What You Need to Know about Canadian Trademark Opposition Proceedings
If you want to oppose a proposed trademark or are the applicant whose trademark has recently been opposed, then read on.
What is a trademark opposition proceeding?
A trademark opposition is a proceeding commenced before the Registrar of Trademarks to prevent the registration of a trademark in Canada.
Importantly, a successful opposition does not prevent the applicant from using their proposed trademark in Canada; such a ban can only be ordered by the courts. However, the applicant will be denied the benefits of registration, including the right to exclusive use in Canada.
Who can oppose a trademark application?
In Canada, unlike some other jurisdictions, any third party can oppose the registration of a trademark as long as they base the opposition on at least one of the four grounds set out in the Trademarks Act:
- the application does not conform to the requirements of section 30;
- the trademark is not registrable;
- the applicant is not the person entitled to registration of the trademark; or
- the trademark is not distinctive.
A third party cannot oppose on any other grounds (e.g., its business would suffer if the proposed trademark is registered). The four opposition grounds encompass both procedural and substantive issues with the trademark application. Each will be discussed in further detail below.
The application does not conform to the requirements of section 30Section 30 of the Trademarks Act sets out trademark application requirements. Therefore, oppositions based on this ground usually involve procedural or technical problems with the trademark application itself. Issues under section 30 can include failing to list the goods and services associated with the proposed trademark in ordinary commercial terms or failing to state an intention to use the proposed trademark (if no previous use is being claimed). However, any application error based on section 30 can form the basis of an opposition on this ground.
The trademark is not registrableThis ground of opposition is based on trademark registrability requirements set out in section 12 of the Trademarks Act. For example, a proposed mark may not be registrable if it is: primarily merely the name or surname of a living or recently deceased individual; clearly descriptive or deceptively misdescriptive of the character or quality of the goods or services or the persons employed in their production or of their place of origin; or confusing with a trademark that is already registered.
The applicant is not the person entitled to registration of the trademarkThis ground of opposition is based on section 16 of the Trademarks Act, which sets out the persons who are entitled to registration. For example, an opposition may be based on the assertion that the applicant should not be entitled to register the proposed trademark because it is identical or confusingly similar to an existing trademark or trade-name that is being used by another party (often the opponent), or to a trademark whose application was filed first.
The trademark is not distinctive
This ground, somewhat like the one above, should be used where there is already an identical or confusingly similar trademark that is being used in Canada by another party (or parties). However, the Registrar will only consider existing trademarks that are listed in association with the particular class of goods or services outlined in the proposed application (e.g., if the proposed trademark is listed in association with footwear, the fact that the same or similar trademark is currently in use for alcoholic beverages will be unlikely to present a successful challenge on this ground). In exceptional circumstances, such as where the existing trademark is so famous as to transcend traditional classifications, the Registrar may rule a proposed trademark confusingly similar even when it applies to an entirely different class of goods or services. To support an opposition based on this ground, the opponent will have to establish that the confusingly similar trademark is sufficiently known in Canada to negate the distinctiveness of the proposed mark.
This ground may also be invoked where a trademark is generic or uses a term that has developed a trade meaning.
When commencing a trademark opposition proceeding, it is key to list all grounds of opposition that you will be relying on. The Registrar will usually only consider those grounds of opposition that the opponent has included within the original statement of opposition, unless there is strong evidence pointing to another ground (though considering another ground is at the Registrar's discretion). Amending a statement of opposition is also permissible, but only with leave of the Registrar, so presenting all relevant grounds at the outset is crucial.
The process of opposing a trademark
An opponent has two months from the date a trademark advertisement is published in the Trademarks Journal to launch an opposition proceeding. Within those two months, the opponent must either file a statement of opposition or request a four-month extension in which to do so. While this deadline can be extended in certain circumstances with leave of the Registrar, launching it within these timelines is best. Further, no trademark opposition may be commenced after a notice of allowance has been given for the trademark in question.
An opponent must submit a statement of opposition to the Trademark Opposition Board along with a $750 CAD fee to commence the proceeding. A statement of opposition without payment of the fee (or a letter stating how and when the fee will be paid) will not be sufficient to commence an opposition proceeding. If the Board deems the grounds of opposition in the statement sufficient, it will deliver a copy of the statement to the applicant and open an official opposition proceeding.
