There are a number of ways in which trademark registration can assist you to protect your brand and goodwill. Trademark registration gives the owner an exclusive right to use the mark and the right to enforce these rights against unauthorised third parties. If infringement occurs, the trademark owner may be entitled to damages from the infringing party, as well as an account of any profits earned from using the mark. Unregistered trademarks receive protection under the common law tort of ‘passing off’ (a tort is a civil wrong, and does not fall under the Crimes Act). This is a more costly and less effective means of brand protection.
After you have registered your trademarks, make sure that franchisees understand the extent to which they are being licenced to use the mark in promoting the franchised business.
When you register a trademark in a particular class, protection is only granted in respect of the goods for which you have registered. If you have registered in the wrong class, you are vulnerable to have the mark opposed and removed by the Registrar for non-use. In most franchise agreements there will be a provision that should clearly define the intellectual property rights being licenced to the franchisee by the franchisor.
The Franchise Agreement
The Franchise Agreement will generally set out the terms and conditions for use of the franchisor’s trademark. The franchisor will often set out limitations on how the trademark can be used. These limitations might include:
- the franchisee will only be licenced for the term of the Agreement;
- the franchisee is not permitted to sub-licence the intellectual property rights to other third parties; and
- the franchisee will not be permitted to register the mark in its own name or that of a third party.
In some cases, the intellectual property clause will impose additional obligations, such as informing the franchisor of unauthorised uses of the trademark. This enables the franchisor to pursue the third party for infringement of its trademark.
In addition the franchisee will be required to acknowledge the franchisor as the owner of all intellectual property, and that any use of the mark that does not fall within the terms of the Franchise Agreement will become grounds for termination of the Agreement. Following termination of the Agreement, the franchisee is required to stop using the trademarks.
To protect the brand of your franchise, you should avoid infringing the exclusive intellectual property rights reserved for the franchisor. If you are unsure what you are allowed to do with the intellectual property and wish to clarify your rights with an IP lawyer, contact LegalVision today.
Our team of IP lawyers are hugely experienced in this field and will provide you with an obligation-free quote for any legal assistance you may need.