Category Archives: trademarks

Apple granted a trademark over physical layout of the Apple Stores

Fifth Avenue Apple Store (Image courtesy of Wikimedia)

Trademarks can protect more than just a brand name or logo. Chocolate maker Cadbury successfully trademarked the shade of purple associated with the brand, while Coca-Cola famously managed to secure a trademark over its iconic Coke bottle. But, in typical ‘think different’ fashion, Apple has now gone a step further, and legitimately trademarked the physical layout of its popular retail stores.

Although not the first instance of a shop interior being granted a trademark, the news has attracted a lot of attention. The U.S Patent and Trademark Office twice rejected Apple’s efforts to trademark the store layout, before finally accepting a “distinctive design and layout” after additional documentation was submitted.

The stores are known for their sleek and uncluttered look. Apple reportedly spends an average of $10 million launching each individual store, usually located in carefully selected upmarket districts. Attention to detail is taken very seriously- the sandstone flooring is imported directly from Florence, while the late Steve Jobs even patented the minimalist glass staircases himself.

Apple’s new trademark covers the trade dress, and overall visual appearance of its stores in the United States. This encompasses elements of the store design, such as the “rectangular tables arranged in a line in the middle of the store” and “multi-tiered shelving along the rear walls”.

With so much investment to ensure the overall quality and unique identity of the Apple Stores, one can understand why Apple is so keen to prevent anyone else mimicking its stores. Competitor Microsoft recently launched its own retail store strategy, while Google has also unveiled plans to open retail stores in California. In fact, Microsoft reportedly acquired a trademark for its own stores in 2011, which covered “a retail store with four curved tabletops at the front and rear side walls and a rectangular band displaying changing video images on the walls”.

Another obvious reason behind Apple’s move is to protect itself against the cheap ‘copy-cat’ stores popping up in China. These stores are deliberately conceived to fool customers into thinking the traders are selling official Apple merchandise. Indeed, many of their customers may have never set foot in an authentic Apple store, and would be unaware they were buying false products.

While the decision clearly benefits Apple, some commentators question if it is appropriate to grant companies trademarks over the layouts of retail stores. Forbes  has criticized Apple’s ability to prevent competitors using in-store rectangular tables, and argues that in the fight against Asian rip-offs, the law of passing-off is sufficient to defeat copy-cat merchants, without resorting to trademarking physical spaces.

But while this argument is valid, proving a passing-off claim is often much harder and more expensive without an established and watertight trademark. With an army of handsomely paid corporate lawyers, Apple is leaving nothing to chance.

Many business owners and company directors are calling for legal reform, to further assist businesses to protect their carefully nurtured brands without resorting to costly litigation. However, some fear that companies would soon monopolise combinations of fairly simple features. IPKat points out, that UK law is far stricter when granting trade dress, as the test requires a mark to be “truly distinctive”.

For the Apple Store layout to acquire a trademark or trade dress in the UK, Apple would have to demonstrate the stores were so unique and distinctive that the public would easily associate the store designs with the Apple brand. Clearly, for most businesses, attempts to secure a trade dress will not be viable. And as the law currently stands, it is difficult to protect distinctive features of a shop layout without engaging the expensive litigation route.

In the high street, distinctive stores can be beneficial. Customers are able to immediately identify store branding and associate particular shopping experiences with particular stores. Therefore, as branding becomes increasingly important, the expansion of legal protection over unique in- shop experiences is likely to be sought out. But until it becomes easier to protect others from copying the interiors of a retail business, the easiest option for most business will be to rely on printing their trademarked brand names or logos on various surfaces throughout the store to act as identifiers which are protected against copying.

Licensing- Don’t Risk Losing Your Trademark

Licensing – Don’t Risk Losing Your Trademark

If your business has reached the stage where you are looking to expand abroad or diversify into different markets, licensing your brand could be the ideal way of achieving this.

With licensing, it doesn’t matter if you haven’t the staff or the money to fund your expansion.  You license your brand to a third party that already has the staff and resources available within the target market in which you wish to expand.

The positives are many: it can be a lucrative move and can generate additional revenue for your business; it can increase your brand awareness; and it can help create new products for your brand without running the risk of failure on your part.

Licensing

Licensing Without Controls

However, licensing has its downsides, too, which can be exacerbated if you don’t manage your licensing effectively.  One of the biggest concerns to be aware of is loss of control.  So, whilst licensing can boost your brand’s strength, it could equally damage your brand’s reputation.

This is the risk you run if a third party is licensed to use your brand without any restrictions.  It’s not just your brand’s reputation that could be damaged; in some cases, a lack of monitoring on how a third party is using your brand name could result in you losing the rights over the name.

Eva’s Bridal Shop

Take the case of Eva’s Bridal Shop in Chicago .  In 1966, Eva Sweis opened a bridal shop under the brand name, Eva’s Bridal.  The brand built a reputation for providing top quality goods and services.  Eva obtained trademark rights in that name.

