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European Trademark Registration

European Trademarks

European Trademark RegistrationIf you are doing business in a number of different European countries then, rather than registering your trademarks in each jurisdiction separately, you will likely apply for protection at the European level. 

This enables you, through a single application, to  secure protection in all 28 countries (and counting). 

Unless you only need protection in one or two member states, a European trademark is a far more cost effective, and straightforward solution.

However, it is not without its risks.  While a trademark application in just a single country generally just faces the possibility of an objection from other brand owners in that country, a European Community Trademark can be opposed by an existing trademark owner in any one of the 28 member countries of the EU.  This would then block the entire trademark.

So, how can you minimise your risks? The key is to commission professional searches to identify potential obstacles before you commit to a mark, and file your application.  You might begin by initially looking at the UK and European trademark registers, before then expanding the search to the national registers of each EU country.  International searches like this can be quite expensive, and offer diminishing returns, so it is important to discuss what degree of searching is appropriate with your legal adviser.  It is never possible to eliminate the risks entirely, but through appropriate searches, you can improve your chances without blowing your budget.  Your attitude to risk, and the funds you are willing to commit to searching, will generally depend upon how critical your brand is to your business.

But what if you do encounter a problem? That is not necessarily the end of the road.  If your European application is opposed by a business with rights in just a single member state, the first step will generally be to negotiate with them, and see if it is possible to come to an agreement allowing both businesses to coexist.  Under some circumstances, it might not be possible to reach an amicable settlement, in which case the European trademark courts may resolve the dispute.  However, this can be costly for all involved.

If, ultimately, you do decide it is best to withdraw your application in that particular country, all is not lost as you are free to file national applications in those European countries from which you did not face an objection.  However, there are no guarantees that those national applications would not face objections from other trademark owners.

A key issue when it comes to trademarks is what is known as the priority date.  Typically, this is the date on which you file your trademark application, and the date from which your registration is effective.  If you were to entirely withdraw your application following a dispute, and refile national applications, then you would receive a new priority date.  However, it is possible to convert a European trademark application into a group of national applications, and retain your original priority date.  An important advantage of doing so, is that your application will, broadly speaking, take precedence over others which were filed in the interim.

Still, converting a European application to national applications, or refiling directly in the relevant countries, can become very expensive as fees are payable in respect of each territory.  So, where resources allow, it is best to carry out appropriate searches in advance.  You can find out more about national, and international trademark registration on our dedicated website AzrightsTradeMarkRegistration.co.uk.

Photography and copyright

Photographers, photography copyright and the Red Bus case

Photography and copyrightPhotography is probably one of the most popular art forms today, with social media platforms such as Instagram, Pinterest and Vine encouraging the professional and the amateur photographer to share their images. Such platforms encourage users to think of themselves as having copyright in their images, so it may come as a surprise that copyright law is not clear-cut when it comes to protecting photographs. Furthermore, when it comes to digitally enhancing or altering photographs, photographers need to be aware of the risks of copying visually significant elements of other images. The ‘Red Bus’ case, decided last year in the English Patents County Court, illustrates the difficulties businesses can face when using ‘photoshopped’ photographic images.

The images in dispute

The Red Bus case concerned images of a London bus crossing Westminster Bridge in front of the iconic Houses of Parliament. Temple Island Collections Limited used one image on souvenirs of London, while New English Teas, used the other image on tea packaging.

Red Bus images

These images had both been digitally altered from original photographs so that the images were black and white with the bus coloured red, although the two images were not identical. The story of how these images were created is more extensively discussed here, here and here, but, in summary, the two parties had a history, having already met in court previously when Temple Island Collections Limited sued New English Teas for copyright infringement concerning images which were much more similar. New English Teas attempted to create an image that did not infringe Temple Island Collection’s copyright, and it was this second image that was the subject of the 2012 litigation.

Temple Island Collections Limited felt that New English Teas had copied their image, while New English Teas felt it was unfair for Temple Island Collections Limited to claim a monopoly over a particular type of digital enhancement of a photograph of a well-known landmark and called into question whether this type of image could attract copyright protection.

Copyright infringement in digitally manipulated photography

Having established that the images were capable of copyright protection, Justice Birss considered whether the second image could infringe the first. Traditionally, copyright infringement has been thought not to occur when two independent photographers take pictures of the same iconic subject, because of the original input from each photographer.

