So you and your co-founders have agreed to form a company to develop a cool new product or way of delivering services. Aside from deciding on a name for your business, you are also going to need to market and advertise your product. This article sets out the laws around branding and marketing – how you can stay within the constraints of the law and what will offer you long-term protection.
1. What’s in a Brand Name?
ASIC are reasonably likely to accept your business name provided it is not offensive or already taken. Company registration does not, however, protect your name from copycats.
You will probably want to design a logo around your trading name and generate goodwill by creating an image or feel. Your trading name is likely to become your business’ identifier, and all of this will involve careful thought, time and expense. Before settling on a name, it’s important to make then sure your name isn’t too similar to something else that already exists in the market. Businesses that adopt generic names and trade marks (e.g. realestate.com.au) must accept that the law will permit others with similar names (e.g. realestate1.net.au) to operate in the market.
In contrast, the law affords greater protection to businesses that adopt unique names. Here, it’s easier to prove that a unique (or invented) name has become distinctive of your product and that anyone who adopts a similar name may, therefore, mislead or deceive the public.
2. How Can You Ensure Your Brand Name is Unique?
The way to avoid conflict between your name and one that is already in use is to search the publicly available name and trade mark registers. It won’t cost you anything to search the ASIC Company Register, the Australian Business Register or the Australian Trade Marks Online Search System. However, it is advisable to seek the assistance of a lawyer or trade mark attorney in doing so, as what may constitute a deceptively similar name to one already taken (in a legal sense) may not be clear to the untrained eye.
Once you have retained the services of a professional to carry out the necessary searches and you have settled on your company and business name, you need to work out what to trade mark in order to protect the goodwill that you have begun to create. Obviously, you will want to trade mark your business/trading name and any logo that you have created to accompany it. However, in the digital age, you ought to consider registering a trade mark for the domain name(s) you will use to market your business online.
As you create new products and service offerings, you will also need to consider naming and registering trade marks in different classes. This is in addition to the consideration that your developments may be patentable.
3. How Can I Legally Use Google AdWords in my Marketing Strategy?
When marketing your particular goods or services, you (or your marketing/advertising agency of choice) will be looking to come up with slogans, tag-lines and hashtags that best represent and sell your brand. In doing so, it is again recommended to be aware of what other brands have done in the past or are doing at present. Aside from the obvious commercial reasons for this, you need to ensure that you are not unwittingly infringing upon someone else’s goodwill or trade mark.
Additionally, your marketing strategy may include the use of Google AdWords. This is an aspect of e-commerce that has given rise to some recent case law and is likely to continue to be the subject of commercial disputes by companies vying for prime (paid) position within Google search results.
It may seem obvious that you cannot use another company’s name or trade mark within your AdWords campaign. However, things become more complex when another company’s name and/or trade mark are used as descriptive terms rather than as a ‘badge of origin’ (legalese for ‘trade mark’).
So for example, if you own a fruit shop you may wish to bid for a phrase that contains the words ‘eat fresh’. In doing so, you may raise the ire of Subway IP Inc. which has trademarked those terms. In such a case, there may be no misappropriation of the other brand’s goodwill. However, as subtle differences in an AdWords campaign may be the difference between having to defend a proceeding or not, it is advisable to err on the safe side.
4. What’s The Difference Between Passing Off and Misleading or Deceptive Conduct?
Aside from infringement of another business’ trade mark, the two main causes of action that arise in respect of a business’ goodwill are passing off and misleading or deceptive conduct.
‘Passing off’ is a common law concept. It relates to actions taken by one business which is deemed to have (or be likely to have) misappropriated the goodwill of another business. This misappropriation can be direct or implied, by fabricating a connection between the two businesses. This cause of action was established to protect business owners from competitors seeking to divert customers under false pretences.
Australia’s Consumer Law prohibits ‘misleading or deceptive conduct’ which occurs in the context of trade or commerce and arises when it causes a loss to a competitor (or a consumer). The object of the Australian Consumer Law is to promote competition, fair trading and consumer protection.
The principles applying to both of the above causes of action are similar in that the conduct giving rise to either of them must cause a reasonable consumer to believe that one business or product is associated with another, when in reality that is not the case.
The law looks at the practical effect of (rather than the intention behind) the relevant conduct in order to determine whether misleading or deceptive conduct (or ‘passing off’) has taken place. Again, the question to be determined is not whether one business has diverted customers from the other. Rather, it is whether it has done so by creating a false relationship between the two businesses in the mind of the market.
If you have any further questions about the law surrounding branding and marketing, get in touch with our consumer or IP lawyers on 1300 544 755.