Monitoring and active enforcement of brand rights are crucial to generate return on investments in the protection of trademarks and other brand rights in the long run.
“The importance of active enforcement of own brand rights cannot be overemphasized,” says Maria Puronvarsi, Partner and Licensed Legal Counsel at Kaulo & Partners.
There are several benefits related to active enforcement. To achieve results, effective monitoring of trademarks and other brand rights is needed to achieve these benefits.
“Effective monitoring of brand rights and actively reacting to infringements will prevent trademarks and other brand rights from weakening and ensure the possibility for increasing the value of brand rights in the future. The enforcement of rights also ensures that the scope of protection of trademarks and other brand rights will not be limited, and that the registered rights will remain valid”, Maria sums up the main benefits.
Enforcement prevents trademark dilution
Dilution of a trademark means a situation where the use of a later trademark takes advantage of the reputation of an earlier and a more well-known mark, thus weakening the distinctive character of the original mark.
“If you do not defend your own trademark, and do not react to infringements in any way, it means in practice that you passively allow others to use a similar trademark for their competing products. Over time, it will lead to a situation where your own brand starts to blur. It no longer fulfils the most important and original function of a trademark, which is to distinguish your own products from the competing ones on the market. Therefore, preventing dilution is extremely important”, Maria explains.
A trademark is being diluted when it is no longer merely associated with one particular company and one brand, but also evokes an association with another company’s brand, product, or a broader product category. In that case, it is no longer related to the brand for which it was originally registered as a trademark.
“A trademark registration is just the first step in protecting your brand. Thereafter, the trademark and the brand must be systematically taken care of by means of monitoring and enforcement of rights for them to retain and increase their value.”
Monitor registrations and online content − actively react to infringements
Without effective monitoring of the trademark, design and domain registries, online and physical marketplaces as well as online content, infringements may not come to the company's attention. In that case, it may also happen by accident that the trademark starts to weaken. If trademark infringements are allowed, either knowingly or unknowingly, the scope of protection of the trademark will inevitably begin to narrow because of the company not intervening in the infringement of its brand rights.
“Unless you react to infringements or registrations that come too close to your brand, it may be impossible, or at least much more difficult, to address them at a later stage. Therefore, it is worth taking good care of your own plot, cherishing the trademark, and not allowing others to benefit from your brand. It is the most effective way to prevent registration attempts that are harmful to your company already at the application stage by means of monitoring”, Maria encourages brand owners.
Market and competitor monitoring is primarily the responsibility of the company's own personnel and cooperation partners. In addition, it is advisable to use an external IP expert service to monitor the trademark and domain registries, online platforms such as Amazon, eBay, Alibaba etc, as well as online content and social media channels. IP law firms such as Kaulo & Partners have powerful software tools at their disposal to detect infringements as early as possible and comprehensively.
“Enforcement is also an important part of a company’s brand right strategy. Having outlined in advance how to defend own brand and how to exercise monitoring and enforcement in practice will help to ensure that brand right matters are handled in a holistic, strategic, and effective manner. A clear plan and guidelines help in everyday decision-making in individual situations.”
Typical trademark infringement: likelihood of confusion
In practice, trademark infringements can be very different in nature. However, it is always a question of someone else using a completely identical or a similar mark in their own business without a permission from the holder of an earlier trademark. Infringement of a trademark arises when there is a likelihood of confusion between the two marks. In that case, the consumer or other target group could mistakenly think that the mark refers to the original brand, even if it refers to a competing brand.
The assessment of the likelihood of confusion and infringement is always on a case-by-case basis. When assessing the closeness of marks and a possible infringement, the assessment is also greatly influenced by whether the later mark refers to a direct competitor and exactly the same kind of products or services, or whether the mark refers to a business with some complementary products or otherwise similar kind of products or services.
“Most commonly, trademark infringement is about a brand coming too close and the companies involved having similar products and overlap in business,” Maria describes a typical trademark infringement case.
The offensive mark may be on the product itself, for example printed or embroidered on clothing, or on the product packaging. In the case of services, the mark may be used as a service symbol in marketing and sales.
Two examples of Market Court decisions in Finland a couple of years ago illustrate the interpretation of the likelihood of confusion, and a typical trademark infringement. The Market Court ruled that the SuPerAlko mark comes too close to Alko's word and figurative marks, and that Pegoratio comes too close to the Pegorion mark, thus creating a likelihood of confusion among consumers.
Customs surveillance is important in the fight against counterfeiting
Counterfeiting is also one form of trademark infringement. Counterfeits seek to give the impression of a genuine product and mislead consumers and other target groups. All ’look alike’ products may not directly infringe registered trademarks or other IP rights; however, also unfair business practices can be addressed.
“Products can mimic the original products or the visual look of the product packaging quite accurately without being direct counterfeits. However, then someone strives to take advantage of the reputation of a more famous brand and increase sales of one's own products through ‘free riding’”, explains Maria.
For many global brands, counterfeiting is a big problem. They tarnish the reputation of the original brand with products of poor quality or being even dangerous or harmful to life and health.
"The significance of the problem is well illustrated by the fact that counterfeiting is the second largest source of illegal revenue worldwide."
For brand owners, one important way to combat counterfeiting is through customs surveillance. When a brand owner has a valid customs surveillance, the custom authority in each country can stop at the border products that it suspects are counterfeit. If this is the case, the products can be effectively destroyed before they reach the commercial market.
“We at Kaulo & Partners are actively working against counterfeiting as a local representative of brand holders operating in the global market. We assist in customs surveillance matters, local market watch as well as in all legal actions related to counterfeit products.”
Infringement assessment and cease-and-desist letters as first steps of action
How can infringements of brand rights be tackled in practice? When information about a possible trademark infringement is obtained through monitoring, the first step is to consult an IP expert and ask for an assessment of the infringement.
“It’s important to analyse the situation first, look at all the circumstances and find out if it’s really a trademark infringement. It is not advisable to contact the infringer directly in a hurry, instead, it is important to do a careful background study and gather evidence as well”, Maria describes the process. As part of the process, it is also important to ensure that your own protection is in order and up to date.
"It is worth checking the status of your own brand rights and that there are no gaps in the IP protection that should be taken care of before contacting the infringer."
After the infringement assessment and background checks, a cease-and-desist letter will be sent to the infringer. It is important to formulate it carefully and accurately so that it does not turn against the brand owner itself. As with infringement assessments, the use of an IP expert is highly recommended. The tone of the warning letter is shaped by the seriousness of the breach.
“The letter sets out the requirements. Its main aim, naturally, is to put an end to the infringement. The aim is also to acquire additional information about the quantities of products sold, and eventually claim compensation and damages based on these quantities”, says Maria.
In most cases, the infringement will end with a cease-and-desist letter, or later in negotiations between lawyers.
“If the desired outcome is not achieved, a court process will only be introduced as a last means to solve the dispute. However, a cease-and-desist letter is in most cases an adequate and cost-effective way to deal with infringements.”
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