After the applicant receives the statement, it can either file a counterstatement (usually just a denial of all of the allegations) within two months or request an extension at the consent of the opponent. If a counterstatement is not served, the trademark application will be deemed abandoned.
If a counterstatement is served and filed, the opposition proceeding will move to the evidence stage, where both parties submit evidence to substantiate the claims in their statements in the form of affidavits or statutory declarations. Alternatively, they may file statements indicating that they will not be filing evidence.
The opponent has four months from the time a counterstatement is served and filed to deliver its evidence. The applicant has four months from the service of the opponent's evidence to deliver its own evidence. The opponent may then file reply evidence within a month, but a four-month extension is available with the consent of the applicant. Filing reply evidence is uncommon; this additional evidence is filed by opponents in less than two percent of proceedings.
After the parties exchange evidence, they may request cross-examinations. Typically, due to the availability of extensions and the lenient deadlines which both parties are allotted, the evidence stage can take upward of a year. Either party in the proceeding can initiate a cross-examination by requesting an order that allows them to examine the evidence that was filed by the other party. Cross-examination involves asking the other party's affiants questions about matters raised in their affidavits, or testing the credibility and reliability of the affidavit evidence itself. Affiants from outside Canada must be able to appear in Canada if a cross-examination of the relevant evidence is requested.
The next stage of a trademark opposition proceeding is the argument stage, which begins within fourteen days of the date on which both parties have completed the filing of affidavit evidence.
Both parties are given the opportunity to file written arguments and make arguments at an oral hearing. However, the argument stage is optional, and the Board can still make a decision without written or oral arguments.
When all of the above stages are completed, the Board will deliberate and issue a written decision.
Possible outcomes of trademark oppositions
Obtaining a decision from the Board will take at least two years and can sometimes take as long as six to eight years. Because of this, as well as the fact that opposition proceedings can cause both parties to incur significant costs, most disputes settle. If an opponent chooses to settle, they may withdraw the opposition at any time by notifying the Board.
If the parties do not settle, the Board will either permit registration or prohibit the trademark from registering. Neither party can recover costs from the proceeding.
Either party can appeal the decision to the Federal Court, the Federal Court of Appeal and, in rare cases, to the Supreme Court of Canada. Higher courts will judge the Board decision on a reasonableness standard (which presupposes strong deference unless the decision was clearly wrong), unless substantial new evidence is submitted by either of the parties which significantly alters the circumstances of the case. That said, it is unusual for new evidence to be submitted; most claims are appealed only on the original grounds. It is much easier to present all relevant evidence during the initial opposition proceeding.
My trademark is getting opposed. What steps can I take?
If you have received a notice from the Trademark Opposition Board that your application is getting opposed, your first step is to decide which strategy you want to take. If you did not use a trademark agent with filing your trademark application, it is best to contact one for a consultation. Since a full opposition is costly and lengthy, getting advice at the outset can save significant costs down the road.
You have three main options:
Fight the opposition to secure registration of your trademarkIf the trademark has significant value for your business such that it is worth it for you to bear the cost of fighting the opposition and settlement with the opponent seems unlikely, then you can file a counterstatement denying all grounds of opposition (it is key to deny each stated ground) and assemble evidence to support your case.
Settle with the opponent
Settling an opposition may be a good option where you see reasonable restrictions you could agree to with the opponent in relation to your registration and use of the trademark, or where you are not certain that the decision of the Board will be in your favour.
In most cases the applicant and opponent settle by entering into a co-existence agreement, such that the applicant agrees only to use the mark in association with specific goods and services and may also agree to reduce the scope of the applied-for trademark registration. If the parties enter into such an agreement, it will be accompanied by either an abandonment of the application or a withdrawal of the opposition.
Abandon the trademark applicationIf you have not invested much in building goodwill in your trademark, co-existence with the opponent seems unlikely, and it is not worth it for you to fight with the opponent based on your likelihood of success or otherwise, you can abandon the trademark application.
We can help you decide what the best option is for you in view of your own particular circumstances. Please contact us for a complimentary initial telephone appointment to learn more about how we can help.