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refresh franchising the heroic choice for entrepreneurs proud sponsor of the distilled wisdom podcast we're going to talk franchise law Canada is an interesting Market to expand into because most of the same things that are required to be disclosed in the US are also required to be disclosed in Canada as you know there are a great number of franchises who often don't leave the FDD in the first place just making sure the cops aren't going to you know come knock at you yeah the franchise police exactly yeah and in Canada everything has to be delivered in one document at one time this one's important for franchise ORS listening that they pay attention of this section I thought it was [Music] fascinating all right welcome back to another episode of distilled wisdom I'm Adam faran your host you already know that if you've been here before um we're going to mix it up a little bit I've had franchise or suppliers franchisees little bit of everything on the show this is going to be a first with an attorney to mix things we're going to hope to help some franchise ores move into the Canada market so we have Chad felstein see look at that guys I didn't mess up the name that time he's with Dale Les and Lesman out of Canada you're in the Toronto area yeah we're in Toronto yeah okay well welcome to the show thank you thank you for having me it's a pleasure man so normally we do more interview style but today we're we're GNA we're going to talk franchise law yeah which is everybody's you know favorite subject is talking about you know the legal ramifications of business right yeah um everyone wants to hear from the attorney of course now actually it's extremely valuable so I expect this episode for franchise ORS to be popular right okay okay I'll do my best all all right so tell me a little bit Chad about your your firm and uh a little bit about what you guys do and you know your specialty and law sure well the um the firm is a 25 attorney full service firm in Toronto uh which is the largest most populous city in Canada um our franchise Department uh is um I think one of the the larger um franchise legal departments in Canada and um I think we try to um operate as a bit of an outsourced in-house legal department for most of our franchisor clients so we certainly help them with um getting all their um getting whether they are domestic franchisors within Canada helping to support their franchise sales and development programs or those who are entering Canada from uh foreign markets you know most of in the US we work with them and um we certainly help them with all their franchise legal compliance all their brand protection and then we're basically there as outsourced general counsel to handle as much of um as much of their legal support uh as we can um fdds are only only one part of it fortunately what so I'm curious just in myself cuz I'm a franchise or I'm not looking at Canada yet yeah but what would be some main considerations for somebody coming from the US and then going into Canada um do we have to register by its providences up there Province yeah yeah uh yeah there's no registration in Canada uh there are no Regulators at a provincial level or a federal level so your FDD is basically ready to go when your franchise lawyer tells you that it's ready to go um so that sounds much easier than the United States yeah yeah the the barrier to entry is a lot lower so you don't have to deal with any of that there's some flip sides to that and there's some you know unique particularities about Canada Canada is um an interesting Market to expand into because it's so proximate to the us obviously uh and you're um you know you're in the part of the northern us so I mean there's parts of Canada that are closer to to you than parts of the US are and so you know culturally it feels feels like it's in many ways just sort of an extension of the US often times as well maybe a little less these days do you think franchisors see it like that like almost you know viewing it like the next state they're going into depending on their state yeah yeah those who are in I think um the the uh the northern us will often see it because they have so much experience often just just traveling personally into um you know some of those I guess you know sort of border cities that you know that that may border against their state so there I think there are a great number of us franchisors who do view it as a very natural extension um and you know the travel is not too honorous uh and so so it feels very accessible for for most parts of Canada it's um it's a bit of a strange country though because it's enormous right the geographic land mass is enormous it's second largest country in the World Behind Russia um but it's very sparsely populated across that enormous you know mass of land there are fewer people than there are in all of California uh by like several million yeah and they are you know we have a small number of densely populated urban areas there's essentially three primaries right there's Toronto there's Vancouver there's Montreal and Montreal is sort of on um its own island of law because it's within the province of Quebec which has a completely different legal system than the rest of the country okay um and there's Calgary Alberta and then some smaller cities uh not not me you know Ottawa and Edmonton and Winnipeg um and then for the most part you have chunks of um you know a lot of vastness in between that are not really all that populated and many and and and smaller very small cities and small towns um and they're all kind of scattered across the country there's there's not many it's not in the same thing as uh you could