What happens if another company uses your business’ name

It’s every company’s nightmare – it discovers another business is already using its brand name. Bernard Wh­yatt, of Brand Protect, gives an example of what the outcome may be

Imagine that you have a great business and have been running it for a few years in Bristol. You want to expand the business nationally and internationally and you decide to franchise the business.

You approach a franchise consultant about your business and get fantastic feedback.

That consultant asks a simple but fundamental question: “Have you conducted a ‘search’ of the brand that you are using?”

You reply: “Of course, we have done umpteen ‘Google’ searches and we know that there is a company up in Manchester that uses a similar name for the goods and services that we sell but they have never caused us a problem.”

The consultant refers you to a franchise trademark expert at Brand Protect to conduct a ‘search’ for your brand. This facility is offered as part of the free consultation advice worth £500 offered by Brand Protect.

The search reveals that the Manchester company has a Community trademark registration for the exact brand you are using and for the goods and services sold by your company. The mark was registered in December 2010. The trademark lawyer at Brand Protect explains to you that a Community trademark is a trademark giving the owner of that registration the ‘exclusive right’ to use the brand for the goods and services for which it is registered anywhere in Europe, including – of course – the UK.

You ask him: “Does this mean that only the Manchester company can use this brand throughout the European Union.” The expert at Brand Protect says: “Yes, that is the usual case.”

At this point you will have a whole number of concerns. If this lawyer is right, you may start considering whether you have to change your company’s name, domain name and the brand, alter the packaging and remove your brand from everything your company does. The re-branding exercise will cost thousands of pounds and confuse your customers. If you do not, the Manchester company could obtain a court injunction, damages and costs. You may even think you will not be unable to franchise your business anywhere in the European Union.

However, help is at hand. The trademark expert at Brand Protect will ask a few more questions about your use of the brand and then shows how he can help you continue to use your brand and, perhaps, prevent the Manchester company from using it and persuade them to relinquish their Community trademark registration.

He asks you if he can write a letter to the Manchester company, which will explain that their registration could be invalidated and that they may be ‘passing off’ their goods and services.

In the negotiations that follow with lawyers representing the Manchester company, the people at Brand Protect persuade them to transfer the Community trademark to your business and then to act as a regional franchise owner for the North West of England in the new franchise company that you establish.

What is the moral of the story? Don’t delay in getting expert advice from Brand Protect on your most important asset – your brand.