The trademark was used for generations; friends and family were allowed to set up bridal shops under the Eva’s Bridal label.  But in 2007, Eva’s Bridal attempted to take legal action against a former licensee for trademark infringement as he was using the trademark after the license had expired.  On the surface, this appeared a fairly simple case of infringement.

However, the original licence agreement exerted no control over the way the trademark was used, and the court ruled that this therefore eliminated Eva Bridal’s trademark rights in that name.

This is because licences over a trademark granted without any regulations or restrictions, are considered to be abandoning the trademark, no matter how long you may have previously had the rights over it.

Therefore, it is vital to ensure when you license a trademark to a third party, it is  not just an agreement stipulating how much you are licensing a trademark for, but also to ensure you have control over the way the trademark is used.

Trademark as a Symbol of Trust

Trademarks are there primarily to indicate to the public the origin of goods, and to protect them from confusion.  It enables the public to rely on a brand as a signifier of quality, or standard, and is a symbol of trust.

Therefore, if you are planning on licensing your business, be sure to introduce quality controls, and limit the distributor’s rights to sub-license the trademark.

How to License Effectively

The first consideration when approaching a licence agreement is to describe what is being licensed, and to take account of the extent of your trademark portfolio.  What specific products or services are covered and in which geographical areas?  Who will be responsible for filing further trademarks, and who will bear the cost of these?

As a general rule, it’s important for you, the licensor, to retain responsibility for the trademark registration.  The licence will be for a specific period of time and may impose a number of conditions.  In return, the licensee agrees to pay you royalties and is willing to do so because you have something that’s popular.

Licensing can be an invaluable tool to some business owners wishing to expand their brand, so, it is essential to make sure that licensing helps rather than hinders your business.

If you have had any experiences of licensing which you would be willing to share, I’d love it if you left a comment below.

Do you need to bother with trade marks?

Since writing my book, Legally Branded, a number of business owners have thanked me for making this fundamentally important subject of intellectual property (particularly trade marks) understandable.

Some entrepreneur friends have even  suggested I emphasise the risks, and danger of ignoring intellectual property advice.  However, I’ve always tried to steer clear of scare mongering as a tactic to raise the profile of intellectual property, preferring to work with those clients that “get” the importance of intellectual property.  Our clients are the ones that get it, even if they’re not in industries where IP is obviously critical to their success.  They value their IP from the moment they start their businesses as did our client Headspace, for example, who are doing great things to make meditation accessible.

I recently attended a meeting with a business owner whose mind was firmly made up that there was no point paying expensive lawyers to give advice on IP.  I had agreed to meet with him at the request of his marketing manager who understands the importance of IP and hoped that someone more aware of the ins and outs of IP may be able to persuade his boss.  However, this business owner’s views did not shift one bit as a result of our meeting mainly because he talked far more than he was willing to listen, and his mind was already made up.  So, I know better than to try to address those whose minds are already made up that they know all they need to know about IP.

This is for readers who are curious, or undecided

This post is for those who may be curious, or who are still on the fence about whether it’s worth bothering with trade marks.  While it’s never a good idea to generalise about who does or does not need IP, I will stick my neck out and say that if you’re a lifestyle business (by which I mean you’re aiming to earn a livelihood and are not trying to build a big business or one you can ultimately pass on or sell) you can ignore trade marks.  You’re unlikely to come to anyone’s attention, or pose a threat to existing trade mark owners such that they would want you to rebrand for infringing on their rights.  Even if someone did require you to rebrand, chances are it will just be an inconvenience to change your marketing materials and rename the business.  You won’t have a name that attracts business, so could rename the business without suffering a drop in activity.  Similarly, if you’re setting up a business and want to first see if it will take off, then you MAY, depending on your business idea, be able to use a temporary name, or take a chance with the name you want to use (provided you’re willing to change it if the advice is that you would do better to choose an alternative name), and see if you can get anything off the ground before worrying about trade marking.  But for everyone else, it would be really foolish not to get trade mark advice from a specialist lawyer on the name you’re using.

Trade marks may be revoked

Trade marks can be cancelled, so even if you’ve secured a trade mark registration it doesn’t mean you’re alright to use that mark.  That’s why it’s misguided to do your own registration work, just to save on legal fees.  You may end up getting a registration, but it may not be for a mark that is capable of generating brand value.  You may not have an adequate scope of coverage, so that although you’re registered, it may not protect you if someone were to challenge your rights.  For example, registering a logo with a totally descriptive name – that is, one that describes what the business does – is easy enough to secure.  However, it’s an extremely poor choice of branding.

The law protects businesses against various unfair competitive practices, and helps you fight off competitors who use similar marks to yours, but you have very limited recourse with a descriptive name.  Using a descriptive name or a name that is otherwise incapable of being owned by you as a trade mark, leaves you wide open.  You will lose business that may have been intended for you, and you will have a business that is far less valuable than it might have been had you selected a legally powerful name.  This is the reason you should always consult your own IP lawyer on any name your branding professionals help you to choose, unless they are willing to take responsibility for its legal effectiveness.

