45-Class Trademark Applications in Canada –A portent of what is to come, or a short-term nuisance?

In the months from now until Canada’s new trademark law comes into force, now expected in the spring of 2019, trademark owners are well-advised to diligently review their trademark portfolios, and to ensure that all of their trademarks have been properly registered in Canada for all pertinent goods and services. 

This recommendation applies in particular to businesses who are about to enter the Canadian market, as they are equally vulnerable to the actions of trademark trolls who have recently become active in filing applications for trademarks in Canada.

Trademark trolls are entities which file trademark applications that are generally used by brand owners but which have not yet been protected in the particular jurisdiction, in order to persuade those brand owners to pay them in order to buy back the rights to their trademarks. 

Trademark trolls have generally not historically been a serious problem in Canada, since use was a prerequisite to obtaining a trademark registration in Canada, in the absence of being able to rely on use and registration in another jurisdiction.  However, as this requirement will be removed in the trademark law, this is no longer an impediment to applications which are now being filed, as no Declaration of Use will have to be filed before the new law comes into force.  In addition, since fee-per-class filing fees will not apply before the new law comes into force, trademark applications can be filed covering all 45 classes at a very low cost. 

With the confluence of these factors, by the end of 2017, over 400 of these applications had been filed, including many filed by a company called Brandster Branding Ltd., many for well-known brand names, but also for given names and generic words.  These applications cause raised eyebrows, since it is extremely unlikely that any single business will actually have an  intention to use a trademark for goods and services in all 45 classes.  In other countries, including in the United Kingdom, such applications have been held to have been filed in bad faith.

The filing of these bad faith applications have put additional burdens on businesses searching for trademark clearance, and filing trademark applications, and on the Canadian Intellectual Property Office in examining these applications.  Whether this trend continues or whether it will decrease once the new higher filing fees are introduced, these applications will have to be addressed by trademark owners and the Office alike in the coming months.

It is therefore important that all trademark owners, including businesses within Canada and those companies who have not yet entered the Canadian market, review their trademarks to ensure that all important trademarks are protected for all of the goods and services of interest.