Apr 2019 Charity & NFP Law Update
As previously reported in the November 2018 Charity & NFP Law Update, significant changes to Canada’s trademark law will take effect on June 17, 2019.
One notable change is that the definition of “trademark” will be amended from “a mark that is used by a person…” to “a sign or combination of signs that is used or proposed to be used by a person…” The word “sign” is also defined as “includ[ing] 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”. The Trademarks Act has therefore been significantly broadened to include protection for these non-traditional trademarks. However, these non-traditional trademarks may be more difficult to secure and may require the applicant to furnish evidence of extensive use and promotion prior to obtaining a registration certificate.
The new law also includes utilitarian function as a universal bar to registrability, codifying Canadian case law. In particular, the amendments to the Act state that “a trademark is not registrable if, in relation to the goods or services in association with which it is used or proposed to be used, its features are dictated primarily by a utilitarian function.” This prohibition against utilitarian function will apply to all marks under the amended Act, not only to distinguishing guises, as is currently the case. Further, it appears that the amendments to the Act do not make it possible to overcome functionality objections by filing evidence of acquired distinctiveness, as is the case in the USA.
An example of this doctrine is the USA case involving Hershey Chocolate & Confectionary Corporation (“Hershey”). Hershey filed a trademark application for the design of their candy bar that was described by Hersey as “a configuration of a candy bar that consists of twelve equally-sized recessed rectangular panels arranged in a four panel by three panel format with each panel having its own raised border within a large rectangle”. The United States Patent and Trademark Office examiner denied the application on the basis that even if the individual features of the candy bar design were not considered functional, the combination of all of the features together were considered functional, since the configuration was to help break the chocolate bar into bite sized pieces. However, ultimately, Hersey provided extensive evidence that established the design as a whole had acquired distinctiveness and the configuration was granted trademark protection in the USA. It will be interesting to see how a similar case will be decided in Canada with the new prohibition.
Charities and not-for-profits should continue to monitor these amendments and strategies should be devised to maximize the scope of protection of trademark portfolios.