TRADEMARKS VS. TRADE NAMES
Hello again this is Andrei Mincov with Trademark Factory. And in this video you will learn about difference between Trademarks and trade names, or company names.
First of all, trademarks serve a very different purpose from trade names. Trade names are used to identify a business or a company (that’s why they are also often called “business names” or “company names”). Trade names are the “who” of the business. Customers deal with a business bearing a particular trade name.
As you’ve learned in a previous video trademarks are used to identify products or services, not the company. They are used to identify that, which your business offers to the public. Customers buy products and services bearing the trademark.
In very simplistic terms, customers buy trademarks from trade names. Again, customers buy trademarks from trade names
With the exception of numbered companies, every business registered with the Registrar of Companies or incorporated (provincially or federally) has a trade name. But neither the reservation of a corporate name nor the formation of a corporation create an absolute right to use the business name of the corporation in that jurisdiction.
Rights in corporate names are treated like rights in unregistered trademarks, which means that unless you are actually known under that name in a specific geographical area, there is really not much you can do to stop others from adopting a similar or even identical name.
Even if you register a corporate name that no one else had thought of before, it does not give you the right to stop others from using it, unless you can prove that other person’s use of that name creates confusion.
Just because you came up with a fancy company name that helps you attract customers for whatever products or services you are offering does not mean that your name, or brand, is a trademark. If you are not using your trade name as a trademark, you don’t have trademark protection for your trade name.
A trade name can be registered as a trademark, but only if you use it as such, that is, to identify products or services.
Let’s say, your company is called Awesome Software Inc. and you make, guess what? - software. If you phrase your marketing materials to say that “Awesome Software Inc. offers such great titles as Text, Calculator and Presentations”, you are using “Awesome Software” as a trade name to identify the business, but not as a trademark to identify the product. However, if you phrase them to say “We offer Awesome Software™ Text, Awesome Software™ Calculator and Awesome Software™ Presentations”, then you are using “Awesome Software” as a trademark, even though it is also your trade name.
The classic example is, of course, Microsoft® Windows® or Microsoft® Excel®. We don’t buy Microsoft, we buy from Microsoft. But because “Microsoft” is a part of the name of the product we buy (and part of the reason why we buy it), it is also protected as a trademark in its own standing.
On the other hand, corporate registries don’t really check if the name submitted for registration violates any prior rights. In other words, just because a provincial corporate registry approved your company name for registration does not mean that you don’t violate someone else’s prior right (in a trade name or a trademark) and that you will not be compelled to change it in the future.
You could probably register a company called Microsoft Awesome Software Development Inc. in British Columbia today. But if you started using that name in your business, it wouldn’t be long before you get a letter from Microsoft’s lawyers demanding that you immediately stop using that name and possibly also pay a hefty amount for infringement of their trademarks.
So when should you consider registering your trade name as a trademark?
There are two types of customers who may be interested in what you have to offer. The customers from the first category buy your services or products after looking for these specific services or products, as in “I’ve heard that AirSucker AS-78 is a great vacuum cleaner, I would like to buy one of these”. These customers really don’t care who makes this particular vacuum cleaner, because they already know what they want. Unless your company name also happens to be “AirSucker”, you would not gain anything with customers from the first category if you register your company name as a trademark. You will of course be protecting a name of the product but as the company name goes, it is relevant for the first category of consumers.
On the other hand, the customers from the second category buy your services or products after looking for you, as in “I’ve heard that ABC makes great vacuum cleaners, which model would you recommend?” They are willing to rely on your expertise, because they already made the decision to buy from you. If you have a significant number of customers from this category and your business is more than just you personally, you should definitely consider registering your trade name as a trademark.
You will learn about other reasons for registering trademarks and about the trademark registration process in the follow-up videos. In the last video of this series, you will also learn about the unique way that Trademark Factory can assist you in registering your trademarks.
In the next video, you will learn what cannot be protected as trademarks and about the difference between the trademarks and the products and services themselves. Sounds obvious? Don’t jump to conclusions.
Meanwhile, if you have any questions about trademarks, trade names or other intellectual property issues, feel free to call me, email me, or visit our website at TrademarkFactory.com. And don’t forget to read my book – The Ultimate Insider’s Guide to Intellectual Property.
Thank you for watching. Talk to you soon.
Watch our other FAQs or leave your comments below!
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Watch our other FAQs:Introduction — What Every Small Business Owner Needs to Know About Trademarks
What Are Trademarks and Why Do We Need Them?
What Cannot Be Protected as a Trademark
Trademarks Don't Give Absolute Monopoly Over Words and Images
Registered ® vs. Unregistered ™ Trademarks
7 Benefits of Trademark Registration
When Should You Register Your Trademarks
What is the Trademark Registration Process
Trademark Tips & Tricks