Can I take on a major competitor?

I set up my organic food business three years ago, and registered my brand and company name as trademarks as quickly as I could. However, recently a major retailer has launched its own in-house brand, which I feel closely mirrors mine. Both customers and suppliers have mentioned it, and there appears to be some confusion in their minds as to whether I have sold my brand to this supermarket. I have complained to the supermarket, but I feel that my small business is no match for this retail behemoth. Is there any way of taking action without spending a fortune?


A. James Knight writes:
If the supermarket is using the same brand name for goods covered by your own registered trademark, then the Trade Marks Act will help protect you. Arrange for a firm of solicitors to send a ‘cease and desist’ letter threatening to sue for the infringement unless the supermarket stops using your trademark. The supermarket will most likely settle once they have received proper legal advice, although sometimes a High Court writ is required before senior management and their legal department give such matters serious attention. It should be possible to recover some or all of your legal costs as part of the settlement.

If the supermarket’s brand ‘closely mirrors’, but is not identical to your own trademark, it is up to you to show that the similarity causes confusion among customers and suppliers. Keep records of such and work with solicitors to bring this to the supermarket’s attention with a view to persuading them to change or stop using the offending brand. Avoid incorrectly claiming in correspondence that the supermarket is infringing your trademark, to prevent countersuit by the supermarket for unjustified threats. Again if the supermarket gives in, it is quite possible for you to recover your legal costs as part of a settlement.

If the supermarket is unwilling to cooperate, you could consider putting in place appropriate insurance to cover against the legal costs of taking further action. Insurers will review the merits of your case in advance and propose a premium accordingly.

As with any legal dispute, the best solution is a commercial one. Bear in mind that a trademark dispute can sometimes be turned into a productive commercial relationship. Rather than going to court, we often see potential litigants teaming up to achieve a common goal and even establishing a formal joint venture.

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