Most people think of intellectual property only as something that should be protected from others.

It is clear that when you invent something great, or write a thrilling new book, or shoot an awesome new movie, that you would want to protect your work from being used against your wish.

Most people and companies, however, are not this fortunate, and do not really create enough to want to hire a lawyer to protect what they’ve created.

This is one of the reasons why many businesses don’t think that they need to consult an IP lawyer. Their thinking goes like this: “Well, we don’t really create anything, and even if we do, it’s not enough to justify spending thousands and thousands of dollars to try to protect it.”

They may be right, but this approach misses a very serious point. IP is not only what you have to protect against others, it’s also something that others can use against you.

If you are a dentist, you may be interested in registering a trademark for your business, but really there is unlikely to be much more beyond that in terms of using IP as a tool of competitive advantage. But if you have a popular website that promotes your practice, you want to make sure that you own every little bit of content on that website.

What you don’t want to happen one day when your business finally makes it, is to find out that someone wants a piece of your pie, simply because you’ve been using their IP for several years to promote your business.

This is the difference between using IP as a sword (to obtain a tool of competitive advantage) and using IP as a shield (to make sure that nobody can lay a claim on your business).

Few businesses will need to use IP as a sword, but most of them are using IP created by somebody else.

If you don’t take care of IP as a shield, you will be sorry if your business becomes successful.

Many people find it ironic when I say that Canada tends to have very little respect for intellectual property.

Hinting on my Russian background, they counter, “Yeah, right, how about this huge Russian torrents website, where you can get pretty much anything you want for free and with impunity?”

Indeed, this may seem like a contradiction at the first sight. However, not really.

While Russia’s piracy rates are huge, I’ve always felt that there the majority of people know that they are doing something wrong when they are downloading other people’s works without authorization. It’s more of an “I’m a bad boy, and I know it” kind of attitude.

Things are different in Canada. Here, the attitude is: It benefits the great majority of the public to have free access to this work, hence it should not be illegal for me to download it, even if the copyright owner protests.”

While taking something that belongs to another without permission is bad enough, I strongly believe that it is much worse to do it under the false pretense that there is nothing wrong with doing it.

It’s bad enough when a bully takes away a toy from a child. It’s much worse when the bully’s parents find a myriad of reasons why it was OK for the bully to do it and why the child should have shared the toy with the bully in the first place.

Yesterday, I attended a Franchise Show in Vancouver.

It was a great event, even though less populated than expected due to good weather.

One thing I could not help but notice was the use by many franchisors and potential franchisors of the ™ sign next to their trademarks.

In context of franchising, this is a symptom of one of two very problematic scenarios.

In the first scenario, the franchisor actually has obtained the registration of its trademark, but continues to use the ™ sign in its marketing materials instead of the ® sign. Not only does this substantially depreciate the perceived value of the franchisor’s brand in the eyes of potential franchisees, such use is also confusing.

In the second scenario, the franchisor has not even applied for registration of its trademark. Granted, there are many businesses for which a registered trademark is an unnecessary luxury. This is the case where the trademark is not something that causes customers to buy from the business. Things are very different, however, in case of franchising. It is the brand that is the franchisor’s product, not what the brand offers to end customers. If a franchisor hopes to build a Canada-wide net of franchisees, it cannot rely on the notoriety of its trademark in one Province. Without a federally registered trademark, the value of the franchisor’s offering is questionable.

To recap, these are some of the benefits that a registered trademark (®) has over an unregistered trademark (™) in Canada:

– The right of exclusive use of the trade-mark across Canada with goods and services covered in the registration, with no geographical limitation to the area where reputation and goodwill has been established;

– No one can register a trademark that is the same as or confusingly similar with your registered trademark;

– The registration is prima facie evidence of your ownership and in a dispute involving a registered trademark, you do not have to prove ownership, the burden of proof is on the challenger;

– Registrar of Trade-marks will notify the owner of a registered trademark of the advertisement of somebody else’s trademark application if the Registrar is in doubt whether that other trademark is registrable;

– The right to sue for trademark infringement pursuant to Sections 19 and 20 of the Trade-marks Act;

– The right to sue for depreciation of the value of the goodwill pursuant to Section 22 of the Trade-marks Act;

– A registered trademark becomes incontestable after being registered for five years: a person who relies on common law rights may be unable to protect and register its trademark if another party registers a confusingly similar trademark and that mark is on the register for more than five years.

If you run a business that uses or sees franchising as its business model, wait no longer – Register your trademark in Canada now!

One of the most common misconceptions surrounding the law of trademarks in Canada is how trademarks relate to trade names. This misconception can have very costly consequences.

Trade names are used to identify a business or a company. Trade names are the “who” of the business. Customers do business with a business bearing the trade name.

Trademarks are used to identify products or services. Trademarks are the “what” of the business. Customers buy products and services bearing the trademark.

In very simplistic terms, customers buy trademarks from trade names.