be in the northeastern us and you know you've got you know New York and Philadelphia and Washington and Chicago's even not that far over and Detroit and they're all not they're all relatively close to each other with many small cities in between most of Canada is not like that um which does mean that uh for us franchise or it feels like it's a natural extension it feels like it's you know an easy step and not really entering a a true International Market but it's a different degree of support when you're talking about crisscrossing that entire land mass and with very little in between so it always leads to interesting discussions about whether um you should be expanding to Canada by way of single unit franchising or whether area development makes sense or you know oftentimes it's by Master franchising but Master franchising again you're giving somebody this enormous territory where the your master franchisee is going to incur a considerable am of cost to be able to crisscross and travel the country to support franchises so you're you're probably well way more well versed on this than I am but when we talk about like doing a master I always considered that like down the line if I went to Europe or something yeah it wouldn't even cross my mind when I'm looking at Canada right yeah um do a lot of people do it that way though there's a great number of I don't know that I would say most but there are certainly many US franchisors who identify Master franchisee for all of Canada or um parts of Canada um you know there's a big difference between Eastern Canada and western Canada uh and so we sometimes see that you know someone will get Eastern Canada someone will get western Canada some might get the province of Quebec as a master franchisee you know it depends on the on the franchisor really if the franchisor would say had the US franchisor had no real plans to expand into Canada and somebody from Canada approached them and especially somebody who is well capitalized and as experience in operations or experienc in franchising that's often times a very good candidate and for the US franchise or to say you know what this isn't my market sure there is this unique sort of um uh there's this Unique Kind of ju toos of huge land mass small population um if you know that market if that's if that's you know that's what you know best that's where you are then I'm just as happy to have you own the territory and run with it I would say that with the US franchise or we work with de balart maybe somewhere around 25 30% end up granting Master franchise rights for for the whole country okay I mean what you said m perfect sense if they don't essentially want to deal with it is and they don't want to you know do the research and the homework into the market that does make perfect sense yeah yeah so we do see a lot of it and um going back to your original question about about selling franchises in Canada um we do have a lot of those same rules that you have here no you know nothing signed nothing paid for at least 14 days uh until someone gets an FD so that surprised me now too cuz you don't have the registry and it sounded really lacked that was one of the next question questions I was going to ask is like so if I get an inquiry out of Canada which you know I'm not looking at it now but say it's a year from now yeah and somebody inquires out of uh quc or Toronto can I open that conversation there's nothing special I need to do I can go move forward with the conversation you can start a conversation for sure um first of all it's no secret that of course ftvs are um publicly available in the US so any Canadian franchise any Canadian prospective franchisee could go and look that up and and you know see where you're offering in the US so you can start a conversation on that basis in Canada we don't have any federal franchise law there are six provinces that have franchise law the other provinces don't and so a lot of these rules and laws just don't apply at all and you can I mean if you were in the province of Saskatchewan for example they don't currently have franchise law if you're in the province of Nova Scotia you could meet somebody today get an agreement signed today get a fee paid today never have to give them an FDD in British Columbia Alberta Manitoba Ontario Prince Edward Island and New Brunswick these laws do exist and so um you can start a conversation as long as I guess two things number one everything that you say should be consistent with what is ultimately in the FDD so if someone asks you a question about the what the fees are in Canada and you don't yet yet know probably a good idea to wait to give them that information until you're certain um and number two is that every in in Canada everything has to be delivered in one document at one time so um sometimes you'll see you know that a franchisor franchise or they might offer some some historic sales information for Canadian franchisee to consider and then they say if you're interested let us know and then we'll give you the FDD it's there's no law that prohibits you from providing those that sales information or those you know Financial the fbr's financial performance representations no law prohibits you from doing it but it has to go in the FDD as one document at one time you can't have sort of Peace meal disclosure and that would include fprs I think that's similar in the US too isn't it yeah yeah again not an attorney but from my understanding of it yeah and so but you often find that sales people will sometimes have separate discussions sometimes I got you so we'll give you this piece of it now that piece yeah it's relevant that's right and so we'll do an FDD for a franchisor and um then