INTRODUCTION:

Intellectual property is the hot commodity these days. Not withstanding registration we all must also consider that a property can be protected even when it is not registered. Thus the clients who own registered or unregistered intellectual property need sound legal advice on how to enhance and protect their clients goodwill, the generic term for all unregistered intellectual properties, particularly in the face of fierce competition on both the national and global business fronts. Lawyers must realize, and convey to their clients, that their intellectual properties are a valuable business asset that must be protected.

While there is an over all better recognition of both the short term and the long term value of all intellectual property, most general practice lawyers do not have the required awareness when dealing with their business clients. While it is true that most general practice lawyers don't hesitate to contact their colleagues in an intellectual property bar, it is also true that there is a lack of awareness in not realizing the full scope or implications of intellectual property issues that can arise. When clients incorporate or start new businesses, choose corporate names, logos and slogans, or develop new products, services, or manufacturing methods. Goodwill is something that has to be dealt with. It is this basic lack of knowledge about the nature of various intellectual property rights that has to be addressed.

Many routine commercial and legal transactions can have an important impact on a clients' intellectual property rights and, if not handled properly, can seriously affect the continued success and viability of the client's business enterprises. These consequences can easily be overlooked if lawyers don't understand or appreciate the myriad of intellectual property problems posed by client's cases.

This proposal attempts to address the steps to be taken by the general practitioner to avoid the problems. If you have any doubt about the need to protect goodwill consider the problems enjoyed by Mr. Brick, the Manitoba based businessman who, after more than 25 years of operating a business, was forced to change his business name due to conflicts with the trade-marks of The Brick Furniture. These problems could have been avoided.

MARKET POTENTIAL

Alberta currently enjoys an oil based economy. Several major Canadian oil companies have their head offices in Calgary, however, they have retained eastern law firms to handle their trade marks. Consider the fact that the major players in the Oil & gas industry in Alberta, namely; Petro Canada, Mohawk, Texaco, Shell, Gulf, Home, Esso, Chevron, Amoco, British Petroleums, Turbo, Conoco, Suncor, Dow, and Syncrude, who collectively own about 2000 trade marks all of which are administered by eastern law firms. Not one single Alberta Lawyer or firm generates any revenue for these clients in this regard. I often wonder how much other corporate business is lost to the eastern firms that handle the trade mark matters.

In addition several major corporations have their corporate offices in Alberta. Included on this list is Canadian Airlines, Agra Industries, Sceptre Resources, Safeway to name just a few, who collectively own about 600 trade marks. Consider the fact that as of September 16, 1997 there were 6508 trade marks list to registrants with an Alberta address. Of these 3612 are owned by 55 owners who have recorded over 8000 others as users of these marks.

In examining the potential opportunities we ask that you take judicial notice of the fact that almost every business in Alberta, and there are over 400,000 of them, has some form of logo on their letter head. Many of these businesses purchase advertising novelties such as pens, hats, lapel pins, decals, etc., which they use as give-away's for the express purpose of keeping that same logo before their clients and prospective clients. Each of these business people is trying to promote his goodwill in association with a trade name, corporate name, slogan or logo. An examination of any yellow page listing will bear out this fact. These people need to be alerted to the methods of protection that are available to them.

Consider the fact that over 20,000 Alberta businesses have a presence on the Internet. Each of the web sites contains copyright material and trademarks that are not, in the vast majority of cases, registered.

Only the general practitioner can create this awareness and take advantage of these opportunities.

STATISTICS TELL THE STORY

Statistically 20% of all active companies have marks that need registration. In Alberta less than 1% of the active companies have trade mark protection. While it can be argued that it is not necessary that all these corporations file for trade mark registration it CAN NOT be argued that they all need to take the basic steps to insure that they do have protection for the goodwill that they generate. This translates into something in excess of 70,000 new files, from currently active businesses, with an annual growth rate of 4000 new files per year based on the current rate of new incorporations.

Gowling & Henderson, one the largest trademark firms in Canada, in a seminar presented last summer, suggested that a mark, once registered will generate on average $4,000.00 of revenue per year. In Alberta this figure may be high but our experience has indicated that an active file is worth at least $1,300.00 per year. Compare this figure to the annual revenue from an existing corporate client.

On going activities include franchises, licenses, litigation, and licensed user agreements. In addition there exists the requirement to defend your clients registrations and to attack conflicting registrations. We can think of no other area of law that provides this kind of growth potential all from existing clients.

Trade mark awareness will bring you into contact with your clients on a far more frequent basis. Conversations with clients about trade mark related matters are not confrontational and therefore not subjects that clients wish to avoid. These conversations may be the best public relations a firm can generate.

Look to your own client base and consider that at least 20% of these clients will want this protection. Arvic will show you to how to attract these clients.

GOODWILL

What is it? How is it acquired? What is it's value? These are all questions that are defined in law or accepted business practices. The corporate lawyer who thinks in terms of these questions must now examine a new mind set. These questions, and their answers, are not important. I prefer the definition that Goodwill is "the unprotected and unreported investment that a client has in his business". What is important is the date at which goodwill begins to grow, the date of first use, and how that growth is recorded within the business.

The common belief that goodwill commences as of the date of registration is false. Goodwill is not acquired until such time as a trader commences to use his trade name or unregistered trade mark in association with the wares or services that he is marketing. The existence of a registration is not sufficient to prove that any mark has been used.

"First Use" is a term defined in Trade Marks Act as being the date at which a trader commences the process of actively trading in his wares. Therefore, the date of first use can be;

1. the date at which a trader commissioned the printer to start printing his literature but not the date he consulted with the artist to design the literature,
2. the date of the first mail out of a proposal but not the date the proposal was prepared,
3. the date that the first advertisement of a product appeared but not the date that the advertisement was composed, or
4. the date at which the first unsolicited order for wares arrived at the traders place of business.

Evidence in support of the date of first use is critical. All actions that challenge the ownership or registrability center around this date. The general practitioner must be cognizant of this fact and assist his client in securing and storing this evidence.

WHAT ARVIC CAN OFFER

Arvic, in addition to being a non-competitive firm, is a full time, full service search house which offers, in addition to, the services outlined on this web site provides two basic seminars that will be made available to your staff.