Trade Name vs. Trade-Mark – What’s the Difference?
Many people confuse trade names and trade-marks and think they acquire trade-mark rights by virtue of having a trade name. A trade name is basically a business name under which a proprietor or company carries on a particular business. The formal name of a business is called its ‘trade name’ and is the official legal name of the business entity. It may be the corporate name of a company carrying on the business or it may be a name registered with provincial authorities. Generally such registrations do not confer any proprietary rights to the name, and simply enable the public to ascertain who is using a particular trade name.
The name the business uses to market its products and services is called a trade-mark. A trade-mark (or brand name) is the device which identifies the particular goods made, or services provided, and sold by a business. A trade name may itself incorporate a trade-mark, or may itself be used as a trade-mark (to denote the origin of goods or services, as opposed to being a name) and may therefore be registrable and enforceable as a trade-mark. The trade name and the trade-mark of a business may be one and the same thing, but unless a trade-mark is actually registered, the protection afforded to trade names only is far less than the protection afforded to a registered trade-mark. If a business does not apply for a trade-mark, they may leave their trade name exposed to infringement claims of other trade-mark owners who may claim prior rights to the same or a similar trade name.
In terms of defending your trade name, the owner of a trade name is entitled to bring an action for what is called “passing off” against a person that uses a trade name that is likely to cause confusion between the businesses of the parties. The owner of a registered trade-mark has the power to sue potential infringers for trade-mark infringement.
Trade-mark registration is not mandatory in Canada but does provide many significant advantages, including the following:
- Registration is direct evidence of ownership.
- In a dispute, the registered owner does not have to prove ownership; the onus is on the challenger. Use of an unregistered trade-mark can lead to a lengthy, expensive legal dispute over who has the right to use it.
- A registered trade-mark can be enforced throughout Canada, regardless of whether it is being used or enjoys goodwill in any particular area. An unregistered trade-mark can be enforced only in those areas where it has actually been used sufficiently extensively to establish goodwill.
- As stated above, the owner of a registered trade-mark may initiate legal action for infringement proceedings. The owner of an unregistered trade-mark may not initiate trade-mark infringement proceedings, but must rely on common law “passing off” proceedings, which subject a plaintiff to a much more onerous burden of proof.
Vanessa DeDominicis practices in the area of business law. As a Registered Trade-mark Agent with the Canadian Intellectual Property Office and the United States Patent and Trade-mark Office, her business law practice has a specific focus on intellectual property law, including filing Canadian and US trade-mark applications and advising clients on infringement issues. You can contact Vanessa on 250-869-1140 or firstname.lastname@example.org to discuss the registration of your trade name as a trade-mark. This information applies as a general rule ONLY and may change depending upon the specific circumstances of your own situation. You should consult a lawyer before acting on any of this information.