subsequently we'll find out that in fact you know yeah we gave them our our business plan for then take a look at it we showed them our us item 19 uh oh okay well that that we we got to now we have to put that in the FTD because we just made an fpr so it's not a big mistake it like you just have to add it it when you give it to them yeah that's right yeah just with all the same qualifications and disclaimers I mean slightly different on just making sure the cops aren't going to you know come knocking at the franch police exactly yeah okay yeah so uh so yeah no registration no renewals no annual filings nothing like that um there are a few things that are uniquely different about the FDD and so one of the things is that sure you don't have to do renewals you don't have to do filings but the FDD you give has to be current and in many cases particular to that prospective franchisee if you've got details about their specific offering their location their territory the FDB may be repaired on a bit of a bespoke basis and is that across all providences or yeah yeah yeah um that they're trying to actually do that here in the US more uh I was in DC do advocating for the nlrb's rule yeah and that was one of the subjects they talked about a little bit at the conference is you know we actually are pushing more to get a regular template of how it should be out lined in the US too so that it's structured the same no matter what franchise you're looking at yeah even though from what I've seen most franchises already do that right they all have the same structure and they're already templating it so I don't know why they were pushing it that much because I can't imagine there's too many Cowboys out there doing it no I guess the the the policy objective in Canada is U you know given well given that the policy objective of an FDD in the first place is to help you make an informed decision the way that's been interpreted by courts in Canada is well how could you make an informed decision if you didn't have all the information relevant and specific to you so what we know for example is you're a brick and mortar franchise or restaurants or retail store um and you have you know you're subletting the premises to a franchisee or you've negotiated the lease on their behalf and then handed it to them to to sign um those are material details material facts that must be disclosed to the franchisee because how could they bind the M themselves to a franchise agreement without having been disclosed about the actual lease that they're going to be committed to so my question there would be does that slow down the closing process right especially you're talking brick and mortar I don't know brick and mortar right if you're talking brick and mortar that means that before you can essentially have them sign you have to have the whole location sourced and in in position in some cases in some cases so it depends um it's all very you know fact specific if in the case of a brick and mortar franchisee franchise or and franch for example if um if the franchisee is responsible for going out and finding locations MH franchisor is there to approve it right to review it and approve it well I don't really have anything as a franchise or dis it is included right because but if I found the site or if I am subletting the site to you if I negotiated the lease on your behalf and then put in front of McDonald's right maybe yeah I mean if if I've got if I've got site specific details in my knowledge in my possession that you are you know you're not sure about you weren't aware of you wouldn't have been aware unless I told you that might be the sort of thing that has to be disclosed often times the same could be true of like a development schedule right so if you are this is not really tested by any Canadian court but if you've got a multi-unit franchisee and you want to put them on a development schedule to open a certain number of units by a certain date it's a pretty material fact right to know what your territory is to know by you know especially if youres yeah and your fees are going to be tied to you meeting certain development milestones so that's sort of thing that might have to be disclosed on a bit of individualized basis okay yeah so it can it can slow the process down there's ways that franchisors can um can certainly help themselves to um you know so that way they can sign franchise agreements even without locations or territories in mind for example uh one of the ways that a franchise work can do that in Canada and this is not always the most um popular solution but if you give a franchisee an option to terminate the franchise agreement within 6 months 9 months a year whatever it is if by that point in time time we haven't yet agreed on a site or agreed on a territory then you know I can't therefore impose it on you because you have to agree to it with me right and then if you can walk away without any risk of loss then um you know I don't have to worry that I didn't give you all the information up front cuz I didn't have it on that day but I don't want to slow down my sales process stay with us we'll be right back citizens of distilled wisdom gather around and listen up if you're a fan of the show and want to join forces with its host Adam Fane then refresh franchising is the perfect choice for you so gather your courage summon your inner superhero and visit refresh franchising.com to launch your heroic franchise Journey refresh franchising the heroic choice for entrepreneurs proud sponsor of the distilled wisdom podcast yeah I don't think there would again I'm looking at it from a franchise or perspective I see the risk in that but at the same time if you're vetting the right