How using your own company or business name can land you in hot water

How using your own company or business name can land you in hot water

Selecting a company or product name can be very important for a business. This is the name by which customer’s will get to know you. This is the name they will look up in the yellow pages when they want to locate you. And if the name is a product name, it is the name that customers will use when ordering your product.

Most businesses (incorrectly) believe that they are free to trade under their name Company name. A prior registered Trade Mark may exist.

Having a name registered as Trade Mark gives the owner exclusive rights to monopolise that name (within a stated field). So if a footwear manufacturer, registers a trade mark (for example, JACKFLASH) for footwear (and possibly related goods and services). This means that no one else can use the JACKFLASH trade mark on those goods or services.

However, if you then want to register a company called JACKFLASH – the Companies Office does a search of its register only (not of the Trade Marks Register). You may be able to register that name (or a similar name) as your company name. This does not give you the right to use the name as a brand name. In fact to do so, would be an infringement of the prior registered JACKFLASH trade mark.

The upshot of all of this is that you can secure a company registration, but not be free to use that name if someone else has something similar registered as a trade mark in the same field of endeavour.

The flipside is that simply registering a company name does not give you the right to stop others from using the same or similar name in your industry. If you do not have a trade mark registered you could prevent others from using your name, but only in limited circumstances. You would have to prove
1. you have built up a reputation in that name
2. the field of your reputation overlaps with that of the copy-cat
3. your reputation extends to the geographical area where the copy-cat is trading and
4. your brand is one that can be monopolised (the Courts have said that some brands are of a nature that no one is entitled to monopolise them because, for example, they may be too descriptive or they may consist of a common surname that the Courts have said should be free for all to use)

A trade mark registration on the other hand provides a monopoly in the mark throughout New Zealand. Your rights can accrue when you register the mark (which may be before you build up a reputation in it). Enforcing trade mark rights is quicker, easier and less costly than if there is no trade mark registration.

Trade mark registration truly is like an “insurance policy”. You pay a little up front to guarantee rights to your name. You hope that you never have to enforce it, but if you do, then you can use it to prevent others from copying your name and trading off your reputation.

To learn more about the potential fall-out of not registering your business name, company name or product name as a trade mark, view our 3-minute video here.

Cathryn Warburton About the author

The Legal Lioness. Overcoming severe bullying as a child instilled in her a passion to protect others. As a skilled litigator, she indulges in her dream to push-back against business-bullies who target her clients. She is an international award-winning lawyer and patent attorney and 5-time published author. Cathryn bullet-proofs her client’s businesses and protects them like a mama lioness protecting her cubs. She makes sure that no business is left without access to affordable, easy-to-understand legal information. She does this through her books, proactive legal workshops and 1-2-1 legal services.