Tag Archives: Brands and Trademarks

Famous Marks – Trade Mark Classifications

Famous Marks – Trade Mark Classifications

Famous Marks – Trade Mark ClassificationsWhilst the classification rules apply to the majority of trademarks, famous marks operate under slightly different rules. A famous mark has a much broader scope of protection than an ordinary mark. This is due to its widespread reputation or recognition which means it is not subject to classification restrictions. It enjoys the same protection as if it had been registered in each of the 45 classes. This broad protection given to well-known marks is afforded by most industrialised countries.

A while ago we wrote about famous names as trade marks which have resulted in numerous high-profile disputes. The situation is no less complex and tricky today. The basic rules about famous marks are outlined on the INTA website. Essentially, the significance of the rules is that when you’re picking a new name for a product or service, you need to beware of adopting famous brand names such as Martini or Coca-Cola for your business. This is because even if you had nothing to do with drinks, and were in a completely different industry, Martini or Coca-Cola could stop you from using their name.

For example, although you might see multiples of the same name used for other brands, such as Polo, you will probably notice that there are no multiple Microsofts or Coca-Colas.

Marks that became famous long ago, or quickly, such as Twitter, or Google, are famous enough to Twitter drinkhave a complete monopoly over their name worldwide. There have been applications to register Twitter for wine, beer and other alcoholic drinks, as well as attempts at other categories. The objection to such applications is that by using the sign, the applicant is taking unfair advantage of the mark’s fame and its use could have a detrimental impact on the well-known trademark.

Trademark infringement and famous marks

For trademark infringement cases involving famous marks, the requirements for proving infringement are different from those found in other cases. Rather than having to prove that someone else’s use of a name is confusing to customers, the trademark owners instead have to show that the other user is ‘diluting’ their brand by ‘tarnishing’ or ‘blurring’ its famous mark. A case demonstrating how a famous mark is protected from being ‘tarnished’ involves Hasbro Inc.

Hasbro Inc. v. Internet Entertainment Group

One of Hasbro’s most popular games is a board game called ‘Candy Land’, which is targeted at young children and since 1949 has been advertised as a ‘child’s first game’. The whole design of the game was focused on using bright colours, and wholesome images, which helped make the games so popular. .

However, in 1995 Internet Entertainment Group (IEG) acquired the Internet domain name candyland.com, using it to launch a sexually explicit website. Hasbro launched a lawsuit against the company on the grounds of trademark infringement.

There is no danger of people confusing an adult entertainment site with a kid’s board game, so under normal trademark regulations Hasbro would not have been able to prevent IEG from using the Candy Land name.

The issue Hasbro was taking IEG to court over was that its use of the Candy Land name would tarnish Hasbro’s own trademark.

‘Dilution by tarnishment’ is defined as ‘the association arising from the similarity between a mark or trade name and a famous mark that harms the reputation of the famous mark’.

IEG lost the case, and was ordered to stop using the ‘Candy Land’ trademark and turn over the candyland.com domain to Hasbro. The outcome of the case was extremely costly for IEG as it had paid over $20,000 to acquire the domain name, and had spent an additional $150,000 on advertisements for the site.

Blurring

An action involving trademark dilution by blurring has to prove that the similarity between a mark and a famous trademark will damage the uniqueness of the original mark through blurring.

An example of blurring would be if a company were to start selling shoes under a famous name such as Kleenex. Again, in this case it would not matter if the two products had no chance of being confused, and that customers would realise each product is made by different entities. What matters in such cases is that the distinctiveness of the mark is lessened. No longer would people associate Kleenex only with the tissue company, but also with shoes, ‘blurring’ the famous mark.

What makes a mark ‘famous’?

Beyond household names the issue is not always straightforward. A mark may be well known in one country but not in another, and it depends on whether the public in the given territory is familiar with the mark.

Absolut Vodka v. Absolute Radio

An example of a case where a well-known mark failed to stop another business using its name is the drinks company V&S, Vin & Sprit, which owns the Absolut Vodka brand. It issued proceedings against Virgin’s Absolute Radio for trademark infringement and passing off on the basis that there was a risk of confusion with its brand. Absolute Radio was registered as a trademark in 2003, and Absolut was aiming to have the trademark revoked.

After 18 months of wrangling, a confidential settlement ensued whereby Absolute Radio was able to continue using the name.

In conclusion, avoid using the name of a mark that is well known in the country in which you intend using it, otherwise you could be required to rebrand even if you have secured trademark, domain or company registrations.