partners then it right shouldn't be a problem that's right isn't a problem until it becomes a problem yeah well we don't need lawyers until we need a lawyer right you know the the the way of the world what are some of the differences between the provinces are there like drastic differences in some of the franchise laws cuz like you said they all yeah have their own kind you know set of laws are there some that are really strict in on certain things or you know fortunately they aren't terribly different um the one exception would be Quebec which is probably put an emphasis on that yeah yeah so the province of Quebec operates under a completely different legal system than the rest of Canada and all the United States does we all operate under a what's called a common law legal system that's based on the UK model yep in Quebec they operate under the French from France model of law the legal system called civil law so so it's a it laws are interpreted and applied in a different way than they are in the rest of the country what are some of those differences now I'm just curious about yeah so structure so one of the one of the ways is that often times the legislation is just it the legislation in Quebec is intended to to tell you this is the way the law this is what the law is this is what the rules this is what the requirement is and the role of the court in interpreting that law on a sort of a case by casee sure um less frequently the way it happens in Quebec so the law is this therefore it applies to this situation sort of full stop so so in other words arguing like former case law and stuff would yeah that's right so it's it's it's a it's a it's a more rigid form of interpretation uh and application of the law than it is in the other provinces and also French legislation Quebec legislation is also in and of itself just different than a lot of the customs and conventions that that we have in common law jurisdictions for for you know the way we sort of transact business so for example in Quebec they don't have have any franchise law there's no legislation that exists what they do have is are laws about contracts of what they call adhesion a contract of adhesion you know you're adhered to one party sets all the terms the other party doesn't get to say anything they're unilaterally imposed on them and so not all franchise Agreements are necessarily a contract of adhesion it depends on a few things including like did the franchise you have an opportunity to negotiate because if they did then it's not a contract of adhesion if you are a contract of adhesion there's certain laws relating to pre-contractual disclosure relating to um French translation of the contract that you know if you're a contract of adhesion these all apply to you if you are not then they may not apply in the same way so my first question would be does your FDD change just for Quebec like do do they have a different version no because all they really say in Quebec is that some measure of pre-contractual disclosure is required without any detail uh there's no 14-day rule or anything like that so what we know uh so you know the practice of most Canadian franchise lawyers has always been to say well if my FDD is good enough everywhere else surely it's got to be good enough in Quebec um so what most franchisers will do is just say here's you know here's my FDD and if they don't yet have one for Canada because Quebec is the First Market they're expanding into okay then here's my us FDD I've not adapted it for your Market because I didn't need to unlike the other provinces where you have to have a an Ontario FDD an Alberta FDD um and the rules between those provinces are all pretty uniform you know you can you what most Canadian lawyers will do is come up with a a Canada wide FDD you can use in any one of those provinces so next question on that is I I I have a US FDD yeah how heavy is the lifting of converting it to a a you know a document for Canada yeah right is it heavily involved is it major differences or is it really just tweaking a few things in it it's somewhere in between most of the same things that are required to be disclosed in the US are also required to be disclosed in Canada there's a few things we have in addition there's a few things that we don't have that are required in the US um and then there are a few um unique local considerations relating to things like governing law dispute resolution currency taxes um that have to be sort of you know canadianized so yeah almost nothing is going to seem foreign to a US franchisor almost all of it is version of what a us franchisor would already know okay yeah do they require Financial disclosure oh yeah it's optional right with the item 19 oh sorry that's optional pardon me yes that's optional yeah I thought you financial statements uh F yeah item 19 is is similarly optional in Canada okay yeah we do have this one very unique technicality in Canada almost every franchisor lawyer hates every franchisor hates it is completely a technicality and it trips up a great number of franchisors especially from the US who have no real equivalent of this at all in the US so we have this unique bizarre requirement that um uh the FTD has to be certified meaning that any two directors and officers of the franchise or have to in their personal capacities sign a document which says everything that is in here is true and accurate and valid and franchisee you can rely on it that's it it's it's like two sentences long put your name on it I'm looking at it like from a legal lens that they're essentially attaching them as an individual so removing the the corporate Shield right so so that's right so number one uh if those individual if there are