A solid brand name and / or logo can enhance or kill a great product and can be the most valuable asset of your business.  And with hundreds of thousands of beauty brands in use around the world, it is easy to unknowingly pick a brand name or logo that someone else already owns or that you cannot stop others from using.  Avoiding common mistakes in selecting and protecting distinguishing brands (also known as trademarks) can save you time, money and disruption to your business.  Here are top 5 things to consider so you don’t get sued over branding.

#1  Avoid being too similar.
The most common mistake that businesses in the beauty industry make is failing to ensure that they can use the brand name they selected without getting sued.  Trademark law prohibits using a name that is the same as or similar to another company’s name for the same or related goods or services in a manner that is likely to confuse consumers.  Thus, if you want to use the brands MACK for shampoo or CHANNEL for eyelashes, they almost certainly violate the trademark rights in MAC and CHANEL, because the brands are nearly identical and the goods are related.  In actual legal cases, for example, the owner of the SO SEXY brand opposed Victoria’s Secret use of the SEXY HAIR brand and the owner of the KW brand of cosmetics sued Kim Kardashian for using KKW for cosmetics.

Even if you believe that the brand you select is not similar to an existing brand owned by someone else, it is often not easy to predict when your competitor will disagree. For example, the company that own rights in the XTREME LASHES brand (and the slogan EXTEND YOUR BEAUTY) for eyelash extensions sued a competitor for using the XTENDED BEAUTY brand for eyelash extensions.

#2  Government approval doesn’t protect you from liability.
Many beauty businesses falsely assume that if a government trademark office (such as the United States Patent and Trademark Office) approves your application to register your brand as a trademark or a state or country approves your corporate name or fictitious business name, this means that you can use the name.  Governments only determine whether someone has registered the same name or a similar name – not whether your name may violate rights of others.

#3 Select a brand you can protect.
Another common mistake is selecting a generic name that you cannot stop others from using.  It is pointless to invest time, effort and money in a brand that you cannot protect.  Generic everyday language terms that identify what a product is (such as “shampoo,” “lipstick,” and “eyelashes”) are not protectable. You can always use generic terms to identify the products that you are offering and your competitors can too.  Terms that describe some characteristic or feature (such as “natural” for a product that contains natural ingredients or “coconut” for a product that contains coconut or smells like coconut), surnames, and geographic destinations are considered descriptive and cannot be protected unless and until consumers associate them with you after extensive use over time (such as L’OREAL and CHANEL).

The types of brands that are protectable are: (1) suggestive terms that require some imagination to know how they relate to a product (such as BARE MINERALS and COVER GIRL for makeup); (2) arbitrary terms that are existing words that have nothing to do with the product for which they are used (such as URBAN DECAY for cosmetics); and (3) coined or “made up” words (such as NEUTROGENA and CLINIQUE).

#4 Register your brand.
Ownership of a brand in some countries (such as the US and Canada) is determined based on first to use the brand.  In other countries, ownership is based on the first to register the brand.  However, in all countries, there are benefits to registering your brand.

With some exceptions, ownership of brands is determined on a country-by-country basis. As a result, if you only register your brand in the United States, you would not be able to stop others from using your brand for the same or related products in a foreign country, unless you can prove that your brand was well-known in the foreign country.

#5 Establish ownership of the brand with your manufacturers and distributors.
There have been numerous disputes between manufacturers and distributors regarding ownership of rights in brands.  For example, in the absence of an agreement, the ownership of a brand between a manufacturer and distributor is determined by different factors, including which party invented the brand and first used the brand on products, which party’s name appears with the brand on the products, which party maintained the quality of the product, and who consumers perceive as the owner of the brand.  For example, in a dispute between the foreign manufacturer and U.S. distributor of the CELLULIFT massage system and the TOUCH N’ GO hair removal system, the court held that the U.S. distributor owned rights in the brands.

In conclusion, once  you select a brand name and / or logo, clear it, register it, and protect it so it’s trademarked and you will be happy you did.

About the author Michael McCue is a trademark attorney with 28 years experience protecting some of the most famous brands in the world.  Michael oversees a domestic and international trademark portfolio of more than 5,000 trademarks.  Michael has been recognized in the 2018 World Trademark Review as one of the top trademark attorneys in the world finding that he is an “extremely effective” trademark attorney who “has handled numerous high-profile disputes” and has a “keen, thoughtful and strategic approach.”

By Michael McCue
[email protected]
Lewis Roca Rothgerber Christie LLP

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