Branding the TPP: Trademark Pros & Problems

Branding the TPP: Trademark Pros & Problems

An overview of what the Trans-Pacific Partnership Agreement would change in Canadian policy

The Government of Canada is inviting Canadians to read and comment on the Trans-Pacific Partnership Agreement (TPP), along with the government’s Summary of the Agreement, which provides an overview of how the TPP would affect Canada.

The summary suggests that the largest trade deal in history will have little effect on Canada’s Trade-marks Act (TMA) since the trademarks section of the TPP is “in line with Canada’s existing regime”. This blog will highlight two instances where that is not the case.

How the TPP changes Canada’s trademark laws positively

The TPP’s broadening of collective marks and geographical indications may provide some benefit for certification marks. Article 18.19 of the TPP requires that Canada “provide that trademarks include collective marks and certification marks.  A Party is not obligated to treat certification marks as a separate category in its law, provided that those marks are protected.  Each Party shall also provide that signs that may serve as geographical indications are capable of protection under its trademark system.

While the TM Act currently provides for certification marks indicating that goods or services are of a defined standard, it does not explicitly carve out protection for collective marks, which indicate membership in a group or organization. Much litigation has resulted from confusion about whether professional designations can function as certification marks. In 2013, the Federal Court of Canada confirmed the possibility that such designations merited trademark protection. This ruling may lead to further adjudication over whether a future trademark application is for the name of an occupation or profession (using CDA to identify certified dental assistants remains prohibited) or for a professional designation or acronym (using CDA to identify that the services of the certified dental assistants meet a defined standard would be permitted). Accordingly, allowing trademark owners to apply for collective marks may provide an alternative to such litigation.

Another and larger change comes from the last sentence of Article 18.19 combined with section E on Geographical Indications (GIs). GIs are indications that identify either where a product originates within World Trade Organization member states, or a region where the quality, reputation or other characteristic of a product is essentially attributable to that geographical origin. While the TMA currently limits GIs to a list of wines and spirits, the TPP expands the definition to include all goods. This is a welcome change for trademark owners, who circumvented that limitation by using certification marks as de facto GIs for the products that could not make the list (e.g., beer, cheeses, meats, confectionary and baked products).

Amending the TMA to both include collective marks and expand GIs may discourage the current abuse of certification marks, which will result in clarity and transparency.


How the TPP changes Canada’s trademark laws negatively

The TPP’s broadening of well-known trademarks may provide little benefit for Canadians. The first half of Article 18.22 of the TPP states:

(1) No party shall require as a condition for determining that a trademark is well-known that the trademark has been registered in the Party or in another jurisdiction, included on a list of well-known trademarks, or given prior recognition as a well-known trademark.

(2) Article 6bis of the Paris Convention shall apply, mutatis mutandis, to goods or services that are not identical or similar to those identified by a well-known trademark, whether registered or not, provided that use of that trademark in relation to those goods or services would indicate a connection between those goods or services and the owner of the trademark, and provided that the interests of the owner of the trademark are likely to be damaged by such use.

The TMA currently makes no mention of well-known trademarks, and will need to be amended to define and protect the same. Such an expansion of trademark rights is dangerous for Canada because most global brands are American. One wonders if American trademark owners need another ground upon which to strong-arm Canadians in light of recent news that the band Metallica sent (then retracted) a mostly baseless 41-paged cease-and-desist letter to a Canadian cover band.

The potential scope of Article 18.22 should not be underestimated. First, Article 18.22(1)’s removal of three possible conditions for determining that a trademark is well-known will result in uncertainty as to what kind of factors is left for consideration: Advertising? Sales? Surveys? Second, Article 18.22(2) is broader than the Paris Convention, which was limited to marks considered by “the country of registration or use to be well known in that country”. The dilemma created by removing any geographical jurisdiction can be illustrated by the example of two popular television shows: The Oprah Winfrey Show and A Date With LuYu (LuYu is recognized by Oprah as the "Chinese Oprah"). Oprah is presumably a well-known trademark in the United States (and other foreign countries, given her popularity in Western culture) based on her average television viewership of 13 million. That assumption does not extend to China, where LuYu averages more than 10 times the viewers at 140 million. Without any geographical jurisdiction, it is unclear if “well-known” refers to cultural significance (and must it cross country/language boundaries?) or if it is a numbers game. Third, footnote 13 of the TPP confirms that Canada “need not require that the reputation of the trademark extend beyond the sector of the public that normally deals with the relevant goods or services.” The removal of the traditional practice of limiting trademarks to their associated goods and services is troubling. The sum of the foregoing means Canadians are left with uncertain factors, no geographical jurisdiction and no internal limit to help them determine whether or not their trademarks could fall victim to well-known trademarks which had no prior registration or recognition in Canada.

As a country with a less litigious nature and fewer global brands, it appears Canada has little to gain and much to lose from such an expansion of trademark rights.


Overall analytical conclusions

Even if the Government of Canada was correct that the TPP’s trademarks section is “in line with Canada’s existing regime”, it is important for Canadians to remember that the TPP’s Investment chapter enables foreign investors to sue Canada for “the revocation, limitation or creation of intellectual property rights” that the foreign investors claim are inconsistent with Article 18 of the TPP and the TRIPS Agreement. For example, Eli Lilly is suing Canada for $500 million in response to a Canadian court's revocation of its patents.

The TPP’s trademark-related provisions will affect Canadians beyond the mere requisite changes to our TMA. In discussing how the TPP would affect Canada, we must consider the substantive effects on our government’s authority to make laws and our court’s autonomy to interpret them.