Another Win for MBM - Increased Cost Awards by the Federal Court - The New Normal?

By Scott Miller and Erin Creber, March 26th, 2018

Successful litigants in Canada’s Federal Court are experiencing a positive shift in the quantum of costs that are awarded by the Court. For years, cost awards have been based on a tariff which typically provides only modest compensation of a party’s actual legal fees. In the past, awards in excess of the standard set by the tariff were considered uncommon.

The recent decision of Weldpro Limited v Weldworld Corp et al (2018 FC 312), where the respondents were successfully represented by Scott Miller and the MBM litigation team, confirms there is an emerging trend by the Federal Court to award costs at a higher level of compensation than the standard level set by the tariff in the right circumstances.

In Weldpro, the applicant made a claim for passing off contrary to paragraphs 7(b) and (c) of the Trade-marks Act. In addition to naming the corporate respondent as a party, the applicant pursued the corporate respondent’s director, Mr. Kocken.

The Court’s decision was entirely in favour of the respondents. In awarding costs to the respondents, the Court took into consideration that there was no shared or split success in the case and that while the issues at play were relatively straightforward, the applicant unnecessarily complicated the proceedings which, on their face demonstrated little chance of success. It was also remarked that the applicant failed to advance the best available evidence and that the allegation of personal misconduct against the corporate respondent’s director was little more than a bald assertion that was not pursued in any fashion in the course of the hearing.

In departing from the standard level of compensation set by the tariff, the Court awarded the respondents a fixed sum amounting to about 23% of the actual legal costs, using the tariff only as a rough guide.

Notably, the award included reimbursement of Mr. Kocken’s travel expenses to attend the hearing. The Court provided that being named as a personal respondent understandably triggered Mr. Kocken’s desire to be present at the hearing.

The Weldpro decision establishes the ongoing opportunity for a winning party to receive an award of increased costs from the Federal Court. Further, litigants should be aware that cost consequences may result from a claim for personal liability against an individual party if such allegations are unfounded and unaddressed at the hearing of the matter.

Canada’s Trademark laws will see major changes in June 2019

By Randy Marusyk and Hyun Woo Choi, November 26t^h, 2018

It has been announced on November 14, 2018 in the Canada Gazette (Part II, Volume 152, Number 23) that amendments to the Canadian Trade-marks Act will be coming into force on June 17, 2019. On the date of this announcement, the new Trademarks Regulations, which also will be coming into force on June 17, 2019, have been published. By virtue of these changes, there will be notable impacts on Canadian trademark regime in many aspects including registration process, and Canadian Trademark law will be in line with major international trademark treaties such as the Singapore Treaty on Law of Trademarks (Singapore Treaty), the Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks (Madrid Protocol), and the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks (Nice Agreement).

Some of the important changes to Canadian Trademarks law are summarized below:

• Expanded definition of “Trademark”: The definition of “Trademark” will be expanded to include “a word, a personal name, a design, a letter, a numeral, a colour, a figurative element, a three-dimensional shape, a hologram, a moving image, a mode of packaging goods, a sound, a scent, a taste, a texture and the positioning of a sign”;

• Increased Government Filing and Renewal Fees: Filing fees and renewal fees will increase and will be charged on a per class basis:
  • The Government filing fee will be $330 for the first class and $100 for each additional class (currently the fee is $250, regardless of how many classes you file in).
  • The Government renewal fees will be $400 for the first class and $125 for each additional class (currently the renewal fee is $350, regardless of how many classes you renew in). For  trademarks with multiple classes, there is a significant cost savings to renew before June 17, 2019, and even for trademarks with only one class of goods and services there is still a small saving of $50.To illustrate with numbers: the cost of renewing a trademark with 6 classes after June 17, 2019 will be: $400 (1^st class) + ($125 x 5 additional classes) = $1,025 in government fees vs. $350 in government fees if renewed before June 17, 2019.

