TRADE MARKS

Who needs to know about trade marks? Mainly, anyone who is connected with manufacturing, marketing or the supply of services.

Let us suppose you are the Chief Executive of a company that manufactures cleaning products. You decide to launch a new detergent on the Australian market. You estimate that it will require an initial advertising outlay of $3 million to launch the product successfully. You instruct your advertising agency to plan an advertising campaign and to come up with a name for the product at the same time. The agency gets down to work, plans the campaign and comes up with a name for the product. You are especially pleased with the name because, in one word, it describes the product. You go ahead and apply to register the name as a trade mark. The advertising campaign starts. A year and half later when you have spent $2 million out of the $3 million advertising budget, a letter arrives from the Trade Marks Office in Canberra informing you that the name cannot be registered as a trade mark. The reason given is that the proposed name is not "distinctive" as it describes the goods. You are astounded. Could this scenario come true? Yes, indeed! And it could have been prevented with only a little knowledge of trade mark law.

In each of the four financial years from 1987 to 1991, the Trade Marks Office received between 20,000 and 25,000 applications to register trade marks. However, the number of trade marks that successfully proceeded to registration came to less than half of these figures. Residents of Australia accounted for only 57% of applicants, the rest were residents of various overseas countries.

What is a trade mark? A trade mark is a sign used to distinguish the goods or services of a trader from those of other traders. The "sign" can be 1) a word, 2) a picture, 3) a symbol or a combination of any of these. Sounds, scents, shapes and colours can also be registered but you can only register a description of these. It should be noted that trade marks are not confined to goods. Trade marks can also be registered for services. For example, an advertising agency or an accounting firm could register its own trade mark. In some respects, applying for a trade mark is the modern equivalent of applying for a coat-of-arms. It is interesting to note that in the UK today, one can apply to the Trade Marks Office for a trade mark and to the College of Arms for a coat-of-arms. The procedures for applying for both are similar.

REGISTRATION PROCEDURE

Registration of trade marks is carried out by the Trade Marks Office in Canberra. It is part of the Patents Office, now known as IP Australia. There is a branch Trade Marks Office in each State capital city. The total minimum fees payable to the Trade Marks Office to register a trade mark is $450 ($150 + $300). Registration of trade marks is usually undertaken by either a Patent Attorney or a legal practitioner. The fee charged by these professionals for registration is usually around $600. The total cost of registering a trade mark will, therefore, usually come to around $1,050. However, the registration process has been simplified and streamlined in recent years and it is now easier for an applicant to personally register his mark.

The outline of the procedure for registering a trade mark is as follows. The easiest method of registering a trade mark is to use the internet. You can a) do a search , b) complete the application form and c) pay by credit-card at the IP Australia web-site. Alternatively, you obtain an application form from the Trade Marks Office. You must now make sure that your proposed mark is not already registered by someone else. You must do a search of the existing registered trade marks. Copies of existing trade marks are held on computer in the Trade Marks office in Canberra and in each of the State capitals. You can do a search at a computer terminal. You can also do a search on the internet. The Trade Marks Office will also do a search for you. They make a charge for this service. It is best to use their services rather than attempt to do the search yourself. Once you have satisfied yourself that no mark exists which is similar to yours, you complete the application form. A trade mark must be registered for a class of goods or services. There are 34 classes of goods and eight classes of services. You attach a copy of your proposed mark to the application form. You send the completed application form to the Canberra Trade Marks Office together with a fee of $150. You must now wait until a Trade Marks Office Examiner has examined your mark. This can take from 9 months to 24 months depending on the backlog of applications. You receive a copy of the report. Not infrequently, a proposed mark will be rejected outright by an Examiner but, more frequently, the Examiner will suggest amendments to the application. If the applicant assents to the amendments, he is asked to pay a further $300 registration fee. The mark is then registered. It is afterwards advertised in the official journal of the Trade Marks Office. This journal is on sale to the public. Anyone may object to the registration within three months. The objection is heard by the Registrar. A further appeal can be taken to the Courts.

The initial registration lasts for 10 years and it can be renewed indefinitely for further periods of 10 years. Registration grants the exclusive use of the mark to the registered owner. He is entitled to protection of the mark under the law. However, registration of a trade mark is not compulsory. You can use an unregistered trade mark. However, the legal procedures for protecting a registered mark are much more effective than those for protecting an unregistered mark. You should be aware that you can also register a word 1) as a Business Name, 2) as a company name and 3) as an Internet domain name. However, the protection afforded by registering the word as a a trade mark is far superior to any of the other registrations and in nearly all cases takes precedence over them. For example, any person wanting to have  the exclusive use of an internet domain name would be well advised to have it also registered as a trade mark.

REGISTRABLE MARKS

What kinds of marks can be registered? This is a crucial question. The basic requirement is that the proposed mark must be capable of distinguishing the applicant's goods or service from the goods or services of any other person.