Keyword rich names probably best avoided 

Also, take a look at the blog I wrote about Google’s recent algorithm change, which makes it even more of a poor decision to use descriptive names now online.  The writing is on the wall, so I would avoid choosing keyword rich names too when branding your business online.  The slides from my talk at Make It Big in 2013 also discuss descriptive names more.

Get legal advice

Even though you get some protection in this country just by using a name, don’t let that lull you into a false sense of security.  For example, if someone registers a Community Trade Mark they can stop you using a name you’ve been using, or limit you to using it only in a certain geographical area.  Why court the vagaries of litigation with all the cost implications when you can secure your rights in a name you’re getting recognition with, by paying ten times less?

Trade marks and legal advice should not be dismissed as too expensive to bother with for anyone who has a viable business.  They are an investment, and are the foundation for licensing and other ways of monetising your products and services.  In particular, don’t wait till you have reached certain turnover targets, because trade marks are fundamentally relevant to any business that aspires to be more than a lifestyle business.  Your business name is what the law protects when competitors behave unfairly.  So, trade marking is good business practice and isn’t just about whether you intend to become a brand, or think that if you sold your company whoever bought it would want to use your brand name.

Misunderstanding IP

There is a lot of misunderstanding about the relevance of IP, and huge generalisations are made about its costs.  But given that there are many different IP rights, of which trade marks are just one type, it’s foolish to dismiss them all as too expensive.  Knowing how to implement procedures to protect just one of these rights may be the critical element to your business success after all.

I think the problem is down to the complexity of IP law.  We are still in a transitional period between an industrial economy and a knowledge economy.   Consequently knowing how to deal with the physical things, the tangibles comes easy while intangibles that you can’t feel or touch, are less well understood. Intangibles are our knowledge, our brands, our digital content, and more.  By their very nature, they are easy to lose. Being transient, and non-physical, their legal significance can sometimes be overlooked or misunderstood.

Scrabulous and other high profile cases

The fact is that it can be difficult for lawyers to point out the benefits of IP except by pointing to situations where there have been well known incidents, such as with Scrabulous, which I discussed in a post recently.  Those of us IP lawyers who prefer to focus on the positives, won’t therefore want to keep pointing out the dangers, but I have outlined a number of scenarios in my book Legally Branded, which should help you better understand the risks.  Don’t assume that just because big businesses like Apple resolve their IP issues, that you will do so too.  People should know that for smaller businesses, the scenarios they hear about in the news about the Googles, Microsofts, Apples of this world would put them out of business because they would not have the resources to get themselves out of trouble.

So the moral is if you are a small business without access to huge sums of money to litigate your way out of  trouble then you absolutely need to make sure you avoid the problem in the first place by getting professional advice to register your trade mark.

Also, if you’re going to ignore IP protection, you need to know what you’re doing.  It could in some cases be rather like deciding not to bother with the foundations of a house you’re building.  In television programs like Grand Designs, the participants who overspend may end up not having enough money to do all the fine design details they had wanted.  Their  lack of funds means they have to compromise on the surface issues like designs.  They can’t compromise on the very structure and foundation of a building.  Unfortunately, the opposite approach happens in business when IP is ignored.  People can spend a fortune on the surface things like branding and websites while ignoring the fundamentals.

Distinguish IP from other legal work

While there are some legal issues you can and should skimp on in the early days of a business, IP isn’t one of them.  Note that IP is very often a contractual matter, and isn’t just about registrations.  So, take advice to see how to minimise your IP expenditure in a safe way if you think spending on IP may seem a waste.  Some business owners question any expenditure which doesn’t enable them to make money (such as learning a new marketing trick would increase their  chances of generating revenues).  However , think of IP as what enables you to keep the money you make, and in some cases to continue to earn revenues. So at the very least you absolutely have to take advice in order to develop your strategy for IP.

Trademarks and Britain Overseas

Trademarks and Britain OverseasIncreasingly, awareness of the value of a brand is leading businesses to protect their names and logos through trademark registration.  As registration is territorial in nature, only offering protection in the particular countries where an application is filed, businesses typically begin by focusing on their primary market before extending their registrations internationally.  For example, a company which operates in the UK might file a UK trademark and then later take advantage of rules which allow that registration to be extended to other countries as their business develops.

There are a variety of ways to protect your trademark further afield, but it is important to appreciate that the scope of a UK trademark may not offer as broad protection as you might expect.  While a UK trademark covers England, Wales, Scotland, Northern Ireland and the Isle of Man, it does not automatically extend to Guernsey, Jersey, the Republic of Ireland or Gibraltar.  So, when devising an international trademark filing strategy it’s important not to lose sight of priorities which might be closer to home.

