5 Disadvantages of Trade Marks
As a business owner, you are likely looking for as many avenues to grow and protect your business as possible. One key way that you can do this is through a trade mark. A trade mark is one type of intellectual property (IP) protection that grants you exclusive rights to your brand assets. Despite the advantages of trade marks, there are also some disadvantages that you should be aware of before obtaining a trade mark. This article will take you through 5 disadvantages of trade marks.
1. Trade Mark Classes Cannot Be Altered
One key difficulty with trade marks is that you cannot alter trade mark classes. When applying for a trade mark, you must choose trade mark classes relevant to your goods and services. This is an important process because it determines the scope of protection for your trade mark.
However, it is important to note that you cannot add more classes to your trade mark once you have made your trade mark application. Instead, you would need to make an entirely new trade mark application. If you are unsure about your business’s direction, it may be difficult to determine the relevant trade mark classes at the time of your application. This is one potential disadvantage of trade marks.
2. Difficulty with Litigation
Another key difficulty with trade marks is litigation issues. If you consider that somebody has infringed on your trade mark, it will be up to you to enforce your rights. This may include sending a cease and desist letter. In instances where such measures are unsuccessful, you will need to pursue legal action. This can be time consuming and expensive, which becomes more difficult because trade mark litigation is largely subjective. This is because the issue of whether two trade marks are deceptively similar is ultimately a subjective matter, which means pursuing trade mark litigation can be difficult.
The process of trade mark renewals is another potential downside to a trade mark. Trade mark renewals are quite regular when compared to other types of IP protection. You must renew trade marks every 10 years, at which time you will need to pay renewal fees for each class you hold. While 10 years might seem like a long period of time, this can be very costly, particularly for businesses with large trade mark portfolios. Failure to renew your trade marks on time will result in removal of your trade marks from the trade mark register. This makes it crucial that you stay on top of your trade mark renewals.
4. Protection Limitations
Another major disadvantage to trade marks is the limited protection that it provides. The very purpose of trade marks is to protect the brand of your goods and services. This means that trade marks do not protect your goods or services themselves – instead, trade marks only protect the associated marketing. While the protection of your marketing is still a critical aspect, for many businesses, it means many other businesses will need to also seek other types of IP.
For example, you may need to obtain a patent if you have designed a process or have a new invention. Unfortunately, trade marks are not always sufficient protection.
5. Risk of Being Genericised
While often only in extreme cases, well-known trade marks do become at risk of being genericised. This refers to the process where consumers associate the brand of products with the item itself. For example, ‘Sharpie’ has become a commonly used term for all markers, and ‘Google’ has become synonymous with search engine. This typically happens when a product has substantial dominance in the market, which is usually a good sign. However, it places the trade mark at risk of losing its legal protection. Trade mark owners at risk of genericisation instead need to take measures to reduce the risk of this occurring, such as by educating their consumers on the proper use of their trade mark.
Having a trade mark can be an excellent tool for your business. However, you should consider several disadvantages to trade marks and seek legal advice to mitigate these disadvantages. Some of these disadvantages include that:
- you cannot alter trade mark classes;
- litigation can be difficult;
- trade marks require renewal every 10 years;
- there are limitations to what your trade mark protects; and
- your trade mark is at risk of becoming genericised.
If you need assistance deciding if a trade mark is right for you and your business, our experienced trade mark lawyers can help. Get in touch with them on 1300 657 423 or by filling out the form on this page.
Frequently Asked Questions
Trade marks have a number of benefits, serving as both legal protection and a marketing tool. Trade marks increase the value of your assets, provide an avenue of enforcing your rights and prevent others from ‘stealing’ your design for their own benefit.
Trade marks are an excellent legal and marketing tool with wide-reaching benefits. However, you should also consider the disadvantages of trade marks. This includes that you cannot alter trade mark classes, that litigation can be difficult and that trade marks require renewal every 10 years. Further, trade marks are limited in what they can protect and in some more extreme instances, your trade mark is at risk of being genericised.