This page contains a collection of free resources which we will be adding to over time. We hope that you find them informative and that they answer some of the questions that you may have on a range of legal topics.
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Protecting Your Brand
There can be no doubt just how valuable a brand can be. Each year Business Week and Interbrand rank the world’s top 100 most valuable brands and this year, Coca-Cola came out on top again with their brand estimated to be worth almost $69 billion.
For many businesses, their brand is their single most valuable asset. This doesn’t happen by accident, of course, and businesses devote huge resources towards developing and promoting these gems of genius and ensuring that they are properly protected.
From a legal perspective, the Coca-Cola brand is no different to many others as it uses a series of trade marks as its primary source of protection. It is also a very good example of what can and cannot be protected.
What is a trade mark?
Trade marks are signs that can be reproduced graphically and distinguish the goods and services of one enterprise from those of another. The Coca-Cola brand fits this definition perfectly. It is instantly recognisable and there is no chance of confusion between it and the many other brands of fizzy drink that are available.
Trade marks are valuable because once registered they effectively give their owner the exclusive right to use the particular mark in relation to the goods and services for which it has been registered.
Trade marks are a form of intellectual property. Just like any other asset, they can be bought and sold or used as a form of security against which money can be borrowed. Also, if you do not take care of them they can be lost or stolen.
Sometimes you will see an “®” symbol next to a logo. This means that it is a registered trade mark. If you see “™” next to a logo it means that it is an unregistered trade mark and is protected through the laws of passing off (see further below). You must not add the “®” symbol to your trade mark until it has been registered.
What are the advantages and disadvantages of registering a trade mark?
Registering your brand as a trade mark has many advantages. First of all, it gives you exclusivity so that you can prevent others from using an identical or confusingly similar mark to yours for their goods and services. If they do, legal action against them for trade mark infringement is more straight forward than bringing legal action for passing off. Registering a trade mark therefore acts as a good deterrent to infringers.
In addition to buying and selling trade marks, trade marks can be licensed in exchange for royalties. So if, for example, you have a luxury goods brand you could licence your trade mark to someone else who sells a complimentary range of products to extend the product range and in exchange you would receive an additional income stream. A disadvantage of registering a trade mark is that once it has been registered, it cannot be changed. Therefore, if you wanted to update your brand you would have to re-register it.
Another disadvantage can be the costs involved, particularly if you are registering a portfolio of trade marks in numerous classes and in numerous territories. However, costs can be managed by registering a few key trade marks and then adding to the portfolio over time.
Can any part of a brand be protected as a trade mark?
Many different elements of a brand can be protected as a trade mark. The Coca-Cola Company has, for example, registered the name of the company, its logo, the name of its products, advertising slogans and even the distinctive shape of their bottles as trade marks. It is also possible to register colours, smells and even sounds.
However, to be registerable a trade marks must fulfil various criteria. First of all, it must be distinctive and not describe the goods and services it is protecting. If a trade mark describes the characteristics of the goods and services it is seeking to protect, such as quantity, purpose, value or geographical origin it will not be registerable.
Other restrictions on registerablity include anything considered to be deceptive, offensive or against the law (for example promoting illegal drugs).
Some national flags, emblems and other symbols are also given a special protected status so cannot be incorporated into a trade mark.
What should be considered when deciding to register a trade mark?
Assuming that your brand is protectable as a trade mark, the first thing to consider is the scope of protection required. When registering a trade mark, you have to specify what goods or services you want to it to protect and then protection is only given for those goods and services.
Trade marks can be registered in one or more of 45 different classes. This process is known as classification and a searchable database is available on the Intellectual Property Offices website at www.ipo.gov.uk.
This means that it is possible for similar or identical trademarks to co-exist for different goods and services. Take the word “polo” as an example. Ralph Lauren has registered it as a trade mark for clothes, Volkswagen for cars and Nestle for sweets. Each is a completely valid trade mark and there is very little chance of confusion arising between them due to them each having their own individual character and distinctiveness.
The next consideration is the geographic area in which you trade. Trade marks are territorial so you need to decide whether you need protection just in the UK or internationally? If you do not register in a particular territory you cannot claim protection in it.
Finally, you must consider costs. A fee is payable for each trade mark that is registered and the fees increase with the number of classes in which each trade mark is registered. Please do not forget that each trade mark is only registered for an initial period of 10 years. After 10 years, renewal fees are payable.
How does the registration process work?
Before making an application to register a trade mark, a comprehensive search should be carried out to ensure that there are no pre-existing marks that are likely to conflict with the application.
If this search does not reveal any potential problems, an application can be submitted to the intellectual property office in the territory (or territories) in which you are seeking protection. The application form will need to contain details of the mark you are seeking to protect and the classes in which you want it registered.