It is well-settled law that certain categories of marks lack distinctiveness and thus cannot be registered. What are these categories? They are 1) descriptive words, 2) ordinary surnames, 3) common geographical names, 4) common devices and 5) combinations of numerals or letters. We shall look at each of these in turn and give examples. But first I should point out that if the applicant has actually used the mark on his goods prior to the application and his case is a borderline case, then it will help his case if he informs the Registrar of the previous use of the mark.

DESCRIPTIVE WORDS

Descriptive words lack distinctiveness and thus cannot be registered.

The Trade Marks Office receives in excess of 20,000 applications for trade marks every year. Most of the applications are for registration of a word rather than logos or marks. It is here where the uninitiated come unstuck. The person not "in the know" will think up a word which describes his goods or services and apply to have it registered. For example, he might apply to have "Detergent" registered for a washing powder. Or he might apply to have "motor-car" registered for a motor vehicle. Or he might apply to have "perfect" registered for any type of goods or services. All of these will be rejected out-of-hand by the Examiner. "Detergent" describes goods which are detergents. Likewise, "motor-car" describes a motor vehicle. "Perfect" is descriptive of goods.

In fact, most trade marks are rejected by the Registrar on the grounds that they are "descriptive of the goods". Even if the word is in a foreign language, it will not be registered if it is descriptive. Applicants must provide translations of foreign words.

What is the rationale behind this prohibition? Is it just plain ridiculous? Let us see. On registration of a trade mark, a person obtains the sole right to use the mark in connection with his goods or services. Suppose that John Smith were successful in obtaining registration of the word "motor- car" for vehicles. The result would be that nobody could subsequently describe a vehicle for sale as a "motor-car" without infringing John Smith's trade mark. If he did, he would leave himself open to legal action by John Smith. The same reasoning applies to "detergent". Any descriptive names for a detergent would not be acceptable such as "detergex", "white", "perfect", "good" etc.

The rationale is, of course, that nobody should be allowed to obtain the exclusive use of a common descriptive word, e.g. "perfect", for his goods.

The following is a sample of words that have been held to be descriptive by the Registrar and have been rejected as trade marks. It will be noticed that many are phonetic spellings of descriptive words.

ALL-BRAN, ALUMINOX, AUREOMYCIN, BACON-BURGERS, BAMBOO BRAND, BAND AID, BLACK AS NIGHT, BLACKTONE, BLUEE, BLUE STRIPE, BLU WASH, BOOT-KNITS, BRIT-TEL, BROCADIAN, CALMS, CARBOYOGHURT, COLORAL, COVERALL, CRUSH, DAIRY MILK, DINKUM, DRINK-MIX, DRY SACK, ELECTRODATA, GOLDEN MELON, HEATAIRE, HI-JEEN, INSTANTO, KIDDIE-KAR, KING SIZE, KOOL KOOSHION, LITAZAIR, MELLOCREAMS, MILK GINGER BAR, MULTI-PLY, NEOTROPIN, NERVEZE, NEUROSTERON, NEVERLEEK, NU-WASH, NYLONENE, SHETLAND PURE WOOL, SLIMCAP, SPORTS GIRL, SUGAR PUFFS, SUPA- COLA, TAILORBILT, TRU-LOC, WIPE-ON, YEASTIES.

ORDINARY SURNAMES

Ordinary surnames lack distinctiveness and cannot be registered as trade marks.

Regrettably, the restriction with respect to surnames can lead to unfortunate results. There are very few words which cannot be found as the surname of some person somewhere in the world. The surnames are not restricted to surnames in Australia. Suppose an application is made for registration of a word. The Examiner thinks it might occur as a foreign surname. The Examiner will do a search of foreign telephone directories. If the word occurs frequently in the foreign telephone directory, the application will be rejected.

What is the rationale behind this prohibition? It is considered that anybody should be able to put his name on his goods. Suppose that John Smith were successful in obtaining registration of "John Smith" as a trade mark. The result would be that all the other John Smiths in the country could not put their name on any goods that they might have for sale.

The following is a sample of words that have been rejected as being surnames. ADAMS, ALEXANDER'S, ANSALDO, BERNARDO, BRECK, BROWNHOIST, COXTONE, FRENZ, HENTI, KELLOGG'S, MASTERS, OXLEY, REVERE, STUDLEY, WILTON.

COMMON GEOGRAPHICAL NAMES

Common geographical names lack distinctiveness and cannot be registered as trade marks.

Problems similar to surnames apply to geographical names. There are very few words which cannot be found as the name of a place somewhere in the world. The names of places are not restricted to places in Australia. Suppose an application is made for registration of a word. The Examiner thinks it might occur as a foreign place name. The Examiner will do a search of Lippincott's Gazetteer of the World. If the word occurs in the Gazetteer and the area is of some significant size, the application will be rejected.

