Branding is becoming an even more essential business tool, particularly as globalization brings bring fashion labels to markets that would have been previously unimaginable. A company's brand image distinguishes its products and services from those of its competitors, and informs actual and potential customers about the promises that a company makes and the level of goods/services that they can expect. By simply making reference to a brand, consider Chanel, for instance, images and expectations about the products are instantly brought to the minds of consumers.
By way of their chosen branding, companies can cultivate customer loyalty and in turn, boost revenue. Given the greater importance of branding, companies should be conscious of the issues concerning brand protection developing and creating new market strategies, so they can attempt to avoid potential issues and conflicts, which can be costly and time consuming. Here are some of tips on ways in which companies can avoid prospective branding pitfalls.
IS YOUR BRAND NAME FREE TO USE AND REGISTER?
The characterization of a brand’s identity and its values are essential considerations that often evolve quite a bit through the lifespan of a brand. Such expressions often depend on a wide variety of forms, including words, symbols, slogans, designs, letters, and use of shapes or domain names. With this in mind, the registration of a trademark – any word, name, symbol, or design (including logos, colors, sounds, product configurations, etc.), or any combination thereof used in commerce to identify and distinguish the goods of one brand from those of another – gives the owner the exclusive right to use the mark in connection with the goods or services for which it is registered. Therefore, whether you are an established business or an entrepreneur developing a proposed brand for the first time, it is worth conducting a clearance search to identify any existing uses of marks that are identical or similar to yours.
Note: Not just a one-off exercise, clearance searches should be conducted each time your brand expands into a new class/category of goods or services and/or when you extend into new industries or geographical regions.
A search of every relevant national and foreign register where you intend to sell your products and/or provide your services should be conducted to alert you to any potential conflicts. Not only will this save your business the long term cost of re-branding, but it might also enable you to avoid potentially infringing the rights of third parties.
It is similarly vital to check the copyright ownership status of any name and/or logo before launching a new brand. Ownership of copyright is often overlooked, particularly when the design and development of a logo or image is sub-contracted to a third party. A key tip is to secure – in writing – the ownership of any copyright in works created or published in connection with your brand. There is a general assumption by business owners that they automatically own the copyright to works developed by sub-contractors. As such, works which are commissioned by a third party provider will belong to the contractor, unless ownership is clearly assigned to the commissioner. Skipping over this step could lead to costly legal battles for brands down the line.
Aside from being free and available to use, a potential brand/trademark must also be valid and registrable. This means that a trademark must fit the definition of a trademark and must be capable of distinguishing goods or services of one party from those of others, as required under the Trade Marks Act 1994, the UK-specific law that implements EU Directive No. 89/104/EEC (“The Trade Marks Directive”), which forms the framework for the trademark laws of all EU member states. Similarly, this is required by the Lanham Act, the federal statute that governs trademark law in the U.S.
As a golden rule, a proposed brand name must not be the same as, or so similar to another registered mark that it will cause a likelihood of confusion or association with that mark. It is important to consider the level of similarities in terms of appearance, sound and conceptual meaning of a proposed mark against any similar registered marks. One must also consider if a consumer is likely to associate the origin of the goods or services that you are offering with those associated with an already registered trademark.
In the same vein, a trademark must also not be too descriptive or else it will be deemed to describe the goods or services at issue, as opposed to serving as an identifier of their source. It is possible to obtain a registration for descriptive or other inherently indistinctive marks if they have acquired distinctiveness – or secondary meaning – as a result of use in commerce. An example of this is Nike’s “swoosh” logo. Prior to Nike’s widespread use of the mark, the check mark design would likely have been found to be too indistinctive to serve as a source-identifying mark for Nike’s clothing, footwear etc. However, as a result of Nike’s extensive use of the mark over a number of years, the public has come to recognize products bearing this mark as originating from Nike.
The acquired distinctiveness of a brand is enhanced by consistent use. Marketing teams looking at new styles and branding initiatives need to engage with internal and external advisors to ensure use of the brand is consistent across the entirety of the business. If you are committed to the brand, you should document, collate and save any of the evidence of use of the brand, which will ensure that when you come to apply to register the brand/trademark you have a bank of evidence that can be submitted to the trademark registry.
Moreover, it is essential to remember that even if you do obtain federal rights in your brand name or logo but fail to police unauthorized use of that mark, it may become generic and cease to afford you with any legal protections. For instance, aspirin, Band-Aid, windbreaker, and escalator were all registered trademarks before being revoked for becoming generic (aka failing to serve as distinctive indicators of source).
CONSISTENCY IS KEY
In terms of branding, consistency is key. In addition to helping to increase the distinctive character of unregistered marks, consistency ensures that your registered trademarks will become less vulnerable to third party attacks. If you do not use the brand in a manner that is consistent with what is listed on the trademark register, then a third party, such as a competitor, can apply to have your rights in that mark revoked. There is also a very real chance that inconsistent use could lead to cancellation of your mark, as trademark rights are based on usage.
A prudent brand owner should also bear in mind the long-term function of branding in connection with future markets and trends. When creating a brand, it is important to consider what word, slogan, logo etc. is the most conducive expansion and further development. For instance, will the brand name/image be appropriate when applied to new products? How will it fare in different markets? If a product or service is likely to develop and change over time – for example undergo significant re-branding or physical change – the trademarks obtained upon commencement of the business may no longer be applicable to the product and a new set of trademarks may need to be registered.
The concept of brand expansion is also essential if you are contemplating whether to enter into a licensing agreement with a third party, which would allow that party to manufacture and market goods using your brand name. Such licensing agreements are founded upon the existence of intellectual property rights (most commonly, trademark rights). It is vital to consider the future of a brand, as entering into a binding licensing agreement serve to severely limit your ability to carry out business in a certain sector and may also hinder any brand expansion in geographic terms.
Finally, an area that is often overlooked by brand owners is the digital sphere, including but not limited to domain names. However, in the digital age domain names and social media handles – as well as other online-specific identifiers – can serve as vital assets to your business and brand. Obtaining the appropriate domain names and social media handles for your brand will help in marketing your products and/or services, as well as preventing any third parties from cyber-squatting by purchasing a domain name for the sole purpose of selling it to the brand owner for a hefty sum. If you are committed to the brand, securing the relevant domain names and social media accounts will not only enhance your brand portfolio, but help you promote your business.
Patrick Cantrill of Bond Dickinson LLP has practiced both in the UK and overseas in contentious and non-contentious intellectual property law for 30 years and is recognized by the Legal 500 and Chambers as an expert and leading individual.
Amy Galloway of Bond Dickinson LLP is a UK and European Registered Trade Mark Attorney in the intellectual property team. She has experience in advising clients in relation to trade mark, design and domain name matters.