The Living Daylights (…Scents, Tastes, and Sounds): Bill C-56 Forebodes Drastic Trade-mark Reform

Bill C-56, a new and inevitably controversial piece of proposed legislation, was introduced on March 1, 2013. With the short title, Combating Counterfeit Products Act, the message seems simple, but contained within it are extensive proposals to change both the Copyright Act and the Trade-marks Act in Canada.

Beyond a suggested resurgence of the Anti-Counterfeiting Trade Agreement (ACTA) principles that were rejected in Europe last year, C-56 contains many backdoor revisions to the Trade-marks Act that do not pertain to counterfeiting. In addition to an extensive list of remedies (see Adam Stevenson’s article here), including the creation of multiple (and stricter) criminal offences for counterfeit-related activities, C-56 would extensively broaden the definition of a trade-mark. The proposed amendment to the definition reads:

“49. If a sign or combination of signs is used by a person as a trade-mark for any of the purposes or in any of the manners mentioned in the definition “certification mark” or “trade-mark” in section 2, no application for the registration of the trade-mark shall be refused and no registration of the trade-mark shall be expunged, amended or held invalid merely on the ground that the person or a predecessor in title uses the trade-mark or has used it for any other of those purposes or in any other of those manners.” [underlined text indicating proposed amendments]

One key addition here would be the “combination of signs”, which would vastly expand the scope of what can comprise a trade-mark beyond the traditional forms. As of the first reading of the bill, signs would now include: “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.” These changes would mean that you could register trade-marks for purely intangible sensory phenomena such as scents, tastes, and sounds (which has been explored recently). Also, in a semantic modernization, the entire Trade-marks Act would be amended to replace “wares” with “goods”, to reflect common modern language.

The bill also suggests clarity of the registration of marks related to utilitarian features. Specifically, it would amend s. 12(2) to prohibit the registration of trade-marks where “its features are dictated primarily by a utilitarian function”. Moreover, s. 20 would provide clarity that trade-marks can not be used to prevent others from using utilitarian features affiliated with the trade-mark. Another change associated with promoting public use and progressiveness is the proposed s. 18.1 which would allow application to the Federal Court to expunge a registered trade-mark that “unreasonably limits the development of any art or industry”. This would bring the trade-mark system in Canada more in line with the underlying principles of the patent system to promote innovation as a matter of public interest. These suggested provisions would represent a shift more toward “user rights”, which was also seen with the expansion of fair dealing provisions in the Copyright Act last year with Bill C-11.

A number of the proposed amendments to the Trade-marks Act pertain to the power of the Registrar, reflecting recent caselaw. The Registrar would have the right to refuse an application with respect to one or more of the goods or services specified and accept it with respect to others. He would also have the power to strike any part of an improperly pleaded Statement of Opposition, so long as it was done prior to the filing of the applicant’s  counterstatement (s. 38). The application process would be substantially changed, including the power being assigned to the Registrar to set regulations to establish the dates of registration for divisional applications to be re-merged (another new aspect of the Act; s. 39.1). Further clarity into the role of the Registrar includes the right to destroy records related to stale applications and registrations, within 6 years of the date of the final decision (s. 29.1) and a right to keep electronic records (s. 64). Finally, while the Registrar typically exercises no jurisdiction over correcting obvious errors in the records (it is presently subject to application to the Federal Court), ss. 41 and 48 would allow the Registrar to correct obvious errors within 6 months of entry and to remove registration of improper transfers, respectively.

Undoubtedly, the proposed amendments to the Trade-marks Act represent a modernization of the Act similar to that imposed by C-11 on the Copyright Act. However, a problem lies in the intention of the bill, which is purported to target counterfeiting. In my opinion, this bill mirrors the type of ‘omnibus’ legislation that drastically and broadly reformed the Criminal Code of Canada, in the form of the wildly controversial Bill C-10. While some of the reforms suggested here will be welcomed to update archaic or out-of-date aspects of the legislation, the overall package of Bill C-56 is bound to be controversial. The NDP have already voiced concern, but I think that is unlikely the Conservative majority will waver. One thing is certain: the drama will be intriguing.

Ryan Heighton is a JD candidate at Osgoode Hall Law School.