Amazon On Trade mark Infringement Trial Over Search Results

Trademark Infringement Trial of Amazon Over Search Results

Amazon On Trade mark Infringement Trial Over Search ResultsRecently, the US Court of Appeals for the 9th Circuit reinstated a case filed by Multi Time Machine against Amazon over trade mark infringement and published its opinion last week.  This opinion reverses a lower court decision held in favour of Amazon and the case is now back to the district court in LA for further proceedings.

The Dispute

The case is about watchmakers Multi Time Machine (MTM) and their allegations against Amazon’s search tool. They claim that Amazon’s search results could be confusing to buyers who are looking to buy MTM’s products. While Amazon does not sell the watches manufactured by the company, the results to buyers who search for “MTM Special Ops” are a list of watches created by competitors and sold by Amazon. What is more, right above competitors’ products, consumers still see the search term “MTM Special Ops” in Amazon’s search bar. This, it is alleged, could mislead users into buying watches from a competitor.

MTM Ops

MTM Watch

Watches

At the heart of the dispute lies the fact that the watchmakers own the trademark for the “Special Ops” watches and, therefore, claim that Amazon uses their trademarked term in their website to list Amazon’s products in search results instead of listing MTM’s watches. The problem for MTM, however, is that Amazon does not sell the watches manufactured by the company at all. The site will not say they are not selling MTM products either. Instead, Amazon display their own products when buyers search for MTM’s “high-end, military-style” watches. It is for this reason that consumers may be confused by the results from their search.

Court’s opinion

Initially, the Los Angeles district court held Amazon’s use of Multi Time Machine’s trademark created no likelihood of confusion. However, on appeal the court did not agree with Amazon’s defence that this use did not constitute “use in commerce”.

“This court has held that use of a trademark as a search engine keyword that triggers the display of a competitor’s advertisement is a ‘use in commerce’ under the Lanham Act,” the opinion states. “We hold that the customer-generated use of a trademark in the retail search context is a use in commerce.”

In a dissent, 9th Circuit Judge Barry Silverman said Amazon’s search results page clearly labels Textmanufacturer for each watch and made an interesting comparison to a diner offering Pepsi and not Coca Cola:

“No reasonably prudent consumer accustomed to shopping online would likely be confused as to the source of the products,” he added. Anyway, the ball is thrown back to the trial court.

What to expect?

This case could turn out to be very important in technology law, as Ars Technica suggests. Actually, many companies have already tried to challenge this practice of “keyword advertising” by suing competitors or search engines, although none has succeeded. This zero success rate is also the reason why this practice gradually stopped. Therefore, the potential win by MTM is exciting news for those who hope to be rewarded. In this sense, if this case leads to payment to the watchmakers, this could create a wave of trademark litigation focused on this issue.

By way of illustration, the most notable case in this context is that of Rosetta Stone and her trademark case against Google which, although was settled on confidential terms, went to an appeals court and raised the awareness of some of the issues involved.

And while we are waiting to see what’s next with MTM and Amazon, Lexology author Christopher Ernst suggests: If Amazon are your competitors, why don’t you check if they are doing this to you?

How do you create a brand using data?

Data & Brands – An Introduction To Creative Data From The Cannes Lions Festival

How do you create a brand using data?Last week was the Cannes Lions week, where some of the world’s most known brands descended on the south of France for the world’s biggest annual awards show and festival for professionals in the creative communications industry. This year Unilever; Intel; Facebook; Twitter; AirBnB; Google; Vice and more, were amongst the most talked about brands.

The world’s foremost professionals and leading thinkers were present to talk about this years’ hot topic: DATA.

What Data?

The word ‘Big Data’ is thrown around a lot with the advent of new technologies but what this is is alien to most businesses. Not every business has the capacity to filter through the vast amount of information it collects about a customer or client whether intentionally or incidentally to their business interactions or transactions. However, the use of this data has enabled the creative industry to drive complex ideas, and drive mass engagements to tell stories more than ever before.

Creative data is the data which can be used to produce highly targeted campaigns.

Tech and Global Brands

Marc Matthieu, former vice president of marketing at Unilever and soon to be Chief Marketing Officer at Samsung, said brands don’t get built the way they used to and if people think about the top brands in the world, it’s no longer Coca-Cola but the “Google’s and Apple’s of the world”, see the full article here.

