How to settle trade mark disputes

Disputes over the use of trade marks arise quite frequently. Most of these disputes can be resolved without recourse to the Courts. In this article, we discuss some of the factors which we take into account when trying to resolve a trade mark dispute under UK law. The article considers both the situation where our client objects to the use of a trade mark by another (you think someone else is infringing your rights) and the situation where someone else is objecting to your use of a trade mark (someone is accusing you of trade mark infringement). The objection might take the form of a Court action, a cease and desist letter or arguments in correspondence during an opposition.

1. What is the strength of the infringement case?

Whether you are objecting to someone else's use of a trade mark, or have received an objection to your use, the first thing to consider is the merits of the objection. We see a full spectrum between cases where there is clear-cut trade mark infringement through to circumstances where one of our client's has received a letter from a trade mark owner who seems to be speculatively trying to stop others from using a mark without reasonable legal grounds to do so. Usually, the situation is somewhere between these extremes and often there is some uncertainty as to whether a claim for infringement would be upheld by a Court.

As well as trade mark infringement there are sometimes objections based on unregistered rights, particularly passing off. These can be difficult to assess because the legal case will depend very much on what evidence each party can provide.

2. Are there defences to infringement which apply?

There are various defences to trade mark infringement. For example, in the UK it is not trade mark infringement to use your own registered trade mark (although this can be a false friend because if your registration is found invalid it is deemed never to have existed); it is not infringement to continue use of an earlier trade mark with a reputation in a locale; some types of non-trade mark use of a mark are not infringement; after a sufficient period of inaction, the proprietor may be deemed to have acquiesced to use of a mark. There are various other defences and occasionally Chartered Trade Mark Attorneys come up with quite creative defences - there are various tricks of the trade.

3. Is the right valid?

There are various grounds on which a trade mark registration may be invalid. These include that the trade mark should not have been registered because it is descriptive of the goods or services that are being sold, or conflicts with an earlier registered mark, without consent; the trade mark was applied for in bad faith; the trade mark has not been used for a continuous period of 5 years. If an unregistered right is being asserted, other validity considerations apply.

If there are good grounds to think that a trade mark registration may be invalid, it is possible to apply for revocation or cancellation of the trade mark, or simply to threaten this as part of negotiations.

4. Counterclaims based on other rights

The recipient of an allegation of trade mark infringement is well advised to think carefully about their own IP portfolio and whether they have or can still develop any rights of their own which are being infringed. Similarly, before sending allegations of trade mark infringement, it is advisable to think about the IP rights of the party to whom they will be writing, otherwise they may find they are starting a fight which they will lose.

5. Who are the parties?

Are the parties to the dispute large or small organisations? Are they well-funded or are they not? Do they have a reputation and history for how they behave in trade mark disputes? Small companies are often frightened to get into disputes with large organisations but sometimes they should. Large companies still have budgets they do not like to overspend. You might ask a large corporation for consent to use a mark and get a positive response (provided you agree to certain terms) and you might ask the same of a small company and find they want paid a lot of money or are unrealistic.

6. Who are the other side's representatives?

Experienced Chartered Trade Mark Attorneys are practical and able to settle cases - when that is what is appropriate. However, sometimes one of the parties is unrepresented, or is using a discount trade mark filing house who are not expert at dispute resolution or do not work well with their clients. Some applicants are represented by representatives who are little more than a box office and negotiating a practical solution may not be possible at all.

7. Are there acceptable co-existence options?

Frequently, disputes arise in situations where peaceful co-existence could be easily agreed. For example, one of the parties might be able to amend their proposed trade mark, or to agree to use it in a certain way or not on certain products. Sometimes there is no way that co-existence could be agreed in which case a dispute is more likely to progress to litigation, but if there are practical settlement options which might be acceptable to both parties, then, if this is brought up in the right way, settlement on acceptable terms is more likely.

8. How easy is it for one of the parties to rebrand?

If one of the parties has only recently started to use a mark - or perhaps has not started to use their mark at all - it may be relatively easy for them to rebrand and this is a settlement option that can be considered. Of course, if one of the parties has large amounts of branded products in a warehouse ready to sell, there is less likely to be a possible resolution along these lines.

Once these factors have been considered, you are ready to decide on a strategy for resolving a trade mark dispute, but you do need to do this kind of thinking before you begin. At Hindles we regularly handle trade mark disputes, frequently negotiating settlement agreements, where that is appropriate for our client.

If you would like advice on resolving a trade mark dispute, please do not hesitate to contact us.