A trade mark may be any kind of marking such as a word, number, phrase, symbol, label, picture, shape or any combination of these. The purpose of trade marks is to indicate a connection between trade mark owners and their goods and services.

Why register a Trade Mark?

The goodwill of a particular product or service is usually attached to a trade mark. Marketing strategies rely on consumers purchasing one product over another by reference to a trusted brand. It is the ability of a reputable trade mark to attract customers that tempts unscrupulous competitors to use the same mark or confusingly similar marks.

Registration of a trade mark confers on the owner the exclusive right to use that mark throughout New Zealand in relation to specified goods or services. A trade mark registration can also be used to restrict the use of the same mark or confusingly similar marks by others. The penalties for infringement of a registered trade mark are substantial and may include:

• damages (losses suffered by the trade mark owner);
• an account of profits earned by the infringer;
• litigation costs;
• surrender of all material carrying the infringing trade mark; and
• corrective advertising.

Trade mark registration protects the time and money spent promoting goods and services, and the reputation and goodwill built up through such promotions.

A trade mark registration will generally deter competitors from adopting a mark that is similar to the registered mark. Registration provides clear evidence of ownership and the right to exclusive use of the mark, irrespective of where in New Zealand the trade mark is used. As a consequence, when trade mark infringement occurs, legal action is usually not necessary to stop infringement of a registered trade mark.

As the goodwill of a business is often realised in its trade marks, trade mark registration provides a means by which the goodwill may be defined, thereby turning the goodwill into a proprietary right and making it more valuable. At the same time, by turning goodwill into a piece of property, it can be more readily sold or licensed.

Some trade marks are difficult to register (typically because they are too descriptive), but it can still be worthwhile applying for their registration for the following reasons:

1. A trade mark application provides evidence of your claim to ownership of the mark.
2. The existence of the application on the Trade Mark Register may act as a deterrent to others wanting to use the same mark or a similar mark. It is common for people to search the Trade Mark Register before using or deciding upon a suitable trade mark. Furthermore, the Trade Mark Register is often searched prior to selecting a name for a new company.
3. A trade mark application is a readily identifiable form of property which can be used as the basis of licences or assignments with other parties.
4. Company names and domain names do not protect a trade mark.
5. Incorporation of a company, or registration of a domain name under a particular name, does not prevent others from selling goods or providing services under the same (or a similar) name.
6. A company name serves only to identify a legal entity. It does not confer a proprietary right in that name. A domain name is simply an address. Others may have almost identical addresses.
7. A trade mark registration creates a legal right which may be relied on to prevent another party using a name the same as or similar to that registered as a trade mark as part of a company name or domain name.
8. A registered trade mark is something separate from a company name. If a company is incorporated under a name which includes a registered trade mark and that company provides similar goods or services, the owner of the registered trade mark may compel that company to change its name.

Moreover, if a company uses any part of its name as a trade mark on or in relation to certain products or services, and another party has registered the same mark or a similar mark in relation to those products or services, then such use by the first company of its name may constitute trade mark infringement.

Enforcing Rights In Unregistered Trade Marks

The owner of an unregistered trade mark may bring legal action against a competitor using that mark under the common law action of passing off or under the Fair Trading Act. In both cases, to enforce rights in an unregistered trade mark the owner must prove to the satisfaction of the Court that:

it has reputation in the disputed mark in the particular geographic locality in which the breach of rights occurred;

• this reputation applies to the particular type of goods or services in which the alleged breach of rights occurred;
• the unauthorised use of the unregistered trade mark will (or is likely to) cause confusion amongst its customers;
• that confusion will cause actual loss to its business or a strong likelihood of same; and
• the other party has no legitimate right of its own to use the disputed mark.

Legal proceedings for passing off or breach of the Fair Trading Act can be costly and uncertain as they are reliant on the strength of evidence of reputation and confusion, and the Court’s interpretation of that evidence. By comparison, enforcing the rights conferred by a registered trade mark is simpler, more certain and usually less expensive.

Trade Marks which are Registrable

Not all trade marks are registrable.

As a trade mark must be capable of indicating, in the course of trade, a connection between the trade mark owner and its goods/services, the trade mark must be distinctive.

It will save you a lot of cost and frustration if you choose a distinctive trade mark at the outset.

The following types of marks should be avoided:

1. Wholly descriptive marks  e.g. FAST WASH for laundry detergents.
2. Deceptive marks  e.g. ECOWOOL for fabrics, when the fabric is not made from wool.
3. Geographical names of places where businesses exist  e.g. MARLBOROUGH for wine.
4. Well known surnames  e.g. SMITH for fast foods.
5. Words in common use in a particular business  e.g. SMART for credit cards.
6. Purely laudatory terms  e.g. FANTASTIC for cosmetics.

The best trade marks are non-descriptive and 100% distinctive. Categories of marks filling these criteria are:

1. Invented words   e.g. ZESPRI and KODAK.
2. Words which have no connection with the goods/services   e.g. APPLE for computers.

Not only are distinctive marks more easily registered, but because they are distinctive, it is easier to prevent others from using similar marks. In the case of a distinctive trade mark, it is easier to show infringement, as it is obvious that use of a similar trade mark by a competitor was calculated to take advantage of your trade mark’s reputation. On the other hand, if the mark is descriptive, a competitor can argue that it was not using your trade mark, but was merely describing its goods or services.

Distinctive trade marks also stand out in the marketplace and are more readily remembered by consumers.

