Get The Answers: Trademark best way to stop others using business name

Simon Rowell. Photo / Supplied

Registration generates formal piece of personal property, writes Simon Rowell, partner at James & Wells Intellectual Property, Auckland.

Naming your company is not the end of it for a business. Over its lifetime you will have to protect it as competitors seek to benefit from the qualities the name bears.

How can companies protect their name against copycats?

My advice was recently sought regarding a New Zealand case in the hospitality industry where a company, which had a trademark registered over its business name, legally enforced its rights by asking another company to stop using a similar name. This was a legitimate action by the company with the trademark - and a good example of why all company owners should consider intellectual property in a strategic way from the outset.

What is a trademark and what can be registered as a trademark?

A trademark is a badge of origin, indicating goods or services originating from a particular supplier. A trademark can be registered or unregistered. A registered trademark is a formal piece of personal property, like any other asset, and is obtained by applying to the Intellectual Property Office for registration. While I recommend seeking legal advice around this first, there is an inexpensive way of registering a trademark: see www.ipol.co.nz

It is possible to register as a trademark any "sign" that can be represented graphically that is capable of distinguishing goods or services provided by your business from those provided by others.

A "sign" includes any word or combination of words, for example, Coke, a slogan such as, Just Do It, a pictorial device, for instance, the "apple" of Apple. It is also a colour, a particular green for BP, for example, a sound, the jingle used by The Warehouse, or three-dimensional shapes like the shape of a Toblerone chocolate bar.

Even smells are a "sign".

If I've registered my company name with the Companies Office, isn't that enough?

A company name registration only prevents another company from adopting that name or a similar one. It does not stop another business from adopting your company name, or part of it, as a brand for that business' own product or service.

A trademark registration gives you the exclusive right to use your registered trademark in relation to the goods or services covered in your registration.

It prevents another business from using the same mark, or a confusingly similar mark, in relation to the same or similar goods or services as those covered in your registration.

If I get rights to my brand just by using it, why do I need to register it as a trademark?

It is true that over time you will generate defendable rights to a trademark without registration, simply by using and promoting that trademark. The goodwill and reputation you generate can be protected under the Fair Trading Act 1986, or under the law of "passing off".

However, there are some significant hurdles faced in relying on passing off or the Fair Trading Act. You must prove that you have goodwill among a significant section of the relevant public in the location(s) where the infringer is operating, at the time they first started operating there. This can be a problem - for example, a relatively new Auckland cafe would have a very difficult time preventing a cafe from starting in Christchurch under an identical or similar name, unless they could show the necessary reputation in Christchurch.

Any business that intends to open in more than one location should seek to register their trademark.