Brands are a often a guarantee of quality. Good brands are memorable and can be protected as forms of intellectual property, giving their owner legal rights to stop misuse by others.
Take the recently reported Café Spice/Soho Spice dispute. When Michael Gottlieb, proprietor of the Café Spice restaurant concept, discovered that Amin Ali was about to open a restaurant called Soho Spice, which was decorated in such a way that he felt it could have confused customers into believing it was connected with Café Spice, Gottlieb sued.
The dispute was settled, but not until both sides had run up substantial legal fees. If a settlement had not been reached, and Gottlieb had been successful, Amin might have been forced to redecorate his restaurant, thus delaying the opening.
There are steps that will avoid this type of problem:
1. Before launching a brand, do a trade mark search to make sure someone hasn't registered or applied to register the same or a similar trade mark. If someone has, you should take legal advice on what you can safely do.
2. Even if no one has a registration or application, someone can build up rights in a brand name simply by using it. Checks can be made to identify such brand names:
- Search Companies Registry for any companies with a similar or identical name. If there are any, this is not necessarily a bar to your use. Many companies do not trade under their registered company names. If the company is trading under its company name, but is in a different business, it may not be able to show any likely confusion or damage - two pre-requisites for a passing-off action;
- Not all businesses are run as companies (eg, partnerships), so a business may be trading under a name but not have a company name registration. A search of telephone and trade directories may show if anyone is using the same or a similar name.
The costs of checking out a brand name are low when compared with the amount paid to branding agencies to devise new brands. Branding agencies should carry out searches as part of their commission - after all, what use is a dynamic, catchy, brand which infringes someone's trade mark? But not all agencies do their homework. So, when commissioning a branding agency, you should insist that it takes responsibility for clearing the brand and indemnifies you against third party claims.
A brand or logo can be registered as a trade mark provided it is distinctive (which generally means not descriptive, or not a commonplace word which might be used by anyone selling similar goods or services) and there are no existing registrations or applications for identical or similar marks.
A trade mark application costs about £450 to file and, if no oppositions are raised by the registrar or a third party, there is little else to pay. The advantage of a registered mark is that, if someone else starts to use that or a sufficiently similar mark in relation to a similar business, you will have a strong weapon to use to stop them. Often, a carefully phrased solicitor's letter will bring the matter to a close.
Even without a registered mark, someone who has established sufficient reputation and goodwill in a brand - or even in something as general as a theme or concept - may be able to bring a passing-off action to stop anyone else imitating that concept where there is a likelihood of confusion and actual or potential damage. Again, a solicitor's letter may do the trick.
A brand may include an artistic design which will be separately protected as a copyright. Copyright arises automatically when the design is created, but only prevents others copying it (not independently coming up with something similar).
One problem in relation to brand copyright is that, if a third party (eg, a branding agency) has devised the brand, it will own the copyright in that brand. Consequently, the agency could limit your use of that design and allow someone else to use the same design. To avoid these problems, any contract with a branding agency should state that all copyright of anything which the agency designs belongs to you.
Owning all rights in your brands is important. It enables you to use them as you wish and gives you the necessary rights to bring legal actions against others who copy your brands.
Linda Fazzani is head of intellectual property law at Paisner & Co Solicitors, London, EC4. Tel: 0171-427 1166; e-mail: fazzani@paisner.co.uk