misrepresentations or errors that are in the FDD those individuals can be personally liable yeah and number two courts have said invariably time and time again in Canada that if that certificate this very short page if it doesn't get certified doesn't get signed it's like nobody at the franchise or you know executive level was prepared to put their names behind it and stand behind it and so if you're not prepared to do that well franchisee how can you be expected to rely I see the transparency with it it's just very unique cuz the the US is it protects individuals through the corporate model you know pretty well that's right and so so an unsigned certificate just this unsigned page invalidates the entire FDD franchisee gets a get out of jail free card just based on that um it's incredibly frustrating it's entirely a technicality because you could have a pristine FDD a franchisee who fully knew and understood what they were getting themselves into right they fully understood the opportunity had every had every chance to you know review and due diligence and they had full disclosure and then somebody forgot to put their names on this one page the entire thing is invalidated you know it it puts franchisors in a bit of an uncomfortable position sometimes an often costly one they've got to look into whether they need you know director an officer liability insurance when they start putting their names on these things and so it has uh it has some impact on the franchise sales process any franchise or out there you got to make sure that that's included in your your signing process whether it's doc you sign or whatever you're using for make sure that that's a it in your process and you won't have a problem yeah yeah in fact you know the one time this ever the first time it ever came up in a case in Canada it was a it was a hotel franchisee so you know Hotel franchises are you know fairly sophisticated fairly well capitalized um so they got a you know pristine FDD it was uncertified and basically in the franchises when the franchisee went to sue the franchise or for damages for an invalid FDD the franchisee basically said I forget the exact words so I'm paraphrasing I know I'm relying on a technicality here but I get to right yes you you get to I personally I mean I I hate the certificate requirement I resent the policy objective most franchises I shouldn't say most as you know there are a great number of franchises who often don't read the FDD in the first place and so to have it all get undone because of a document not being signed that they didn't even care about in the first place I mean I to me it's a law that ought to be repealed but so many courts have stood behind this certificate requirement for so long that I don't expect that's ever going to happen so it just remains a warning sign about doing business in Canada I mean I see the motives on him not wanting to do it from the outside looking in you know like again for them they're they're making them stand behind what they're having people sign so yeah yeah so but personally so you were referred for the podcast yeah and Dan uh Dan Dan made a suggestion on something we have to talk about yeah and that's the the trademark protection uh in Canada and this one's important for franchise ORS listening that they pay attention to this section I thought it was fascinating um can you speak a little bit about what's going on with the with the trademark laws and everything in Canada right now yeah so trademark law in Canada is fairly similar to what it is in the US okay governed at a federal level same sort of process to get a trademark applied for you get it register it's protected federally we don't have a primary and secondary register just the the one so a lot of the concepts are very SAR to um us companies trying to protect their trademarks in Canada the biggest difference is that in the US and in Canada up until 2018 as any franchisor would know who's applied for a trademark you can go through the whole process the examination process with the USPTO and then at the end of the line once you've been approved the US PTO asks you for proof of use of your trademark right a specimen of use so that way nobody is just like squatting on these trademarks indefinitely with no intention of ever using them and until you submit proof of use you don't get the trademark registered proof that you're using the you know the actual trademark Canada repealed the use requirement in 2018 so what that means is that in order to get a trademark registered in Canada all it needs to happen is that the Trademark Office C the Canadian intellectual property office SEO just needs to have approved it because there's nothing out there that's too similar you know we it's not the trademark doing that check they still do the examination to make sure the trademark is registerable compared to you know other s trademarks that may be out there but once you've cleared that hurdle then you move straight to registration there's no requirement to ever prove that you've used the trademark when when this law change was introduced in 2018 Canadian lawyers were screaming from mountaintops that this is just going to encourage trademark squatting right just like cyber squatting where some you know domain name squatting where somebody you know picks up yours your domain name and the trademark that you want and basically holds it for ransom from you and we've seen that start to happen we've seen that start to happen that um there are Canadians who recognize that there are us companies that have not taken steps to file or protect their trademarks in Canada and they do go and they file those trademarks and then effectively get to hold them for ransom