Tuesday, November 03, 2009

Company Names Tribunal - 1 year on

One year on and the Company Names Tribunal (CNT), which was set up to provide a remedy against opportunistic company name registrations, has so far been good news for brand owners.

So called opportunistic company name registrations are similar to ‘cyber squatting’ where domain names are registered in the hope that the brand owner will purchase the domain from the squatter.

The same practice occurs in the registration of company names where the squatters try to take advantage of a brand in the hope of extorting some money. The brand owner having to use traditional trade mark and business name remedies to have the offending company struck off or forced to change its name.

The CNT can order these squatters to change the name of their company within a specified time as well as order the payment of costs. This can be a valuable addition to the brand protection arsenal of all companies.

The CNT procedure is a formal legal process initiated with an application made to the CNT. The Company Names Adjudicator will assess evidence submitted, then decide a case and award costs if appropriate.

Out of the 39 cases that have been reported so far, 35 applicants have been successful in requiring squatters to change the company name. The first successful applicant was Coco-Cola but there are numerous smaller corporations who have taken advantage of this useful tool.

However, the scope of remedies is limited to the changing of the name so it will not provide a solution to a company where the infringing company changes its name but continues to use the name as a trading name. This illustrates that merely having a company name registered with Companies House gives few rights in itself and that companies will still have to use trade mark and passing off laws. A registered trade mark giving the strongest rights of all.

If you find a company that you think has a name which is an opportunistic registration then you will need to consider the position carefully. The circumstances in which the CNT will make decisions are limited and there is a cost involved in making the application and also cost penalties if the application is not successful.

There is also the ability to appeal the decisions of the CNT to the High Court with even higher costs implications. Therefore the CNT, whilst a useful alternative to litigation and trade mark infringement action, can be seen as another formal legal process and should be used with caution and under advisement.

That said, given the high percentage of successful applications if used correctly, this is another string to the bow of brand owners to defend their much coveted brands.

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