The Madrid system offers a way to register international trademarks based on an earlier filing, and a European Community Trade Mark (CTM) registration can protect your brand in nearly 30 countries, but it may surprise you to learn that, even together with a UK application, these will not cover all of your bases.  There isn’t scope in this article to detail all of the Crown Dependencies (such as Jersey or Guernsey) or British Overseas Territories (such as Gibraltar or the Cayman Islands), but to give an indication of what might be involved to trademark a name in some of the countries which might be relevant to you, we have summarised some of the intricacies of the system below.

Jersey Trademarks

Jersey has its own trademarks registry, and is not party to the Madrid system but is covered by European (CTM) registrations.  So if you have only registered your trademark in the UK, you would need to either re-register in Jersey or secure a CTM.  One curiosity is that, although UK registrations do not extend automatically to Jersey, an international application that designates the UK does offer protection in Jersey.

Guernsey Trademarks

As with Jersey, Guernsey has its own trademarks registry and is not part of the international Madrid system.  However, CTM registration does not protect your trademark in Guernsey, and nor will an international registration designating the UK.  So, it is necessary to register directly.

Trademarks in the Republic of Ireland

There are three ways to protect your trademark in Ireland.  If you operate elsewhere in Europe, then a CTM may the best way forwards, and you can also designate Ireland as part of an international application through the Madrid system.  Alternatively, if you don’t need wider protection you can file directly with the Irish Patents Office.

Trademarks in Gibraltar

The European system also covers Gibraltar, so if you would like to register a trademark in Gibraltar you will need to either file directly in that country, secure international protection designating the EU, or register a Community Trade Mark

Cover your bases

Only a handful of jurisdictions are mentioned above, and there are a range of former British Protectorates and Commonwealth territories, Bailiwick’s and other Crown Dependencies, and British Overseas Territiories which each have their own particular quirks.   Bearing in mind the diversity of routes available when registering trademarks internationally, through national registration, re-registration based on national marks, the CTM system, the Madrid Protocol and the Madrid Agreement, a well thought out strategy for securing protection of your brand is crucial.  Without expert advice, it’s easy to leave gaps.

If you want to protect your brand internationally, let us know by completing our enquiry form. In the meantime, if you want to learn more about the legal aspects of branding why not buy a copy of Legally Branded, a book that explains the relevant law in an accessible way?

How To Secure An Unusual Trademark

Whilst the most common use of trademarks is to legally protect brand names or logos, this is by no means the only way in which a trademark reinforces a brand.

Trademarks act to identify the source of a good or service to consumers, and therefore a trademark can cover any aspect of a brand that denotes a particular company in the mind of consumers. For example, as mentioned on the Azrights blog Cadbury secured the colour purple as a trademark, Coca Cola has trademarked its iconic glass bottle shape.

With the Internet making competition ever more fierce, and difficult for brands to stand out, securing an unusual trademark could help give your company that added distinctiveness which competitors could not emulate. However, securing an unusual mark is not straightforward.

The way Coca-Cola was able to get a monopoly over its bottle shape demonstrates what can be involved in securing an unusual trademark.

Coca-Cola & its distinctive bottle shape

The design of Coca-Cola’s instantly recognisable glass bottle is highly distinctive. Even feeling the contoured bottle shape in the dark can be enough for the identity of the brand to be instantly recognised. Coca-Cola’s bottle shape helps it to stand out from the crowd because no other drinks manufacturer is able to copy its bottle design.

However, this is something that the company has had to gradually achieve over a number of years.

In order to be granted a trademark for the shape, Coca-Cola first protected the bottle design with a registration which gave it a monopoly over the design.  In the EU a design registration gives you a maximum of 25 years protection. Therefore, although a design registration is effective in the short-run, in order to ensure long term exclusivity Coca-Cola needed a trademark.

In order to get a trademark granted Coca Cola had to make sure the bottle design was associated in consumers’ minds with its name.  So, the bottle needed to be identified with the brand whenever they saw the bottle. To achieve this, the company promoted the bottle heavily during the time it had design protection.

Once consumers did identify the bottle shape with Coca-Cola the company was able to secure a trademark over the bottle shape.  This means that as long as Coca-Cola renews its trademark, and uses the bottle shape, no other company in the world can use such a bottle shape.  That is very powerful IP indeed.

How you can secure an unusual trademark

So if your company wants to gain a monopoly over a particular brand identifier, make it can become synonymous with your brand.  You’ll need to put appropriate intellectual property rights in place in order to stop competitors copying your branding in the meantime. So, if you want to associate a shape with your brand, make sure you register it soon enough, using a series of images to properly protect the design first.  If you have an effective registration that can give you a monopoly over the shape for 25 years, then vigorously promote the design as something that is synonymous with your brand. For those on a smaller budget, social media may make it more affordable to achieve such a task without breaking the bank.

