3rd September, 2018
Having somebody else rip off your trademark to cash in on your hard work is frustrating. But there are a few simple things you can do to make sure it doesn’t become a nightmare.
Imagine this: you’ve worked hard over the past year or two to build a reputation with customers, but then somebody comes along with eerily similar branding to your business.
Suddenly, your potential customers are confused about which business is yours. If the offending party has a great SEO game they can take traffic from you overnight.
It was the case for Man With A Van.
In a 2015 interview with SmartCompany, co-founder Tim Bishop said the company needed to spend hundreds of thousands of dollars trying to stamp out copycats trying to leverage its early success.
The trouble is largely avoidable with the right IP approach from day one.
Principal at IP Law specialists Spruson & Ferguson, Blake Knowles, told The Pulse that the first step for any new business should be to do a clearance search.
“If you don’t do that, the risk is that you may be trading for four to five months and you get a nasty letter from someone, maybe me, saying ‘you’re infringing on my trademark and my rights’,” he said.
“That’s really a terrible and expensive inconvenience, especially if you’ve started to generate some momentum under the brand.”
Once you know that your trademark won’t be infringing on anybody else’s, the next step is to file for a trademark.
READ: Do you have (IP) protection?
Knowles said most new businesses should file for both a word and logo trademark, as in most cases that’s enough to hold a company in good stead.
Knowles also said a common misconception among SMEs was that registering a business name had IP power.
“You’re obligated to registered to file a business name if you’re trading under a name that isn’t your own, but while there’s an obligation to do that it doesn’t actually give you any rights,” he said.
“A business name is a very weak form of registration. It’s not something that has any inherent IP rights to it.”
He said registration was important as opposed to relying on establishing first use because it gave the trademark owner more enforceable rights.
Once you do have the strength of a trademark behind you, enforcing your rights is a lot easier.
In fact, in most cases all it takes is a letter and a light touch.
Knowles said over 90 percent of the trademark infringement cases which came across his desk were solved by sending out a letter on the practice letterhead – and it doesn’t need to be a threatening one.
“The majority of cases really are just honest mistakes – they choose a word which sounds good in the context of their industry, but they don’t do a clearance search,” he said.
“If you’ve got a strong case and you’re dealing with a local infringer, they don’t want to end up in court any more than you do. But if the writing’s on the wall for them that if they go to court and they’ll lose – we can usually resolve the situation fairly quickly.”
All in all, he says it may cost as little as $2000 to resolve the matter which may cost multiples of that in lost business if it isn’t resolved.
But it all comes back to having the initial trademark filing as the legal basis for protection, which can also be important when it comes to international expansion.
READ: The key to doing business in China
Where trademark protection can be a bit tricky is when a company decides to expand to new markets.
A trademark filing in Australia effectively establishes a date of filing for six months which can be used to establish ‘priority’ for your trademark when filing in other countries.
For example, if you file your trademark in Australia on 1 January, and then file the same mark in New Zealand any time up to 1 July, your NZ application can claim the same filing date as your Australian application.
But Knowles said very few businesses expand within six months, and lose the benefit of the international priority system.
“That can be important sometimes because all other things being equal, whoever files first generally wins,” said Knowles.
It’s why he says a cautious approach to international expansion is needed, and protecting trademark in international markets has many traps for the unwary.
“It can be a grey area of the law,” said Knowles.
“If you ever do get a letter from a foreign company saying you’re infringing their rights by using your brand or visa versa – you really need to get some professional advice on that.”