Trade marks, everything you need to know

Whether you’re working on a big brand or a small one, there are several must-knows that can protect you and your clients against an inadequately protected trade mark, or even stepping on the intellectual property (IP) toes of another brand.

Take the expensive lesson learned by Tesla, which was almost called “Faraday” after Elon Musk struggled to obtain the Tesla trade mark. How did this happen? The Tesla Motors name was trademarked in 1994 by a man named Brad Siewart, who was unwilling to sell to Musk’s company when it first approached him in 2004. Eventually, Siewart got $75,000 and Tesla got the trade mark – a bargain considering Tesla’s market cap of around $60 billion at the time. But Musk also had trouble getting the tesla.com domain, which cost the company $11 million and took over a decade to secure. Do we have your attention now?

What is a trade mark?

You should know that a trade mark is anything capable of being graphically represented, with the main purpose of distinguishing the goods and services of one business from those of another. In the context of marketing, it is an expectation, a promise, a relationship. Like a brand name, it is infused with audience relevance, competitive differentiation, sustainability, credibility, graphic potential, and personality – but there’s more to it.

Trade marks are badges of origin, serving to identify and advertise their owners’ products and services in a competitive marketplace, guarantee consistent quality, and even indicate manufacturers’ acceptance of responsibility.

Different trade mark types

  • Word marks – Think OMO and Mrs Ball’s. These might be business names, brand names, slogans, or even sub-brand variants, like Johnnie Walker Blue Label.
  • Devices, like a logo (think Nando’s); a set of numbers (like Levi’s 501); or letters (like Woolworths’ iconic W, Facebook’s f or Netflix’s N). In the case of letters, the trade mark must go further than a single alphabetical letter and have distinctive visual representation or styling.
  • Signatures, like Picasso’s, Taylor Swift’s, or Jack Daniels’.
  • Service marks, like OUTsurance’s where use is made of the suggestive suffix ‘surance’.
  • Shapes, like Toblerone’s triangular chocolate bar and box.
  • Containers, like the OLMECA tequila bottle with its recognisable engravings.
  • Packaging/get-up, like the McDonald’s Happy Meal box.
  • Colours, like Tiffany & Co’s “light medium robin egg blue”.
  • Trade dress, like Guerlain’s distinctive 3D lipstick packaging.
  • Sounds, like the BMW horn and Harley-Davidson’s distinctive V-twin engine sound. However, the bar for registering sound trade marks is extremely high and the public must be able to recognise it as an indicator of origin.

Why is it important to know these different trade mark types?
Because each element can add a layer of distinctiveness that helps you craft a stronger brand – and build bigger brand value for your clients – via protection and commercialisation.

Let’s look at the Lindt Easter Bunny, of which more than 500 million have been sold in Germany alone and which has been marketed for over 30 years. Lindt attempted to register the shape of the sitting bunny as a trade mark, but was unsuccessful. Changing its tactics, the company then filed for registration of the specific tone of gold foil in which the bunny is wrapped, because market research had shown that 70% of surveyed respondents associated the gold foil with the Lindt bunny.

Why register a trade mark?

Unregistered trade marks are protected by the common law, but these rights are harder to prove. This is because evidence of your rights needs to be secured and proven, while a certificate of registration is proof of your rights in a trade mark. So, if a lot of money is being invested in a brand, or the brand owner intends to use the brand’s trade mark/s for a long time, it is safer to register them.

Registration assists with the enforcement of the exclusive rights to use a trade mark; is proof of the owner’s rights; gives notice of these rights to others in the market; facilitates attack and defence if this is necessary; and enables commercialisation and licensing. Be aware, however, that if a registered mark is not used for more than five years, it can become vulnerable to cancellation on the grounds of non-use. It cannot remain on the Register as a “defensive” trade mark if the owner does not truly intend to use it but, as long as it is used, it can be renewed every 10 years in perpetuity.

Trade mark classification

An international trade mark classification system is used throughout the world, providing for 45 different classes of trade marks. Of these, 34 cover a wide range of goods and 11 cover services. To illustrate, the Tesla Motors trade mark held by Brad Siewart was filed in Class 12, covering “Vehicles and Vehicle Components”.

Why is classification so important? It’s impossible to register in every single class. You can’t have a monopoly over your mark name in every class category, because it is unlikely that a trade mark will be used for all conceivable goods and services. As such, registering a trademark in the right class and for the right “items” (specific goods and/or services) can be tricky, and the right mix of general terms and specific items secures both validity and offers a broad scope of protection.

Be aware that trade marks often apply across classes via “line extensions”, like Adidas shin guards, backpacks, swimming goggles, and hockey sticks; in addition to the traditionally recognised Adidas products, or a range of branded sauces (think Spur barbecue sauce), that might be sold outside of a company’s own stores.

The ‘R’ vs the ‘TM’

The ® symbol, called an encircled sign, shows that it has been registered and that the trade mark owner has a registration certificate. The TM symbol shows that the rights are being claimed, in cases where a trade mark is either unregistered or registration is pending.

Now let’s say that a brand has a registered trade mark, but does not show the ® symbol in advertising or a press release. Is the mark still protected? Yes, it is. Use of the symbol is not a prerequisite to enforcing a registered trade mark. So even if you don’t use it, or the infringer didn’t know that you had a registered trade mark, you can still take steps to get an interdict against the infringer and claim damages. Having said that, using the symbol is a useful way to deter infringers upfront.

Steps in trade mark registration worldwide

Is there a specific process that global or multinational companies can follow to register their trade marks worldwide?

Unfortunately not. Not even when you’re a well-known trade mark. Because there’s no such thing as a worldwide trade mark registration, it’s important to determine or anticipate the territories in which you require registration. Google search engine is your friend when it comes to conducting a quick informal check of what’s already out there. For instance, let’s say you’re a marketing company and you’re creating imagery for a possible logo. You may not want to do a full formal clearance search until after the client has chosen an image, so do an online search first.

It is important to conduct a formal clearance search as your next step, however, if you want to avoid potential risks to the use and registration of your mark.

Advertising and marketing agencies should also agree with clients, upfront, on whose responsibility it is to arrange and carry out the clearance search. You’ll need to determine classification for your trade mark (and have in mind any future line extensions), and decide on the trade mark owner. The latter is especially important for agencies and start-ups. Then, application happens and after that, registration.

Good practices for trade mark usage

Once-distinctive marks, like Aspirin, Escalator and Thermos, have become generic marks: descriptive of goods or services or generally defining a class of goods or services; rather than identifying the goods or services of a particular trader. This process is known as “trade mark genericide”, and it’s bad for business.

You should therefore adopt a strict protocol for the consistent proper usage of your or clients’ trade marks. Here’s how:

  • Police usage and don’t allow others to get away with using your trade marks without consent.
  • Follow and enforce usage guidelines as a way to avoid sloppy or generic use.
  • Don’t use trade marks in different forms or change them without deliberate decision-making. Preferred trade mark use should be as an adjective; followed by the common name of the product or service – as in Photoshop photo editing software, Google search engine, BMW vehicle, Nike sneakers, etc.
  • Use encircled signs and other symbols where appropriate in written advertisements and advertising materials, including websites and online marketing.

In short, establishing trade mark recognition with consumers, and maintaining that distinctiveness in the marketplace requires concerted and consistent effort. No matter the size of your client’s company, proper trade mark use and enforcement is essential to retaining the value and strength of their valuable brands.

By Louise Myburgh.

This article was first published in Retailing Africa.