The brief for this talk was challenging – Alongside other speakers from different regions I was asked to consider questions such as:
As the basic answer to most of these questions is, from a European perspective, ‘no’ then this had the potential to be a very short talk!
However, there are interesting things to say about house marks. For instance a house mark means something different to different industries. There are industries where the house mark sits, umbrella-like, over a variety of other brands – examples of this type of house mark include FMC giants like Unilever or GSK which sit above strong independent brands. In other industries, the house mark is ‘the’ primary mark, such as for Jimmy Choo or Yves Saint Laurent.
Whether they function as an umbrella brand or the primary mark, why do companies use a house mark? Trade marks are all about communicating with the consumer and the house mark can immediately offer a range of values to the consumer such as reliability or quality that may help persuade the consumer to select from that business rather than a competitor product.
Of course it is possible for a house mark to ‘go bad’. An example of this is Sears, a once venerated house mark, which has been associated with financial difficulties over the years. This negative association is likely to have a knock on effect and has the potential to infect the sub-brands sold under the mark.
House marks may evolve over time and we have seen this particularly in our work with clients such as Jimmy Choo and Paul Smith. In these fashion-led industries there is a natural desire to continually evolve the brand – whether that be in terms of stylisation or abbreviating the brand. Recent examples of this are Jimmy Choo moving towards ‘JC’ and Paul Smith moving to ‘PS’ etc. Some of these changes are led by the business and some by consumers with, for example, consumers moving from using the name ‘Jimmy Choo’ to referring to the brand simply as ‘Choo’, well before the business formally moved in that direction. From a portfolio management point of view this can make the strategic planning of a portfolio difficult. An extensive portfolio of registrations relating to, say ‘Jimmy Choo’, is not going to help you stop other businesses using ‘JC’ and that abbreviation may have been legitimately monopolised by others already.
In other cases the issue lays in the shear breadth of activity which can cause challenges. For example Virgin Enterprises, whose purpose is to licence the Virgin mark as widely as possible, needs to maintain a broad scope of protection to ensure they are well placed to exploit new opportunities when they arise.
In addition, businesses are not likely to want to spend considerable sums of money proactively putting in place protection for variations of their house mark until they have decided to use that mark. Once that decision is made they are likely to want to use it immediately rather than wait for the trade mark registration process to complete. However, watching for industry trends in relation to house marks and maintaining a regular dialogue with clients can help keep you ahead of the game.
This came into focus in the seminal case of THOMSON LIFE. That case dealt with the use of THOMSON LIFE by Thomson, a multimedia company, and a claim to infringement from the owner of an earlier registration of the mark LIFE. This case is clearly a house mark issue – does the house mark help in these circumstances? The answer is a resounding ‘no’ – the LIFE part of the mark in THOMSON LIFE had an independent distinctive role. This independent role did not overrule the general principles of global assessment but, in this instance, where the goods were identical and the element in question was used with a company name then confusion could occur.
This case has been widely used in instances which stray from the underlying principle of company name + ordinarily distinctive mark + identical goods. It has also been used in other circumstances to justify a likelihood of confusion where one element of a composite sign is used but the conclusion was very fact specific and has, arguably, been applied in cases where the court finding is not directly relevant.
As an example of how literally THOMSON LIFE is interpreted by the UK IPO consider WEALTHSMART v UBS SMARTWEALTH in relation to financial services. Take two weak words like ‘wealth’ and ‘smart’ and you get what is, at best, a borderline mark in terms of registerability. In this instance my personal view is that the original mark, WEALTHSMART, is so weak in relation to financial services that the addition of the house mark UBS and the reversal of the words to SMARTWEALTH mean that confusion is not likely. However, the UK IPO rejected the UBS application based on an application of THOMSON LIFE. Another question that comes from this case is: what did UBS think they were going to get from the registration of UBS SMARTWEALTH? Was there really any legal value in obtaining a registration of a mark which is so dominated in terms of distinctive character by the UBS house mark?
Whatever you think of the UBS SMARTWEALTH case, it is clear that you cannot just add a house mark and expect to avoid any issues with conflicts or infringement.
The UK IPO have said that a secondary mark may acquire a distinctive character when used in conjunction with another mark – that is to say the secondary mark does not have to be used alone and, in principle, use of a secondary mark with a house mark will not prevent the secondary mark acquiring a distinctive character. However, there may be a greater burden on the applicant to show the secondary mark functions as a trade mark. This often means that the applicant needs advice on how to make use of the secondary mark in a manner which will be viewed favourably by the trade mark offices, such as distinguishing the secondary mark from the house mark by using a different font.
The UK IPO practice manual also makes it clear that non-traditional marks, such as colours or the appearance of the goods, pose particular problems in this regard and particular effort need to be made to educate the public that the feature for which protection is sought has trade mark significance.
A UK pharmaceutical company traded under the name PHARMACIA for many years prior to 1995 when, following a merger with another company, it became PHARMACIA & UPJOHN and use of PHARMACIA on its own stopped. Use of PHARMACIA was restarted in 2000 and in 2004 an application to register FARMACIA URBAN HEALING was opposed. Initially the opposition based on ‘unregistered rights’ was unsuccessful, but on appeal it was found that there would have been residual goodwill in the PHARMACIA mark in 2000, even though it had only been used with UPJOHN for five years. That was then bolstered by the use of the mark from 2000 onwards, which shows that unregistered rights in house marks can function effectively to protect the mark, either alongside or in place of registered rights.