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Trade Mark Act Threatens Major Brands

Trade Mark Act Threatens Major Brands

The new Trade Mark Act presents some challenges for trade mark owners, while also bringing in some welcome changes, according to trade mark specialist, Bryan Thompson, partner at A J Park.

“The major challenge for trade mark owners is that trade marks will be revoked if they become a ‘common name’ in general public use, where previously this was only the case if they became a ‘common name’ within the trade”, he says.

“An example is where people might commonly refer to inline skates as Rollerblades, even though competitors and the trade might respect the difference. While trade mark owners can sue competitors to stop misuse, they cannot sue members of the public.”

Bryan Thompson says the Select Committee took the view that owners of trade marks must take steps to prevent their trade marks becoming generic to the public by using their trade marks as adjectives, not nouns. “An example given, is the trade mark owner should use the term “Levi jeans”, not just Levi’s, to prevent Levi’s becoming a generic product”, he says.

Bryan Thompson says many valuable trade marks may now be removed from the Register because the public misuse them as generic terms. “Trade mark owners have a clear signal to properly brand their products to ensure their trade mark remains distinctive, and they will have to be rigorous in enforcing the correct use of their brand”, he says.

On a positive note, he says the Act retains the new clause prohibiting registration of trade marks likely to offend a significant section of the community.

“The Select Committee recognised the value of being able to stop registration of trade marks which are offensive to Maori and other significant sections of the community. This allows for changes in New Zealand’s social and demographic patterns, and shifts in the mix and significance of identifiable groups, values and beliefs to be recognised over time,” he says.

Bryan Thompson says there is a welcome extension of infringement law to protect against misuse of famous trade marks. “Protection now extends to goods or services that are not similar to those in the registration, where the trade mark is well known in New Zealand and the use of the sign takes unfair advantage of, or is detrimental to, the distinctive character of the mark”, he says.

“Overall”, he concludes, “the new Trade Marks Act will meet modern international standards and increases penalties for counterfeiting to include a jail term for up to five years, and fines of up to NZ$150,000.”

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