When the application form is received by the intellectual property office it will be examined to ensure that proposed mark is registerable. If it is, the proposed mark will then be advertised in a trade mark journal but if it is not registerable, the application will be rejected. If the application is rejected there is normally no right to a refund of the fees paid. Therefore it is advisable to take great care over the application and take professional advice if necessary.
Acceptable applications are advertised for a period of two months and during this period interested third parties may object to the application by filing an opposition. Grounds for opposition include someone claiming that they have a prior-right to the mark, it conflicts with their existing trade mark or that it does not fulfil the criteria for registration.
If no oppositions are received or if they are successfully overcome then the trade mark will be registered.
What happens once a trade mark has been registered?
Once a trademark has been registered, the owner must make sure that it is not used without their permission. If it is, for example if someone was to sell counterfeit goods bearing the trademark, the owner would be able to take legal action to stop them. They may also be able to recover compensation for any sales that have been lost to the counterfeiters or for damage to the reputation of their brand.
Coca-Cola has been used as an example of what can be done to give a brand maximum protection. For most brands, however, registering one or two trademarks would give an adequate level of protection.
What if my logo is not registerable?
If your logo is not registerable, all is not lost as it may be protected through the laws of passing off.
The laws of passing off effectively protect reputations and prevent one person from selling their goods and services on the pretence that they are someone else’s. Therefore, passing off cannot be used for new brands, only those with an existing reputation.
Compared to a claim for trade mark infringement, bringing a claim for passing off can be far more complicated and time consuming due to the elements that you need to prove and the evidence that you need to provide.
First of all there must be a misrepresentation as to the origin of the goods which leads to confusion in the mind of the public. As a result of this misrepresentation, you must have suffered a loss (for example, lost sales) or the other party must have gained (for example, increased sales).
A good example of a successful passing off action was when United Biscuits brought a claim against Asda as a result of Asda launching a chocolate bar known as a “Puffin” bar. This was found to be confusingly similar to the McVities “Penguin” bar in the way that it was packaged.
Protecting your brand online
In theory, there is no reason why trade marks should not be able to protect your brand on-line. However, in practice this is not so straight forward as you need to keep in mind that websites are accessible globally but trade mark registrations are territorial. Therefore, as explained above, if you have only registered a trade mark in England, you are unlikely to have any protection in other parts of the world.
If you are a trade mark owner, your mark will be infringed if somebody else uses for their business and without your permission:
- an identical sign for identical goods;
- an identical sign for similar goods and there is a chance of confusion; or
- a similar sign for identical goods and there is a chance of confusion.
In some cases it is obvious whether or not a trade mark has been infringed but in others, it is not quite so clear.
One such situation is in the registration of keywords of different search engines. If the keyword is a registered trade mark and is registered by a competitor who has no legitimate right to the word then it seems clear that they may be risking a claim of trade mark infringement. However, if the competitor can show a legitimate use for the keyword, for example by using it compare his goods or services to those of the trade mark owner, he may well have a defence to the claim if he can show that he is using it honestly.
The difficultly for the competitor in proving honest use is in explaining why he felt the need to register the keyword (which is effectively invisible to the user of the website) when simply referring to it in the text of the website would have been sufficient.
If the competitor has no legitimate right to be using the keyword then you potentially have a claim against them and could recover compensation for any losses you suffer or an account of profits if they have benefited unfairly from use of the keyword.
Managing your portfolio
If you go to the trouble of registering a portfolio of trade marks (or even just a single trade mark) you should take good care of it.
Renewal dates should be diarised to ensure that they are not missed. If they are, penalties may be imposed or ultimately the trade mark will expire.
Regular checks should be made on how the trade marks are used and whether the current level of protection is sufficient. If you have expanded your business into new areas you may need to register new trade marks. If you have stopped trading a particular are, you may need to take the trade mark of the renewal list.
You should also make regular searches on different search engines to see how your trade marks are being used. If you think that you have found an example of your trade mark being infringed then you may have a claim against them. However, you should consider taking professional advice before making any accusations against them because if the trade mark is being used honestly you could face a claim yourself as unjustified threats of trade mark infringement are an offence under the Trade Mark Act 1994.
We hope that you have found this Grid Guide useful. As you can imagine, this is a huge topic and we can’t hope to cover everything within these pages. It should not therefore be read as comprehensive legal advice but simply as a guide to some of the issues that may be important to you.
If you do have any questions on any of the issues raised, or would like to suggest a topic for a future Grid Guide, please feel free to contact us on a no obligation basis on 01202 961342 or via email at info@gridlaw.com
