Top 10 trade mark mistakes – and how to avoid them

Building a valuable brand isn't easy, but it is all too easy to jeopardise or destroy the value of a brand by making mistakes in trade mark selection and registration and failing to properly protect trade mark rights. Here are 10 trade mark mistakes that businesses commonly make.

1. Choosing non-distinctive brands
In devising new brands, marketers are frequently attracted to names that are highly suggestive of the nature of the goods or services. While these names have a superficial appeal, protecting them can be difficult, as the Trade Marks Act prevents registration of trade marks that are not sufficiently distinctive. A name such as APPROVE-FAST (for home loan services) instantly conveys a characteristic of the services to potential customers, but its descriptive quality makes it difficult to protect, and easy for others to legally imitate.

2. Not conducting trade mark availability searches
It is vital to conduct an adequate trade mark search before settling on any new brand, name of a business, a product or a service, a logo, or even a slogan. Businesses that fail to search, or that search inadequately or inexpertly, risk wasting significant sums invested in a brand that they may be forced to abandon because of the prior rights of an earlier trade mark owner.

3. Failing to register brands as trade marks
Businesses that fail to apply for and register their brands as trade marks find it more difficult to prevent third parties using the same or similar marks than those who have trade mark registrations. Businesses without trade mark registration must establish that they have used their brand to an extent that they have acquired a reputation in the mark to bring an action. The required level of reputation may be difficult to establish, or may be confined to a small geographical area. Trade mark registration, by contrast, gives national rights (and can indeed provide international rights). Businesses that expand into new countries should seek registration in each country where use is proposed or occurring.

4. D-I-Y trade mark filing disasters
D-I-Y trade mark applications can be disastrous. The trade mark application process is full of traps waiting to catch the amateur filer. Commonly, trade mark owners that file their own applications nominate the wrong classes of goods or services or describe their goods and services in ways that, while appear reasonable to the layperson, in fact provide inadequate or inappropriate protection.

5. Inadequate protection for all branding elements
Good branding can involve a number of elements. Trade mark protection can be obtained for words, logos (graphics), and items such as packaging designs, shapes and colours, even sounds and smells! Maximum protection is afforded by protecting each of these elements separately.

6. Not securing underlying copyright rights
Branding elements that include logos or other graphic material may attract some protection under the law of copyright, as well as being potentially registrable as trade marks. Unfortunately, many businesses incorrectly assume that because they have commissioned a graphic designer to create branding elements for them, that they will own the underlying copyright in the artwork.

7. Allowing uncontrolled use by third parties
Any use of a trade mark by a person other than a trade mark owner, be it a franchisee or other user, should be made strictly under an appropriately drafted trade mark licence agreement which permits the owner to 'control' the use of the brand. Uncontrolled use can lead to dilution of the value of the brand, inconsistent application of brand values and even potential loss of registered trade mark rights.

8. Not using the trade mark as registered
A trade mark may be removed from the Register for non-use if it is not used in the form in which it is registered, hence it is important to use the mark as registered, and register the mark as used.

9. Failing to renew registered trade marks
Australian trade marks are registered for 10 years initially and can be renewed for further 10 year periods. Once a trade mark's renewal period has expired, registered rights are lost and a fresh application must be lodged to secure the rights.

10. Failing to monitor the market
Brand owners need to vigilantly monitor their market for any third parties using similar trade marks . To preserve their rights, they need to take legal action promptly to prevent unauthorised use and trade mark owners should arrange monitoring services through qualified trade mark practitioners. If those uses are not detected and/or action not taken against the unauthorised users, the third party may acquire its own rights through use, paving the way for significant confusion in the marketplace and loss of value of the original brand.

 

Article written by Daniel Kovacs, Senior Associate, Kliger Partners, www.kligers.com.au