If yes, then this article is for you!
Have you ever wondered why large corporations globally fight tooth and nail over their trademarks patents and industrial designs? Is there something they know that we are yet appreciate? Recently, in March 2021, the US Olympic Committee (USOPC) sued Puma for trademark infringement, alleging the sportswear company had ‘declared war’ on Olympic trademarks. In June, Adidas sued US fashion designer, Thom Browne, for allegedly infringing the trademarks for its signature three stripe logo by using “confusing similar marks” on a sports apparel range. These are global examples.
In Kenya, the case of ABSA vs ABSA on trademark infringement is not yet lost in our minds and there are many more. What does this tell you as a professional firm that is keen on build a name? Consultancy is a service that depends largely on the identity and positioning of your brands. You firms name, logos, colors and any other brand symbols are your IP assets. They can be legally protected as your Trademarks (not PATENT!). Even if you don’t mind, for whatever reason, if your IP rights are infringed, you risk being sued for infringing other parties’ IP rights unknowingly? So what can you do, when and how?
The point is whether you know it or not, you could either find yourself in a legal suit for infringing a trademark that you did not even know their existence or someone else could be infringing your IP rights while you have little or no recourse because you did not register them. Of course there are other ways of dealing with matters of passing off, but trademark law is definitely stronger than any other law that you could rely on to retain your rights on your trademark. The costs involved in IP disputes usually incurred as legal cost and damages can be jaw breaking. Worse is when you end up looking a brand that you have built over the years without legally securing its ownership – you will incur extra cost of rebranding.
In a lawsuit filed in the District Court for the Southern District of New York on April 12, Brooklyn-based artist William Hicks sued Gökçe (a.k.a Salt Bae) for $5 million in damages after the chef reportedly printed his art on menus, takeout bags, and signs at international Nusr-Et Steakhouse locations in Turkey, Greece, and the United Arab Emirates without permission. Mind you, Salt Bae had paid for the art-piece for his advertising campaign. It sounds simple but it might not be, how IP law works. How is this relevant to an Audit or Accounting Services firm in Kenya?
This article is written to address a common “under-education” and misconceptions of not only many accounting firms but also other professional and consultancy firms in Kenya. First thing you do once you have decided to engage in your professional consultancy usually is to get a name and a logo. You probably do that after registering an LLP or limited liability corporation then afterwards, you hit the ground with aggressive marketing strategy.
Over the years, Intellectual Property (IP) has become the most valuable business asset and several companies are taking steps to protect and commercialize it. IP consists of different rights created by law to protect innovators and creators and allow them to be able to control and receive incentives through commercialization. IP rights include Patents & Utility models, which protect new inventions; Copyright, which protects literary and artistic works such as software, books, music, art etc.; Industrial designs, which protect the aesthetic appeal of products; Trade secrets which protect the confidential information your business owns that is of commercial value; and Trademarks, which protect words, phrases, letters, numerals, shapes, colours, logos, labels or a combination of these that a company/business may use. Trademarks are the most common type of IP, especially to Audit and Accounting firms.
The current wave of registration of trademarks across Africa, in our view signals an avalanche of IP infringement disputes in the next five to ten years. This is because some business enterprises have engaged non-IP professionals to register advice then on IP; they then end up with insufficient protection. Others don’t give IP registration priority it deserves, so they build brand they dont own. Later when other enterprises register the same IP assets, disputes will definitely arise over who is the true owner of the assets.
Trademarks are important to your business since they act as an assurance of quality. They enable customers to distinguish your goods/services from those of your competitors. Most companies allocate a lot of money and time to promote and market their brand since consumers/customers will seek your services or products based on your brand’s reputation. Trademarks are therefore said to be the passport to the success of a company as it places a company in a more competitive position. Several audit and accounting firms have protected their Trademarks and are making the most out of them by commercializing and generating profits i.e., Deloitte was recently ranked the most valuable and strongest commercial services brand in the world for the third consecutive year, according to the Global 500 2021 report, released by Brand Finance, an independent brand valuation consultancy firm recognized worldwide. This is owed to their IP rights, especially Trademarks. Other Audit and accounting firms such as KPMG and Grant Thornton have also registered their names and logos as trademarks.
The main objective of Trademarks is to exclude others from using your mark without permission. Failure to protect your Trademarks may allow imitators to take over and offer similar services/products at a lower price or even offer inferior services/products that may be linked to your company hence hurting your brand or running you out of business. Counterfeits and fakes are also very common nowadays and are used to make quick and easy profits by unscrupulous individuals. To deter this, it is important to have an IP professional/consultant ‘watch’ over your Trademark to ensure no one is selling products or offering services that bear your Trademark. These Trademark watch services are imperative once you register your mark.
The growth of internet usage poses an opportunity for brands since Trademarks can gain a presence on the internet. This makes it very vital to consider the protection of domain names. A domain name is basically the address of a person or an organization on the Internet e.g. ‘home.kpmg’ is a domain name, whilst ‘KPMG’ is the Trademark. Registering a domain name gives one the exclusive rights to use the domain. Many companies fail to make informed choices when selecting their Internet addresses, or domain names. A domain name may be available and registerable, but that does not necessarily make it legally safe or practically useful. It may conflict with the trademark rights of someone else. It is important to secure a domain name that corresponds to your trademark. Therefore, before establishing a presence on the Internet, you need to understand that domain names conflict with the trademark system. There have been cases where audit and accounting firms have lost their domain names to other companies/individuals. An example of such a case is PWC vs Ultimate Search. PricewaterhouseCoopers lost the domain name ‘pwc.com’ to Ultimate Search, a Hong Kong based firm. PricewaterhouseCoopers had sued Ultimate Search and claimed that the ‘pwc.com’ domain name is “directly identical and confusingly similar to its PWC mark. The World Intellectual Property Organization ruled that PWC had failed to prove that Ultimate Search should be made to give up the domain.
Before you start conducting business, you should know the marketplace and your competitors, consider trademark protection when registering a business name, consider registering your domain name and treat trademarks as a valuable business asset. If you are not paying attention to your Trademarks for the purpose of gaining a competitive advantage, then you should pay attention to your Trademarks for risk reduction and management. As always, you can get in touch by phone (+254 722 23 39 95) or email (email@example.com) for FREE consultation.