The Law is no stranger to producing “David v Goliath” scenarios, in which large multinational companies assert their rights against commercial minnows in actions that are often portrayed in the media as a disproportionate, unnecessary or unfair abuse of financial strength and legal might.
However, in the context of trade mark law, should giant corporates be demonised as bullies in the instances where they seek to enforce their trade mark rights against sole traders/SMEs who they are not necessarily in direct competition with? Or should we empathise with the Goliath of the conflict and see such actions as a legitimate attempt to safeguard the value of intangible assets and preserve a market position?
In a recent tale, Hard Rock International Inc., the parent company of the multinational ‘Hard Rock’ chain of restaurants and hotels contacted with Mr Robbie Forbes, the owner of a live music venue/restaurant based in Wirral, Liverpool called the ‘Soft Rock Café’, over his venue’s name and branding.
Mr Forbes had opened the restaurant two years ago and apparently adopted the name to reflect the genre of music predominantly featured at their live events. The graphic representation of the Soft Rock Café, as displayed on the exterior of the premises and on the website, also shares a degree of stylistic similarity with that of the font used for the Hard Rock Café chain of restaurants.
The representatives of Hard Rock International wrote to Mr Forbes to request that he refrain from using the conflicting sign and that he remove it from his restaurant premises and website.
In setting out the reasons for the request, the representatives of Hard Rock International claimed “the name Soft Rock Cafe Bar is extremely similar to Hard Rock Cafe, accordingly there's a likelihood of confusion on the part of the public.”
“On seeing the infringing marks used in connection with the identical services to those provided by our client, consumers will be led into the mistaken belief that your services are provided by our client or that you are somehow otherwise connected to our client, which of course is incorrect.”
“The potential for damage to our client’s business is clear.”
According to media reports, Mr Forbes was given a deadline of 28 days to change the name of the business. He is quoted as saying “It seems bizarre. We’re a little local place in Liscard – I don’t think we’re going to be taking away any of their business.”
A well-known brand is typically the most valuable asset owned by a company. Through communicating a plethora of complex information relating to a product, range of products or the company itself, a brand has the capacity to accumulate goodwill i.e. the attractive force which brings in custom. To put this into some sort of quantifiable financial perspective, according to Forbes magazine, Apple (the World’s most valuable brand) is valued at $104.3 billion. This figure is likely to totally eclipse the sum of the total tangible assets owned by Apple Inc.
Developing goodwill in a brand is not cheap and involves a considerable investment of time, money and innovation. In addition to the costs involved in developing, marketing and advertising a brand, there is also the added expense of registering and maintaining a portfolio of trade marks to protect different aspects of the brand in law, such as words, logos and slogans.
Although sole traders and SMEs may not necessarily be in direct competition with the big players who own these well-known signs, allowing them to continue using the confusingly similar word or logo could potentially damage the distinctive character or repute of the original mark, thereby depreciating the goodwill in, and value of, the brand.
In effect, this could occur where a confusingly similar mark is used on inferior goods/services; the mark is linked with goods/services which are incompatible with the quality and prestige associated with the brand; or where the mark is used on non-competing or unassociated goods/services.
Contrary to how the media like to portray the legal teams of big corporates, the representatives of Hard Rock International appear to have approached the conflict in a measured and sensible manner by making concerted attempts to settle the matter amicably rather than through litigation.
A spokesman of Hard Rock International has said: “Hard Rock has been attempting to resolve this situation in an amicable manner with the owner of Soft Rock Cafe for several months.
“Our representatives have reached out to the owner on numerous occasions to try to reach a resolution, but have not received a reply from him.
“At this time, Hard Rock has no intention to initiate legal proceedings, but if the owner continues to refuse to engage in meaningful dialogue, Hard Rock reserves the right to consider necessary actions to protect the goodwill and reputation of the brand.”
In a world where brands possess so much intrinsic value and can be damaged so easily, it is essential that owners take steps to safeguard their rights and enforce them, where necessary, irrespective of the size of the offending party.