because they just got it registered they own the trade they own the trademark it got it got all the way through got registered and now that is a major obstacle this is different from when you know somebody else coincidentally has the same trademark as you and they're actually using it that's a different Hassle and that happens in the US and Canada equally but this is a uniquely canadi Canadian um issue and challenge for us companies is that there are enterprising Canadians uh and we're you know we're normally a very humble very polite Bunch but there are a small number of enterprising scammers Among Us who see an opportunity to grab your trademark hold on to it get it registered no one's ever going to ask at the examination level whether you intend to use the trademark or not and then um then you got to deal with that person is there any recourse so let's say I'm a brand in the United States somebody has my trademark I find this out when I try to go into Canada do they have any recourse or do they just have to they can yeah yeah yeah there's a few different you know channels that are available first of all when the when the use requirement was repealed the trademarks legislation in Canada was amended to introduce this concept of bad faith filing so if you can prove that somebody filed for your trademark in bad faith then you can get their trademark cancelled how do you prove bad faith this is sort of a yeah it's sort of a developing area of law because it's relatively new right it was introduced in 2018 so now in 2024 we're starting to see over the last couple of years some of the very first cases that are analyzing it one thing that we know is that um I mean certainly there's evidence that like you know if they're not using it it shouldn't be that complicated but when we start getting in the law yeah things always get muddy yeah so like a rational person think XYZ and but then you go into a legal setting and it's like well yeah I mean a logical person would agree with XYZ yes however there's this this and this to consider in you know case law or whatever yeah yeah that's right so one thing we know is let's say let's say um you want to file for your trademark in Canada and I've already got yours registered if there's proof that I offered to sell it to you that's proof of bad faith that I clearly got it with a design to extracted from you in exchange that's proofing and of itself what are they doing with them are they just helping people buy them and without challenging often times yeah yeah that that happens yeah just like just like you know domain name or cyber squatting for sure there can be proof of it where let's say IA prospective franchise of yours in Canada right you and I have had a few discussions uh about whether I'm going to you know buy a um a refresh uh oh and then they go out and they just trade mark and use your name right right and so that's probably going to be evidence of bad faith that wasn't a coincidence that we that I chose to name as yours I went out with a view to usurp your trademark ownership in Canada so it's a very fact specific caseby case determination whether someone's applied in bad faith or not the other ways that a us franchisor can sometimes counter that is if they can show that they have got AC it's called acquired distinctiveness of their trademark in Canada already so if a us franchisor a you you know brand owner not a franchise or can prove okay fine my trademark might not be registered in Canada but Canadians know me right like Canadians know the brand and I have proof of that because um I've got all these Canadians who are members of our loyalty program I have shown up at all these different Canadian franchise trade shows trying trying in Earnest to sell franchises in Canada I have got all of this proof of of Canadians who engage with us on social media even though we have no locations in Canada these are examples of things that can all go to show the trademark took on its own certain you know recognition and and a you know it it is it is distinct in the minds of Canadians and that gives it right that ought to LeapFrog this you know um basically fraudulent trademark application in the first place what are you seeing out of the first cases uh are generally the the brand winning in these cases or it's um it it really does depend it depends on the strength of the brand it depends on the on the facts you know we had a case this is not in a in a sort of Realm of bad faith but there's a case a few years ago where Hilton Hotels had filed for the trademark Waldorf historia okay and somebody tried to get it canceled on the basis that Walder aoria there are no Walder aoria hotels anywhere in Canada so the trademark can't possibly be in use Hilton was able to successfully maintain its Waldorf aoria trademark in Canada on the basis that Canadians are still using the trademark engaging with the trademark what's the proof I'm sitting here in Toronto and I go and I make a hotel reservation for Waldorf a story in the US I have I have you know I've used the trademark I've engaged interacted with the trademark so that wasn't in the realm of sort of bad faith filings but um when you are a brand owner franchisor and you can show that you've got Canadians who know you engage with you uh done more than just existing but you've actually like like canadi I gave the example about you know loyalty programs when you've got Canadians sitting in Canada who are engaging with your trademark even though there's no physical locations that's going to be stronger evidence of your um acquired distinctiveness in Canada which should defeat some of these you know bad faith actors um like I said you know uh you know the demands for money Ransom right that can make a difference and so in the cases that we've seen that was clear and the court decided in favor of the the you know the rightful brand owner because there was evidence that somebody had clearly applied for it just to extract some settlement out of it I have a real life scenario when it comes to trademarks that happened to me yeah um I had a competitor get angry at me and he got upset because my managers I guess approached some of his people trying to you know to recruit him right and so he got really upset about it got emotional and he looked at the state level if I had registered Trade names for all of my Brands right and I hadn't which was a mistake on my part but I did have Federal trademarks on yeah right so he went and he tried to essentially register the names and and take the names of all my Brands and then sends me a cease and desist order like what a childish move yes almost the exact same thing but I mean it was literally just one letter back it's like cool well now you're infringing on my federal trademark yeah yeah he didn't think that went all the way through he didn't check he didn't you know he didn't go to the federal level probably yeah yeah I think I made a mistake earlier I think I said primary and secondary register I meant to say primary and supplementary register um uh but that's almost it's it's it's in spirit that's almost the exact same thing right which is that I very clearly not the person who um is entitled to use of this trademark and we've seen it happen I mean we've seen it happen that there is a popular us brand and there is somebody in Canada who and you can see the date they filed right 2019 2020 um and then you can see that they've got no restaurant or store in Canada yet it's pretty clear that have gone all those years it shouldn't be hard to prove brand recognition any sizable operation to Canadians right right so your example with Hilton I mean any sizable brand like Canadians know about it in the US yeah for the most part they yeah so this will be um this will be probably the next phase of a lot of these disputes which will be okay so I'm a I'm an emerging restaurant brand in the US I have no locations in Canada we're just getting known in the US now you have applied for my trademark in Canada is it enough that I got this publicity that was seen by Canadians is it enough that I had some inquiries from prospective franchises and in Canada is it enough that I took the step of preparing a Canadian FDD even though I'm not in Canada and even though I'm still getting known everywhere is that enough to show that I've got some trademark rights in Canada that clearly should Trump what you know what this person did by just filing for my name when it was clear that they had no intention of using it and so we'll we'll continue to see but it is um and the other thing I should mention about filing trademarks in Canada is that the Canadian intellectual property office is the most backlogged trademarks office anywhere on the planet it's not even a close second is that why they did those that's has been the speculation that they eliminated the use requirement to eliminate the bureaucracy and the paperwork because they were so backlogged if you apply for a trademark today I forget if you and I talked about this earlier if you apply for a trademark today it will take over three years to get your application examined it'll just sit there in the queue for over three years and so um given that given how long it takes you know without sounding self- serving about it we definitely always recommend to you know to us companies if you think you're going to be in Canada within the next three to four years best to apply for a trademark now otherwise you know somebody else even if you're unsure in my eyes right if if you're unsure and there's a slim chance you're going to be there in five years why not just get it yeah is there is there a cost to maintaining in any way no it just sits there in the queue right so you might as well and what do they cost generally like what's the investment to get a trademark well I I mean I can tell you that the um SEO charges filing fees of uh I think it's $350 Canadian dollars uh for an application in a first class and I think it's $120 $150 for each secondary class and so that with legal fees for a single class trademark application you know who knows but it it it shouldn't cost very much uh it's definitely worth just it's very it should be very very accessible to to file a trademark application in Canada recognizing how long they were taking the Canadian in SEO kyal property office they made the decision a couple years ago to introduce some other channels to have your a expedited and one of them is if you swear an affidavit which says I believe my trademark is likely going to be the subject of litigation so let's say you decide you're going to apply for your trademark in Canada and someone else is already there maybe you send a season assist letter I mean the the prospect is out there litigation you can swear that affidavit submitted to SEO and your trademark application which was just filed and was at least 3 years away from getting examined all of a sudden gets expedited and within about two weeks you can get a response and your examination done so there's some recognition is there any evidence required to do that or you just swear on the affidavit well I guess it would be a of Love Canadians just I swear take my word for it that's yeah yeah yeah we're very very very trusting people uh it's interesting actually because we found initially you were able to get these affidavits that didn't really they just said you know I think this G be the subject of litigation I