The recent clash between the Toronto Stock Exchange (TSX) and the Texas Stock Exchange (TXSE) highlights essential takeaways for businesses navigating trademark law. While the dispute centered on brand similarity, it revealed broader implications for intellectual property protection and legal strategy. Here’s how to safeguard your brand and avoid similar conflicts.
Lesson 1: Trademark Rights Depend on Commercial Use
Trademark protection is not automatic. It hinges on actual use in commerce. TSX held U.S. trademark registrations for "TSX" but did not operate within the U.S. Their registrations covered services like "operation of a stock exchange," which TSX argued were not offered in the U.S.
This underscores a key principle: trademark rights arise from use, not registration. Without commercial activity, a mark may lack enforceable rights. Document your brand’s use meticulously:
- Maintain dated records of how your mark appears on products, packaging, and marketing materials.
- Keep invoices, sales data, and customer communications showing the mark in action.
- Archive online ads, social media posts, and website screenshots featuring your brand.
- File trademark applications only after launching your brand or use an intent-to-use application with a clear timeline.
Expanding into new markets or product lines requires separate trademark filings. A mark covering "restaurant services" does not automatically protect packaged food.
Lesson 2: Visual Distinctions Can Counter Similarity Claims
Courts assess trademark disputes by evaluating likelihood of consumer confusion. Even if marks share similar words or sounds, strong visual distinctions can shield a brand.
In this case, a U.S. judge noted the logos “did not look alike,” casting doubt on TSX’s claim. To strengthen your brand’s legal standing:
- Design logos with unique graphic elements, avoiding generic symbols.
- Choose color schemes and fonts that clearly differentiate your brand from competitors.
- Test your branding against competitors to ensure it stands out in the marketplace.
Visual distinctiveness reduces the risk of being perceived as a copycat.
Lesson 3: Timing Influences Trademark Disputes
TXSE filed its trademark application in May 2023, making it publicly accessible. TSX waited over 16 months to act, by which time TXSE had secured significant funding, media coverage, and public support.
Delays in challenging a mark can signal:
- Lack of genuine belief in trademark infringement.
- Motives tied to competition rather than legal rights.
- Weakness in the claim’s validity.
Act swiftly if you suspect infringement. Document the date you first noticed the issue and consult an attorney promptly. Delaying can imply acquiescence to the infringing use.
Lesson 4: Declaratory Judgment Actions Shift Legal Control
TXSE’s proactive move to file a declaratory judgment in Texas federal court shifted the legal narrative. By initiating litigation, they forced TSX to defend its claims in a jurisdiction favorable to TXSE.
Consider this strategy if:
- You have strong legal defenses against infringement claims.
- You want to resolve disputes before litigation disrupts your operations.
- You prefer to litigate in your home jurisdiction.
- You seek a binding legal ruling rather than damages.
This approach allows you to control the outcome and avoid costly, unpredictable courtroom battles.
Lesson 5: Settlements Often Outweigh Litigation in Business Strategy
The dispute was resolved through mediation in late 2025, with both parties avoiding prolonged litigation. Settlements offer advantages:
- Control over the terms and confidentiality of the agreement.
- Flexibility to craft business solutions unavailable through court rulings.
- Avoidance of public precedents that could impact future dealings.
Even with strong legal arguments, litigation carries risks. A negative ruling could harm your business model. Settlements are not compromises - they are strategic choices to protect your brand’s future.
Your Brand Is a Valuable Business Asset - Protect It
A brand represents your reputation, customer trust, and market position. To shield your brand:
- Conduct thorough trademark searches before investing in marketing.
- File federal applications to establish priority and legal strength.
- Document use with dated examples, sales records, and market presence.
- Monitor for confusingly similar marks or infringers.
- Register domain names tied to your trademarks.
- Establish brand guidelines for consistent use across all channels.
- Work with attorneys who balance legal expertise with business strategy.
By prioritizing proactive trademark protection, you can avoid costly disputes and secure your brand’s place in the marketplace.
IP Defender monitors national trademark databases for conflicts and infringements, helping businesses like yours stay ahead of potential threats. Their service covers 50+ countries, ensuring comprehensive protection for global brands. With IP Defender, you can focus on growth while their team handles the complex task of trademark monitoring.