If you want to secure a trademark in a colour, or other unusual identifier, let us know by completing our enquiry form. In the meantime, if you want to learn more about the legal aspects of branding why not buy a copy of Legally Branded, a book that explains the relevant law in an accessible way?

Trade mark registration and brand extension in China

Trademark registration and brand extension in China - Chinese FlagChina is now the second largest economy on the planet, and has become a key market for businesses worldwide. So, securing ownership of your brand in China should be an important part of your plans.  While the Chinese system of trade mark registration shares many common elements with the European regime there are subtle differences that can be a trap for the unwary, and in this blog post we are going to take a look at two of them.

Classification

Throughout much of the world, trade marks are categorised according to the Nice Classification. This system sets out 45 classes of goods and services for which a given trademark will be used, for example class 25 covers clothing, class 9 covers software, and class 41 covers education, among other things.  The same trademark name can be registered in different classes by non-competing businesses, and you can find out more about trademark classification here.

Although the Chinese trademark system does make use of the Nice Classification, it further divides these classes into narrower subcategories. This means  the same mark can be registered in the same international class, for similar goods or services, provided that the registrations fall within different subclasses.  For example, general footwear, and football boots, would fall in different subclasses, and the same trademark might be registered by different companies in each.

A cost effective, and efficient way to protect trademarks abroad is by using the Madrid Protocol system of international trademark registration. This mechanism lets you extend an existing application or registration into a number of different countries in one go, rather than filing in each individually.  However, the international applications must be filed in the same classes, and against the same goods and services. Typically this is not a problem, but in China, while it may be cost effective at first to file using the Madrid system, you may find that you also need to file an application directly to ensure  you are protected in the correct subclasses. In fact, where you have the resources available, registering a national Chinese mark may be the priority.

Translation, transliteration and Chinese characters

While in the UK, and Europe generally, you often only need to consider the English language trademarks that you use with your products, there are several dimensions to securing trademark protection in China.  The original brand name may be a priority, but your business, products or services will also become known by a name in a local dialect.  Unless you develop a strategy early on, you may find that the market has chosen a brand name for you.  This is what happened in the early 1990s, when Chinese businesses began using Chinese characters to approximate the sound “Coca-Cola”.  Unfortunately, though the wording used may have had a similar pronunciation, actual translations of the text included “female horse fastened with wax” and “bite the wax tadpole”.

So, well in advance of taking steps to extend your brand into China, you should decide how you would like to be known. Beyond your domestic branding, you will need to consider translation or transliteration of your name, whereby you either use words in a local dialect to approximate the sound, or translate the meaning of your trademark into Chinese.  Coca-Cola were lucky to find a Mandarin pronunciation which had a positive meaning (“Ke Kou Ke Le”, roughly “permitting the mouth to rejoice”), but you may not find it so easy.  You will also need to consider registering your trademark in Chinese characters, and the position is further complicated by the fact that many different  characters have the same pronunciation, so the best approach will depend on the particular name you choose.

Timing and Manufacturing

IP squatting, whereby trademarks are registered by a local entity which then trades on your success, or which tries to sell the rights back to you, is a problem in China, where it can sometimes be big business.  So, timing is  important. If you wait for your plans to mature, you may find  it’s too late, and a local Chinese business has already adopted your branding, as happened to Starbucks.  While the coffee giant eventually won its legal battle with the Shanghai coffee corporation, it could have avoided the costly dispute if it had registered its own brand in good time.

It is typical for businesses to outsource manufacturing of their products to China, and in doing so license their Chinese partner to use their trade mark for that purpose.   In some cases, the Chinese manufacturer, or another entity in China, will hijack the brand, registering it as a trade mark and securing ownership of the rights to it in China.  Case law on this point is developing, but there is a risk that such a hijacker might bring an action against the manufacturer for trade mark infringement, stopping production in its tracks.  So, even if you manufacture but don’t sell your products in China, it is crucial to secure local trade mark protection.

Though not relevant to every business, if in the longer term you hope to manufacture or sell in China, it is prudent to take steps quickly to protect your interests.

To find out more about trademark registration in China and elsewhere, please submit an enquiry.

Branding For Success

I presented this presentation at Triumphant Event’s one day ‘Make it BIG in 2013′ event on November 24. For those who missed it, here is a transcript of my speech along with the accompanying slides.

To thrive in a crowded market, a business has to be clear about its niche, positioning, brand values – its whole identity – which should then be reflected in appropriate designs. This is essential if you’re to become a brand in the sense of having pre-sold clients who want to do business with you.  That’s how you stop having to compete on price.  However, what is less well-known is that there are fundamental Intellectual Property issues that must be addressed if you’re to reap the benefits of your success.  I’ll be discussing some of these IP issues in the next 20 minutes as they’re important if you’re aiming to make it big in 2013.