• Adoption of the Nice classification system: Goods and services in a trademark will need to be classified according to the Nice Agreement classification system, as in many other countries;

• Date of first use will no longer be required: Identifying the date of first use of a trademark in Canada will be removed from the application;

• Declarations of use not required for a “proposed use” application: Applicants will no longer be required to file a declaration of use in order for the application to proceed to registration;

• Ability to divide and merge applications: A trademark application can be divided to expedite the registration process, especially when there is opposition to certain goods or services. Divided applications and registrations can be merged later;

• New registration period: The registration period for trademarks will be shortened from 15 years to 10 years and the renewal of a trademark registration will be required every 10 years. Terms for existing trademark registrations will remain 15 years; and

• International filing through a single application: Canada will be joining the Madrid Protocol. As such, will be able to file a trademark application in multiple countries (that are members of the Madrid Protocol) through a single application. 

Recommendation given the new legislation: if you have clients who are considering filing trademarks, especially multi-class applications, there could be significant cost savings if filed before June 17, 2019. As mentioned above the current Government Fee for filing regardless of how many classes you file in is $250, however, after June 17, 2019, the government filing fee will be $330 for the first class and $100 for each additional class. The same is applicable for renewals, it is recommended to renew before June 17, 2019, especially multi-class applications, as renewal fees will be going up, $400 for the first class and $125 for each additional class. Even if you renew now, before June 17 2019, the new term (10 or 15 years) will be calculated from the actual renewal due date NOT when you paid the renewal fee.

For more information please contact:

 
Randy Marusyk, Partner

T: 613.801.1088

E: This e-mail address is being protected from spambots. You need JavaScript enabled to view it.

Hyun Woo Choi, Articling Student

T: 604.239.0274

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Don’t Let Your Trademark Go Up In Smoke: “smoking is cool” Branding Is Prohibited Under Canada’s Cannabis Act

By Deborah Meltzer, June 23th, 2020

In Canada, trademark registration is an important form of intellectual property protection for brand-owners as it confers the right to exclude others from using confusingly similar trademarks across Canada. Having said that, brand-owners in the cannabis space looking to register their name or logo as a trademark face a unique challenge; a trademark registration does not mean the trademark itself can be lawfully used in association with cannabis products, accessories, or services in Canada under the Canadian Cannabis Act, SC 2018, c 16 (“Cannabis Act”).

Branding Restrictions under the Cannabis Act

The Cannabis Act has placed strict regulations surrounding the sale and promotion of cannabis products, accessories, and services for the purposes of protecting Canadians, in particular young persons. Since the legalization of cannabis, many Canadians have become familiar with strict packaging restrictions, similar to those required in the sale of tobacco products. What may be less known is that the Cannabis Act imposes rigorous branding and promotional restrictions which go beyond the actual packaging.

Of particular concern with respect to the selection and use of a trademark, cannabis products or any related service cannot be promoted:

• in a manner that could reasonably be believed to be appealing to young persons;
• by means of the depiction of a person, character or animal, whether real or fictional; or
• by presenting it or any of its brand elements in a manner that associates it or the brand element with, or evokes a positive or negative emotion about or image of, a way of life such as one that includes glamour, recreation, excitement, vitality, risk or daring.

(see section 17 of Canada’s Cannabis Act).

Similarly, each province may also have additional restrictions related to cannabis branding. Quebec, for example, a particularly strict province with respect to cannabis branding, is governed under a similar provision which restricts promotion of cannabis in such a way that associates the use of cannabis with a particular lifestyle (see section 53(3) of Quebec’s Cannabis Regulation Act.)

Cannabis Trademarks should be Chosen Carefully

In light of the above, careful consideration must be taken when selecting the name and/or logo to be used as a trademark in association with cannabis-related products and services in Canada, as non-compliance can result in a fine as high as $5 million or up to 3 years imprisonment. Therefore, savvy cannabis businesses should recognize these limitations and work within these restrictions when developing a commercial strategy in order to distinguish their brand.

Budding cannabis entrepreneurs should also keep in mind that in addition to the Cannabis Act, trademark applications for registration must be in compliance with the regulations imposed by Trademarks Act and Trademarks Regulations. For instance, it remains to be seen whether a cannabis trademark can be restricted under section 9(1)(j) of the Trademarks Act for being scandalous, obscene or immoral in such a way that would offend a significant segment of the Canadian public. Ideally, it is recommended that cannabis brand-owners seek legal counsel before using or applying to register a trademark to ensure that they are set up for commercial success with a brand strategy that falls within the purview of lawful promotion and branding of cannabis.

For more information please contact: