Common Misconceptions About Trade Marks That Could Cost You Dearly


Common Misconceptions About Trade Marks That Could Cost You Dearly

The complex area of trade mark law can cause many business owners to take comfort in a handful of urban legends that may in fact cost them their livelihood. So, for anyone who has poured their heart and soul into the creation of their business, let me dispel a few myths by addressing the top 5 fallacies.

1. Registering my business name will protect me.

A search of the business name registry on the ASIC website will quickly determine if the name we’ve come up with is available. If it is, the registration process is relatively straight forward and required by law.

Now although that is an important starting point, many stop there, believing that the process of registering a business name protects it from being used by anyone else. It’s true that others wanting to register a similar name will need to vary the wording to meet ASIC’s guidelines, but is that enough?

Simply, no. Australian law requires the registration of business and company names, but there is no obligation to register the name of a product or service. That means that someone else can use your business name in that manner. Worse still, they can register the name as a trade mark and secure the rights to its exclusive use.

2. Trade Marks are only for logos and designs.

No, they aren’t. Anything that uniquely identifies your products or services can be considered a trade mark. It might be a signature scent in a range of toiletries, or a sound used to introduce your product (the 20th Century Fox theme or the Windows start-up chimes for example).

It may also apply to a slogan you use quite separately to your logo or the names of individual products or services. While your business name itself mightn’t be anything special, you may run a workshop or sell a uniquely named product that is.

A good way to appreciate the value in protecting those marks is to imagine seeing them used in conjunction with someone else’s business. How would that impact on the value and identity of your product?

3. I’m just starting out, so it’s not a priority.

In the initial stages of launching a new venture there is perhaps little commercial value in the name you’ve chosen. Perhaps only a handful of people have even heard of you and while you intend to build a solid reputation within your niche, you’re certainly a long way from being a household name.

The thing is, every household name we know started in your position. At one point in time they were virtually unknown. It was the investment of time, effort and hard earned money that built a reputation.

Imagine having to stop a couple of years into that process and fight for the right to use the name of your core product. Imagine having to start again. Worse still, imagine finding out that you’ve breached someone else’s rights. Up to this point we’ve focused on your protecting your rights, but the process of registering a trade mark will also quickly identify the rights of others before you breach them.

4. Building a solid reputation around my unregistered trade mark is enough.

One of the complexities associated with trade mark law is the interaction between registered rights and those protected by reputation (acknowledged by common law). It is true that where neither business has registered their trade mark, the one with the most established reputation will most likely succeed in any court action, but both parties will expend a great deal of resources helping the court reach that conclusion.

If one party is registered and the other isn’t, the registered trade mark definitely has the upper hand. It’s not the end of the matter (sometimes trade marks are registered and never actually used) but generally speaking, matters involving registered trade marks can often be settled with a few letters.

5. It’s too expensive.

The real value of any expenditure depends on the circumstances. Someone who puts off a dentist visit to avoid the cost, may end up paying more when their tooth starts to ache. A wealth of sayings apply – ‘A stitch in time, saves nine’… ‘prevention is better than cure’… The upshot is that some initial outlay may prove to be a very sound investment. And it may not be as expensive as you think. The IP Australia website provides solid information about fees and how to lodge a trade mark application, and if that still makes your eyes boggle, contact a professional who can walk you through it.

Regardless of the approach you choose, take a fresh look at your trade mark assets. Bump it to the top of your ‘to do’ list and take action to protect your livelihood.

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