I’ll just say a few words about my background before I begin. I’ve practised IP law for nearly 15 years, having qualified as a solicitor more than 25 years ago.  I worked at Coopers & Lybrand, Reuters, and Eversheds before setting up my own law firm 8 years ago.  Going into business on my own made the legal work really enjoyable in a way it had never been before.  I love helping businesses to bring their ideas to life and one area of my focus is on names, as they raise a number of legal issues, some of which I’ll touch on here.

Inevitably when you work in an area you spot problems, and one I’ve noticed is the widespread confusion about what ‘branding’ actually is.  To a designer a brand is the logo.  A marketer may emphasise the niche, and positioning, while a communications professional will stress the importance of consistent messages, and an IP lawyer will emphasise trademarks and copyright.  The fact is that the skills of many different professionals are relevant to branding.  So it’s not surprising that people don’t really know who to turn to, and in what order when they brand new products and services.  And that includes people in the branding industry. A very experienced and well-educated marketing director contact confessed that he didn’t really know in what order to do things when he wanted to create a new brand.

This explains why companies so often make mistakes with branding. In practice, they’ll pick a name they like, see if the domain is available and buy it, then they’ll commission someone to produce a brand identity.  At the very end of the process they may or may not turn to a lawyer to protect the brand. Some people do nothing at all, while others might register a trademark themselves.  This puts a business at great risk of either using a name which infringes on someone else’s rights or of using a name that’s inadequate to meet the wider long term business objectives.  The reason the risk of infringing a name is quite high is that the trademark registers are cluttered with registrations so that it can be difficult to find names that are available to use for the various purposes for which you may need to use the name. Also, using similar names to those which someone else has already trademarked is an infringement, so it’s not just the exact same names that are out of bounds.

It’s worth knowing that if someone else has a better right to a name you’re using, you would be infringing on their rights whether or not you may have registered a domain, a company or even a trade mark.  Registrations can be and are cancelled. The owner of a similar trademark may not be aware of you or may not be concerned while you’re a small scale operation.  It may be a different story though if you make it big.  Imagine what it would feel like to receive a cease and desist letter requiring you to change your name immediately, to provide a list of your customers, sign an undertaking and pay damages.  From the perspective of the trademark owner, you only achieved your success because you were riding off the back of their brand, so it’s fair enough to ask you to account for the profits you made during the time you used their brand name.

A name is where your brand both begins and ends. It’s the first thing customers hear when they discover your business, and the last thing they remember at the end, so it’s vital to own the rights in your brand name.  Intellectual property law is similar to the law of physical property.  If you were developing a plot of land you’d be sure to buy the land first before investing in building on it. The last thing you’d want would be to run the risk  that someone else had better title to it.  It’s the same with intellectual property rights over a brand name.  Don’t assume the professionals who may have helped you to brand your business must have taken care of the IP aspects because it’s unlikely they’ll have done so.  Their expertise is not in IP law.  I wrote my book Legally Branded, because of the widespread lack of accessible information on the IP aspects of branding.

It’s not possible to have copyright in a name, no matter how much money you may have invested in creating a name. Trademarks are the only way to stake your claim to a name. Trademarks are tools to capture the economic potential in your business, and are central to how the law protects a business against unfair competition.  Trademarks give you legal title to a name, and exclusive right to use it for your business.  This makes it easier to enforce licensing and other agreements.  Some entrepreneurs assume trademarks are just about protecting goodwill, but they’re much more than that.  The reason a trademark is desirable is to monetise your business.  You don’t need to be intending to be the next Coca-Cola for trademarking to be relevant to your plans.  If you have a big vision you’ll need trademarks to grow the business, both nationally and internationally.  The right strategy for registration will differ depending on your business plans and the type of business you’re in. With some niches you are very vulnerable unless you are quick to register your mark in other countries once your concept takes off.

Trademark infringement is something I come across a lot because it’s quite common given the way in which business owners pick names.  So, it’s a real risk not just a theoretical one.  Having the distractions of potential litigation and rebranding is not a risk any sensible business owner should run.   I don’t want to depress you, but it’s important to realise that you could be sitting on a time bomb.

Let me give a couple of examples. Mcdonald’s takes a somewhat aggressive stance to users of the ‘Mc’ prefix.  So Elizabeth McCaughey had to stop using the name McCoffee for her coffee shop even though she had operated for 17 years with that name, and used the name in the first place because it was a play on the word in her own name.

Some businesses that are infringing on the rights of a trademark owner have to rebrand virtually overnight.  For example, Scrabulous one of the first Scrabble like games on Facebook was removed by Facebook as soon as Hasbro complained about trademark infringement despite having gone viral. We will never know how big Scrabulous would have been today if it had opted for a better name. The setback cost them dearly as it paved the way for Zynga to enter and dominate the market with its successful Words with Friends app.

