Trademarks
Introduction to Trademarks
Justifications for trademark protection
1. Trademarks as an indication of trade source
a. Consumer search cost theory: trademarks allow consumers to identify the
products they want more quickly and confidently → trademarks serve as an
origin function
i. The source can be anonymous without compromising the origin
function
ii. Scandia Down Corp v Euroquilt: “By identifying thesource of goods,
they convey valuable information to consumers at lower costs. Easily
identified trademarks reduce the costs consumers incur in searching for
what they desire, and the lower the costs of search, the more
competitive the market.”
b. Market diversification rationale: trademarks allow traders to differentiate on
the grounds other than price → trademark guarantees a certain quality to
consumers.
i. Incentive to maintain quality over time to meet the expectations of the
consumer.
ii. Incentive not just to maintain high-quality but to have diverse qualities
of products in the market. (ie. not everybody is looking for the best
quality leather goods or the best quality eggs).
c. Constitutive of a market economy?
d. Implications: the need to prevent confusion.
i. Wagamama v City Centre Restaurants: Wagamama suedRajamama
for trademark infringement. There is an expectation that Wagamama is
1) a Japanese restaurant and 2) a huge chain restaurant that has
consistent quality of food.
ii. The need to protect consumer expectations by protecting trademarks to
avoid confusion.
2. Trademarks as anchors of brand value
a. Protects the investment of the brand owner
i. You buy into the brand messages. (ie. sustainability, etc) → but should
this lead to legal protection?
ii. Implication: protection against dilution harms
1. No harm around trade origin confusion. They are about
tarnishing the suggestion that the use of a mark can cause
negative connotations to their own brand to arise in the minds
of consumers.
2. Blurring: overuse harm → impair the connection between the
trademark and the product.
, ree ride: misappropriation → the use that takes unfair
3. F
advantage of the senior mark
b. Supports the expressive autonomy of the brand owner (ie the owner’s ability to
control the messages associated with its trademarks.
c. Trademarks are associated with marketing innovation and help traders recoup
their investment in new products.
i. Communication function: different types of messages that brands want
to solidify to the public.
Registration purpose:
1. Legal certainty - other traders know what to avoid.
2. Costs are incurred by maintaining a register.
3. Disadvantages of smaller businesses who don’t have legal advice or representation,
and the dangers of over-claiming by companies with deeper pockets for legal
arguments.
4. You also need interpretive rules for the register
a. How to apply, what representations of the trademark are adequate to be on the
register? (qualifications and eligibility)
b. Relevance of actual confusion
Reading
obertBurrell,“RethinkingtheRelationshipBetweenRegisteredandUnregistered
R
Trade Marks” (Cambridge University Press, 2020)
hendoesitmakesensetoapplyapresumptioninfavourofmakingrightseasytoenforce
W
vs. when owners should be put to the trouble of proving their case in passing off.
Benefits to a TM system:
- “Trade mark rights, whether registered or unregistered, have been justified on the
basis that they reduce ‘consumer search costs’ by providing a reliable indication of
trade origin.” (40)
- “Trade marks promote market efficiency by enabling consumers to find what they
want quickly and easily” (40)
- Italsoprotectsthetrademarkownersfromtheconsequencesofdeceivedcustomers.
This islikelytoleadtohigherratesofenforcementthanrelyingonstateagenciesor
consumers themselves to bring proceedings.
Concerns about the legal mechanisms to prevent consumer confusion: (41)
- Passingoffclaimscanbedifficultandexpensive-underenforcementandincreasein
consumer confusion
- The US allows trade mark owners to enforce their own rights without requiring
evidence that consumers recognise the sign as a badge oforigin,saysthisproduces
lower error costs than passing off - but this increases consumer search costs. If the
defendant had begun to develop areputation,theplaintiff’senforcementwillleadto
consumer confusion and search costs.
, egistration
R
- Serves as a means of reducing enforcement costs - not generally required to
demonstrate a reputation, evidence of actual confusion is not necessary for
infringement and system is build on broad abstract rights (41)
- Sourceofpublicinformationthatenablestraderstodiscoverwhichsignsthirdparties
have already claimed - reduces business costs.
- Communicates reliable ownership information - facilitates licensing and assignment
of marks
- Assists consumers or state agencies to identify trade mark owners
- Butthescopeoftheregisteredtrademarkrightscangobeyondwhatcanbejustified
to prevent consumer confusion - lead to plaintiff monopoly.
- Thiscanonlybejustifiedonthebasisthatitservesasanincentiveforowners
to register their marks and by reference to the need to reduce enforcement
costs.
But only limitedincentivesseemtobenecessaryforregistration(US,Australia).
(43)
Trade mark registers may not perform their public information function
effectively.
