Do you need a Trade-mark Opinion?

I have trade-mark clients who range from the very small – startups who want to protect what little intellectual property they have, knowing it will one day be their greatest asset – to the very large – national and multinational corporations who protect all of their intellectual property as a matter of habit.  They both desire the same result – solid registration of a strong trade-mark – but they often have different ways of getting there.

Trade-mark registration is a long process, often lasting for two or three years, that begins with an idea about a proposed mark and ends with a certificate from the Canadian Intellectual Property Office, telling you that no one else is allowed to use your mark.  The decision as to when to bring your lawyer into that process is one that will determine how much you spend, when you spend it, and may ultimately determine your success or failure in the application.

With larger corporations, the mark usually comes from the marketing department; it’s a word or phrase that they’re going to use in the branding of one of their upcoming lines of products or services and they want to have the registration process started before the launch.  This is where the legal department or outside counsel steps in and advises them not to invest a significant sum of money into the campaign until they’ve had a chance to clear the mark.  The clearance they’re speaking of is the trade-mark opinion on registrability. 

In order to provide an opinion, a lawyer conducts extensive searches of government databases and a variety of public sources so that they may determine whether the desired mark (or something confusingly similar to the desired mark) is currently in use somewhere in the jurisdiction.  A lawyer reviews the search results and analyses them based on the statutory and common law criteria for confusion.  The lawyer will also generally make comments on registrability based on the sections of the Trade-marks Act that dictate what is and what is not allowed. 

As most searching is outsourced to expert agencies, a disbursement of between $400 and $700 is usually associated with the search.  Add to this your lawyer’s hourly rate multiplied by the two or three hours of their work involved and the opinion will cost somewhere between $1000 and $2000.  If your organization is considering spending significantly more than that on marketing, branding, packaging and other associated costs, then the cost of an opinion is an absolute necessity.  Although an opinion doesn’t guarantee registration, an opinion will give you a good idea of the likelihood of success.  Seeing clients spend tens of thousands of dollars to change out a failed brand name on a product line mid stream isn’t something I enjoy and I would caution any business to do the due diligence and get an opinion before such expenditure.

On the other hand, I often find that smaller businesses have already fallen in love with their proposed mark before they talk to me.  They often have the mark in mind before they have fully conceptualized the product or service that goes along with it.  They’ve done a Google search and a NUANS and they’re confident that the mark doesn’t infringe any existing mark.  Although I have to warn the client about the possibility of a failed registration, or worse yet, a passing off claim if they use a mark that someone else already claims, I have to admit that there is some economic sense in this approach. 

If your business is small, then the investment in the product or service line is bound to be (relatively) small as well.  If you can afford to find out a year or two down the road that your mark isn’t registrable, then it makes sense not to spend the money on the opinion and just to go ahead with the trade-mark application itself – especially when the application will likely run about $1500 to $2000 including fees and disbursements.  I would of course caution against letting the CIPO examiner be the first opinion you get on registrability, but the economics of the process do make that a reality sometimes.

So, as always, the answer depends on your resources and your business needs.  I’m always going to recommend the opinion, but I’m also going to understand that business people aren’t lawyers; business people are risk-takers – and sometimes an application without an opinion is a risk that makes sense.

Scott R. Young