WNA Blog

Wed 23 Mar 2016

Avoid Making a $200,000 Trademark Mistake

Legal Services

Learn from this recent trademark court case reported by Cara Waters of the Sydney Morning Herald: MUSASHI® v A-Sashi: Nestle wins trademark battle against Aussie small business

Small business owner James Christian has been forced to stop trading after losing a courtroom battle against Nestle over the use of the word “A-Sashi”.

   A-Sashi Vitamins

Christian started an online vitamin business in 2013 known as A-Sashi Vitamins for which he registered a business name, domain name and used logos incorporating the word A-Sashi.

But Nestle, as the owner of a range of trademarks for dietary supplements incorporating the word Musashi®, sued Christian for trademark infringement. Nestle argued Christian intentionally fashioned the A-Sashi name and logos so that they would be deceptively similar to the Musashi® trademarks.

Christian said he was unaware of the Musashi® trademarks and came up with the name A-Sashi himself “from looking at Asahi beer and wanting to have a Japanese feel about the brand”.

“I was travelling along fine until Nestle got in my life and now I’m on a Centrelink payment and unemployed,” he says. “My business is completely shut down.”

Christian says he has lost the $200,000 he invested in A-Sashi and now owes costs to Nestle.

Lessons from James Christian’s story:

1)    If you are a start up company, obtain a trademark before even registering your business name.  If a trademark application is rejected by the government Examiner you have still gained the      knowledge that the name is not available to be trademarked and not opened to be sued in the future. Plus, you get a second chance of naming the business/product/service before launching into expenditure such as product development, website development and general business set up costs.

2)   If you have been in business for a while, why wait for someone to take your name before you are ready to defend it? It’s more costly to defend a trademark than it is to apply for and register   a trademark.

3)   You can’t claim ignorance as a defence for a trademark infringement.

4)   A trading name, company name, domain name and/or logo does not protect your brand unless a trademark has been obtained for it.

5)   The expense of obtaining a trademark is worth it when weighed against the investment many people/organisations put into a new venture (in Christian’s case $200,000) not to mention the  time involved to kick start a business venture.

6)   Engage a trademark specialist to ensure you obtain the correct protection. It’s not good obtaining a trademark if it does not offer you the right protection.

We’ve had many clients come to us recently with exciting names for their new businesses and at times we’ve had to tell them the name is not available to be trademarked. Business owners were heartbroken at first, as they had set their mind to the name, however when we had explain to them that they may be sued at a future date if they continued to use the name, they usually change their mind and are happy to have us help them come up with a new name.

If you would like to check if your business name is trademarkable, we’re happy to check for you.  Email us via our Seriously Trademarks® website.

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