A different aspect to consider about the name you’re using is whether it’s capable of taking your business to the heights you envisage for it.  For example, using a name that says what your business does on the tin, so to speak, often appeals to people. But there are powerful legal reasons why a descriptive name should be avoided.  Descriptive names inevitably limit a business’ potential.  They’re only suitable as an option in the early stages of a business that’s testing the waters with a new concept, and wants to avoid trademarking considerations, and to benefit from a name that communicates what it does.  However, a better name should be chosen as soon as the concept proves viable. A descriptive name is actually devoid of personality.  It’s like calling a dog, dog.  You’re not giving that dog its own unique name, and identity, and it’s no different when branding a business.  A trademarkable name protects consumers by providing a reliable way for them to find products they’ve bought in the past.  If I’ve enjoyed a chocolate called Milky Way, and want to buy another one, I should not be confused by seeing chocolates with names like Mulky Wai.  The law will stop other traders calling their chocolates by a name that’s misleadingly similar to Milky Way, but if the chocolate has no name, because it’s simply called chocolate, the law cannot and will not stop other chocolate sellers also calling their chocolate bars ‘chocolate’.  So, if a competitor starts using the same name or a similar name to yours, there’s little you can realistically do to stop them if yours is a descriptive name and you inevitably lose some of your potential customers to competitors.

To understand the limiting effect a descriptive name could have on a business let’s use a fictitious example.  Say there’s a website which connects dog owners looking to leave their dog with other dog lovers instead of in kennels when they’re away on holiday. If the website were called Dog Vacation it could be deemed descriptive. If the name couldn’t be trademarked, the website’s success couldn’t be fully exploited through licensing others internationally to set up and run similar websites in their home market. In fact, such a niche website has been created just in the past year in the USA, and luckily its name is capable of legal protection because it’s called Dog VACAY, not Dog Vacation.  This business currently has a multi-million dollar value mainly due to the lively and active community of dog lovers it has given rise to.

Apart from licensing people in other countries, exploiting the value in an engaged community, such as Dog Vacay could include extending the brand into areas such as pet foods, pet furniture and accessories and so on by licensing others to apply the brand name to their products.  So the bottom line is that licensing depends on having a name you can stop other people using.  You would register a trademark in your home country and then ultimately in other countries if you’re to avoid seeing your business copied by unlicensed individuals elsewhere who may even use the name Dog Vacay unless the US company has been astute enough to register a trademark in other markets as well as in the USA. It inevitably reduces the value of your business if you can’t properly control use of its name.

There are a number of do’s and don’ts around what makes for a good name, but the most important thing to remember is that a name must be legally effective, and capable of getting you to your destination.  It’s not just about whether you like a name or whether it sounds good or even whether it is capable of being trademarked.  It needs to be a name that suits your business plan and objectives. One reason businesses have been attracted to descriptive names in the past, is that Google historically looked favourably on domain names that included relevant keywords.  For example, dogvacation.com would be likely to come up in a search for “dog vacation”.  However, Google discovered that this led many low quality webpages to appear in search results, as marketers were taking advantage of descriptive domain names to increase visibility.  In response, in September Google tweaked its algorithm to give less weight to domain names which are an exact match for a search query, so even this limited benefit is no longer a worthwhile reason to use a descriptive rather than distinctive name for your business online.

Zumba the dance is a great example of an effective name for a business that spread like wildfire internationally, as well as extending into all sorts of different categories like DVDs, clothes, and so on. So, make sure you’ve got the right name if you want to make it big because the wrong name will put a ceiling on your ultimate business growth, no matter how good a business you build, and how effective you are as an entrepreneur. Once you have a powerful name, put in place appropriate IP protections and a strategy for international trademarking.  That’s the way to bulletproof your brand so there are no limits on how your business can grow once it captures the public’s imagination in 2013.  I wish you every success in the upcoming year.

If you’re interested in learning more about this topic, why not buy a copy of Shireen’s book Legally Branded which is available on Amazon? You can download the contents and the first chapter free at www.legallybranded.co.uk.

if you’re interested to understand this topic more why not buy a copy of Shireen’s book Legally Branded which is available on Amazon, and you can download the contents and first chapter free at www.legallybranded.co.uk

Trademark Infringement- M&S vs. Interflora

Yesterday the IPKat wrote about an interim judgment handed down by the Court of Appeal in the dispute between Interflora and M&S.  The case revolves around the question of whether competitors should be able to bid on a registered trademark in Google Keywords, and you can read more about it in our earlier post, which covers Internet Marketing and Keywords in Search Engine Advertising.

This particular decision didn’t focus on keywords, trademarks or advertising as such, but answered a question never before posed to British courts about how evidence should be gathered and used in cases of trademark infringement.  The court had to decide whether evidence from witnesses who were selected via a survey should be admitted, when the survey itself is not to be relied on.  

Far Reaching Implications

The decision ought to interest anyone involved in a case of trademark infringement. Often, a critical issue when proving trademark infringement is demonstrating evidence of public confusion. However, there are inevitably hurdles to gathering this kind of evidence: is any particular witness indicative of the sentiment of the general public? How many witnesses should be called to give an accurate view of public opinion? How do you go about finding those witnesses? This last question in particular was at the heart of the decision yesterday.