What is the rationale behind this prohibition? It is considered that nobody should be allowed to appropriate the name of a place e.g. Sydney, to his own use and stop others from using it in connection with their goods or services.

The following is a sample of words that have been rejected as being geographical names.

ARLINGTON, BEDFORD, BRUNSWICK, CAPRI, COBDEN, CROYDON, ITALIA, LORRAINE, MISS AMERICA, PALL MALL, PORONGORUP, ROMA, SAVOY, SIERRA, SOUTHERN STATES, TOLEDO, YERONGA KNITWEAR.

COMMON DEVICES

By "devices", we mean drawings and pictures of things (as used in the language of heraldry). Common devices will not be registered as they lack distinctiveness.

A logo will be rejected if it is not distinctive. A logo will not be distinctive if it is a mere photograph or drawing of the goods.

Common devices such as a circle, a straight line, a star, an arrow etc are not distinctive and will not be registered.

Some devices are so common to a trade that they will not be registered e.g. a red-and-white pole for a barber, a curling snake for a chemist, an abacus for an accountant etc.

What is the rationale behind this prohibition? The rationale is that nobody should be allowed to obtain the exclusive use of a common symbol e.g. a wheel and stop others from using it in connection with his goods or services.

The following is a sample of devices that have been rejected as lacking distinctiveness.

Drawing of bird flying, drawing of wrens, drawing of boxes and cases of wood, drawing of chariots, Maltese Cross, drawing of cross and concentric circles, drawing of diamonds, drawing of serrated lines, drawing of shields, scrolls, panels, circular devices, drawing of blue stripe, drawing of two parallel blue stripes.

COMBINATION OF NUMERALS OR LETTERS

Mere combinations of numerals, e.g. 123, or letters, e.g. ABC, lack distinctiveness and will not be registered.

What is the rationale behind this prohibition? Combinations of numerals are an everyday occurrence as any accountant will tell you. Nobody can have a monopoly of them in relation to his goods or services. The same reasoning has been applied to combinations of numerals but the logic is weaker here.

The following is a sample of letter combinations and numeral combinations which have been rejected as lacking distinctiveness.

ABA, A.B.C., AC, A.P., ASC, F & M, 44, HJA, P.V., W & L.

PRIOR REGISTRATION

Another big obstacle in the path of anyone seeking registration of a trade mark is prior registration of the mark. The Act does not allow registration of a mark when it is deceptively similar to a mark already on the Register. Copies of all current marks are held at the central registry in Canberra and each of the State-capital branches. The registries are open to the public. Before incurring costs in submitting an application, an applicant would be well advised to pay the Trade Marks Office to search the trade marks registry for any conflicting marks. A search can also be carried out online on the internet by the applicant. A search should be conducted under the class of goods or services for which registration is sought and under similar classes of goods or services.

GENERIC USE

A brand-name owner should not use his mark as a generic term and should endeavour to prevent others from doing so. Using the words "Registered Trade Mark" or something similar on the goods will help in preventing others from using the mark in such a way. It must be understood that if the name comes into general use as a generic term, the trade mark owner will lose his proprietary rights. You should be aware that for anyone to use your trade mark as a generic term is prima facie a breach of your trade mark rights. ASPIRIN, ESCALATOR, LINOLEUM, GRAMOPHONE and PYREX were all registered trade marks at one time but their coming into use as descriptive terms caused them to lose their trade mark significance.

PRACTICAL POINTS

It is possible and it is often good practice to register a name simultaneously 1) as a trade mark, 2) as the name of a company which you are forming and 3) perhaps as an internet domain name. This enhances the overall advertising effect and helps to create a corporate image. For example, 1) you register a trade mark e.g. "Aliton", 2) you form a company called Aliton Pty Ltd and 3) you register an internet domain name called www.aliton.com. The company can own the trade mark and the domain name.. A person who invents something and who intends to start production should apply for a patent and a trade mark at the same time. It is also desirable to register in overseas countries where you intend to carry on business.

How can you reduce the chances of your proposed mark being rejected? First, steer clear of ordinary words and devices. Ordinary words run a much greater risk of being rejected 1) as being descriptive of the goods or services, 2) as a surname, 3) as a place-name and 4), as being already on the Register. An invented word is much less likely to fail any of these tests.

Therefore, an invented word is your best bet. But make sure that the word does not describe the goods either verbally or phonetically. Next, check the Sydney telephone directory to make sure that it does not occur as a surname. Finally, check the word against Lipincott's Gazetteer of the World in your local reference library to make sure that it does not occur as a place-name.

If you want to register a logo, make sure that it is distinctive. It must not be any of the common devices mentioned above. Use your brains and think of something completely new. Scribble freehand at will on the paper, if need be! The result is bound to be distinctive.

Search the Trade Marks Registry or, preferably, have the Trade Marks Office search it for you to make sure that your mark does not resemble a mark already on the Register. Do not confine your search to the class of goods or services for which you are seeking registration. Search allied categories as well.

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