CHAPTER 4 – DISTINCTIVENESS IS THE KEY

FROM THE INITIAL IDEA TO A WELL KNOWN TRADEMARK- A LONG WAY TO GO

No matter how good a business`s goods and services are, they will struggle in the marketplace unless they are easily distinguishable from those of competitors. This is why building a strong brand is important to survive in a tough market.

It is often observed that businesses try to monopolise a whole new product category by using a descriptive term as a trading brand. One supporting argument is that they will come up in the Google ranking. However, this is by far a very risky strategy, as generic or descriptive trade marks are not registrable in most cases. The bottom line could be that the brand cannot be legally protected when challenged by a competitor. This may result in a total loss of customers and money.

As well as taking advice from branding professionals when developing a new product or services brand, businesses should consider commissioning a legal report on trade mark registrability in all proposed target markets. The added cost could prove insignificant compared to that of litigation or rebranding in the future.

Only registered Trademarks are presumptively considered marks of ordinary strength entitled to all protections consistent with Trade Marks Act 1995 an other trade mark laws around the world. Unregistered trade marks, trade names are not given this presumption and are not entitled to the same presumptive rights under trade mark law. This explains why simply registering a business or company name is certainly not enough to defend your position in the market. It leaves the business out to the open.

The date when a business obtains common law rights in a trademark (sometimes known as well known trademark) depends on the distinctiveness of the mark. A business will obtain rights in the mark upon first use only if the mark is inherently distinctive. If the mark is not inherently distinctive, a business may obtain ownership rights in the mark when the mark attains a secondary meaning.

A trademark can be opposed or cancelled by a competitor just because it is merely descriptive and they want to be able to use the descriptive words freely without worrying about infringement suits or other problems.

Under Sec. 18(1)(b) Trade Marks Act 1995 the Commissioner must not register a trademark that has no distinctive character. A trademark suffers lack of distinctiveness as set out by Lord Parker of Waddington in W&G du Cross Ltd`s Application (1913) 30 RPC 660 at 672 (and affirmed as the appropriate test under the Act by the New Zealand Court of Appeal in Intellectual Reserve Inc. v. Robert Sintes CA31/2008 [2009, NZCA 305] in case other traders are likely, in the ordinary course of their business and without any improper motive , to desire to use the same mark, or some mark nearly resembling it, upon or in connection with their own goods.

The distinctiveness of a trademark refers to how easily customers identify a mark with the associated products goods or services, how easy it is to distinguish one trade mark from another. Weak trademarks, marks that are not distinctive, are often marks that are often used by third parties, dictionary words, geographic words or other terms that are hard for any party to claim exclusive to.

Secondary meaning is when the consuming public has made a link between an alleged mark and the source of the mark. A mark has acquired secondary meaning when it has been used so long and so exclusively by one producer with reference to its article that, in that trade and to that branch of the purchasing public, the word or phrase has come to mean that the article was the first producer’s trademark (G. Heileman Brewing Co. v. Anheuser-Busch Inc., 676 F.Supp. at 1467 (E.D. Wis., 1987).

The factors considered in determining whether a descriptive mark (not inherently distinctive) has achieved secondary meaning include:

  1. whether actual purchasers of the product bearing the claimed trademark associate the trademark with the producer as evidenced by survey or direct consumer testimony;
  2. the degree and manner of advertising under the claimed trademark;
  3. the length and manner of use of the claimed trademark; and
  4. whether use of the claimed trademark has been exclusive. Levi Strauss & Co. v. Blue Bell, Inc., 778 F.2d 1352, 1358 (9th Cir.1985).

The exclusiveness factor is a problem for many trade marks that are not distinctive because what makes them not distinctive is often that common descriptive words are being used to identify the product or service in the consumers mind. Since the words are common, they are not being exclusively used by just one business owner.

Trade Mark owners can increase the link between their products or services and their claimed trademark in the minds of the consuming public by making Proprietary Claims (PC).

Further the concept of distinctiveness is key to determining whether there has been infringement. This is because a person infringes a trade mark if the person uses a sign that is substantially identical or deceptively similar to the registered mark as a badge of origin.

A trade mark is a sign used to distinguish goods or services. The question whether a sign was used as a trade mark is if it indicates the trade origin or in statutory language whether the sign is used to distinguish one person`s goods and services from the goods or services of others.

In Coca Cola v All-Fect Manufacturers the Full Court of the Federal Court said that use as a trade mark is using a sign to indicate a connection in the course of trade between the goods and the person who applies the mark.

The test on whether or not a trade mark is recognised to be distinctive and therefore registrable has been established in Unilever v Karounos. Section 41 of the Trade Marks Act 1995 conceives of three methods by which a word or symbol may be capable of distinguishing the applicant’s goods or services from goods or services of other persons. These three inquiries form the basis for the determination of the capacity of a word or symbol to be registered as a trade mark. Section 41 indicates that there are three main types of distinctiveness: inherently adapted to distinguish.

To become a trade mark a brand must be capable of distinguishing goods and services by a combination of the inherent adaptation of the word or symbol to distinguish the goods and services, the use or intended use of the word or symbol by the applicant and any other circumstances not inherently adapted to distinguish but does in fact distinguish because of extent used trade mark before filed application.

Signs that are inherently capable of distinguishing goods and services are meaningless words or meaningless connections. This would include completely made up words like Apple in relation to computers. On the other hand the word “Apple” is purely descriptive for fruits. This is why it is not distinctive and thus not registrable for any good in relation to fruits.

A word which is not inherently adapted to distinguish, such as a descriptive word or a person’s name may become a distinctive sign if it is combined with swirly calligraphy, or an interesting logo. The word itself cannot be registered as a trade mark but the combined sign, the word and the device, can be registered as a composite trade mark. The combination is distinctive because the other features give the sign as a whole its distinctiveness. For example, the words “Fizzy Berry”” is not distinctive for sweets as it indicates the taste. But the words combined with a certain logo are distinctive. The non-word feature give the sign as a whole its distinctiveness. The combination may then be registered as a trade mark.

The problem with meaningless signs or meaningless connections is that they are meaningless. If you are spending a fortune promoting a sign, you might as well also convey some information about the product. The ideal sign both conveys some information but still has the capacity to distinguish.

This would also include abbreviations. The categories of descriptive words on the one hand and those that are capable of distinguishing goods and services on the other are not mutually exclusive. No firm divides between words which are descriptive and those which are capable of distinguishing goods and services from others. The key is that the descriptive word acquires a secondary meaning. In Johnson & Johnson Australia Pty Ltd v Sterling Pharmaceuticals it was observed that the mere fact that a word is descriptive or has a descriptive flavour does not necessarily prevent it being distinctive of somebody’s goods. If a word is prima facie descriptive the difficulty of establishing that it is distinctive of the plaintiff’s goods is considerably increased. The question is one of degree. There must be a sufficient degree of distinctiveness to counterbalance the descriptive character of the word.

A word which is prima facie descriptive may become distinctive in connection with particular goods and yet retain its descriptive meaning. But the word must, in order to become distinctive, have a new and secondary meaning different from its primary descriptive one and thus cease to be purely descriptive. However, it is essential that a sign has at least some inherent capacity to distinguish. In contrast, some signs may have been “so totally descriptive of the goods concerned as to be unregistrable.

It can be learned that it does not pay of to try to establish a descriptive term as a strong brand. You may not even obtain a registered mark and suffer all disadvantages of lack of protection.


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