’re the first to file, and no one has previously used a confusing name or mark in Canada.

Q: Can you be completely confident that you’ll be able to register the mark?
A: No.

The Trade-mark Opposition Board’s iReward decision (June 28, 2010) shows how a later-entitled opponent can render an applicant’s mark not distinctive (and therefore prevent registration) through use of a confusing mark beginning after the applicant’s filing date. This outcome resulted from peculiar circumstances: the opponent adopted its mark in good faith (after clearance searching), and quickly commenced very substantial use, whereas the applicant never commenced use of its proposed mark at all.

In iReward, the opponent, Indigo, successfully argued that the applicant’s proposed mark (“iReward” for loyalty cards and related services) was not distinctive as a result of Indigo’s own use of the confusingly similar mark iREWARDS for the same kind of services. The novel aspect of the case was that Indigo’s use began after the applicant had filed the proposed use application. Furthermore, the applicant had given Indigo early written notice of its prior entitlement. The Board found that Indigo, by the time it opposed the application, had built up a sufficiently significant reputation in its iREWARDS mark to render the applicant’s proposed mark not distinctive. Central to the decision was the finding that Indigo had adopted its iREWARDS mark in good faith (with no knowledge of the applicant’s trademark application). Also, because the applicant never commenced use of its proposed mark, it could not argue that Indigo’s use was passing off or otherwise illegal.

The decision shows that there can be unusual circumstances in which a proposed use trademark application is not a fully secure placeholder. Canada’s trademark registration regime is not simply a “first-to-file” system, and marketplace circumstances (which can change over the course of prosecuting a trademark application) must be assessed carefully and on an on-going basis.

Mark L. Robbins, B.A., LL.B., is a partner with Bereskin & Parr LLP's Trade Mark Practice group. Mark can be reached in Toronto at 416.957.1605 or .

Peter Woods, Student-at-Law at Bereskin & Parr LLP, from Western University, can be reached in Toronto at .

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Information on this website is for information only. It is not, and should not be taken as, legal advice. You should not rely on, or take or not take any action, based upon this information. Professional legal advice should be promptly obtained. Bereskin & Parr LLP professionals will be pleased to advise you.

 
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