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Can I stop others trading on my reputation?
We live in a world where name, reputation and “Unique Selling Point” are everything in order to achieve and maintain a competitive edge. In my everyday work I am often asked questions about the use of business names and trading styles. Queries range from the use of a name on the formation of a limited company to the ability to trademark or adopt a business name or trading style which is similar to an existing business.
It’s fair to say that the law relating to the use and protection of business names and trading styles is not easy to navigate and there are a number of different considerations which may apply.
Formation of Limited Companies and Limited Liability Partnerships
When forming a limited company or limited liability partnership, Companies House will not allow the registration of a name which is the same (note the emphasis) as a company or LLP already on the register unless the existing company/ LLP gives its consent and the proposed company or LLP is part of the same group of companies or LLP’s. Further, Companies House will not allow a name which is “too similar”. Each proposed registration will be considered by Companies House. A decision will be taken as to whether the proposed name is acceptable and if not guidance will be given. Once registration has occurred a level of protection is afforded. It is worthy of note that Companies House do not police the names of unincorporated businesses.
A name or trading style may attract trade mark protection, subject to grant by the Intellectual Property Office (IPO). There is no legal requirement to obtain trademark protection but once trademark protection has been granted the owner has the exclusive right to use the trademark. There are a number of requirements to be met in order to satisfy the IPO that a mark is capable of registration and certain categories are excluded from registration. Three of the key requirements (although there are others) are:
1. the trade mark must be distinctive and not just descriptive of the goods or services for which protection is sought;
2. be capable of graphical representation; and
3. there must be no conflict with prior rights owned/ granted to third parties.
Then there is passing off. What’s that I hear you say. In simple terms Party A may have a right of action for passing off against Party B where Party B uses or adopts a trading style, name or mark which is the same or similar to Party A and where Party A:
1. Already has an established reputation or goodwill attached to the name or trading style;
2. Party B misrepresents to the public (either deliberately or unintentionally) that the goods or services which B is offering are the same or similar to that of Party A; and
3. Party A suffers damage as a result of Party B’s misrepresentation.
In summary, none of these questions are straightforward. Some of them will require consideration of complex areas of law and an understanding of commercial issues.