Start-ups: Getting off on the right IP foot

COVID-19 has affected the business world in a variety of ways, but not all of them have been negative.

A wave of start-ups has emerged across the UK, many of them embracing the opportunities that e-commerce holds. According to new figures from the Business Data Group, about 1,300 e-commerce start-ups were being formed each week during the early stages of the lockdown restrictions, more than double the number in the week prior to the restrictions’ introduction.

However, with more businesses starting out, there is an increased chance of trade mark rights being infringed. So, how can these fledgling businesses avoid unwanted disputes while protecting their own brand identity?

A quick search online will show that poorly researched business names can get new start-ups off on the wrong foot, potentially leading to costly legal disputes. In order to avoid this situation, it is essential that new businesses carry out a series of preliminary checks and searches to ensure their chosen name does not infringe any existing trade mark rights.

For entrepreneurs looking to begin their business venture as quickly as possible, it may be tempting to overlook this stage or do a quick Google search and think they have done enough. However, this could lead to costly disruption and incur legal costs, especially if a small business ends up going head to head with a much larger, established company.

Enlisting the help of an intellectual property professional who can search the Trade Mark Register as well as other sources with a trained eye could help to de-risk the start-up process. For example, as well as looking for pre-existing marks with the same name, it is important to look for ones that could be considered confusingly similar.

A truly comprehensive search will involve investigating trade marks or names that are phonetically similar or differ by only one or two letters. It is especially important not to ignore these pre-existing marks if they have secured trade mark rights in the same category of goods or services. The results of these searches can help to determine whether a new brand name is worth further investment.

Trade mark searches shouldn’t be limited to a single country, particularly if a start-up has international aspirations. The majority of EU countries have their own online registers, which can be easily accessed. Although it may be difficult to justify the cost of carrying out up-front global searches, this could eliminate an expensive name change or dual-branding strategy further down the line.

Assuming no infringement risks are found, the next step for start-ups is to protect their own name. This involves applying for a trade mark registration. Once granted, the new owner should be prepared to enforce their rights where necessary and establish watches to look for any infringing names. If necessary, the business should take steps to block use of the infringing mark.

Should the infringement relate to a domain name, the trade mark owner can apply for the name to be surrendered or have the rights transferred over to their own business, ensuring complete ownership of it.

To protect their brand as they build their business, entrepreneurs should keep their trade mark portfolio under review and perform market searches regularly. They should also collate evidence of use from the date that the trade mark is granted. If the company is ever challenged, this evidence of use can be vital in defending ownership of a trade mark. Brand owners should also consider making new filings to increase the scope of protection as the business grows.

It is undoubtedly positive news that so many start-ups are emerging at such a challenging time. However, founders must not forget the importance of researching and protecting the name of their new venture before launching it to the marketplace. Getting embroiled in a costly trade mark dispute at the start could spell the end of their business before it has even begun.

Fiona McBride, partner and trade mark attorney at European intellectual property firm, Withers & Rogers