Date 10 October 2006
As with a business entity charities create and own intellectual property, the most significant of which is their name and logo. Both the name and logo enable the charity to be identified and if chosen well, distinguished from other charities and businesses.
As we are all aware, it is the responsibility of the trustees to protect and further the interests and purposes of the charity. One key purpose is to fundraise. This can be done through events organised by the charity such as sponsored walks, runs, cycle rides, fairs also sponsorship in the broader sense, which helps to raise the profile of a charity as the sponsor has the exposure to promote its work. Charities also receive donations.
In the case of grants of probate it must be clear which charity the donor intended to benefit. If this is unclear, the executor could apply the donation to the wrong charity. The best method of avoiding this and ensuring that all the hard work of the trustees and its volunteers is optimised, is to ensure that the name and logo of the charity is clear and cannot be confused with another.
As has been described above, confusion can result in donations reaching a different charity, if this or any other form of confusion is brought to the attention of the charity, it is my opinion that the charity is under an obligation, as far as is reasonable and practicable, to remedy the problem. This may mean having to sue or threaten to sue the other charity, which, if made public is negative exposure and/or rebrand, which is costly and loses the exposure gained to date. In the following paragraphs I outline steps that can be taken to strengthen and protect a charity’s name and logo.
Protection
A common misconception is that by incorporating a charity proprietorship rights in the name have automatically been obtained. This is not the case. With various exceptions, Companies House will register a business name as long the name is not identical to another. For example, the addition of ‘UK’ to what would have been an identical name would be sufficient.
Ideally, the best method of protection for names and logos is through trade mark registration. A trade mark is a sign or device that is capable of distinguishing one entity or brand from another. A trade mark can be made up of words, signs, shapes and numbers. It can also include personal names.
Trade marks can be registered or unregistered. The difference between the two is that it is easier and generally less expensive to sue for trade mark infringement (registered) than passing off (unregistered). Trade mark registration ring fences the reputation and goodwill developed, enabling third party use to be limited. In some circumstances third party use may be prevented and in others, licensed for a specific purpose.
Sponsorship arrangements are much easier to control if a trade mark is registered and, of course a formal licence offers far better protection as it sets out use, the period of use, liability for improper use and is clear about how the licence may be terminated. Terminating an implied licence can be more complicated and involve additional legal expense.
Trade mark registration is often perceived as being an expensive option. However, simple registrations need not cost more than possibly £600 - £800 plus VAT. That protection is available for a period of 10 years and can be renewed perpetually for a fee, which is currently £200 plus £50 for each additional class. I accept that in some circumstances such funding may not be available. Alternative forms of protection can put in place in the interim such as placing a ‘TM’ next to the name and logo, which indicates that the charity is asserting its unregistered proprietary rights in the name. Use of both the name and logo should also be consistent – same colours and font, and try not to add words such as ‘The’ to the beginning of the name if they are not really a part of the name.
Ownership
If a logo is commissioned it is important that the charity obtains an assignment of the copyright vested in it. This is the case whether payment is made for the design or whether it is donated. If the charity doesn’t own the copyright in the logo and it wishes to change it or reproduce it, possibly on a website, rather than just stationery materials for example, the designer has the right to prevent the changes from being made without their permission or without payment of a licence fee. It also avoids any complications with a trade mark application. A simple transfer letter may be all that is required.
Selection
When choosing a name, be it for the charity as a whole or for a brand it is essential that one that is suitable for registration is selected. In short, avoid names that are descriptive of the goods and services you intend to apply the mark to. The general rule is that trade marks that describe their goods and services cannot be registered. In some cases it may be possible to obtain a registration but it is likely to take considerable time and money to achieve the necessary level of distinction. Furthermore considerable supporting evidence will need to be filed. That said, Breast Cancer Care has obtained a registration for ‘BREAST CANCER CARE’.
You can read more about the requirements for trade mark registration by clicking here.
Clearance Searches
Whether or not you are going to register checks should be carried out to make sure the name and logo you want to use is available. (Domain names should also be checked if you intend to have a website). This checking process is often described as a ‘Clearance Search’. Clearance of the proposed name should reduce the possibility of claims being brought against you for passing off or trade mark infringement, which could lead to you paying legal costs, damages and re-branding if you lose. It will also help your penetration of the market i.e. check that the name you intend to use will distinguish the charity.
A good place to start the Clearance Search is on the web. Search engines will provide you with a good idea of who else there is in the market using an identical name. A full Clearance Search will review trade marks that are similar as well as identical in the jurisdictions you intend to trade. This is to avoid infringement claims, which can be brought on the basis of similar names and similar goods or services or the fact there is confusion. It is also worth checking the Design Register as the logo may have been registered as a design – another form of protection that you should consider.
Designs
As is the case with trade marks designs can be registered and unregistered. A registered design is a monopoly right protecting a new design, that is not reminiscent of other designs. The design can be the shape of a product or a design applied to a product, such as a pattern applied to a set of crockery. This may be the logo of a charity.
Unlike registered designs, unregistered design right only extends to the shape of a product, so this form of protection won’t assist in the protection of a logo. Registered designs are fairly inexpensive to obtain in the UK and last up to 25 years.
If you require any information about protection of names and logos, or any other form of intellectual property, please contact Chris Wilks on 01727 798081 or at chris.wilks@salaw.com.
© SA Law 2006
Every care is taken in the preparation of our articles. However, no responsibility is accepted as being owed to any person or organisation who acts on the basis of information contained in them. You should obtain specific advice in respect of individual cases.