For quite some time now, my firm’s cannabis lawyers have been working with Canadian clients looking to enter various state-legal markets for cannabis in the United States. Now, with recreational cannabis legalization poised to happen in Canada, we’re predicting even more collaboration between Canadian and U.S. cannabis companies. And one of the ways companies are already building cross-border collaborations is through IP and brand licensing deals, which raises the issue of trademark protection.
According to Canada’s health minister, federal legislation to legalize marijuana will be introduced in spring 2017. In the meantime, many Canadian companies are pursuing opportunities to partner with cannabis businesses in the United States to gain valuable industry experience, and to establish their brands in anticipation of going to market in Canada.
When Canadian clients are preparing to move into the U.S. market, one of the first questions they ask is if they can simply use their existing Canadian trademark registration as the basis for obtaining a trademark registration in the U.S.. The answer to that question is no. To obtain a trademark in the U.S., the applicant must make actual use of that mark in U.S. commerce. A Canadian applicant can also file a federal trademark application on an intent-to-use basis if they have a bona fide intent to sell their goods in the United States.
When applying for a trademark in another country, regardless of your country of origin, it is important to perform a clearance search on your mark to make sure the mark is available in the new country. Just because a mark is available in Canada, doesn’t mean the same mark will be available in the United States, or vice-versa. And even if there are no similar marks registered with the USPTO, it is also important to perform a clearance search to determine whether there are any conflicting state trademark registrations, or any companies with superior common law rights in your mark. This means that if you know you will be operating in both Canada and in the United States, you should choose a brand name you know you can register as a trademark in both countries.
Another important thing to note is that filing fees are structured differently in the U.S. than in Canada. In Canada, there is one fixed fee for any trademark application, and that fee is relatively low. In the United States, the fee will depend on the number of classes of goods and/or services the application covers.
Canada does not require a specimen of use for trademark registration or renewal purposes, but the U.S. requires a specimen be filed with every trademark application based on actual use. This specimen must show how the trademark is being used on the relevant goods and/or services, and may include packaging, labeling, or samples of advertising of services such as brochures or signage.
And finally, whereas Canada has only a single trademark register, the U.S. has what are referred to as both a “principal register” and a “supplemental register.” The supplemental register provides limited protection for certain marks that do not qualify for registration on the principal register due to, for example, mere descriptiveness. Registration on the supplemental register is limited to marks that are already in use in the U.S.. The supplemental register offers benefits to marks deemed descriptive, including the ability to use the ® symbol. It also may be used to prove exclusive use of the mark for a five-year period, which is one of the requirements for proving distinctiveness in order to transfer the mark to the principal register.
With these significant differences between Canadian and U.S. trademark law, it is important to consult with experienced international trademark counsel when pursuing trademark applications in both countries. And if your company is considering doing cross-border work, it’s important to explore whether your trademark rights can be utilized sooner rather than later.