Canadian Lawyer InHouse

MAY 2015 24 INHOUSE going to be to keep on top of the volume of applied-for marks and to try to engage in some policing action to protect legitimate interests in marks. I have a very robust opposition practice now, I think it's going to be much more robust." There are admittedly many issues that have to be clarifi ed before the new rules come into force. The government has not yet advised on the fee structure for the multiple fi lings that will be possible under the Nice classifi cation system, and some question how CIPO, the Canadian Intellectual Property Offi ce, will cope if the volume of fi lings does rise signifi cantly. Canada's weekly Trade-marks Journal, already an inch-thick volume, is likely to get even thicker, and more costs and responsibilities are likely to be punted down to those who might wish to challenge a trademark application. There's even been a spirited debate about whether eliminating the prior-use requirement might decouple trademarks from trade and commerce, a responsibility of the federal government, and tie them to property and civil rights, which is a provincial responsibility. That could, in theory, open the door to a constitutional challenge, although not in the near future. "We're advising clients to be proactive now, before the changes come into force, so that they can take advantage of the lower fi l- ing fee and so that they are able to put their application in before other entities are able to move more eas- ily into Canada. Make sure that they have moved to register for all of the brands that they think are important to them and that they are using or might be using in the next little while," says Elizabeth Williams, who focuses on intellectual property law and brand management at Norton Rose Fulbright Canada LLP in Calgary. "It's going to require that you re- ally police the trademarks register as well, because if you don't, it does become more costly for clients to expunge a registration that has already moved to registration, rath- er than to oppose it at the opposition stage." The changes will bring Canadian practice more in line with the situation in Europe, where there is also no requirement to prove the prior use of a trademark as part of an application. But the United States, also a party to the Nice and Madrid rules, has kept a prior-use requirement in place in its trademark registration process, meaning that Canada's trademark rules will diverge from those of its biggest trading partner. "It's going to make searches more diffi cult, it's going to enable companies to register their trademarks without declaring an intent to use, which means they can get a registration without ever using the mark," says Scott Smith, director of intellectual property and innovation policy at the Canadian Chamber of Commerce, which is one of many industry groups that has spoken out against the changes. "The changes to the Trade-marks Act are fl awed. The intent was right but how they are moving forward with it is fl awed and it's going to cause some problems, mostly because of the declaration of use. CIPO's modus operandi was to try to streamline things and make it easier for people to apply. In so doing, they've ended up probably making it too easy to apply, where companies can apply across the board for things and see what sticks." One challenge will be how CIPO itself copes with the changes, given tight deadlines to examine applications made under the Madrid Protocol and the broad budget constraints that are hitting every Canadian government department. Some lawyers say the government agency is already struggling to turn applications around in a timely manner, and many observers fear CIPO examination standards will slip if the removal of the prior-use requirement boosts the volume of trademark applications. "They don't have the resources now. They really are trying, but they are strained in terms of their resources, they are under a lot of pressure from the government to be more effi cient and they are criticized now for their backlog," says White, from Osler. White says the time to fi rst examination of a trademark application has already risen to about eight or nine months, from four to six months earlier in her career, and she expects further delays as applications start to refl ect the Nice agreement's long lists of goods and services and as CIPO prioritizes the Madrid applications. In a response to queries, Industry Canada says it is meeting the service standards outlined on the CIPO web site, and notes these standards are reviewed annually. But White says CIPO already appears to have stepped up the volume of doubtful cases notices, where the agency notifi es a trademark holder that it plans to approve an application that could be deemed confusingly similar to one they already hold. That gives the prior holder a chance to oppose the application, but it also brings costs. Some opposition proceedings are resolved by settlement, but others can be complex matters involving boxes of evidence and hearings with lengthy cross- examinations. Costs, over several years, can exceed $25,000 or even $50,000. "They are effectively trying to down- load cost, download diligence on business," White says. "To download on business an increased burden of vigilance and an in- creased burden to oppose is very signifi cant. A lot of businesses don't have the resources, and even if you do have the resources it takes a long time to resolve these things." For the fi rst time in Canada, customs will seize infringing items at the border and hold them, as opposed to letting them come into the country and let the trademark owner deal with them later. MATTHEW MARQUARDT, Dickinson Wright LLP '' '' going to be to keep on top of the volume of applied for marks and to try to engage in in ing g fe fe f e pu pu p t t th th entit ily i they all o are they the ne William property l at Norton Ro Calgary. "It's ally police the infringing items at the border as opposed to letting them come into t let the trademark owner deal w MATTHEW MARQUARD

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