What Everybody Ought to Know ….About Names and Trade Marks

July 2, 2010

In business, as in life, we are constantly assessing and managing risks.  One of the most important risks to avoid is that of choosing your brand name without doing some very careful searches.  

I know this from personal experience.

When I started up my law firm I named it A1 Law, having done a brief trade mark search to make sure I would not be infringing on anyone’s registered trade mark rights.  The name wasn’t that important to me so I wasn’t interested in trade marking it.

I had little insight into the important role that positioning plays in business and so set up as a general practice following the advice of the Law Society’s recommended book Setting up and Managing a Law Practice by Martin Smith. Back then (I haven’t read the updated content to know what it says now) the book recommended taking on whatever work you could get.

I quickly realised within a year of starting up, that this was a really bad idea for me personally.  It was far too time consuming having to grapple with subjects like conveyancing, probate, landlord and tenant, which I hadn’t touched in years – but this was the work that was coming in!  I was forever investing time and resources buying books, and systems to be able to process the work without being negligent!  Unsurprisingly this wasn’t very profitable, so that I decided to relaunch as an Intellectual Property niche firm.  After all, I had spent a lifetime doing commercial and intellectual property law, had a masters degree in IP law, and a strong interest in the subject, so why not?  I knew I just had to be determined enough to turn down other work while I waited to build up my Intellectual Property practice.

 By now you may be wondering what all this has to do with trade marks?  Well the point is while I was fine as a general practice law firm using the name A1 Law, as an IP law firm it was not fine.

I didn’t do another trade mark search when A1 Law focused on IP work.  No sooner had I made a few adjustments to my website to attract IP law work, than I fell foul of trade mark law.  I immediately received a letter from A1 Trademarks pointing to their registered trade mark covering ‘industrial property’  (which is another term for Intellectual Property).  In their view my IP law firm which was offering, among other things, trade mark registration services, would create confusion with their business.  I agreed and immediately rebranded.

It was really avoidable, as I had noticed their registration when I first did a search before starting up, but hadn’t really focused on it, as I was then just looking to see whether any law firms were using a similar name.  Also ‘industrial property’ didn’t make an impression.   But I want to make 2 points by sharing this story:

1. It’s really easy to fall foul of someone else’s trade mark rights when you set up, or change your business in any way; and
2. I was really lucky that the trade mark owner found out about me straight away.  Rebranding is hugely disruptive as you have to change your marketing materials, your website domain url (no redirection to a new domain is possible!)   You have to get a new logo, business cards, and start over with a new name etc.  It’s a huge distraction.

But the later the trade mark owner finds out about you the more devastating the consequences will be for you.

Running a business without doing thorough trade mark searches (and while you’re at it, claim your name and register it as a trademark) is running a risk that could literally wipe you out at some point in the future when the business might be very successful, and a source of income for you.

 If you’re using a name you cannot own then when the inevitable legal challenge comes from the trade mark owner you will have a very short timescale in which to stop using the brand in which you have built up a reputation over the years.  Think how devastating it will be to have your history wiped out, and to have to start over with a new name.  Not only that, but you stand to suffer serious financial loss from having to withdraw from the market your products, packaging, and advertisements, and could be liable to damages.  You may even be forced to hand over your customer lists.

So where once upon a time when I was a lawyer for a large entity like Reuters I used to think that trade marks were for big business, now I think a trade mark is relevant for every size of business.  If you cannot own the name in which you are investing time and energy when building your business, you are building it on a foundation of sand.

This post is part of a series, to view all of the posts in this series, please click here.