Don't under estimate the value of a search

04 August 2009
Too many small businesses are exposing themselves to legal action by not making sure the names and trade marks they use on their products and services are available for them to use.

Doing a search before using a name will identify any potential issues. Then you can make a strategic decision about whether you can adopt that name or whether you have to select another. But not any old search will do, it needs to be comprehensive enough to find existing identical and similar trade marks that have been applied for, are already registered, or in use. 

Some people believe they have the skills to search for new names and trade marks themselves. Yet on an almost daily basis we are approached by small businesses seeking help after facing difficulties searching for trade marks themselves. Even though the trade marks database is online, there are some impending pitfalls when doing a search yourself.

Recently, one business had searched for the prefix of the trade mark they were interested in. They found many trade marks beginning with the same prefix but somehow missed the exact trade mark!  That business went on to produce catalogues and labels thinking that the trade mark had been cleared for their use. It was not until they received a letter from a law firm pointing out that their use infringed another’s trade mark that they realised they had a problem. 

Not only did they have to re-label their goods, change all of their promotional materials and incur legal costs, they also had to select a new trade mark and get it cleared through the proper channels. Another business searched the exact trade mark they were interested in. They found the exact trade mark, but in a different class to the one they knew their goods were classified in. Again, they proceeded to use the trade mark until they also received a lawyer’s letter. They were infringing on the rights granted under the trade mark they had in fact found. What they had not considered was the likeness of the goods. Again this business has had to select a new trade mark.

Generally speaking, when a new trade mark is devised, the most critical issue is ensuring that it is available for use and, in particular, will not breach any prior third party rights in the same or a similar trade mark.

To clear a trade mark, you need to search  the official trade mark records and do a search of trade marks in use.

The criteria selected for each trade mark searched will depend on many factors. These include the nature of the trade mark, the presentation of the trade mark, the goods or services (or both) on which it will be used, as well as the country and database being searched. There is no one-size-fits-all searching criteria!

Many countries offer online searches of trade mark databases. The method adopted for entering trade marks onto a database differs from database to database. You need to be familiar with this to have any chance of finding potentially relevant trade marks.

It is also important to note that trade mark rights are territorial. If you intend to export goods from New Zealand, then you should also clear your trade mark for use in each of the countries where you will use your trade mark. 

Too often an individual or business undertakes their own trade mark clearance search but goes no further than entering the exact trade mark as the search criteria.  While on occasion you may find an exact trade mark, it gives you no indication whether there is a similar trade mark lurking on the database, or already in use. As New Zealand and several other countries have infringement laws that extend to cover ‘similar’ trade marks and ‘similar’ goods and services, any search undertaken needs to take this into account.

It is essential to search on any new trade mark before investing in its development and use. The risk of not doing so can be very expensive. After all, it is not the doing-it-yourself that counts – it is the doing it right!

An edited version of this article was published on the HomeBizBuzz website.