The Trademark Registration Checklist – 20 Reasons to Register a Trademark
A quick Trademark Registration ‘Boot-Camp’ that aims to explain the legal and commercial benefits of trademark registration and what every tradeonlinemarket business should know about how to protect the legal rights in their business name….
1. Exclusivity: The One and Only… – Trademark registration will confirm your legal ownership of the name or brand and enable you to stop others using your name for the same, or similar, goods or services. A successful trademark application will mean that you quickly become the only business that can use the name in your sector. This cannot be achieved by domain name registration or by company name registration. Any name you adopt should be legally available, satisfy the criteria for trademark registration and should be registered as a registered trademark without delay. Trademark registration will ensure that you have the exclusive right to use your particular name or brand in your product or service sector in the geographic market for which you have obtained registered rights.
2. Stay Safe: Avoid Infringement Claims – A successful trademark registration demonstrates conclusively that your name is deemed to be legally available in your market sector and does not belong to anyone else. It generally means that pre-registration searches showed your name to be free for use and registration and that no one else was able successfully to oppose your application. Once you have obtained a trademark registration, the risk that your use of the trademark will infringe the trademark rights of anyone else is vastly reduced. The converse is also true. If you steam ahead and adopt a trademark without checking if it is available, and protecting it by trademark registration, you are running a very high risk that you will sue for trademark infringement by the owner of the mark. This ultimately means court action against you to restrain your use of the brand, and award of damages, confiscation and destruction of infringing stock and heavy legal costs.
3. Protect Goodwill and Reputation – A strong and memorable brand that is protected by trademark registration is the surest legal foundation on which to build the reputation and goodwill of any business. A business that soldiers on without the benefit of a registered trademark is missing out on a huge commercial opportunity. Strong registered brands (Mercedes, Google, Amazon, iPad, The London Eye etc) quickly pass into the collective consciousness of the world consumer market and become synonymous with quality, consistency and reliability.
4. Get Noticed: Differentiate Your Business – The main purpose of a trademark is to denote the origin of the products or services to which the trademark is attached. The trademark becomes a badge of origin and quality. In short, the consumer knows where it came from and what to expect. So every business has an equal opportunity to adopt a distinctive brand that it alone owns and protecting it by trademark registration. This enables the business to differentiate itself from every other business in the same market sector. It makes no sense to adopt a name that is already in use, or is similar to an existing name, since this will not serve to differentiate your business from the competition. Your brand should be strong, memorable and unique and, for this reason, invented or quirky words tend to be best.
5. First is Best: Avoid Pre-emptive Registration – Once you have identified a legally available name that you want to adopt for your business you need to bang in a trademark application without any delay. If you do not do so, someone else may file an application before you and you will lose the opportunity to own the name exclusively. This may be because someone else has seen your name in print or, for example, at a trade-show, and thinks it is a good name that they would like to use. It may simply be an honest, concurrent application. Whether it is coincidental or intentional, the first application will usually take precedence. To avoid a pre-emptive application act fast and do not invest in any name until you know that you have successfully protected it by trademark registration.
6. Anti-Sabotage Measure: Competitors – If you fail to protect your name by trademark registration, you lay yourself wide open to attack by competitors you want to close you out of the market by filing an application to register your name and then alleging that your continued use of the mark constitutes trademark infringement. If a competitor gets a trademark registration for your name, or a very similar name, you may have to stop using your brand and could effectively lose your business overnight. It may be possible for you to seek a revocation of the competitor’s mark on the basis that you used it first or perhaps that the competitor is acting in bad faith but this is likely to cost you a very substantial amount in terms of legal costs and you may fall short on proof. Sometimes an oversea competitor will seek to register your trademark in national markets where you have not protected you name for the same products(eg by filing an EU or Community Trade Mark for all of the EU Member States) with the intention of preventing you from expanding into those markets or selling your products in those countries without rebranding your products for those markets.
7. Anti-Retaliation: Employees, Suppliers, Developers – Given that anyone can file an application to register a trademark if they have a genuine intention to use it, you can see that it is very easy for an aggrieved supplier or ex-employee, or anyone else who has a grudge against you, or your business, to retaliate by getting a trademark registration for your name if you yourself have neglected to protect it. This can cause you a major headache. It is quite common for developers or joint venture partners to make a pre-emptive, retaliatory application for trademark registration of the business name in order to give themselves a negotiating platform in the settlement of a wider, ongoing dispute. Prompt trademark registration in the first place closes off this avenue of attack and ensures that your business cannot be held hostage over the ownership of its own name.
8. ‘Lock In’ Brand Value – By protecting your business name by trademark registration you are effectively ‘locking in’ your brand value. If you think about it, if you develop your business under a brand that you have not take the trouble to check out and protect, you are taking the very real and inevitable risk that the name you are using is legally owned by someone else. In such a case, all of your hard work and advertising spend under that name is actually simply building up the goodwill and reputation of a business that is owned by someone else. When you are obliged to stop using the name you will lose any brand value that you may have acquired and will have to start again with a new name. Lock in the brand value of your business by trademark registration.
9. Defeat the ‘Copy-Cats’ – If you are successful, often competitors will try and copy your name and business model. They may, for instance, try and adopt a variant of your url. If you have protected your name by trademark registration, any copying of the domain name in this manner will probably amount to a trademark infringement and you will be able to stop them. Also, it is possible to protect, not just word marks, but also strap-lines, graphics, shapes and colours by trademark registration, so it is often possible to get a degree of exclusivity for the ‘look-and-feel’ of your business in this way, which also makes it much harder for competitors to copy your business idea effectively.
10. Assure Investors – Given the fundamental importance for any business of exclusive ownership of its brands and trademarks, potential investors often, quite rightly, require the business to demonstrate such ownership as a condition of making the investment. The most conclusive demonstration of ownership is a trademark registration certificate. Conversely, a conflict over name ownership is quite often a reason why investors do not proceed. Quite simply, they are not interested in buying into a legal dispute over the ownership of one of the main assets of the business.
11. Due Diligence: Satisfy Buyers – If you are planning to sell your business at any time, you will need to protect all of your names, marks and brands by trademark registration. Any prospective buyer will want to know that you have all of these rights under ownership and that there are no third parties using same name, which would obviously dilute the strength of the brand, or worse, actively seeking to prevent you from continuing to use your name. Since the value of the goodwill of your business is inextricably linked to the ownership of its trading name, failure to obtain a trademark registration can not only mean that you will not get the price you expect for your business, but, in difficult cases, your business may simply become unsaleable because of uncertainty or legal conflict over your right to use your current business or product name.
12. Support Expansion: Franchising, Licences, Agents – A strong brand protected by trademark registration is a sure footing on which to develop a business by way or franchise, licence or agency. A franchise is, in effect, nothing more than a glorified trademark licence and the very least that any franchisee will expect is the unfettered right to use the franchise name. The commercial benefit of being part of an umbrella brand is, after all, one of the main reasons that people invest in a franchise. A registered trademark can be licensed for a royalty. Any agency or distributorship network will want the comfort of knowing that you have the sole and exclusive legal right to use your product names and the only way this can be obtained conclusively is by way of trademark registration.