- Inaccurate information
- Incomplete information - registration is not obligatory
Possible solution? - double identity infringement; if the defendant is using the
samemarkforthesamegoodsandservices,thereisastrongpresumptionthat
consumers would be confused. (attracts strict liability)
. Burrell, ‘Is Trade Mark Law Fit for Purpose’ in A. Johnston & L. Talbot, Great
R
Debates in Commercial and Corporate Law (Macmillan 2020)
● IP law should be reformed
○ Where "confusion" principle expanded too much
○ Defensive doctrines within trademark law underdeveloped
○ Mechanisms for detecting tm's that should be removed from the register
ineffective
● IP law should be abolished
○ Where it relates to tarnishment or blurring of commercial tm's as
communicative tools
○ Trademark system is being abused
● Why do we protect trademarks
○ Shows one company exercises control of goods bearing the logo, not a mark
of its origin
■ Also reduces search costs and are easy to find
■ Necessary for the market economy to function
, ○ E ssential function is indication of trade sources, but has developed to
become mark promoting brand loyalty and quality
○ Protect against free-riding; warrants moral intervention to protect the person
who was the first to invest in the brand or trademark
Problems with brand protection limb
●
○ Doctrine of "dilution" used to protect brand investment; ie. There cannot
exist Nike bars or Rolls-Royce café's, which would undermine brand
integrity
○ Protecting against tarnishment or blurring
○ L'Oreal v Bellure: attempted to apply trademark lawto the scent of a
perfume
■ CJEU held there could be action even if distinctive character and
mark of a product is not actually affected
○ Criticism - internal incoherence
■ Brands must be "famous" or "well-known" to be protected against
dilution
■ Makes the register less effective for businesses because even though
a trademark is not on there, anti-dilution principles can still apply
where the goods or services are not related (registers may be more
industry based)
■ Blurring and tarnishment have been tested and not even strongly
grounded in the evidence
■ Ie. Two brands have been using the Rolls-Royce name but
the actual company suffered no loss
■ Ie. Test subjects shown another product with brand name,
only late reaction to recognize by milliseconds
■ Anti-dilution principles can suppress free speech
■ Ie. Environmental group mocked oil company using their
brand name but subject to trademark regulations
Robert Burrell and Michael Handler, Making Sense of Trade Mark Law (IPQ 2003)
n TM registration
O
Main argument: ‘decisions, and the Sieckmann criteriain particular, rest upon unarticulated
and problematic assumptions about the nature of representative registration and the role of
trade mark registers. More generally, we argue that Sieckmann, Libertel and Shield Mark
shed light on the role that the bureaucratic requirements of registered intellectual property
systems can have in shaping intellectual property law and policy – an issue that deserves far
more attention than it receives at present.
- B
rad Sherman and Lionel Bently argue that representative registration provided a
means of resolving the apparently intractable problem of identifying and demarcating
Introduction to Trademarks
Justifications for trademark protection
1. Trademarks as an indication of trade source
a. Consumer search cost theory: trademarks allow consumers to identify the
products they want more quickly and confidently → trademarks serve as an
origin function
i. The source can be anonymous without compromising the origin
function
ii. Scandia Down Corp v Euroquilt: “By identifying thesource of goods,
they convey valuable information to consumers at lower costs. Easily
identified trademarks reduce the costs consumers incur in searching for
what they desire, and the lower the costs of search, the more
competitive the market.”
b. Market diversification rationale: trademarks allow traders to differentiate on
the grounds other than price → trademark guarantees a certain quality to
consumers.
i. Incentive to maintain quality over time to meet the expectations of the
consumer.
ii. Incentive not just to maintain high-quality but to have diverse qualities
of products in the market. (ie. not everybody is looking for the best
quality leather goods or the best quality eggs).
c. Constitutive of a market economy?
d. Implications: the need to prevent confusion.
i. Wagamama v City Centre Restaurants: Wagamama suedRajamama
for trademark infringement. There is an expectation that Wagamama is
1) a Japanese restaurant and 2) a huge chain restaurant that has
consistent quality of food.
ii. The need to protect consumer expectations by protecting trademarks to
avoid confusion.
2. Trademarks as anchors of brand value
a. Protects the investment of the brand owner
i. You buy into the brand messages. (ie. sustainability, etc) → but should
this lead to legal protection?
ii. Implication: protection against dilution harms
1. No harm around trade origin confusion. They are about
tarnishing the suggestion that the use of a mark can cause
negative connotations to their own brand to arise in the minds
of consumers.
2. Blurring: overuse harm → impair the connection between the
trademark and the product.
, ree ride: misappropriation → the use that takes unfair
3. F
advantage of the senior mark
b. Supports the expressive autonomy of the brand owner (ie the owner’s ability to
control the messages associated with its trademarks.
c. Trademarks are associated with marketing innovation and help traders recoup
their investment in new products.
i. Communication function: different types of messages that brands want
to solidify to the public.
Registration purpose:
1. Legal certainty - other traders know what to avoid.
2. Costs are incurred by maintaining a register.
3. Disadvantages of smaller businesses who don’t have legal advice or representation,
and the dangers of over-claiming by companies with deeper pockets for legal
arguments.
