What's in a Name?

Trade Marks vs. Business Names

By Douglas B. Thompson

In many cases, there is no difference between a Trade Mark and a business name. If a person starts a hair salon under the business name “Scissor Hands”, that business name also serves as an “unregistered” Trade Mark. You can establish rights in an unregistered Trade Mark by establishing use.

When registering business names, minimal screening takes place. It is possible for two persons to file very similar business names. What can a person who has been operating as “Scissor Hands” in Victoria for ten years do, if another person starts operating as “Scissor Hands”? The “senior user” can go to court and prove that he or she has established a reputation in Victoria as “Scissor Hands” and that having another person also operating as “Scissor Hands” is causing confusion. It is up to the Judge to decide whether the “senior user” has rights that deserve protection. If the “junior user” has also set up shop in Victoria, the “senior user” will likely be successful. If the “junior user” has set up shop in Nanaimo or Kelowna, the “senior user” may not be successful and there may end up being unrelated “Scissor Hands” businesses in other parts of Canada.

It is possible for persons to register their Trade Mark. This can be done after they have been using it for a while and realize that it has become valuable. It can also be done before they start using it. However, the Trade Marks Branch of the Canadian Intellectual Property will not register all “unregistered” Trade Marks. They won’t approve of any Trade Marks that they feel will restrict trade. This means that they will not approve of a Trade Mark like “Hair Salon”, because other persons must be free to inform the public what business they are in without harassment. This means that they will not approve “Victoria Hair Salon”, because other persons must be free to inform the public that they are located in Victoria. This means that they will not approve “Thompson Hair Salon”, because that might prevent other persons by the name of “Thompson” from getting into the Hair Salon business.

If you can meet the tests for Trade Mark Registration, you obtain the following advantages:
You obtain the rights to the name for a particular product or service throughout Canada. Not only can you prevent someone from Nanaimo or Kelowna from using your Trade Mark, but also someone from Toronto or Halifax.
The public is given notice of your rights. Saying that they didn’t know doesn’t help them, because they should have looked.
There is a “legal presumption” in your favour. You win unless persons can show that a mistake has been made in granting the Trade Mark to you.
You have the right to enforce your Trade Mark in the Federal Court, and obtain orders that are enforceable anywhere in Canada.
You can use your Canadian Trade Mark as a basis to obtain registrations in foreign countries, most notably the United States.