5 Trade Mark Mistakes to Learn From
Your trade mark is an essential part of your business. Trade mark infringement disputes can take many years to achieve a final result, and an adverse outcome can hurt your business. This article will take you through five famous trade mark disputes to help you avoid one.
Zara Food vs Zara Clothing
Founded in Spain in 1974, Zara is a renowned fashion brand. The business is considered the largest apparel retailer in the world, and has more than 2,000 stores worldwide. However, a restaurant in India opened under the name ‘Zara Tapas Bar’, with the marketing focusing on the word ‘Zara’.
Fashion giant Zara took action immediately, arguing that the restaurant was seeking to ride on the success of their branding. The restaurant argued that their business was unlikely to be confused with the fashion company because they operated exclusively in the food industry.
However, given just how similar the restaurant’s branding was to the retailer and Zara’s cross-border reputation, the court found that the restaurant had to change its name. Despite operating in different industries, the trade marks were simply too similar to ignore.
Lesson learned: Companies are always searching for trade marks similar to or identical to their own. A business’ brand is important. No matter how small your business is, a similar trade mark to a major business will not go unnoticed.
Burger King and Hungry Jack’s
The famous American franchise is not known as Burger King in Australia, leading many to question why. The answer begins in the early 1970s, when Burger King began expanding overseas, including Australia. However, a small Australian business in Adelaide was already operating under the name Burger King. This business refused to give up its name to the American food giant. Instead, Burger King was forced to use the name ‘Hungry Jack’s’ in Australia.
Eventually the Burger King name became available to the Hungry Jack’s franchise. However, the Hungry Jack’s brand was already well-established in Australia, and the company decided to keep the name.
Lesson learned: Protecting your trade mark in your own country will not give you rights internationally. If you plan on expanding your business overseas, consider the availability of your trade mark in every potential country.
Bentley Clothing vs Bentley Cars
In 2019, the luxury car manufacturer Bentley found themselves at the centre of a now famous trade mark dispute with a Manchester-based clothing company also called Bentley. The two businesses had been discussing the dispute since the 1990s before finally reaching the High Court in 2017.
The court ruled that Bentley Motors could no longer use their name on clothing. Therefore, the brand’s future fashion ventures would be limited to accessories such as silk ties, caps, and scarves. The motor company had previously attempted, unsuccessfully, to cancel the clothing company’s trade mark at the UK Intellectual Property Office.
Lesson learned: If you plan on expanding your business’ goods and services range, plan early. By the time you decide to branch out into other areas, somebody else might already have your trade mark. You could then find yourself at the centre of a trade mark infringement dispute.
Victoria Beckham vs VB Skinlab
In 2018, Victoria Beckham and Australian skincare brand VB Skinlab had a trade mark dispute. Both Victoria Beckham and VB Skinlab sell skincare products. However, Victoria Beckham had concerns that VB Skinlab could appear to be associated with her fashion brand.
Victoria Beckham’s legal team argued that she had been using her unregistered trade mark ‘VB’ since 2016 in Australia, including in collaboration with Estee Lauder. The court found that Victoria Beckham was too late, suggesting that she might have been successful if she had registered her trade mark earlier. Instead, her brand was only known in Australia for 18 months before she opposed the trade mark. The court did not consider this short time frame sufficient to prove that her brand had established a significant reputation in Australia.
Additionally, Victoria Beckham’s brand argued that the trade marks were identical and that use of the VB Skinlab trade mark could be misleading and deceptive conduct. However, the court found that using a side-by-side comparison, the two trade marks have clear differences and would not likely mislead consumers into believing that they were buying a product affiliated with Victoria Beckham.
The court allowed VB Skincare to continue to operate under its own name.
Lesson learned: It is important to register your trade mark as early as possible. No matter how famous you are, early registration will (usually!) beat reputation.
In-N-Out vs Down-N-Out
In 2016, the Australian burger chain ‘Down-N-Out’ was established, looking very similar to the American regional burger chain ‘In-N-Out Burger’. With a similar menu, aesthetic, and overall style, it appeared to the court that Down-N-Out was following their American predecessor’s footsteps.
The Australian business lost its appeal in the High Court in 2020 after a famous four-year trade mark legal battle. The business argued that In-N-Out did not operate in Australia and therefore had not established goodwill or a substantial reputation in Australia. However, the court found that not only were Down-N-Out trying to pass off their brand as In-N-Out, they were also in breach of the Australian Consumer Law for misleading and deceptive conduct. The court found the overall impression of the business’ trade marks was the same, which could attract customers confused by the correlation.
Lesson learned: Attempts to pass off will not be looked upon favourably, even if the business you are imitating is not registered or known in your country. Passing off also puts you at risk of being accused of misleading and deceptive conduct, which is in breach of the Australian Consumer Law.
No matter how big or small your business is, your brand’s reputation is your most important asset. Over the years, highly publicised, famous trade mark infringement disputes have taught many lessons about trade mark infringement, including the importance of:
- monitoring your trade mark;
- registering your trade mark internationally if needed;
- considering the future of your business as early as possible;
- registering your trade mark as early as you can; and
- not attempting to pass off trade marks, even if they are not registered in your country.
Frequently Asked Questions
Trade mark registration refers to formally protecting your trade mark on a trade mark register. Trade mark registration gives you enforcement rights over your trade mark, meaning you can take legal action against anyone who uses your trade mark without your permission.
Having a trade mark is a great way to protect your business’ brand. While unregistered trade marks give you some rights, registering your trade mark adds an extra layer of protection against competitors.
There are a number of ways you can enforce your trade mark rights. The approach you take in enforcing your trade mark will differ depending on your individual circumstances. Some ways you can enforce your trade mark rights include sending a cease and desist letter, making a formal opposition, or taking the matter to court.