What Marc says, to a large extent, is true. Technology has now become such an integral part of our lives that it has seems inconceivable that you wouldn’t just ‘Google’ something on your iPhone. What drives these companies is essentially how they are using the data that they collect to create a brand that seamlessly fits into our lives and delivers value.

Theo Theodorou, head of EMEA at xAd, says that Ad tech firms have begun making their mark for this very reason. He said that advertising technology is making its mark more than ever before because these companies are offering data driven ad targeting in location based mobile technology.

This means information provided by you through your digital interaction can be, and is increasingly being used to target you in very clever ways, wherever it is you are in the world.

While collecting ‘big data’ is all well and good, what companies are doing with that data is more important. According to AirBnB’s CMO, it is important to “work with talented people who understand how to tell a story out of data and use that story to inspire creative people, so the foundation on which the creatives are asked to work is actually robust”. In essence, extracting information and creating a story is not dissimilar to the function of a trade mark communicating brand values to customers when buying a product. To this extent, creating these stories is to create a brand and to create a brand is to create intellectual property, which is an asset and one which will require careful management if it is going to be successful.

The Googles and Apples of the world are some of the most prolific intellectual property generators developing some of the most advanced technology the public has yet to see and their success is because of successful IP strategies and management. Making your brand stand out requires more than extracting a story from the details of many, it involves a clear intellectual property strategy that allows you to create the value and continue commercialising it.

What makes your brand stand out?

In our post Brand Name – 8 Points To Consider Before You Name Your Product Or Service, we highlighted some of the elements that would help in creating a distinctive brand. For example, the data collected by a business may reveal some important details such as age demographics, shopping habits, location etc. When creating a story out of those details choosing an appropriately distinctive name to represent it is important as it will allow easy association and will help translate your product to your respective market.

Take for example the Compare the Meerkat campaign as a trade mark, it was noted that Jason Lonsdale of Saatchi and Saatchi was quoted as saying “They’ve done something unexpected and a bit bonkers, and it’s paid off. A campaign based on talking animals and a pun sounds like a terrible idea, but it works.” See the full article here.

Finding an appropriate name is half the part, however, as registering it is what will help maintain its aura. In this example, Alexsandr Orlov (the Meerkat) is actually a UK trade mark, see here.

Tech is king, but first movers win

If someone had already registered ‘Compare the Meerkat’ the campaign would have suffered immeasurably compared to what the brand is worth today.

With technology taking over every aspect of brand communication, being smart about brand strategy involves a lot more than creating innovative stories and concepts. It involves understanding the insights offered by data and the value of your intellectual property as much larger chess pieces in a commercial strategy that will help your business grow.

What will be of the future of 3D trade marks?

3D Trademarks – No Breaks For Kit-Kat

What will be of the future of 3D trade marks? The latest in Nestlé’s attempts to trademark its iconic four-finger chocolate is at odds with EU Law.

Back in 2012 we reported in our blog Can you trademark a colour? that Cadbury had managed to secure a trademark for its signature purple colour after a lengthy battle with Nestlé. If you have been following the race for confectionary supremacy between Nestlé and Cadbury, you will know that in 2013 Nestlé successfully blocked Cadbury from maintaining its trademark rights in the colour purple ‘pantone 2865c’ for its Dairy Milk chocolate bar.

Cadbury’s application did not meet the criteria of a trademark, namely that ‘predominantly’ purple was not specific enough and lacked objectivity for the purpose of registration. See here.

Nestlé are set to see a similar fate in the latest turn of events.

What does this mean for the future of 3D shape marks?

Yesterday it was reported that the Advocate-General (AG) has advised that the Nestlé’s application for the three-dimensional ‘Kit-Kat’ shape is not compliant with EU law.  Although not an official ruling, it poses a serious threat to the future of three dimensional trademarks.

Life in 3D

Three dimensional trademarks are notoriously difficult to register. Why? Because a registered trademark grants perpetual monopoly rights and, because, the registration of these marks provide an enormous advantage in highly competitive markets where products are homogenous or differ only by a few features.

Having a trademark means that no one else can use the same or similar shape for the same or similar goods. This is generally considered anti-competitive.

To this extent, shape marks play a crucial role in the multi-dimensional aspect of a brand’s distinctive character. A trademark acts as an agent of a commercial strategy, and shapes are one of the foundations to a successful marketing campaign.

In our piece about ‘Coca Cola Bottle Granted Trademark Protection in Japan’ we mentioned the Coca-Cola bottle, which seems to be one of the few shapes on the market which has been able to achieve trademark protection in many different countries. It only takes a few moments to think of that bottle and realise how many international campaigns, advertisements and references are based on this one shape.