4. You also need interpretive rules for the register
a. How to apply, what representations of the trademark are adequate to be on the
register? (qualifications and eligibility)
b. Relevance of actual confusion
Reading
obertBurrell,“RethinkingtheRelationshipBetweenRegisteredandUnregistered
R
Trade Marks” (Cambridge University Press, 2020)
hendoesitmakesensetoapplyapresumptioninfavourofmakingrightseasytoenforce
W
vs. when owners should be put to the trouble of proving their case in passing off.
Benefits to a TM system:
- “Trade mark rights, whether registered or unregistered, have been justified on the
basis that they reduce ‘consumer search costs’ by providing a reliable indication of
trade origin.” (40)
- “Trade marks promote market efficiency by enabling consumers to find what they
want quickly and easily” (40)
- Italsoprotectsthetrademarkownersfromtheconsequencesofdeceivedcustomers.
This islikelytoleadtohigherratesofenforcementthanrelyingonstateagenciesor
consumers themselves to bring proceedings.
Concerns about the legal mechanisms to prevent consumer confusion: (41)
- Passingoffclaimscanbedifficultandexpensive-underenforcementandincreasein
consumer confusion
- The US allows trade mark owners to enforce their own rights without requiring
evidence that consumers recognise the sign as a badge oforigin,saysthisproduces
lower error costs than passing off - but this increases consumer search costs. If the
defendant had begun to develop areputation,theplaintiff’senforcementwillleadto
consumer confusion and search costs.
, egistration
R
- Serves as a means of reducing enforcement costs - not generally required to
demonstrate a reputation, evidence of actual confusion is not necessary for
infringement and system is build on broad abstract rights (41)
- Sourceofpublicinformationthatenablestraderstodiscoverwhichsignsthirdparties
have already claimed - reduces business costs.
- Communicates reliable ownership information - facilitates licensing and assignment
of marks
- Assists consumers or state agencies to identify trade mark owners
- Butthescopeoftheregisteredtrademarkrightscangobeyondwhatcanbejustified
to prevent consumer confusion - lead to plaintiff monopoly.
- Thiscanonlybejustifiedonthebasisthatitservesasanincentiveforowners
to register their marks and by reference to the need to reduce enforcement
costs.
But only limitedincentivesseemtobenecessaryforregistration(US,Australia).
(43)
Trade mark registers may not perform their public information function
effectively.
- Inaccurate information
- Incomplete information - registration is not obligatory
Possible solution? - double identity infringement; if the defendant is using the
samemarkforthesamegoodsandservices,thereisastrongpresumptionthat
consumers would be confused. (attracts strict liability)
. Burrell, ‘Is Trade Mark Law Fit for Purpose’ in A. Johnston & L. Talbot, Great
R
Debates in Commercial and Corporate Law (Macmillan 2020)
● IP law should be reformed
○ Where "confusion" principle expanded too much
○ Defensive doctrines within trademark law underdeveloped
○ Mechanisms for detecting tm's that should be removed from the register
ineffective
● IP law should be abolished
○ Where it relates to tarnishment or blurring of commercial tm's as
communicative tools
○ Trademark system is being abused
● Why do we protect trademarks
○ Shows one company exercises control of goods bearing the logo, not a mark
of its origin
■ Also reduces search costs and are easy to find
■ Necessary for the market economy to function
, ○ E ssential function is indication of trade sources, but has developed to
become mark promoting brand loyalty and quality
○ Protect against free-riding; warrants moral intervention to protect the person
who was the first to invest in the brand or trademark
Problems with brand protection limb
●
○ Doctrine of "dilution" used to protect brand investment; ie. There cannot
exist Nike bars or Rolls-Royce café's, which would undermine brand
integrity
○ Protecting against tarnishment or blurring
○ L'Oreal v Bellure: attempted to apply trademark lawto the scent of a
perfume
■ CJEU held there could be action even if distinctive character and
mark of a product is not actually affected
○ Criticism - internal incoherence
■ Brands must be "famous" or "well-known" to be protected against
dilution
■ Makes the register less effective for businesses because even though
a trademark is not on there, anti-dilution principles can still apply
where the goods or services are not related (registers may be more
industry based)
■ Blurring and tarnishment have been tested and not even strongly
grounded in the evidence
■ Ie. Two brands have been using the Rolls-Royce name but
the actual company suffered no loss
■ Ie. Test subjects shown another product with brand name,
only late reaction to recognize by milliseconds
■ Anti-dilution principles can suppress free speech
■ Ie. Environmental group mocked oil company using their
brand name but subject to trademark regulations
Robert Burrell and Michael Handler, Making Sense of Trade Mark Law (IPQ 2003)
n TM registration
O
Main argument: ‘decisions, and the Sieckmann criteriain particular, rest upon unarticulated
and problematic assumptions about the nature of representative registration and the role of
trade mark registers. More generally, we argue that Sieckmann, Libertel and Shield Mark
shed light on the role that the bureaucratic requirements of registered intellectual property
systems can have in shaping intellectual property law and policy – an issue that deserves far
more attention than it receives at present.
- B
rad Sherman and Lionel Bently argue that representative registration provided a
means of resolving the apparently intractable problem of identifying and demarcating
