Communication Breakdown: Canadian Quirks to Madrid Trademark Filing System that Foreign Applicants and their Counsel need to know

Canada joining the Madrid international trademark filing system earlier this year came as welcome news to much of the international trademark community. Hidden in that euphoria however, are a couple of Canadian quirks that are likely to trip up unwary applicants and their foreign trademark Counsel.

This Knowledge Bytes article, reviews the limited Canadian Intellectual Property Office (CIPO) communications that will be sent to the World Intellectual Property Office (WIPO) and to foreign representatives of applicants who designate Canada in their applications for international registration. The bottom line is that a resident Canadian trademark agent should be appointed for all such applications, so that important communications from CIPO not go astray or languish, unattended, for an undue period of time.

Delays Nourish Desires: Canada’s New Trademark Laws Come Into Force June 17, 2019

Earlier today, the Canadian Intellectual Property Office announced that long-anticipated amendments to Canada’s trademark laws will come into force on June 17, 2019.  It also published a new set of Trademarks Regulations, which will support those amendments.

First introduced in June of 2014, the amendments contain the most significant changes to Canada’s trademark law in decades, (discussed in earlier posts) including:

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Trader Joe’s trying to make Pirate Joe’s “walk the plank” in U.S. trade-mark case

In the ongoing dispute between Michael Hallatt, a Vancouver businessman, and U.S. based retailer Trader Joe’s, the United States Court of Appeals for the Ninth Circuit (the “Ninth Circuit”) has overruled the 2013 decision of the U.S. District Court for the Western District of Washington (the “District Court”) not to hear Trader Joe’s claim against Hallatt for, among other things, trade-mark infringement, dilution, unfair competition and false advertising.

The dispute arose out of Hallatt’s purchase of products from Trader Joe’s stores in the U.S., particularly in the state of Washington, for resale in Canada (there are no Trader Joe’s stores in Canada).  Hallatt has and continues to mark up and re-sell Trader Joe’s products at his store in Vancouver, named Pirate Joe’s.

The goods are not counterfeit, and the source of the products being sold is not in dispute – the packaging on the products bears Trader Joe’s trade-marks, and Hallatt states on his website that he sells Trader Joe’s products.  Hallatt expressly states on his website that he is not an authorized or affiliated distributor or reseller of Trader Joe’s.  Nevertheless, Trader Joe’s took the view that Hallatt’s conduct violated its U.S. trade-mark rights under the U.S. Lanham Act, and in 2013 it brought a claim against Hallatt in the District Court.

Taking the view that any unlawful conduct by Hallatt would have taken place in Canada rather than the U.S., and that Hallatt’s activities did not cause a cognizable injury to Trader Joe’s in the U.S. or an effect on American foreign commerce, the District Court judge decided in October 2013 that the Court had no subject matter jurisdiction to hear Trader Joe’s claims.  Trader Joe’s appealed that decision to the Ninth Circuit.

The Ninth Circuit disagreed with the District Court judge, opining instead that Hallatt’s activities could affect the goodwill and value of the Trader Joe’s brand in the U.S., and accordingly, its U.S. trade-mark rights.  The Ninth Circuit concluded that the Lanham Act does apply to Hallatt’s allegedly infringing conduct, and in the result, remanded the case back to the District Court for further proceedings.

We will be keeping an eye on this trade-mark case that is likely of particular interest to cross-border shoppers.

Combating Counterfeit Products Act Receives Royal Assent

On December 9,2014 Royal Assent was given to Bill C-8, the Combating Counterfeit Products Act. The intention of Bill C-8 is to give the government and holders of trade-marks and copyrights new mechanisms for enforcement, along with substantial remedies, in order to combat counterfeit and black-market goods. Before the introduction of Bill C-8, Canada had been criticized for not having meaningful policies to combat the global problem of counterfeit trafficking which flowed across Canadian borders.

Specific enforcement mechanisms contained in Bill C-8 include:

  • new civil prohibitions under the Trade-marks Act and Copyright Act giving rights holders the ability to start civil actions against those who infringe their trade-mark or copyright by possessing, manufacturing, distributing or trafficking goods for commercial purposes;
  • new criminal offences under the Trade-marks Act and Copyright Act for possessing, manufacturing, distributing or trafficking counterfeit goods for commercial purposes;
  • new provisions giving customs officials ex officio power to independently seize and detain suspected counterfeit goods. This includes the ability for copyright and trade-mark owners to file a “request for assistance” with customs officials to increase the information available to customs regarding possible counterfeit goods.

For a deeper review of the changes contained in Bill C-8, please see our previous post written in March 2013 when the bill was first introduced as Bill C-56.

While the Bill has obtained Royal Assent, it is only partially in force. Changes currently in force include:

  • the introduction of the new criminal provisions;
  • the deletion of section 7(e) of the Trade-marks Act; and
  • amendments to Section 20 of the Trade-marks Act dealing with infringement.