To be or not be?

In a recent article by the Guardian, Iain Connor, head of Pinsent Masons’ contentious IP practice, stated that the AG’s “opinion is entirely consistent with the court’s previous refusal to grant trademark protection for Lego bricks and so comes as no surprise.”

It is not so clear cut, however. The general rules are that you can’t register a 3D mark, even if it has acquired a level of distinctiveness, if:

1. The shape results from the nature of the goods, i.e. you’d have a hard time registering the shape of a banana for bananas;

2. The shape is necessary to obtain a technical function; and

3. The shape adds substantial value to the goods. (What this value is, is inconclusive).

Lego had failed to register its toy bricks because the shape was necessary to connect one brick to another. Philips had failed to register its 3 headed shaver for similar functional reasons. On the other hand, the triangular Toblerone pack enjoys trademark protection which, arguably, makes it easier to package the confectionary in bulk. Is that not a technical function? Chrysler were also able to register the front ‘seven slot’ grill of their Jeep vehicle which, in the author’s opinion, serves the technical function of cooling the engine. The court’s interpretation of these ‘exotic’ trademarks is therefore far from consistent.

To draw the distinction is a conceptually difficult task. For instance, the shape of a chocolate bar with ridged indents is no less necessary to break the fingers off than a Toblerone is good for stacking; a Cola bottle is useful for containing Coca-Cola; and the holes in the front of your car prevent your engine from exploding.

The argument put forward by Cadbury was that without the branding and logo the shape was not distinctive enough to warrant a trademark. However, a street survey revealed that 90% of consumers recognised the chocolate bar (without its packaging) as a ‘Kit-Kat’.

If it is all about packaging, however, then the court offers no less abstract guidance. Last summer, Apple Inc. were able to trademark the layout of their store. The CJEU came to the conclusion that, somehow, the Apple store is equivalent to ‘packaging’. See here at para. 16.

The author’s view is that the ruling (whilst a coincidently accurate metaphor for corporate culture) defies the whole point of specificity and objectivity. Not all Apple stores are the same, and if the design alone is such that it presents the services provided, then does Cadbury’s ‘predominantly’ purple ‘packaging’ or Nestlé’s four-finger chocolate bar not present ‘Dairy Milk’ and ‘Kit-Kat’ in much the same way?

The ‘certain’ circumstances for registration 3D trademarks are not so certain after all.

Trademarks unchained

Shape marks are construed narrowly because of the commercial power which they yield. However, to what extent does a company have to sacrifice its distinctiveness for the good of its competitors?

Modern advertising and marketing practices now incorporate far more than your standard bill-board and infomercial. Companies are awakening to the fact that the most powerful advertiser is the consumer himself. The one who is inadvertently a brand ambassador carrying ‘lifestyle’ products for the world to see.

The shape of a product is therefore more important than ever before. It helps preserve the individuality of the product and uniqueness of its brand and it creates something completely different from the myriad of the commonplace. Sooner or later, a reform of trademark law will need to take into consideration this new function of trademarks.

 

What will your trade mark be?

Trade Mark Infringement – What’s Skype Got To Do With It?

What will your trade mark be?A recent General Court of the EU decision in the Sky v. Skype body of cases that has spanned the last decade, will not be the final straw for Microsoft.  According to the BBC Microsoft who owns Skype, after acquiring it in 2013, has announced its intention to appeal the decision. This may be seen as a bold and sensible move since Microsoft is in the process of expanding the brand to replace their Lync product.

What this decision means

This decision prevents Skype from registering for trademark protection, it does not prevent Microsoft from using the Skype brand. Some pundits have suggested that Microsoft may pay a fee to licence the name. At this time, Microsoft has not confirmed that they will be pursuing this route.

It is important to note that this limitation on registration has a jurisdictional limitation. Both companies, which operate globally, will only be bound by court decisions in the European Union. For example, this means that Microsoft’s registration of Skype in the United States will continue to protect them from trademark infringement there.

The Court issued a press release stating that its reasoning for not permitting the registration is that there is a likelihood of confusion between the figurative word and sign for Skype and the word mark for Sky.

