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Trademarks, Trade Names, Service Marks and Domain Names

A startup should protect its identity and marketing strategy. While trade secrets, copyrights, and patents focus on the methods, products, or services of the startup, trademarks and service marks protect the startup's distinctively recognized symbols such as logos, marks, slogans or designs that are used to identify and distinguish its wares and services. Only use of a trademark or a service marks creates rights, and then not in respect of a creator of a trademark but in respect of a person or entity behind the use of trademark and its public recognition. Trademarks, service marks, and trade names are protected at Common Law trough an action in tort of “passing off” and under the Trademarks Act.

The federal government requires registration in order to obtain protection for trademarks and service marks. Only indicia that qualify as a trademark are considered for registration. To register a trademark or a service mark: (1) the subject matter must be trademark eligible; (2) the trademark must be distinctive; and (3) the trademark must not be likely to cause confusion with a previously used or registered mark. Descriptive, mis-descriptive, generic words, names of people and marks or symbols used by other companies or institutions will most likely be rejected. The eligible subject matter is very broad, and according to the Trademarks Act there are the following categories of trademarks and service marks: (1) classic trademarks; (2) service marks; (3) proposed trademarks (either classic or service marks); (4) distinguishing guises; and (5) certification marks. To be protected by the Trademarks Act, a mark must be distinctive enough to identify clearly the origin of wares or services. Moreover, a trademark will lose its eligibility for protection if prospective purchasers come to perceive a trade symbol primarily as a generic designation for the category, type, or class of goods or services with which it is used. For example, aspirin used to be a trademark, but as it became more and more descriptive of the product and less distinctive, it lost is ability to be a trademark.

Canadian trademark registration gives the startup the exclusive right to use the trademark throughout Canada in association with the wares and services defined in the trademark registration for a period of 15 years from the date of registration. Registration of a trademark can subsequently be renewed for further multiple periods of 15 years. The registration also gives the startup the right to sue others who may be infringing the registration by using a similar trademark to that of the registered trademark. The benefits of registering under the Trademarks Act include (1) being able to prevent others from using the marks in a manner that would likely lead to confusion in the market place; (2) obtaining a statutory presumption of ownership of the trademark; and (3) putting others on constructive notice of ownership. If others use a trademark without permission or use a substantially similar mark that will likely cause confusion, an entrepreneur controlling a particular mark can bring an action to end the infringing use of the trademark. Also, the startup may seek damages and lawyer' fees in exceptional cases. Finally, the startup can have the infringing objects destroyed. By contrast, the rights that are afforded at Common Law under an action in tort of “passing off”, are limited to the territorial area in which the trademark has been used, or where the trademark owner can establish a reputation based on that trademark. The rights will be similarly limited in scope in association with the wares and/or services with which the trademark has been used.

The differences between domain names and trademarks and service marks are as follows: (1) unlike trademarks, domain names are unique in that only one person may register a specific domain name. Many entities may be associated with one trademark, as long as the wares or services are different and there is no likelihood of confusion, but only one entity may be associated with a domain name; (2) the registration of a domain name containing a trademark may preclude legitimate uses of the trademark as a domain name in jurisdictions other than those in which the registrant is carrying on business. The registration of a trademark in one jurisdiction does not preclude the legitimate use of a same or similar trademark within that jurisdiction in the absence of a likelihood of confusion nor does it generally preclude, uses of a trademark in another jurisdiction; (3) domain names, are not expressly referred to in any legislation (other than in the U.S.A. Anti-Cybersquatting Protection Act); and (4) trademarks when registered are registered with government authorities in accordance with legally mandated requirements whereas domain names are granted through registration with non-governmental authorities in accordance with policies and on a first come, first served basis.