think SEO might have been a bit overwhelmed by the number of people who are submitting that and so now they're slowing down and saying hang on you got even more detailed than that give me give me something that all of a sudden everybody's expedited what happened yeah exactly exactly so uh there's you know there's some description that which which you have to be careful with because what you submit can be a you know a matter of public record it's all publicly searchable so if you're in a dispute with somebody you don't want to over disclose but you want to disclose just enough that your you know your request is going to get approved but um that is a channel um so that way you're not uh sitting there in limbo for three or more years not sure what's going to happen when the other person is ahead of you in line and you know they filed in bad faith you can use this channel sometimes to expedite your own application make perfect sense yeah that's awesome yeah do you have any advice you would pass on to a franchise or or anybody yeah looking at going into Canada that we didn't cover in the episode like what would be your legal advice for them to start the process of going into Canada I definitely would certainly start with a trademark application um but I guess I would say when I think of those situations we've seen us franchise ORS really really struggle the most I would say to not be guided just by flattery so if a Canadian calls you up and says I love what you're doing I think I could make a go with it in go of it in Canada and I'm prepared to pay you a royalty in order to do it I wouldn't base your decision to enter into Canada solely based on that it seems easy it seems accessible the cost of a Canadian FDD in the grand scheme of things is you know should be accessible for you know most any franchise shouldn't like shouldn't be a significant barrier yeah so I would say that you should definitely um you should in some ways almost treat that Canadian like it is another state and so treat it as it's your home Market I mean like like I said you know Canada the US not that far apart um you know there's a lot of interaction between those two markets so to not be guided by flattery and say great you know like if this all works out it's an ATM for me no not really I mean the franchisee is right there and and has all the same needs that a US franchisee is going to have so by all means you know start the process when you found the right operator in Canada expand into Canada because the right operator presented themselves but I would still proceed with the same deliberation you would for franchisee anywhere else in the in the US awesome awesome and and consider the the ramifications of support right that's why you were kind of getting out there too yeah yeah that's right yeah yeah hopefully all the you know pandemic restrictions are are all behind us now but uh because that introduced a whole host of franchise supp do you have any feedback on that I know yeah did during that whole situation yeah was there challenges for franchisors that are in both the US and Canada with they were then yeah yeah for sure I mean there were there were so many travel restrictions and if anybody was coming from the US they had to be quarantined initially for a certain amount of time and uh you know often times the training Personnel their own schedules do not permit that quarantine period so weren't there sections where they just weren't letting anyone in even with the quarantine or if you had business purposes you could get it on business purposes and you still had to the the quarantine requirements were were a little bit intense um so you could still cross the border but it added quite a lot of time and quite a lot of disruption so we definitely saw that our we saw was our us franchise or clients who just prior to the pandemic had signed franchise agreements and the franchise are getting ready to open and there's no one who can be there to help them physically that was incredibly challenging um so yeah hopefully those days are uh are I hope they all pulled through it well yeah yeah yeah unfortunately not all but but uh you know better times hopefully yeah yeah so I appreciate you doing the show do you want to uh tell people where they can find you in your firm a little you know give your a shout out website sure yeah the firm is um Dale and Lesman so we're Dale lan.com and I'm on LinkedIn Chad finlin and uh yeah happy to um happy to talk to anybody anytime awesome yeah I appreciate you doing the show chat and enjoy the rest of the IFA thank you very much you too all right I'm refresh man and I'm here to empower you to take charge of your destiny are you tired of working for someone else do you dream of making a difference in your community and unleashing your full potential then look no further than refresh franchising with us by your side you can start your own heroic business venture with the unwavering support and cuttingedge resources you need to conquer your goals our franchise model is like a super serum that will give you the strength strength to succeed refresh provides extensive training ongoing mentorship and an established brand with a loyal customer base plus you'll become part of a heroic League of entrepreneurs who serve as allies on your journey towards greatness and the best part you won't have to waste time building your business from scratch like some kind of neoy with refresh franchising you'll hit the ground running at lightning speed and unlock the key to heroic financial success so gather your courage summon your inner superhero and visit refresh franchising.com to launch your heroic franchise Journey always remember together we can achieve greatness