However, while highly distinctive trade marks are desirable, there is no reason why a distinctive trade mark cannot also be slightly suggestive of goods/services. For instance:

1. CARDAX for card access systems.
2. CYCOLOGY for a bicycle retail outlet.
3. MICROSOFT for software.

Such trade marks can be created by listing words which describe or partly describe the goods/services and/or characteristics of them, and then combining two or more of those words (or parts of words) in a novel way which leads to an invented word.

Information Required for Filing an Application

To prepare an application to register a trade mark, you need to provide:

1. The applicant’s full name, business (street) address, nationality and occupation;
2. A list of the goods and/or services in relation to which you want to register your trade mark; and
3. A high quality representation of the mark if the trade mark includes lettering in non-standard form or a logo, device or symbol.

A trade mark owner’s exclusive rights to a mark will only extend to goods and/or services of the type in which the owner trades or intends to trade. Hence trade marks are registered in relation to specific classes of goods and/or services. For example, registration of HERON in relation to “clothing” in class 25 should not prevent an orchardist using and registering HERON in relation to “apples” in class 31.

Where a trade mark is to be applied to a range of goods and/or services which fall into more than one class, a single trade mark application nominating each relevant class of goods and/or services can be filed. An outline of the International Classification of Goods and Services is provided in the Classes Index. This is for general guidance only as it is merely a thumbnail outline of the classes.

Selecting the appropriate class can be quite complex and requires reference to the full index of Goods and Services. The Trade Mark Wizard should help you with this.

The Procedure for Registering a Trade Mark

The usual procedure for securing registration of a trade mark is summarised below. Typical time periods are indicated. A trade mark application usually proceeds to registration six months after filing.

If at any stage you decide not to continue the application may be abandoned. Your interest in the mark will remain recorded on the Trade Mark Register for many years and may act as a deterrent to others.

Trade Mark Search

Trade mark searches are recommended before using or applying to register a trade mark.

A search of the Trade Mark Register will indicate whether:

• your trade mark is registrable having regard to other marks on the Trade Mark Register, and
• use of your trade mark is likely to infringe any current trade mark registrations.

A Register search should cover not just the exact mark, but marks which are phonetically, visually or conceptually similar. Many people make the mistake of checking only whether the exact same mark is on the Trade Marks Register. This can lead to failed applications and infringement issues.

A full clearance search will also cover trade marks which are in use, but aren’t registered, thereby avoiding the risk of inadvertently breaching the Fair Trading Act.

Filing a Trade Mark Application

When you submit your trade mark application through IPOL, it is filed at the Intellectual Property Office of New Zealand (IPONZ). IPONZ will acknowledge receipt of your application by e-mailing you a ‘Filing Summary’, which will record the application number and filing date allotted to your application.

Examination

IPONZ examines each trade mark application around 5-10 days after it is filed. IPONZ examiner’s will assess the registrability of your mark and will conduct a search of the Trade Mark Register. If the examiner considers there is any reason why your mark should not be registered, or if any amendments to the application are required, a Compliance Report describing the examiner’s concerns will be sent to you. You can instruct IPOL to respond to a Compliance Report on your behalf.

Acceptance

If IPONZ raises no objections to your application, or once any problems with your application have been resolved, the application is accepted and advertised in the Patent Office Journal.

Registration

If there is no opposition to your application (or if any opposition filed is unsuccessful), your trade mark will be registered.

A certificate of registration will not issue until an application is more than six months old. The delay is to avoid conflicts with trade mark applications which might have an earlier priority date.

Proceedings for infringement cannot be taken until the certificate of registration has issued.

Term

Provided your trade mark registration is renewed by the payment of renewal fees every 10 years, it will last indefinitely.

You can arrange for IPOL to remind you when renewal fees are due.

Trade Mark Applications Overseas

You can protect your trade mark in other countries at any time by registering it there - provided no other party has prior rights (by use or registration) to the same mark or a confusingly similar trade mark.

If you file a trade mark application overseas within six months of filing your New Zealand trade mark application, the overseas application can be given the New Zealand filing date under an International Convention. This procedure enables you to deter competitors from registering or using your recently launched New Zealand brand in other countries.

Assignments

You can assign your trade mark registration or application, either with or without the goodwill of the business associated with the trade mark. To give full effect to the assignment, a deed of assignment is usually required.

Recording Subsequent Owners:

Any transfer of ownership of a trade mark registration must be recorded on the Trade Mark Register before the new owners can rely on the trade mark registration to enforce their newly acquired rights.

Licences

The right to use a particular trade mark may be licensed so that others can use the trade mark. Any trade mark licence agreement should be recorded in writing. The licensor should have sufficient control over use of its trade mark to ensure appropriate standards of quality in the goods or services carrying the trade mark are maintained. In the absence of such controls, it may be found that the trade mark registration is invalid because it is no longer distinctive of the trade mark owner, or the mark has become deceptive in that it is used on goods from different sources and of different quality.

Recording Trade Mark Licences:

A licensee of a trade mark may be recorded on the Trade Mark Register as a permitted user of a particular trade mark. The recordal of a licence gives the licensee specific rights to the trade mark, including the right to sue an infringer of the trade mark registration.

Use of the trade mark by a licensee is deemed to be use by the owner. Consequently, the licensee can never acquire goodwill or reputation in the trade mark and, even if the owner is not using the trade mark itself, the registration cannot be challenged on the basis that it is not being used by the owner.

Trade Marks Must be Used Every 3 Years

A trade mark registration can be revoked by a third party, if it has not been used during the previous 3 year period.

Opposition/Revocation of Trade Mark Applications/Registrations

If you object to someone’s trade mark application or registration, there are procedures available to oppose an application or invalidate/revoke a trade mark registration.