Every business registered with the Registrar of Companies or incorporated (provincially or federally) has a trade name. But neither the reservation of a corporate name nor the formation of a corporation create a right to use the business name of the corporation in that jurisdiction.

How can that be? The government registers my business name and I can’t use it? Yes. Unfortunately, corporate registries don’t really check if the name submitted for the registration violates any prior rights. In other words, just because a provincial corporate registry approved your name for registration does not mean that you don’t violate someone else’s prior right (in a trade name or a trademark) and that you will not be compelled to change it in the future.

Rights in corporate names are treated like rights in unregistered trademarks, which means that they are nonexistent outside the geographical areas where the business is actually making use of and it known for its name.

Even if you register a corporate name that no one else had thought of before, it does not give you the right to stop others from using it, unless you can prove that other person’s use of the name creates confusion.

Just because you came up with a fancy company name that helps you attract customers for whatever products or services you are offering does not mean that your name, or brand, is a trademark. If you are not using your trade name as a trademark, your don’t have trademark protection for your trade name.

Trade name can be registered as a trademark, but only if you use it as such, that is, to identify products or services. This is often referred to as using the trade name as an adjective, as opposed to a noun.

Let’s say, your company is called Awesome Software Inc. and you make software. If you phrase your marketing materials to say that “Awesome Software Inc. offers such great titles as Text, Calculator and Presentations”, you are using “Awesome Software” as a trade name. If you phrase them to say “We offer Awesome Software™ Text, Awesome Software™ Calculator and Awesome Software™ Presentations”, then you are using “Awesome Software” as a trademark.

The classic example is, of course, Microsoft® Windows®. We don’t buy Microsoft, we buy from Microsoft. But because “Microsoft” is a part of the name of the product we buy (and part of the reason why we buy it), it is also protected as a trademark in its own standing.

If you believe that a substantial number of your customers are attracted to your business because of your trade name, you should consider using the trade name as a trademark and getting it registered as a trademark.

In other words, if you consider your trade name a factor that gives you a competitive advantage, you should not rely merely on registration of the company name with the Registrar of companies. You should accord the asset that you care about the protection that it deserves, and the only way to do it is through registering it as a trademark.

Canada is not an active participant in international treaties on intellectual property. It is currently a party to only 7 out of 25 treaties administered by the World Intellectual Property Organization: Convention establishing the World Intellectual Property Organization, Paris Convention for the Protection of Industrial Property, Berne Convention for the Protection of Literary and Artistic Works, Patent Cooperation Treaty, Rome Convention (International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations), Strasbourg Agreement Concerning the International Patent Classification, and Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure.

Most notably, Canada is not a party to Madrid Agreement or Madrid Protocol, Nice Agreement, Phonograms Convention, WIPO Copyright Treaty, and WIPO Performances and Phonograms Treaty.

Below is the list of countries that are a party to 7 or less treaties: Afghanistan, Andorra, Angola, Antigua and Barbuda, Bahamas, Bangladesh, Belize, Bhutan, Bolivia, Brunei Darussalam, Burundi, Cambodia, Cameroon, Cape Verde, Central African Republic, Chad, Comoros, Congo, Côte d’Ivoire, Democratic Republic of the Congo, Djibouti, Dominica, Equatorial Guinea, Eritrea, Ethiopia, Fiji, Gambia, Grenada, Guinea-Bissau, Guyana, Haiti, Holy See, India, Indonesia, Iran, Iraq, Kiribati, Kuwait, Lao People’s Democratic Republic, Lebanon, Lesotho, Libya, Madagascar, Malawi, Malaysia, Maldives, Malta, Marshall Islands, Mauritania, Mauritius, Micronesia, Mozambique, Myanmar, Nauru, Nepal, New Zealand, Niger, Nigeria, Pakistan, Palau, Papua New Guinea, Paraguay, Qatar, Rwanda, Saint Kitts and Nevis, Saint Vincent and the Grenadines, Samoa, San Marino, Sao Tome and Principe, Saudi Arabia, Seychelles, Sierra Leone, Solomon Islands, Somalia, South Africa, South Sudan, Sri Lanka, Sudan, Suriname, Swaziland, Thailand, Timor-Leste, Tonga, Tuvalu, Uganda, United Arab Emirates, Tanzania, Vanuatu, Venezuela, Yemen, Zambia, and Zimbabwe.

With all due respect to India, New Zealand, South Africa, and the other sovereign states on this list – am I the only one who is not overly impressed by the company of the countries that Canada finds itself in?

Of course, there are many underdeveloped countries that have joined many IP-related treaties, so the correlation may not be perfect. But still, does anybody else see the problem with Canada’s participation in intellectual property treaties equal of that of Rwanda?

PS. On September 10, 2012 New Zealand acceded to the Madrid Protocol and the Singapore Treaty on the Law of Trademarks, so it should be removed from this list.