TRADEMARK - A VALUABLE ASSET STORING A BRAND’S GOODWILL AND TRUST FROM CONSUMERS
Trademarks are not just simply a sign, design, or expression that makes a product or service recognizable. More importantly, they have become a medium to store value for a brand’s goodwill and trust from customers.
Hard working entrepreneurs have dedicated countless hours into building trust in their brand amongst their consumers. To prevent damages to reputation, trust in the brand, and loss to potential revenue, companies, no matter what size they are, should protect their brand from passing off by competitors.
The cost of registering for a trademark under the Trade Mark Act is affordable to most SMEs. However, enforcing trademark rights through the traditional legal means seems to be available only to big companies with deep pockets.
SMALL CLAIMS COURT: AN INEXPENSIVE OPTION TO ENFORCE YOUR LEGAL RIGHTS TO YOUR TRADEMARK
The Small Claims Court is a branch of the Ontario Superior Court of Justice created with the objective to provide an expedited and cost-effective way to resolve legal disputes. It has civil jurisdiction over claims with a monetary value of up to $35,000 CAD. However, this court does not have the power to grant injunctions (e.g. to remove passing-off products from market) that were normally involved in a trademark dispute.
Nevertheless, in a 2018 decision by the Small Claims Court, the Kashruth Council of Canada (Plaintiff) successfully obtained a monetary judgment against the defendant, who was found to be in violation of s. 22 (1) of the Trademarks Act. The defendant had used the Kashruth Council’s Kosher certification mark on its product without authorization (i.e. passing off), which resulted in damages to the goodwill of the Kosher mark.
The Kashruth Council of Canada was able to enforce its trademark rights without having to go through the traditional way of filing a claim to the Federal Court of Canada. Such a process could involve significantly more costs and a longer timeline for the claimant to obtain their judgment.
SUMMARY OF BENEFITS AND LIMITATIONS WITH ENFORCING YOUR TRADEMARK RIGHTS THROUGH SMALL CLAIMS COURT
BENEFITS:
↓ $$$: lower legal costs
↣ Save time: faster timeline to obtain your judgment
↑ Cost-effectiveness*: obtaining a court judgment could be an effective deterrence against passing-off practices by your competitors
*The cost effectiveness of filing a passing-off claim in Small Claims court may vary in specific situations. Contact Innovate LLP to find out if this is a cost-effective way to protect your trademark.
Limitations:
X no jurisdiction to grant injunctions: claimants cannot ask Small Claims Court to grant injunctions to remove offending products/services from the market.