The majority of the amendments to the Trade-marks Act and Copyright Act, including the provisions relating to importation and exportation and ex officio powers of custom officials, will be brought into force by regulation. It is not clear when this will occur. However, it is thought that implementation will be in step with Bill C-31, the Budget Implementation Act, which is also waiting to come into force sometime in 2015 early 2016 and contains further significant amendments to the Trade-marks Act.

We will keep you updated as coming into force dates are announced and these legal tools become available to trade-mark and copyright owners.

Canadian Government Tables 5 IP Treaties in the House of Commons

The Canadian Government tabled 5 intellectual law Treaties in the House of Commons on January 27, 2014.   The purpose of this action is for Canada to harmonize its trademark, patent and industrial design laws with those of many other countries.

The Treaties tabled are as follows:

The first three Treaties in particular will have significant impacts on the procedures for trademark applications and registrations in Canada.   The tabling of these Treaties is the first procedural step towards their ratification and implementation by the Government of Canada.  Implementation will require amendments to Canada’s existing IP legislation, which could take a long time to be approved.  The Canadian Intellectual Property Office published a paper in January of 2012 on the changes required to the Trade-marks Act in order for Canada to adhere to the Madrid Protocol.  Until such amendments are approved by the Canadian Parliament, none of these Treaties will be binding in Canada. 

 

Punitive Damages: Trademark and Copyright Infringement

The most recent case from the Federal Court continues the Court’s tough stance with respect to trademark and copyright infringement in Canada. 

In Harley-Davidson Motor Co. Group LLC v. Manoukian, the Court awarded significant compensatory and punitive damages against the Defendant company and its principal.

The Plaintiffs, H-D Michigan, LLC (“MI”), Harley-Davidson Motor Company Group, LLC (“MCG”) and Harley-Davidson Company, Inc. (“MCI”), hired an investigator to conduct an investigation into the alleged manufacture, offering for sale and sale of counterfeit Harley-Davidson clothing by the Defendants.  The investigator attended two separate locations of the Defendants.  While in attendance at both locations, the investigator was shown and purchased a number of counterfeit items including t-shirts, cloth and leather jackets and hooded sweatshirts, all of which contained unauthorised productions of the Harley-Davidson trademarks.

The Court was satisfied the matter could proceed on a motion for summary judgment.  In determining the damage award, the Court noted that where Defendants provide no records to substantiate the manufacture and sale of counterfeit wares, it is difficult to assess damages.  However, in these circumstances, the Court will apply a minimum compensatory damage award on a per infringing activity basis.

Following such cases as Ragdoll Productions (UK) Ltd v. Jane Doe and Oakley Inc. v. Jane Doe, the Court awarded damages for trademark infringement of $3,625 for each of the three occasions on which the Defendant was observed selling counterfeit goods at a flea market and $7,250 for each of the two occasions on which the Defendant was observed selling wares from a fixed retail establishment.  As the Plaintiffs were seeking damages on behalf of the trademark owner, MI, and the licensee/distributor, MCI/Fred Deeley, these amounts were doubled for a total of $65,250, payable jointly and severally by the Defendants.

In addition, although the Defendants’ lack of records made an accurate assessment of profits impossible, the Court found that the Plaintiffs were entitled to punitive damages of $50,000 to sanction the “blatant disregard” of the law by the Defendant.  In awarding the punitive damages, the Court noted that the Defendants had been offering for sale and selling counterfeit Harley-Davidson merchandise since as early as October 2006, and continued to do so despite the cease and desist letter served on the Defendants in 2010.  The Court also noted that there was evidence that the Defendant Manoukian, was well aware of the illegal nature of his trade.

The Court refused to award solicitor-client costs, since the evidence that the Defendants had missed a number of deadlines was not the kind of conduct attracting solicitor-client costs.  Further, the Defendants’ unjustifiable and inexcusable violation of the Plaintiff’s rights was covered by the punitive damages.

Is There a Trademark Enforcement App For That?

News today that Apple is about to obtain a US trademark registration for “THERE’S AN APP FOR THAT”.

Filed in 2009, Apple’s initial application covered both wares and services.  However, following a recent division and filing of evidence of use, the USPTO approved the registration of the mark for use in association with retail store services and various online services, including app recommendations.  Additional claims pertaining to various wares and to telecommunication services remain in the divided parent application, and Apple  has obtained an extension of time to file use information on those points.  (In Canada, Apple filed an application for “THERE’S AN APP FOR THAT” this past May; it remains pending with CIPO.)

With a registration nearly in hand, it is unclear is whether Apple plans a campaign to aggressively enforce its mark.  In addition to Apple’s use, the mark and its derivatives have been widely referenced in the US – most notably by Verizon in its “There’s A Map For That” advertising campaign (intended to mock the limited coverage of Apple’s exclusive US carrier, AT&T).  An “app for that” catch-phrase generator, “App For That“, was also developed.  And writers seem to love using the phrase in their article and blog headlines.

In this light, one wonders if such uses of the mark and its derivatives reinforce or dilute the mark’s association with Apple. If the latter, Apple will have to go on the offensive to protect its rights, lest it lose them.

We’ll keep you “app”-rised of new developments.