Insurance · 21 August 2018

I’ve been accused of trademark infringement – will I be forced to rebrand my business?

Proving there are more differences than similarities between two brands could be crucial in a trademark dispute

As one reader finds their company under threat of a trademark infringement dispute, Grid Law founder David Walker considers the credibility of the accuser’s case.

[Please note: The names of the two companies and links to the trademarks have been removed to preserve confidentiality. The two brands contained two words that were the same, but in a different order and with different spelling]

Question

Hi David,

I have just read your article on trademark infringement. I run a small business and have been approached by the director of a London-based company called “[NAME OF COMPANY]” which claims I am infringing its trademark/passing off its European trademark.

I don’t believe this is the case because we are called “[NAME OF COMPANY]” and our brand (which we haven’t registered as a trademark) looks nothing like their “get up”.

Their trademarks appear to be:

[LINKS TO ENTRIES ON IPO WEBSITE]

Background: we are a consultancy company and have been running since 2016. This year we also started offering training to our clients. I believe this is the sticking point as we are both selling course on a similar subject. However, we sell our courses for £49 and they typically sell their courses for several thousand pounds to a completely different market.

Our customers are end users, often very small businesses or charities who may have a tiny budget for training and have not heard of nor would find any relevance in [NAME OF COMPANY].  Our training turnover so far in 2018 is £1,710, with a gross profit of under £400.

I have personally trained 44 small businesses and charities in that time – and obviously that helps us as a loss-leader to bring in new work. Their turnover is, I believe, around £20m.

The director advises that their lawyers have advised they have a very strong case against both my company and myself – I am not so certain. He mentioned passing off (which in my mind suggests the trademark case is not cut and dried).

My company was named and brand created in good faith and there is no chance of confusion between customers – especially as there is zero overlap between customers.

Few of my customers would be able to afford thousands of pounds of training – more importantly some are volunteers in their 60s and 70s so would not wish to attend “intensive boot camp training” which appears to be this company’s forte.

The director advised that he would like to come to an amicable agreement – he will give me the next 60 days or so to rebrand before sending in the lawyers.

I just wondered if you had any advice or pointers you could give?

Kind regards

Answer

Thank you for your question.

I’ve taken a look at their registered trademarks and both of your websites.

Their trademark is registered in several classes including class 41 which covers training. Interestingly, there was another trademark identical to theirs also in class 41 but for slightly different services. This is important because it shows they do not have absolute exclusivity over these words.

From what I have seen, there appears to be very little risk them successfully pursuing you for trademark infringement or passing off.

To prove trademark infringement, they must show either:

  1. Your brand is identical to their registered trademark and you are using it in relation to products or services that are identical to theirs; or
  2. Your brand is identical to their registered trademark, you’re using it in relation to similar products and services to theirs and as a result the public are likely to be confused between the two or think there’s an association between them; or
  3. Your brand is similar to their registered trademark, you’re using it in relation to identical products and services to theirs and as a result the public are likely to be confused between the two or think there’s an association between them; or
  4. Your brand is identical or similar to their registered trademark, their trademark has a reputation in the UK, and your use of your brand takes unfair advantage of, or is detrimental to, the distinctive character or the repute of their trademark.

Whilst there are similarities between your brands and from a trademark perspective the services are almost identical (you are both offering training on the same subject) I think the chances of confusion or association are almost nil.

If they did try to pursue a claim against you I think we would have a strong defence. We could show that there are more differences than similarities between the brands and that they are both distinctive in their own right.

Take a look at these other trademark disputes:

Now let’s take a look at what you have to prove to successful bring a claim for passing off.

There are two different tests for passing off but basically, they must show:

  • They have goodwill or a reputation for providing their services;
  • That you have misrepresented your services to the public (intentionally or unintentionally) and as a result the public are lead to believe that your services are theirs; and
  • As a result of the confusion you have caused, they have either lost sales or you have made sales of your services.

Whilst it’s clear that they have a reputation for providing their services, there doesn’t appear to be any misrepresentation on your part. As your target audience is so different to theirs, I can’t see that you have made sales or they have lost sales as a result.

Therefore, it’s highly unlikely that any claim for passing off would succeed.

The fact that their director is so keen to reach an amicable settlement at this stage indicates to me that they know they don’t have the strongest case.

Therefore, my advice is to write back denying that your brand infringes their trademark or that you are in any way passing off your services as theirs.

Also, it’s an offence to threaten trademark infringement when they don’t have good reason to do so. I would point this out to them and say that if they don’t withdraw their threat you will pursue them.

If you would like to discuss this further or would like any further advice on this matter, please feel free to email me again.

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Nike

 

How a UK micro business sued Nike for trademark infringement and won

After a small UK company spotted global brand Nike had launched an advertising campaign with a slogan suspiciously close to its own, the business successfully sued the sportswear giant for trademark infringement.

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ABOUT THE EXPERT

David Walker is the founder of Grid Law, a firm which first targeted the motorsport industry – advising on sponsorship deals, new contracts and building of personal brands. He has now expanded his remit to include entrepreneurs, aiding with contract law, dispute resolution and protecting and defending intellectual property rights.

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