Temple Island Collections alleged that the second image reproduced a ‘substantial’ part of their image, and therefore infringed their copyright. New English Teas disagreed, arguing that this would give Temple Island Collections a monopoly over a particular digital manipulation of a popular iconic image.

Justice Birss compared the two images and considered the parties arguments. The fact that the parties had produced their respective images independently from original photographs was insufficient to avoid copyright infringement. It is not the skill and effort of the author or photographer which is relevant for copyright purposes, but the effect of the final work. In particular, for a photographic image, Justice Birss considered the visual effect of the final image to be the most important element in determining copyright infringement.

The bright red bus against the monochrome background, and the blank sky were of particular importance to the visual effect of the first image. Differences in other compositional aspects like the direction of travel, presence of people and traffic and scale of the composition, were less significant. Justice Birss found that the selection of the visually significant elements of the first image, the monochrome image with the bright red bus, and the blank sky, by New English Teas was deliberate, given the parties history it would have been difficult for New English Teas to deny that they were unaware of the first image. So, although New English Teas had not physically reproduced the same work, Justice Birss found that they had copied the ‘visually significant’ elements of the image used by Temple Island Collections Limited and by using the ‘key combination’ of the important visual elements from the Temple Island Collection image, New English Teas had copied a ‘substantial’ part of the first image. Therefore, New English Teas had infringed the copyright of Temple Island Collection Limited’s original image.

The ‘Red Bus’ case has been quite controversial in legal circles because the rule of thumb for intellectual property is that the law does not protect ideas, but only the specific expression of those ideas. For some, a black and white image with one colour picked out is merely an idea, most famously used in the 1993 film Schindler’s List. After the case, the court was asked to consider a considerably more cropped image of a red London bus in front of Big Ben, reported here, and found again that the visually significant elements of the first image were present.

Implications

Businesses and individuals who regularly engage in altering and enhancing photographic images can take comfort from the decision that these efforts are likely to be intellectual endeavours that attract copyright protection. Intellectual property is a valuable asset for many businesses and assigning or licensing such images can provide a revenue stream. However, the availability and ease of use of photographic software such as Photoshop also presents risks for photographers, because they cannot be sure that simply because they are working with their own photographs they will be safe from copyright infringement. Copying the techniques other photographers have used to manipulate images could infringe copyright. Photographic software which provides templates for digital manipulation is particularly risky, as other photographers will be regularly using the same templates. More than anything, the ‘Red Bus’ case illustrates the need for photographers and design agencies to familiarise themselves with copyright law and keep up to date with developments.

Businesses that use photographic images need to be aware of the risks highlighted by the Red Bus case. Working from original photographs is not enough to avoid copyright infringement. Businesses and individuals need to educate themselves on copyright law and have in place robust risk management procedures to avoid copyright infringement when digitally enhancing and altering photographs.

 

Trademark Registration A Lack of Finality?

Trademark Registration – A Lack of Finality?

Trademark Registration a lack of Finality?Over half a million trademark applications are filed each year throughout Europe, and a memo of the European Commission indicates that as of March 2013 there were nearly 10 million trademarks listed in European registers.  Putting it mildly, the Commission notes that “The demand for trade mark protection is high”.  But if you consider the essential purpose of trademarks, a problem starts to emerge.

Are the Trademark Registers too Crowded?

At their most basic, trademarks are a way for consumers to tell the goods and services of one business apart from those of another.  In principle, trade mark rights can also last indefinitely.  So, if the number of trade marks registered continues to grow in this fashion, with every combination, and every permutation being snapped up, surely businesses will run out of words to use?  Some people worry that it is already difficult to find a good .com domain name, but what would be the impact if you faced an uphill struggle when looking for a brand name you could use in general?  What if all possible brand names were taken, what would you call your new business, or products?

Fortunately, even if the rate at which trademarks are applied for is set to increase significantly, this scenario is far from becoming a reality.  First of all, just to cover all possible combinations of letters and numbers with marks only as long as the word ADIDAS would mean every single human being on the planet registering at least 10 trade marks, and that doesn’t take into account stylised text, logos, sounds, colours, shapes or other types of trademark.  Of course, the scope of protection extends further than basic identity – the use of a similar word can constitute infringement of a registered trademark, so not every combination of characters need be registered before it becomes difficult to conceive something novel.  However, this becomes even less of a problem once you account for the fact that the same trademark can be registered by different owners who are not competitors, but even so, the cluttering of the trademark registers is undoubtedly a valid concern.

Trademark Revocation

That’s why the role of trademark revocation is important.  Trademark registrations are not immortal, and although it’s feasible to maintain them indefinitely provided that renewal fees are paid promptly, there are a number of grounds on which a registration might be challenged.  One of the fundamental grounds on which you might apply for revocation of a registered trademark is that it isn’t being used.  Richard Arnold QC put it like this:

“The purpose of revocation is to remove trade marks or parts of the specifications of trade marks where there has not been use.  It is there to serve a purpose in trade; it is the Lipitor that stops the arteries of commerce being blocked with the cholesterol of unused trade marks”

Broadly speaking, if a trademark is left languishing for a continuous period of 5 years, it is vulnerable to revocation.  So, out with the old (owner) and in with the new.  But this is far from the only reason a trademark might be struck from the registers.

As discussed above, the purpose of a trade mark is to help consumers distinguish the goods and services of one undertaking from those of another, and once a word becomes the common name for something, it can lose this ability to designate origin.  This process is referred to by trade mark professionals as genericide – once a trade mark becomes generic it loses its distinctive character.  Some common examples of genericide are Hoover and Escalator – both of which are brand names which have become accepted into general language.  Once this happens, trademark registrations are on shaky ground.

Although far less common, another basis for revocation of a registered trademark is the argument that it is likely to mislead the public, for example if the trademark suggests that products have a particular geographical origin, or a particular quality when in fact they do not.

Invalidation

Aside from revocation, registrations can also be declared invalid.  Whereas the impact of revocation is that the mark is removed from the registers, if a trademark is declared invalid it is treated as never having been registered at all.  Trademark applications occasionally slip through the net, and so a registration might be invalidated if later on, it is discovered that a similar or identical trademark was already registered by someone else, or because another business had built up rights in a conflicting trademark by using it.  Alternatively, having been reassessed the trademark could be deemed descriptive in retrospect, and therefore lacking the ability to distinguish the origin of goods and service.

Should I still try to Register my Trademark?

So, registration is feasibly indefinite, but there are no guarantees as it suffers from a lack of finality.  Does this mean it isn’t worth registering? Absolutely not. The key message here is that there is far more to registering a trademark than simply making it onto the registers.  All of the risks mentioned above can be managed by taking care at the outset.  By casting a critical eye over your trademark before applying for registration, an expert will be able to assess whether it might later be deemed descriptive, or deceptive, and a professional search will reduce the chances of conflicting rights turning up out of the blue later on.  They will also be able to advise you of ways to maintain your registration, for example by using the registered trademark symbol you may be able to avoid genericide, alerting people to the fact that the mark isn’t simply a common word but an indication that you are the source of the product.

To help avoid losing your rights you should also take care to make genuine use of your trademark.  The concept of genuine use is complex, and you might be surprised by some of the situations which don’t meet this test.  For example, a manufacturer promoted its clothes by giving away drinks labelled with its brand, and because the freebies were not distributed with the aim of penetrating the drinks market, it was not sufficient to maintain rights over the brand in that class of goods.  On a related note, it’s important that you take care to use the mark in the way it is registered, and if you do make a change, for example by altering the design of your logo, you should consider whether it’s necessary to file a fresh application for the variation.

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?

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

Why you shouldn’t overlook the law when branding

A lack of attention to the legal side of branding has been the cause of unnecessary setbacks for too many businesses.

There are a large number of trademark infringement lawsuits and the high-profile ones which get into the news are just the tip of the iceberg.  One which was reported recently concerned Lord Alan Sugar’s new venture YouView. The company’s trademark has been denied due to its similarity to Total’s Your View mark, which was already registered in the same category.

Whilst YouView has been reported to have ‘no intention of changing its name’, the trouble the company has got itself into really demonstrates the need to ensure that a name is suitable from a legal perspective before it’s chosen.  Even within the branding industry, it’s not generally appreciated that you need to first make sure a name is legally available before you go on to base your brand around it.

