Focusing on infringers

Bernard Whyatt explains how franchisors should always check what protection their trademarks give them, if they believe another company is replicating them.

Many people buy a buildings insurance policy when they purchase their home and never check the policy again until something goes wrong. In the same way, many franchisors never revaluate the protection afforded by their trademark portfolio in the light of changing business opportunities and threats until they are challenged. Therefore, franchisors need to re-evaluate their trademark – failure to do so could lead to dire consequences.

A leading franchisor of spectacles and hearing aids, Specsavers BV, uses about 100 European Community trademarks, as well as its British registered trademarks to protect its franchise business. These include two adjacent black ovals with and without the word ‘Specsavers’ inside the shapes.

Spectacle case

In mid-2008, the Asda supermarket re-launched its optical dispensing business with an extensive marketing campaign. The campaign used a trademark with the words ‘Asda Opticians’ inside two adjacent white ovals on a green background. It also used the straplines: ‘Be a real spec saver at Asda’ and ‘Spec savings at Asda’.

Specsavers sued Asda for trademark infringement and passing off of their ‘Specsavers’ word marks as well as both device marks mentioned above. Asda counterclaimed that Specsavers had never used the device mark (without the words ‘Specsavers’).

In 2010, the High Court decided that Asda had not passed-off its services for that of Specsavers and that there had been insufficient likelihood of confusion to be able to make a finding of infringement.

That said, the court found that Asda’s use of ‘be a real spec saver at Asda’ took unfair advantage (or, as the court put it, was ‘standing on the shoulders’) of the reputation of Specsavers and, therefore, infringed Specsavers’ registrations. Controversially, the court found that Asda had not infringed Specsavers’ trademarks by use of the other phrase ‘spec savings at Asda’.

Earlier this year, the Court of Appeal overruled the High Court decision and found conclusively in favour of Specsavers and found that Asda’s strapline ‘spec saving at ASDA’ and the Asda logo shown also took unfair advantage of Specsavers’ reputation and, therefore, infringed its registered trademarks.

Trademark power

The fact that Specsavers lost its passing off action against Asda shows that it was correct to rely on its registered trademarks in order to prevent the unfair encroachment of Asda on its business.

The fact that Specsavers owns more than 100 registered trademarks is not an excessive investment in its brand when faced with the likelihood of losing its business to the unfair attack on its brand by an unwelcome predator. Without all those registrations, Specsavers may not have been able to defend its brand as successfully as it did.

Franchisors should always look to protect the investment made in their trademarks by ensuring their brands are registered as trademarks to protect and enhance them. Those registrations should protect every brand formulation used in the franchise business.

For a cost effective quote, please contact Bernard Whyatt of Brand Protect today: