Part of the challenge of managing a business’ IP, so it makes a positive contribution to the company’s balance sheet, is working out what you actually have. For example, what is a ‘trade mark’? Is it the same as a brand or a product? What about the slogan? Does that constitute IP?

The short answer is “it could be”. In fact, some quite out-of-left-field stuff can be defined as trade marks (such as pink cement trucks).

Let’s step back to first principles. Why do we have trade marks in the first place? In a nutshell, to prevent others from using your brand or product name and image. It’s important to note here that IP rules are all about protection, that is, stopping someone else, rather than pro-action – “can I use this safely myself?”

The name of your business, both in terms of its ability to attract customers and its deeper representation of what your business stands for, is a vital element of your business’s success or otherwise. Unfortunately too many business owners find out, often to their substantial cost, the ‘just perfect’ trade mark they’ve dreamt up for their business has already been dreamt up and registered by someone else.

Here’s where it is absolutely critical to have comprehensive trade mark searches done, before committing resources to supporting and promoting your ‘just perfect’ brand image. Sure, it’s disappointing if you’re unable to register a trade mark. But it can be potentially disastrous for your business if you end up in an expensive legal wrangle with another organisation that can prove prior ownership of the IP.

As any reputable trade mark attorney will tell you, a trade mark is not a ‘set-and-forget’ guarantee that no-one will be able to use your good name and reputation to boost their own reputation and sales. This is because the type of trade mark registration most commonly used sets ‘use by’ dates and the law takes a ‘use it, protect it or lose it’ attitude to holding registration.

A common misconception is that business name registration or company name registration will spill over and give some form of de facto trade mark protection. Not so. Just because you register a business name doesn’t mean someone else can’t use it. In fact, if you check the business name registration lists with the NSW Office of Fair Trading right now, you’ll find 60 listings of businesses registered with ‘Blue Sky’ in their names -and that’s just in NSW.

“So what?” I hear you say. “My business is different from all the others with the same name. I’m a photographer (or an accountant, or a cleaning service or whatever). People looking for my services won’t mix me up with a bakery or a removal business or a real estate agency.”

Perhaps not, if they’re looking for your specific service. But what if, by using the name of an organisation that is well known and has a good reputation, another business is able to attract customers. Without actually saying “we are part of Organisation XYZ”, by having XYZ in their registered business name some customers may think “I trust Organisation XYZ to deliver the quality I want. XYZ services could be a part of the organisation, so I’ll give them a go.”

Does it matter? If Organisation XYZ is not actually losing sales to the business riding on its coat tails, where’s the harm? In reality, it could matter quite substantially, by threatening the reputation of the organisation if the other business doesn’t live up to its customer’s expectations. As a number of household name companies have found, if there is any threat to reputation the organisation may well be caught up in the fallout, with customers moving away to less controversial suppliers.

What can be done to avoid this situation?

Here’s where the less commonly used ‘defensive registration’ may come into play. Let’s say you’ve registered a trade mark for the goods or services you supply, clothing for instance. Your trade mark is sufficiently well known, to the point where if someone else used it for other goods or services, say jewellery or handbags, it would be deceptive or cause confusion in the market. In these types of cases you can apply for defensive registration. This type of registration is designed to prevent people cashing in on other people’s brands and is not subject to the non-use provisions. So even if you may have no intention of producing and selling jewellery or handbags, a defensive registration of your trade mark will allow you to stop others from taking commercial advantage of your success.