Trademark infringement lawsuits can have disastrous consequences for businesses. Take the case of Scrabulous. You may remember Scrabulous as a Scrabble-like game available to play in 2007 as a Facebook application. The app allowed people to play the game online- with friends, family or anybody in the world- and quickly became very popular with hundreds of thousands of users playing every day.

However, the brothers hit trouble when Hasbro, the owner of the Scrabble trademark, contacted Facebook and shut down the game on the basis of trademark infringement.

Had Scrabulous’s creators sought legal advice before settling on a name for their game, they would have realised that trademark law prevented them from using a similar name to Scrabble. In fact the founders had even applied to register a trademark for the name, demonstrating their lack of awareness of the broad scope of protection trademarks afford.

Despite the fact that Scrabulous has now returned to Facebook under the name Wordscraper, it lost its position as the first app to offer a scrabble like game on Facebook.  This paved the way for other apps to enter the market, and Zynga’s highly successful ‘Words with Friends’ app is now the market leader.

Scrabulous had already gone viral when they were shut down.  Who knows how big Scrabulous might have been today had they opted for a more suitable name.

The lesson to learn from the Scrabulous experience is that no matter how perfect you think a name is for you, it’s only perfect if it’s legally available.  That is the way to build a business on solid foundations and avoid the wasted time, money and heartache of trademark infringement .

Scrabulous is just a high-profile example of what happens to too many businesses. It is a simple mistake which can easily be avoided by understanding the right order in which to do things when looking to brand a new business, service, or product. The legal aspect of creating a brand is too often left till last, after a website has been created and a logo has been designed, by which time it is either too late, or people bury their heads in the sand because they’ve invested too much in a name.

If your company has a brand name, or a name for a new product, that has not been legally checked out or you have any questions, why not submit an enquiry to find out how we can help you?

Will Olympic Brand Protection Cost Michael Phelps His Medals?

Olympic swimmer Michael Phelps, famous for being the most decorated Olympian of all time, may be getting attention for all the wrong reasons recently. He appears to have landed himself in trouble with the International Olympics Committee following a leaked photo featuring the athlete lying in a bath tub as part of an ad campaign for Louis Vuitton.

As we discussed in our previous blog article, the IOC have been getting a lot of attention this year for their harsh regulations and brand policing during the games.  Preventing any brands other than the official sponsors of the games from piggybacking off of the IOC’s high profile is the reason for their  approach.

Earlier this year a new rule (rule 40) was implemented which was designed to prevent athletes from promoting non-Olympic sponsored brands from July 27th to August 15th.

The photo for the ad campaign surfaced on Twitter on 13 August, putting Michael Phelps in breach of this regulation. However, Phelps is not the first athlete to have been impacted by this rule; team GB were warned against wearing Beats’ headphones that had been sent by the company to their hotel rooms, and Yohan Blake may receive a fine for wearing a $500,00 Millie watch rather than one made by Omega, official watchmaker of the games.

In the case of Michael Phelps there might be more far reaching consequences. The leaked photos could potentially disqualify the athlete as the IOC rules state ‘A competitor or a team may lose the benefit of any ranking obtained in relation to other events at the Olympic Games at which he or it was disqualified or excluded; in such case the medals and diplomas won by him or it shall be returned to the IOC’.

Whether or not Michael Phelps’s medals will be put in jeopardy rests on whether the photo was leaked intentionally by Louis Vuitton. The company declares that the photos were unofficial and that the campaign was not due to run until 16 August, similarly Phelps’s agent Peter Carlysle has stated that there is no issue with the IOC as the athlete did not authorise the photos to go out.

Will Phelps loose his medals? Does this show a fundamental problem with rule 40 in relation to the Olympics? We asked before whether the IOC’s strict regulations concerning brand promotion during the games were too harsh or whether they were an understandable way to protect the Olympic brand, but what do you think might happen now that the rule might cause an athlete to lose his hard earned medals?

First Sale Doctrine being called into Question

You buy a book, finish it, sell it second hand via Amazon marketplace- for many this approach to buying goods has become fairly common practice. Especially with sites such as Ebay, Preloved and Gumtree, it has become easier and more frequently practiced for people to re-sell their old goods. After-all once you have bought something its yours to do with what you like, right? Well, it might not be any more…Currently in the U.S. this style of ownership is being put into jeopardy due to a number of court cases that have called into question people’s rights to re-sell their goods.