Other cases

This is not the first match-up between Sky and Microsoft. In early 2014, Microsoft was forced to rebrand following the decision that their SkyDrive cloud storage product created a likelihood of confusion with Sky’s mark. The SkyDrive was later renamed OneDrive in order to comply. In its decision, the Court reasoned that the identical portion of the marks coupled with the allusion to the sky and air transmission and similar nature of the products offered made it likely that consumers would be confused.

As Sky is a litigious company, and they have gone to great lengths to protect their brand, there are numerous case examples of where they have either filed a complaint or+ alleged infringement of their trademark. One such examples is of the Livescribe dispute that was filed in 2012. In order to avoid litigation, Livescribe, maker of the Sky Wifi pen, opted to rebrand in the UK.

Naming a brand

Naming A Company? How Can You Avoid Trademark Disasters?

Naming a brand When choosing a new name, it can be confusing to know the order in which to do things – such as registering domain names, a company name, designing a new logo and so on.

People tend to do all these things and then only at the end of a branding project do they turn to a lawyer to protect the brand. This is the wrong way to go about it because if you’ve chosen a name that infringes on somebody else’s rights, it leaves little scope to choose a better name. You will have invested time and resources in the name, and may be tempted to continue to use that name, despite the very real and serious risks.

So, what due diligence can you carry out yourself? And when do you need the expertise of an appropriately experienced intellectual property lawyer?

Well the first point to be aware of is that the domain name or company name’s availability does not mean you may use the name. It depends what you want to use the name for.

Carrying out your own checks to settle on a shortlist

A key question is whether the name is in use by a competitor, who may have registered it as a trademark or built up unregistered rights in the name.

So, do some Google research. If you find somebody else is already using the same or a similar name within the same or a similar industry sector, then beware.

However, if someone is using a similar name, the next question is to look at where they are located. If they are based outside the geographic area in which you will do business, then you may be alright to use the name. However, it does depend.

Assess the Google search result by asking yourself whether the country the other entity is based in is relevant; whether they are potential competitors, and whether they have customers in your territory or online. If the entity using a similar name might be selling their product in the UK (say via an estore), then you may have problems using the name.

If you find nothing, this is not conclusive. For example, not all websites are search-engine friendly, and not all products are promoted by names online. In some cases, someone could have registered a mark and not started using it yet, as it’s possible to register a name for up to five years before using it.

Checking the trademark registers.

That’s why you also need to do a search of the trademark registers.

The trademark registers are public, which means that anyone can search them to discover whether someone else has already registered the same brand name. If the name is registered that means you can avoid investing on marketing, graphics, websites and so on using that name.

This is a central function of the registers, putting others on notice of their rights. However, if the name is not already registered it does not mean you’re in the clear. Is a similar name registered?

Increasingly, the search facilities provided by the trademark registries are quite sophisticated so that it’s possible to find out whether similar names are already registered too – not just exactly the same name. If you do find similar registrations, then you need to take a view as to whether the owner of one of those marks might object to your use of a similar name. If you can’t work it out, then you should pay a lawyer for a legal opinion.

How a professional can help

While I’m more than happy to provide information to help people assess the risks for themselves, it is not possible to provide opinions on specific names without being engaged to provide the service.  Often it is necessary to consult the registers before an opinion can be provided.

It’s important to appreciate that initial checks do not replace the need for legal advice, but are a step to take before settling on a few possible names.

By carrying out these searches, choosing names carefully, and immediately discarding names which are obviously already in use by others, you will save yourself a lot of expense and disappointment. You will also find a shortlist of worthwhile names to ask a lawyer to assess for you.

If you get the green light, you should consider registering a trademark at the same time. That is the way to ensure the name is uniquely yours to use and that someone else doesn’t start using the same name in a way where your two  businesses might be confused for one another. It costs a lot of money to resolve such disputes. A registration is much cheaper than costly litigation.

As a firm we suggest clients use the resources available for preliminary due diligence of their own, and then take professional advice if it matters to you to avoid litigation, or to have a name that you can uniquely own.

Finally, remember that not all names are capable of being trademarked, so a lawyer can add significant value to any naming exercise as they are best placed to advise whether your chosen name is capable of functioning as a trade mark. .

Learn which countries are part of the Madrid Protocol

International Trademarks – Madrid Protocol System

Learn which countries are part of the Madrid ProtocolWhile it is not possible to register “international trademarks”, the Madrid Protocol system provides the next best solution if the country in which you want to register has signed up to the Madrid Protocol.

The current list of countries within the Madrid System has some notable gaps, such as Canada, South Africa, Hong Kong and many South American and Middle Eastern countries.  So, it is gratifying that more and more countries are signing up every year.

