Brands of time: keeping up with protection rights

Commercial lawyers
could be forgiven for overlooking a recent European Court of Justice decision about whether a pattern on a knife handle constituted a trade mark.
Yet it shows the importance
of addressing the underlying intellectual property (IP) when dealing with any contractual arrangements involving brands. For the commercial solicitor, this is relevant for any contractual documents
dealing with brand rights.

Without overlooking provisions for obligations on performance, quality standards, marketing, deliverables and monies payable, a lawyer should look at whether their client has put into place all the available protection before entering into formal agreements.

Limited protection

Obligations and finances are often a client’s main focus, while the brand identity is assumed. Most well-advised businesses register their trade mark(s) – typically, word and logo marks only – early, which tends to comprise the brand protection process. With the main boxes ticked, the business feel
secures and rarely considers further action.

Therefore, by the time a brand becomes established and the basis for a franchise, in many cases the actual protected rights can be precariously outdated.

Conducting a brand review is a crucial first step before drafting a franchise agreement. After all, until the subject matter of the agreement is clear it’s risky to start drafting.

A full review at this point can be of real value to the client, highlighting both areas of weakness and potential. Certain IP rights may be also identified that had never been considered (such as the recipe book and service guidelines for a franchised restaurant, which could be protected by copyright or database right).

Moreover, the IP moves on.
For example, Apple is trying to obtain protection for its much-copied store layout.

Trade marks

Defining the brand on paper needs creative thought combined with a commercial approach. There will be more
to a brand than just the
two-dimensional word and
logo trade marks.

Non-conventional trade mark types that can be registered in the UK and EU include 3D marks (e.g. the Coca Cola bottle), position marks (Rotring’s red ring), colour combinations (Red Bull’s silver and black), sounds (MGM’s lion’s roar), music (the McDonald’s whistle), animated marks (Lamborghini’s car door opening), tracer marks (Adidas’ triple stripe), and holograms (Sony’s security label).

Arguably, the most valuable
of these categories is 3D marks. Many businesses will have distinctive 3D elements to
their product shapes, packaging, advertising displays or product stands, which are easily recognised at a distance.

Another useful and versatile category is the position mark. This protects the position of
one element with respect to an overall product, in a consistent proportion and location, such as the red tag on the back pocket
of Levi’s jeans. The label is not unique in its own right, but it is
in that position.

Elusive elements

There is, of course, more to a brand than just the trade mark rights. Simply referring to unregistered rights is not enough – consider drafting specific definitions of the main get-up elements as part of any schedule including colours, artwork, designs and text. These must be drafted with some precision to be enforceable.

But some key elements of a brand can never be registered. Subway, the sandwich chain, considers its unusual conveyer-belt service a distinctive part
of its user experience but this is elusive and cannot be protected in the UK.

However, it can be specifically described in contract, and ownership (and exclusivity) acknowledged to useful commercial effect.

Finally, as a business evolves its brand may follow suit. Things that were incidental can become more important. A client cannot anticipate these, so it’s an ideal opportunity for the practitioner to show their expertise and, for example, ensure that the agreement allows for the licenser to make unilateral changes to the relevant schedule to account for future development. SJ

Tristan Sherliker is an IP solicitor at Silverman Sherliker