Intellectual Property Law Case Study

The CEO of Miglit, Bob Brown, has come to you for advice. Miglit have been manufacturing and selling torches in Canada for 15 years. Miglit have a registered trademark in the name "MIGLIT". The mark is registered for torches and other portable lights, and for penknives.

Three years ago, Miglits designers came up with the idea of putting a band of texture around the centre of the torch, and a hole at the opposite end of the torch from the light, so the torch could be attached to a key-ring or chain. This shape, which has now been used for the last 3 years.

Miglit have supplied you with the following information about these torches:

- They have been sold in the Canadian market for the last 3 years, under the name "Miglit";

- The torches have been very successful, capturing some 20% of the market for small, personal handheld torches;

- Miglit have spent a lot of money on promotion of the torches: something like $2 million per year for the last 3 years.

Joey Jones is the managing director of Grand Pty Ltd ("Grand"). Four years ago, Joey approached Bob with the idea of marketing penknives under the Miglit name. Bob and Joey, on behalf of their respective companies, signed a contract for this "joint venture". Under the contract, Grand manufactures and sells the penknives, and then pays a percentage of the profits to Miglit. The contract states that Miglit may terminate the contract on 6 months notice, or on one months notice if Grand fail to remit the profits to Miglit punctually. Grand has been manufacturing and selling the penknives for 3 years now. Bob sometimes asks Joey how the business is going, and notices the penknives in the stores, but does not pay any real attention to Grand's business, as long as it keeps paying Miglit - which it does. Very recently, Bob found out an American penknife company, Handy Inc, has applied to register the trademark "MEGALITE" in relation to penknives.

Please use IRAC method (issue, rule, analysis, conclusion) to answer following questions:

1. AdviseBobwhethertheshapeoftheirtorches isregistrableasatrademark inCanada.

2. Advise Bob whether they are able to oppose the application by Megalite, and whether there are any risks in so doing.

3. Commentonwhether, inyouropinion,allowing trademarkregistrationfortheseshapes is consistent with the aims and rationale for trademarkprotection.