Why you need to consider a trademark
A registered trademark gives you exclusive rights to use a sign to distinguish your business from another. Trademarks can take the form of a name, logo, shape, letter, number, packaging, colour or even a smell.
For most businesses, business names are important to trademark.
A trademark is a form of Intellectual Property (IP) right. Trademarks are registered through IP Australia, a Federal Government agency that also administers other types of IP – patents, designs and plant breeder’s rights.
To see how a trademark works, let’s look at an example of an unusual trademark – smell.
Marie Wong – Perth-based Principal of Australian boutique IP firm, Wrays – explains: “There is one registered trademark I know of that is the scent of eucalyptus for golf tees.”
“So consumers smell eucalyptus and associate it with that particular brand of golf tee.
“The smell is not natural or inherent to the product – it usually needs to be something that is entirely unique to identify that product.”
Trademarks are particularly important if you want exclusive ownership of a business name. It’s not enough to just register a business name with the Australian Securities and Investments Commission or secure the name in a web address.
If someone has already registered your business name as a trademark with IP Australia, you could be at risk of infringing their rights.
“Worse-case scenario, you might be taken to court,” says Wong. “Otherwise, you might need to rebrand after having invested time and resources into developing a brand you thought was available to use.”
So, if a business starts using a business name and develops a brand, can a second party later file a trademark for that name?
“No, not usually,” says Wong. “The second company would need to have used and already have rights in the mark as well. Otherwise, the first business may be able to challenge the second company’s use and registration of the mark.
“In Australia, trademark rights are acquired through first use and registration, unlike some other countries, which are first-to-file jurisdictions. So, you can’t just obtain rights by registration which trumps someone else’s rights that have already been developed.”
It’s important to note that trademarks only offer protection against other businesses that provide goods or services that are the same or similar to those covered by your trade mark registration.
Play it safe
Wong says the safest approach before adopting a new brand is to:
- Conduct availability searching to ensure it is available for use without infringing third party rights
- If available, to register a trademark to prevent others from adopting it and making it easier to establish a trade mark infringement.
“We’ve had clients come to us with a letter of demand from a third party alleging infringement on either their registered trademark right, or unregistered rights that have been developed through use of the trademark,” Wong says.
“So, when we’re presented with a client who has received a letter of demand who has not undertaken proper clearance searching, and it’s clear that they are infringing a third party’s rights, then we need to advise on ways in which that client can get out of the situation.”