Fifth of all SMEs don’t understand Trade Mark rules & could be open to huge legal action

pizza express

Intellectual property law firm Mathys & Squire evaluated nearly 1,500 trade mark registration enquiries that were received over a three month period and found that 18 per cent of people wanted to register a trade mark that was identical or almost identical to a rival’s brand.

Trade mark attorney Gary Johnston said: “We were stunned by how many people clearly didn’t understand that registered trade marks are used to differentiate businesses, and that they could not register the same trade mark as a competitor.

“Without consulting a professional it isn’t always obvious what trade marks have been registered, but a large number of the small businesses in our study, for example the hairdressing business ‘Joni & Guy’, were clearly trying to use the popularity of well-known brands to market their own business.”

Nine per cent of those involved in the study wanted to register a trade mark identical or almost identical to those owned by rival businesses. Examples of trade mark registration enquiries included:
· M-&-S for a food retailer (an infringement of Marks and Spencer plc)
· Pizza Xpress for a restaurant business (an infringement of Pizza Express (Restaurants) Limited)
· Tiger’s Woods for a golf shop (an infringement of ETW Corporation)

Another nine per cent wanted to register a trade mark with slightly different spelling or wording to that of a rival’s. Enquiries for confusingly similar trade marks included:
· TopStop for an online fashion business (an infringement of TOPSHOP.COM)
· Grrufts for a dog grooming business (an infringement of The Kennel Club’s Crufts brand)
· Tres Semey for a hairdressing business (an infringement of Unilever UK Ltd’s TRESemmé brand)

Trade mark attorney Gary Johnston said: “Trade mark registration is used to prevent confusion between different businesses, products and services, and enables a brand owner to stop a third party using the same or a similar mark without permission. We were stunned that so many people were keen to register trade marks but didn’t understand this.

“By registering a trade mark you have a monopoly on that name and your brand name is a protectable asset. Any investment you make in it, be that through designing a website or through advertising, adds to its value. The stronger and more successful your business becomes, the more valuable the trade mark is, and the more watchful the brand owner tends to be about stopping other businesses trying to piggyback on their success.”

Whilst many of these cases are small independent businesses infringing larger companies and seeking to piggyback on the awareness created by larger companies with greater market budgets, that is not always the case. Last year Capital Business Media, owners of the Business Matters brand had to take legal action against HSBC for trade mark infringement.

After lengthy legal action the bank agreed that it had both infringed the trade mark and caused confusion by potentially passing off when it introduced a magazine & online offering to their SME client base called Business Matters and agreed to remove all references to it.