One Federal Court decision clarifies what is considered as “authorised use” of a trade mark wherein the trade mark user is not the trade mark owner but a subsidiary of the owner’s company.
Brand Name vs Trade Mark
Brand name and trade mark are used interchangeably in daily life. However, the difference between brand name and trade mark lies in their function. A brand name may be a company name or a name ascribed to a particular product or service. It is what the company uses to represent its goods and services and what consumers use to refer back these goods and services to their source. A trade mark is an intellectual property right that protects a brand. A trade mark gives protection to the brand name that it would not otherwise have.
What is a brand name?
A brand name is unstylised text that functions as a name to differentiate a company or product from others. A brand name is how consumers can recognize a company and its output, that is, goods or services, in the market. Companies may use brand names of different forms, such as their actual company or business name (Telstra), a product (Vegemite) or a product variant (Coke Zero), or a service (Uber Eats), among others. A well-known, recognisable brand name induces strong customer recall so that the target market will connect the company automatically to the goods or services on offer. The goal of a brand name is to build enough reputation so that the public would opt to avail of that brand’s product instead of a generic kind.
What is a trade mark?
A trade mark is a type of intellectual property right that protects a brand. It is not necessarily a logo: it may be plain text, a slogan, a design aspect, a smell, a color or even sound. In a similar manner to a brand name, the purpose of a trade mark is to differentiate a product from others in the market, but a trade mark offers the owners protection that an unregistered brand name cannot. After application and upon approval by the Trade Marks Office, a trade mark is registered into the national register of trade marks. Trade mark registration awards the owner the right to seek legal relief against parties using a trade mark that is substantially identical or deceptively similar to the registered trade mark after the trade mark’s priority date. This right may also deter potential infringers and counterfeiters.
One important difference between a brand name and a trade mark is the legislated enforcement option available for each. When left unprotected, a brand name that has acquired a good reputation may become a target of counterfeiters who attempt to benefit from the established goodwill toward the brand name by selling subpar counterfeit items or using their own confusingly similar brand that people may mistake for the original brand. Unregistered brand names and logo marks can be protected by the common-law tort of passing off, but the proceedings may be costly and lengthy. In addition, expansion, outsourcing production or distribution to other countries may be out of the question as the lack of a registered trade mark may put the brand owner at risk of trade mark infringement allegations in other jurisdictions with a “first to file” rule, such as China.
By registering the brand name as a trade mark, the owner of the registered trade mark is automatically granted the right to seek legal relief in the country of registration against the unauthorised use of a confusingly similar mark. Thus, it makes good business sense to register the brand name and other possible trade marks that may be subjected to third-party infringement in order to protect the company’s position in the market.