Additional countries that have joined the Madrid System recently, according to WIPO, are the OAPI (African Intellectual Property Organization) countries and Zimbabwe.

The OAPI countries include: Benin, Burkina Faso, Cameroon, the Central African Republic, Chad, Comoro Islands, Congo, Equatorial Guinea, Gabon, Guinea, Guinea-Bissau, Ivory Coast, Mali, Mauritania, Niger, Senegal and Togo.

India and Mexico signed up in 2013 and China in 2012. Cambodia will join in June 2015. It is also rumoured that Canada, one of the notable gaps mentioned above, will soon become party to the Madrid Protocol.

How the Madrid Protocol works in practice

The first step to securing wider protection globally is to register a trademark in your home country as a starting point.

For UK companies or those operating within the EU, the base application will either be a UK or EU trademark.

Then once that UK or EU application is filed, you may extend your registration by using a single application. In that application you designate your desired countries (which must also be party to the Madrid system).

The overall costs will depend on the applicable official government fees of the countries in which you are applying to register, and the number of classes.

Note that the application must use the same classes as the base application, although it is possible to apply in fewer classes than your base application.

The official fees vary a lot from one country to another. To get an indication of the official fees, use our official fee calculator. The legal fees will depend on the number of countries and classes involved.

Conclusion

With more and more companies doing business online, businesses nowadays have to think about international trademark matters from the word go.

Before the Internet became the main route to market for so many companies, global trademark issues would only have arisen for them once companies were substantial enough to move into other countries.

Nowadays, being online means you do business worldwide, so that it is increasingly important to check the trademark registers in other jurisdictions before making a final selection of a name. This is often overlooked by businesses, even substantial ones, with serious consequences. For example,as mentioned in our previous post SkyDrive Set for a Skydive? Microsoft recently had to rebrand to One Drive,

Once a company has done its due diligence in other markets and settled on a name it needs a clear strategy for registering in other markets. And the Madrid System provides a cost-effective way to obtain multiple registrations worldwide. The cost of applying in 3 classes in 10 countries could come to less than it would to register in 2-3 countries that are not party to the Madrid system.

Have you registered your rights in other countries? What was your experience? Please do share your experience with us by leaving a comment below.

 

Aston Martin file suit alleging that former employee copied their designs

Design Infringement Claimed By Aston Martin

Aston Martin file suit alleging that former employee copied their designsOn 27 Friday 2015, Aston Martin filed suit against Galpin, in the Central District of California on the grounds that Galpin’s new prototype design for the Thunderbolt infringed their intellectual property rights. In particular, the claim is that the Thunderbolt draws on similar design features to the Aston Vanquish, such as the wings logo and side vents.

Interestingly, the Thunderbolt was designed by Henrik Fisker, a former Aston employee. During his tenure at Aston, Fisker participated in the design of the famous DB9 and Vantage (the predecessor to the Vanquish).

Aston Martin said, “Fisker’s bad faith intent to free-ride off the tremendous goodwill associated with the famous Aston Martin mark, wings logo, side vent mark, and Vanquish mark could not be more transparent.”

The Court will now determine whether the similarity between the two cars is permissible.

For details of this case see: http://www.bloomberg.com/news/articles/2015-03-30/aston-martin-empire-vodka-philips-intellectual-property

Eight points to consider before you name your product or service

Brand Name – 8 Points To Consider Before You Name Your Product Or Service

Eight points to consider before you name your product or serviceAlthough household name brands invariably have distinctive visual identities – for example, Coca-Cola’s bottle shape, and Nike’s swoosh – the primary sign through which any brand is identified is its name.

It is worth thinking about your name carefully given that it is what you will be using to answer the phone, and to promote and advertise your business. It’s also what your customers will use to recommend your product or service.

This quote, from Oscar Wilde’s The Importance of Being Earnest, demonstrates just how much faith can be placed in a name alone.

“It had always been a girlish dream of mine to love someone whose name was Ernest. There is something in that name that seems to inspire absolute confidence.”

Undoubtedly, a name can evoke certain reactions and emotional responses. It can give customers an idea or feeling about your business from the outset, before they have even experienced working with you. Therefore, choosing a name for your brand is an important task that should not be taken lightly. Here are 8 points to bear in mind:

1. Choose an appropriate name

The name you decide to brand your company under should be well thought-out in order to ensure you pick the name that suits what your product or service is trying to do. When choosing a name, think: what is unique about the brand I am trying to create? Who is my target audience? How do I want to make people feel?

