A contractor's guide to trademarks

By Sheana Wheeldon
Partner, Kensington Swan Lawyers

It is a well known fact that the Kiwi ‘can do, No.8 wire’ attitude has seen amazing developments in engineering and everyday tasks. This is nowhere more so than in the contracting industry where by necessity or pure inspirational skill, each year engineering and practical innovations abound. This also highlights the need to understand other intellectual property related benefits and pitfalls.

The NZ Contractors’ Federation’s solicitors, Kensington Swan, has a specialist intellectual property team operating in both Auckland and Wellington. Over the next three issues of Contractor we are presenting a contractors’ guide to intellectual property.

This first article explains why businesses should obtain trademark registration for their names and any other important brands. In the second topic, in next month’s issue, we will deal with copyright, confidential information, and patent and design law. The final instalment will cover what you need to do to avoid infringing other parties’ intellectual property rights.

What’s in a name?

The name of a successful business can be one of its most valuable assets. Household names such as Wattie’s and Fisher & Paykel come to mind. In the contracting industry, many well known business names and brands are being advertised in this very magazine.

Customers have strong loyalties to brands they know and trust.  Just think of how you choose a product (for example good old tomato sauce) when there are a few choices offered by several competitors. Often people pick a product based on recognising and trusting a well known brand they may have liked in the past or heard about from others.

A strong brand is linked with the hard earned reputation and core values of a business.  A strong brand also increases the chances of success in winning new clients and work, and retaining existing clients. 

Unfortunately, despite the importance of a strong brand in business, many people do not have a clear understanding on how to best protect their business name or important product names from competitors.

Obtaining a registered trademark for all important brands is your best insurance policy in securing your position against competitors who may want to copy you and ‘coat-tail’ on your success.  Many people think that obtaining a registered company name provides them with exclusive rights to a name. This is not the case.  Only a registered trademark gives its owner exclusive rights to a particular name or brand.

If you obtain registered trademark protection for your name or brand in plain block capitals, this gives the broadest possible protection, enabling you to stop other parties using it in any form, font or in combination with a logo.  There is no need to separately register logo forms of your trademark, but in the case of a distinctive logo it can be worthwhile to obtain separate protection in the form of a stand alone trademark registration.

In some circumstances unusual trademarks such as the shape of an item, a slogan or even a colour scheme can be registered.

The advantages of a registered trademark include:

• It is easier and more cost-effective to stop competitors imitating your brand or name if you have a registered trademark.
• A registered trademark is also a strong deterrent against competitors potentially copying you. All registered trademarks are recorded on a publicly available register. If you have a registered trademark, a search of the register will bring this up, demonstrating that you have staked your claim to your name.
• Registered trademarks can become very valuable assets and are definitely worth putting a value to if you are selling the associated business.
• A registered trademark will protect you from so-called ‘cybersquatters’ – businesses or individuals who register domain names that imitate or misappropriate well known brands, but have no relationship to the brand owner. They then use the domain names to gain

advertising revenue, and/or demand money from the brand owner before releasing the domain name.  Past cybersquatting cases in New Zealand include businesses such as NZ Post and Qantas.

It is equally important to look closely at trademark protection if you are purchasing a business. What is it that you are purchasing? Does it include the name of the business and any important brands, and if so are these names and brands registered as trademark, and does the seller actually own the trademark registrations?

It is essential not to put off registering trademarks that are important to your business, as time is often the essence. Claim your territory early by putting in place registered trademark protection and you will save yourself headaches in future!

A contractor's guide to protecting new ideas and inventions

A contractor's guide to intellectual property enforcement and avoiding infringement