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Target Faces Trademark Challenge in Canada

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Target by Kevin Dooley on Flickr

Target by Kevin Dooley on Flickr

Opening stores north of the border isn’t turning out to be an easy mark for Target, the well-known American retail chain. This is because in Canada, Fairweather Ltd. (owned by International Clothiers) has owned the trademark for “Target Apparel” for the past decade, which could make it more difficult for the American retailer to expand.

But Target hasn’t given up. The retailer filed a lawsuit last summer, claiming that Fairweather hasn’t actually been using the name even though it owns the trademark. Fairweather, though, has since opened at least two stores called “Target Apparel.”

Under Canadian law, Fairweather may still be able to keep its ownership rights in the trademark if it proves it has used the name within the last three years or had plans to do so.

Through an e-mail to the Ottawa Business Journal (OBJ), Target has insisted that “nothing that prevents Target from using the Target name and branding elements in Canada the same way we do in the United States.”

A University of Ottawa intellectual property law professor sees things a bit differently however. Teresa Scassa, also quoted in the OBJ, notes that American Target does have a hurdle in front of it; according to Scassa, a trademark owner in Canada “has the exclusive right to use that mark in Canada so anyone who enters the market with a mark that’s identical or confusingly similar to it could be liable.”

This isn’t the first time Fairweather has seen disputes over its trademark, as it was previously lost then reinstated by the Federal Court of Appeal. Even if Fairweather does get to keep the trademark for Target Apparel, though, it is possible that Target could make an offer to buy it.

The trouble Target is experiencing raises an interesting question for anyone starting a new business: should you also be concerned with trademarks held in Canada when choosing your name and logo? What do you think?

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January 19th, 2011 at 9:11 am

Posted in Intellectual Property

Tagged with , ,