2. Find a name that people will easily associate with your product or service

The big household names that have built such solid reputations have generally based their brand on something they believe suits that which they are trying to create.

Talking about Google’s name, co-founder Page stated in Business Week, “We spent a lot of time on the name … because we figured that it would be important for people to be able to remember it” Google’s search engine was originally called BackRub, but the company decided the name was unsuitable, and Google was then settled on. The name originated as a play on the word ‘googol’, a mathematical term for the number 1.0 × 10100, to reflect the search engine’s ability to sort through a seemingly infinite amount of information on the web.

‘Apple’ is similarly not just a name given to the tech-giant without any forethought. Apple is currently the world’s most valued brand, and is known for its sleek designs and good-quality products and the very name of the company helps to create this image. In Jobs’ biography, written by Walter Isaacson, he explained that he was coming back from an apple orchard when he thought the name sounded ‘fun, spirited, and non-intimidating’. Steve Wozniak, Apple’s co-founder, in his book iWoz: Computer Geek to Cult Icon explained that “We both tried to come up with technical-sounding names, but we couldn’t think of any good ones. Apple was so much better, better than any other name we could think of”. And like the name itself, the company and the brand became much more innovative and forward-thinking than previous technical companies.

3. Make sure your name translates into other markets

Not only should a name accurately reflect your business, but it must also be something that works in different countries as well. There are many examples of company owners who have not realised that their chosen name in one country might have a completely different meaning in the next. For example, Chevrolet launched its Chevy Nova car in Spain under the same name, which translates as ‘Does not go’. American Airlines advertised the luxurious aspect of flying business class to its Mexican customers by focusing on the leather seats, using the slogan ‘Fly in Leather’, which translates as ‘Vuelo en Cuero’ in Spanish. The Spanish dictionary neglected to inform American Airlines that the phrase ‘en cuero’ is a slang term for ‘in the nude’. Unsurprisingly, there was little demand for mile-high naturism among Mexico’s business flyers. The beer-maker Coors discovered that its slogan, ‘Turn it loose’, translated into Spanish as ‘Suffer from diarrhoea’.

4. Get legal title to your brand by registering  your trademark

The name does much more than carry the goodwill of the brand.  Some people equate trademarks with goodwill, but they’re not the same thing. Goodwill is a term used by accountants to refer to the customer base a business develops.

Trademarks can protect goodwill, but they do far more than that.  The reason you need a trademark isn’t to protect your goodwill, which is protected anyway, but because a trademark is a tool to capture the economic potential in your business.  When you register a trademark you get legal title to your name so you are better placed to control use of the name by third parties. You can then monetise the business by granting licences, and extend the brand to other goods and services if you are successful.

5. Be aware of the value an appropriate trademark  creates

As the business develops and expands, so its name will increase in value, and evoke a reaction in its target consumer which then enables the brand to charge a premium for its product or service. For example, people are willing to pay significantly more for an item of clothing made by Louis Vuitton than they would pay for a similar-looking item made by an unknown designer. The value of one item of clothing over the other is purely down to the name and so the brand is what adds that extra value.

6. Bear in mind that the name could be a most valuable asset, but only if you choose well

Also, when a company is being sold it is the brand, as well as the goodwill associated with the name, that the purchaser is buying into. Therefore, it is important to begin any project by realising that the name you choose for it is potentially one of the most valuable assets the business will generate if it succeeds. It should be treated as such and appropriately protected.

7. If the name you like is not legally available find another

A name must be protected. Given that the value of a brand lies in its name, it’s no good to just focus on coming up with a catchy, memorable name if this name is not protected.  If, once you have conceived a name and have gone on to have designs and branding produced, someone claims you are infringing on their trademark, nobody is going to care that the name is ‘just perfect’ for you. For a name to really be perfect for your business, it must be legally available, and hence be suitable from both a marketing and a legal perspective.

8. Do your research before you start using a name

Apple v. Apple Corps – Although Jobs decided that Apple was the most suitable name for his company and that it would work well from a marketing perspective, the name has proved less suitable from a legal perspective. Apple Inc was locked into legal disputes from 1978 to 2006 over the name with Apple Corps, the record company owned by the Beatles.