First Sale Rights

The first sale doctrine, allows the purchaser of a copyrighted work to re-sell it, lend it, rent it, or destroy it, without having to seek explicit copyright permission. This law means that copyright only applies to a product being sold for the first time. Without it free-markets allowing for the distribution of CDs, DVDs, used phones etc. would be deemed illegal, as would rental places such as Blockbuster, Love-film or Libraries unless they had specific authorization from the copyright holders. Fundamentally, the law allows people to do with their goods, pretty much everything we are accustomed to do, even down to lending a CD to a friend.

So what is the problem?

The first sale doctrine applies to any copyrighted good ‘lawfully made under the [Copyright Act]’. However, what has currently become the subject for debate is what exactly constitutes a product made lawfully under the Copyright Act?  Although it has been established that this covers any product manufactured in the U.S. what is now being questioned is whether it applies to those goods manufactured outside the U.S as well?

Omega vs. Costco

The issue was first raised in 2010, in a case involving Omega and Costco. Omega was selling watches only for distribution in South America, yet Costco was managing to sell Omega’s watches in the United States for a cheaper price than the suggested re-sale price there. Costco defended its distribution right using the first sale doctrine. The federal district court ruled in Costco’s favour, but the Ninth Circuit Court ruled in Omega’s favour declaring that the Doctrine did not apply to goods manufactured outside the U.S. The case was then moved to the Supreme Court, which remained in a 4-4 deadlock and the issue was never fully resolved and therefore can provide no precedent.

John Wiley & Sons, Inc. v. Kirtsaeng

The case that currently is being addressed by the Supreme Court involves an international student from Thailand reselling textbooks that were manufactured in both the United States and Thailand. Textbooks were also sold in both places; however the ones being sold in Thailand were made in lower quality materials, and therefore were cheaper than their American equivalents. In order to finance his way through University, the student, Supap Kirtsaeng, decided to buy these cheaper textbooks in Thailand and then sell them to his fellow students at a cheaper price than they would otherwise have had to pay when buying the more expensive American editions. On learning about this, the publisher Wiley, sued for copyright infringement. The trial court ruled in favour of the publisher, awarding them $600,000 in damages, with the Second Circuit Appeal court upholding the ruling, declaring Copyrighted works manufactured abroad were not works lawfully made under’ Copyright Act… and thus are not subject to  first sale doctrine’

So what now?

The case is now being moved to the hands of the U.S. Supreme who will be charged with the ultimate decision. If they do rule in favour of the Second Circuit, then it looks like the flexibility of distributing products will be severely altered.  This means that any products manufactured abroad, even if they might have been designed in the U.S, will no longer be able to be re-sold freely without fear of infringing copyright. This very concept would mean that people would no longer truly own what they buy, where products are leased rather than sold to you, which as Techdirt points out, would be a ‘massive encroachment on individual’s property rights’

On top of this, some fear that this will encourage companies to manufacture their goods abroad in order for them to have greater control over the distribution of their products, and have sustained copyright over the products. With many companies, such as Apple, already manufacturing their products abroad in places like China, what will this mean for people who, say, want to resell their old iPhone?

Feeling the Pressure?

Ebay is clearly feeling the threat that this impending case poses, and has given its support for the Citizens for Ownership Rights to help collect signatures for a petition urging the Obama administration to support ‘the rights of Americans to purchase legitimate goods, resell these goods, give them away, or use them in any legal manner as they see fit’

Library Associations have also stepped in to defend their rights to lend books printed abroad, feeling that they do not have the legal budgets to risk continuing lending in case they were sued, nor have the time or money to track down all individual rights holders. They claim that U.S libraries have over 200 million books with foreign publishers; not counting those printed abroad, meaning that the implications for libraries would be massive. Therefore, the LCA (Library Copyright Alliance) have asked the court to alter the Second Circuit’s definition as ‘lawfully made under this title’ meaning made ‘in the United States’, to ‘copies manufactured with the lawful authorization of the holder of a work’s U.S reproduction and distribution rights’

A Step Backwards

In the Internet age, at a time when it seems likely that we might soon even be able to resell digital music, a decision ruling against first sale doctrine being applied to goods manufactured abroad, seems like a major step backwards.  With the whole definition of first sale doctrine being placed under scrutiny in this case, there seems to be a lot more riding on the Supreme Court’s decision than purely the redistribution of textbooks.