Have you seen a business using a name similar to yours? Or does their logo look like yours? Or have you received a cease-and-desist letter and you’re wondering what to do next?
Trade mark infringement can be quite complex, with different laws in play and procedures to follow.
In this ‘All You Need to Know’ guide, written by our expert solicitors, Ramsay Monime and Saad Khan, we simplify the various aspects of trade mark infringement, so that whether you are an individual, small business or conglomerate, it all becomes a bit easier to digest. We’ll start with the basics and then explore what happens in a trade mark infringement case – for parties on both sides of the claim.
Let’s dive in!
A trade mark is a registered right which protects a sign and distinguishes the goods and services of one undertaking from those of another. Essentially, a trade mark acts as a ‘guarantee of origin’ in relation to the goods and/or services for which it is registered. Words, logos and slogans are common trade marks. But, in recent years, the scope for trade mark registration has expanded and now colours, 3D objects, sounds and smells can be registered.
Trade marks are territorial, which means that they need to be registered in every country where you want to use them. Also, when applying to register a trade mark, it needs to be registered in respect of goods and services. There are 45 classes covering various goods and services.
The owner of a trade mark has the exclusive right to the use of the trade mark. As such, trade mark infringement occurs when someone uses a registered trade mark without the consent of the owner, by doing any of the following, in the course of trade:
In the course of trade simply means that the sign used by the alleged infringer must be in the context of any commercial activity with a view to economic advantage, as opposed to private or domestic purposes.
As such, if you are applying an embroidered Arsenal badge to a hat you intend to wear or gift to a friend called Reed, this would not be in the course of trade.
However, if you started to sell these hats, for example, on eBay or in a store, then this would be in the course of trade for the purposes of trade mark infringement.
The following acts constitute trade mark infringement:
If trade mark infringement is established before a Court, the trade mark owner is entitled to the following remedies from the infringer:
Further, there are criminal offences for unauthorised use of trade marks in relation to goods leading to imprisonment or a fine.
For businesses, trade mark infringement can lead to negative publicity. While Colin the Caterpillar stole the show in the Marks & Spencer and Lidl dispute, it is wise to avoid infringement in the first place and prevent damage to your reputation.
Naturally, the registered owner of the trade mark can bring a claim for trade mark infringement. Licensees of a trade mark can also claim subject to certain conditions.
If you discover someone using your registered trade mark there are a number of things you can do straight away:
From a commercial perspective, if another party is infringing your trade mark(s), stopping the infringing acts immediately is imperative. A trade mark is a valuable commercial asset for your business and can be renewed indefinitely, which grants a monopoly right to the owner. Therefore, you will want to enforce it against both unregistered and registered marks that are similar/identical.
If you have been using a brand name for years but never bothered to register the mark and you discover someone else begins using a very similar or identical name, you may be able to rely on the tort of passing off.
To show passing off you must show: (1) that your brand/mark has acquired goodwill; (2) there has been misrepresentation by the other party; and (3) that you have sustained damage.
Goodwill is, as the Courts have explained, “the benefit and advantage of the good name, reputation and connection of a business. It is the attractive force which brings in custom”. Customers must be able to link the goods/services that you sell to the brand/mark in question. It’s important to factor in that goodwill does not mean reputation, as a mark may have a reputation but if there is no trade in the UK there may not be any goodwill associated.
Secondly, the other party must have misrepresented that they are you. This must be express or implied, and the misrepresentation needs to lead to or be likely to lead to deception.
Finally, you need to show that you have sustained damage or are likely to sustain damage in respect of the misrepresentation. This could include loss of business/profit to the other party or there has been damage to your goodwill because the other party’s goods/services are of poor quality.
Passing off is an effective tool if you have unregistered trade mark rights. However, it is quite difficult to prove and requires you to collate a significant amount of evidence for each element. Learn more about passing off.
A letter before action, also known as a letter of claim or cease-and-desist letter, is a letter sent from one party to another requesting that the recipient stops a particular activity, for example, trade mark infringement. The sender, usually being the registered owner of the trade mark (or their legal representative on behalf of the owner) sets out the basis for the claim, the rights relied on, the alleged infringing activities and the remedies sought. Often, the letter of claim is accompanied with written undertakings, which state what the recipient must or must not do if they agree to them.
If you receive a letter of claim, you should not ignore it. Obtaining legal advice from a legal professional who can advise on the best defence strategy is a sensible first step after reading the letter. And of course, make sure to respond before any deadlines.
In some cases, attack can be the best form of defence in a trade mark infringement claim, such as by bringing a counterclaim for invalidity or revocation. Below is a list of a few possible defences:
Seeking legal advice early on, especially if you have received a letter of claim, is advisable as your lawyers will be able to advise on which defence best applies.
Prior to starting a business under your chosen brand name, it is crucial you conduct trade mark clearance searches to ensure a third party isn’t using it already!
Initial searches include a UK IPO trade mark search, internet searches for unregistered marks and social media searches. Make sure to keep a record of any searches and any brand development process. Specialist IP law firms, like us, can assist and advise early on so do not hesitate to obtain legal advice.
For smaller businesses, showing that you have conducted extensive searches prior to using a mark can show that you acted honestly (for the purposes of honest concurrent use) if a bigger business with an identical/similar name tries to sue you ten years down the line.
As an alternative, you can approach the owner of an existing trade mark and request to co-exist (best done through a co-existence agreement), request a licence or request to purchase the mark.
The key points to take away are:
Trade mark infringements can be complex cases, for both sides of the court. Often, it is better to negotiate, come to an agreement, and settle early – thus avoiding a costly, public court case. Of course, sometimes this cannot be avoided. But regardless of whether you want to settle or fight your case in court, you’ll need specialist advice from a solicitor. Our trade mark team offers free initial consultation, followed up by fixed-fee quotes. Please get in touch today if you need help.
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