Once the initial dispute was settled by agreeing that Apple could use the name on the basis that it would not expand into the music industry, there were problems on several subsequent occasions when Apple’s business expanded to cover the iTunes store and the iPod product. The dispute caused several losses for Apple, first preventing it from launching a computer with recording software installed on it, and then leading to the Beatles’ music initially not appearing on the iTunes music store.

The dispute has now been resolved between the two companies, with Apple buying the rights to use the name in all industry sectors and allowing Apple Corps a licence to the name. However, this resolution should not be seen as something most businesses could achieve. The process proved extremely costly and time-consuming. Such problems would have forced less well-resourced companies to rebrand. This is why the legal aspect of names should never be lost sight of.

Conclusion

Names are an important way in which the law protects a business against various unfair practices that tend to arise when a business succeeds. So, make sure the name you have invested so much time and effort in creating and around which you have built your good reputation, is one that can remain exclusively yours.

Protect your business against copying

How To Protect Your Business Against Inevitable Copying?

Protect your business against copyingCopying is so rife in business that if you have a profitable niche or concept, it would be surprising if competitors didn’t sooner or later try to capture some of your market share.

They will borrow freely from other businesses that they believe have identified lucrative market opportunities. If they cross the bounds of acceptable, legitimate competition and engage in unethical practices, how will the law help you?

What is unacceptable copying?

This automatically raises the question what is acceptable and unacceptable copying? What legal protections might a business use in such situations?

For example, Airbnb and Groupon came up with novel business concepts which were quickly copied. An example of how quickly competitors copy a new business idea is apparent when you consider the numerous Airbnb competitors that have sprung up, such as Gogobot, Atraveo and SunnyRentals using similar business models to Airbnb

Whether the business model is copied in the same country or elsewhere, there is nothing that can be done to prevent others copying what is merely a good idea.

Tropicalisation

Indeed, ‘tropicalisation’ is a term which refers to the practice of investing in start-ups which take an established business model and adapt it to an emerging market. Examples include Peixe Urbano a Brazilian clone of Groupon which is arguably even more successful than the original, Weibo the Chinese Twitter-like microblogging platform, RenRen the Chinese version of Facebook, Baidu the Chinese take on Google and Alibaba a Chinese copy of eBay. Alibaba is now one of the most successful online businesses.

Investors are keen on these projects as the business models are proven already, and from an IP perspective there are few legal barriers to this tactic, as the law does not protect bare business models, whether through patents, copyright or otherwise.

That said, a patent can protect the technology which is central to a product, copyright can protect the expression of a concept, for example training and marketing materials, videos, source code and other key materials like your business plan itself. Trademarks protect your business and product names, and designs protects aesthetic aspects of your products, software or website.

Securing rights over your name is how you protect the underlying business

So, although there is little you can do to prevent a competitor from creating a new business based on your model it would be a mistake to ignore IP rights as mentioned in my blog post Intellectual Property Rights – Why Ignoring Them Could Be Disastrous For UK Business. Your business name provides an important opportunity to prevent others from taking unfair advantage of your efforts, and trading on the back of your success.

So there are ways in which you can put a stop to some unfair competitive practices by properly protecting your business. When businesses copy others they tend to adopt a similar name in order to attract business towards themselves.

Scrabulous

When Scrabulous set up its online game it wanted to suggest to the market that this was a similar game to Scrabble, so it used a name suggestive of Scrabble. Because trademark law helps you to prevent piggy backing off the success of your brand, Scrabble was able to get Facebook to pull the Scrabulous App off Facebook even though it was extremely popular.

There may be other practices businesses engage in, such as stealing competitive information, taking your staff and using your confidential information, or even stealing your database.   In all such cases you are likely to have an uphill climb during litigation unless you have taken steps to have the right contracts in place and to establish your rights to the maximum extent possible, so that it would be easy to prove your case.

Competition

As Seth Godin says of competition in Purple Cow (Penguin Books, 2003): “Why do birds fly in formation? Because the birds that follow the leader have an easier flight. The leader breaks the wind resistance, and the following birds can fly far more efficiently”.

So if you demonstrate a breakthrough idea, and others can see that it’s a good one, they will copy it. They will benefit from the fact that you’ve shown them the way forward to possibly implement the idea even better than you did.

The way to have strong IP protection in your business is to secure as many of IP rights as you can afford to secure because each IP right protects you in subtly different ways and situations. However, there is a lot more to it than just IP registrations. Often it will involve having the right employment and confidentiality agreements in place too, and having effective terms of business.

If you’re worried about protecting your IP, why not start by taking our 3 minute test.