The Court’s Decision

In short, though the judgment was not as dismissive of survey evidence as courts have been in the past, it makes clear that if you want to use surveys to identify witnesses, you should be ready to justify your methodologies.  The IPKat wisely observes that this could be an added incentive for people who don’t like surveys, perhaps spurring them on to attack methodologies, and devalue surveys in legal proceedings.

The judgment also serves to illustrate how careful you need to be when gathering evidence of trademark infringement.  Integrity and reliability are paramount, and you might need to be particularly careful if your aim is to describe the ability of a hypothetical ‘reasonably well-informed and observant internet user’ to glean whether two businesses are connected. 

Can You Trademark A Colour? Cadbury Secures The Rights To The Colour Purple

Last month Cadbury managed to secure a trademark for its signature purple colour after a lengthy battle with Nestle. The outcome means that Cadbury now has the exclusive rights to use its own distinctive colour on its confectionary items.

Cadbury is not the first company to seek a trademark in a colour. Their court victory closely follows Christian Louboutin’s successful trademark of the distinctive red it uses on the soles of its shoes, Heinz has a trademark in the turquoise colour used on its baked bean tins, and Orange has a trademark in, you guessed it, orange.  

Should a business be able to own a colour?

Some people are sceptical about whether companies should have the ability to own a particular colour, believing the idea to be ridiculous. However the idea is not as ridiculous as it might seem. Firstly, despite Cadbury’s successful trademark registration, it by no means ‘owns’ the colour purple. Rather it owns that particular creamy purple that is associated with Dairy Milk (Pantone 2685C) and even this only covers milk chocolate products and within this category, chocolate bars and tablets, chocolate for eating, and drinking chocolate.

Secondly, a company’s right to trademark a particular colour boils down to one very important factor- brand recognition. The whole purpose of a trademark is to protect the identifying signs that can help customers determine the origin of a particular good or service. A name and logo are obvious identifiers, but colours and even shapes can also become a unique distinguishing factor for a brand.

What can colour add to your brand?

In the case of Cadbury, the colour purple used on its packaging was hugely indicative of the company itself. Take for example one of its most successful adverts.

The advert is very simple, featuring a Gorilla beating the drums to Phil Collins’s ‘In The Air Tonight’. Despite the fact that the product itself does not get featured till the very end of the advert, the ad displays the trademarked purple as a backdrop in the studio set.

This use of the colour perfectly demonstrates, not only how Cadbury was trying to tie the colour to its product in the minds of its customers, but also how it was able to immediately evoke its own brand in people’s minds simply through the use of colour.  Through this it was able to create an advert that was unusual as it lacked any obvious attempts to sell a particular product, only subtle visual symbols, but that still drove customers to buy its product due to the lingering feeling of happiness the ad created which was associated with the Cadbury brand.

The use of colour and visual identities can really be a great communicator of a brand’s values and messages that speak without any need for words.

The importance of visual identity

Think about when you go to do your weekly shop at the supermarket as an example. What are you drawn by when you pick up your purchases? The visual image of a product often plays a really important factor in driving a customer to buy something.

As Brand Republic states, ‘[visual] brand identity is more than a corporate label, it is a neurological mnemonic that influences what we think and how we behave’ It cites how some people show a preference for Coca-Cola purely on packaging alone, when in a blind taste test these same people might find the taste of Pepsi to be preferable. Therefore colour, when put into context, can be powerful in its ability to draw customers to one particular product over another. (If you want to explore this topic in more detail the book Visual Hammer by Laura Ries (Kindle, 2012) is a useful read for understanding the interaction between visual and verbal communication.)

How well-known are these brands’ colours?

See for yourself if you can identify some of these trademarked colours. (Answers listed at the end of the article)

Can you tell which department store uses this green?

 

 

 

 

Which luxury brand uses this blue?

 

 

 

 

Or on whose home-supplies would you find this yellow?

 

 

 

 

How can you secure an unusual trademark?

However, trademarking a colour is by no means a simple procedure. Whilst it is relatively easy to secure a trademark in a name or logo, more unusual trademarks, such as colours, shape or music can be difficult to secure as you need to prove that the element in question is synonymous with your brand in the mind of your customers.

Although a brand is much more than purely a logo, colour or even a name- these are the identifiers that can carry certain associations in customers’ minds.

We will be writing in a future blog post about the difficulties of obtaining unusual trademarks, and how Coca Cola managed to trademark its iconic bottle.  In the meantime our 7 Mistakes Book gives some tips to help inform you how to make the most of intellectual property assets.  Even if you get just one idea from it, it could prove invaluable, so why not downloaded it here.

Answers: Green= Harrods; Blue= Tiffany; Yellow= Post-it