Keep calm and carry your brand through the COVID-19 crisis

The novel coronavirus, COVID-19 has had an unprecedented and dramatic impact on people and businesses internationally. The measures that have been put in place to contain the spread of the virus are the most significant restrictions since World War Two, with the economic impact as yet uncertain.

Business impact

Many Registries around the world have adopted exceptional measures in light of the crisis, suspending or extending a number of deadlines. Most of the IP offices have closed physical offices, but are still able to provide online services without interruption. An up to date list of the current position in each territory can be found on the HGF COVID-19 Support Platform, which also provides useful resources relating to intellectual property.

Many companies and businesses are remote working and implementing business continuity plans to remain fully operational. The IT capabilities available in these modern times have greatly assisted to reduce the negative impact on both employees and employers, allowing business to continue as close to ‘normal’ as possible.

Trade mark non-use

In the UK and EU, trade marks can become vulnerable to cancellation if they have not been put to use within five years of registration and there are no proper reasons for non-use.  ‘Use’ in relation to trade marks must be real commercial use with an intention to create or maintain a market share for the goods or services provided under the mark.

However, many businesses and brands will have been impacted as businesses are no longer able to trade at the same pre-COVID-19 levels, if at all.

A key provision in respect of non-use is no proper reasons for non-use. Although there is no definitive list of what constitutes ‘proper’ reasons, the interpretation is quite narrow – the circumstances must (1) arise independently of the will of the trade mark owner, (2) have a sufficiently direct link with the trade mark and (3)  make its use impossible or unreasonable (Häupl v Lidl, CJEU, Case C-246/05).

It remains to be seen if COVID-19 would be considered a valid reason for non-use and much will depend on individual circumstances and the facts of each case.

If there is the possibility that your trade mark is at risk of non-use cancellation, documentation should be collated demonstrating the steps taken before and during the pandemic. This can include information on government restrictions including lockdown and timescales, issues with import/export and distribution, licensing, use information pre-pandemic and efforts taken in trading/preserving its business.

Without the ability to prove its impact longer-term, COVID-19 may not provide sufficient reasons for non-use. It must be shown that, in the absence of the obstacle, there could and would have been genuine use of the trade mark in the relevant five year period.  If little was done to prepare for use in that period, this could constitute lack of genuine use, irrespective of the COVID-19 impact.

Brand promotion during COVID-19

A number of well-known companies including McDonald’s, Audi and Volkswagen have changed their brand promotion to make it relevant to current trends, for example, social distancing. Read more about logos and social distancing here.

Other companies have taken further steps, with Gap Inc sourcing and producing masks and other personal protective equipment (PPE) for healthcare professionals, and LVMH (the parent company of Dior and Givenchy, amongst others) converting some of its perfume manufacturing facilities to make hand sanitiser for the French authorities and the healthcare system (the APHP).

In the UK, numerous manufacturers have provided PPE items – The Manufacturer has a great article showcasing all the companies involved here.

There are a also a number of patent pledge, design and copyright incentives circulating where companies would make IP publicly available if used to fight COVID-19 (for example, for ventilator manufacture).  If this is a consideration, it is worth discussing the specifics with your IP advisors to ensure that the necessary freedom to operate analyses and potential infringement risk evaluations have been carried out to avoid any issues  with existing IP rights, and to establish parameters around what parts of your IP may be made available for collaboration.

Online business/counterfeiting

With lockdown provisions across many countries, physical ‘non-essential’ stores have been closed and consumers have increasingly needed to use online resources.  This increases the risk of counterfeit items.

The Anti-Counterfeiting Group (“ACG”) has recently launched its Annual Report (see link here) and warns that there has been an increased risk of substandard and dangerous fakes available online.

Brand owners should not cut back on online protection strategies and should look to review the current position to ensure that they are fit for purpose. Many of the large online sales platforms, such as Amazon and eBay will have brand registries and if not already enrolled, registration should be actioned so that counterfeit or infringing items offered for sale can be removed quickly and easily.

There will always be those that take the pandemic as an opportunity – there are a number of counterfeits and scams operating, including fake websites, price gouging, phishing, fake invoices requesting payment, protection policies and more.  Companies should be particularly vigilant of the promotion and reputation of their own brands online.

Summary

IP assets are an integral part of a business, and although the pandemic may impact IP strategies, it is, now more important than ever to ensure that your strategy takes into account the new circumstances and that companies are flexible and can adapt as new opportunities arise. Not protecting brands or expanding brand protection , or dealing with issues even in these unusual times could cause problems further down the line with enforcement and validity of brands.

Vigilance should be maintained in relation to third party filings and in a timely fashion, as well as continued monitoring and actioning of infringements and dilution. Many court systems and registries remain open, albeit with delays or limitations on what can and cannot be actioned online.

Watching services including in relation to domain names and on-line counterfeits should be stepped up to ensure that opportunistic applications are not being filed linking a brand with COVID-19 terms or other opportunistic activities which undermine the rights in the brand.

Portfolios should be reviewed to ensure that coverage is fit for purpose. With companies producing new products, online sales potentially reaching new territories, and companies moving online, a review will ensure that the goods and services being offered are still covered by existing protection. Where required, new applications can be filed to cover any new goods or services.   For example, a restaurant may well have a trade mark for ‘restaurant services’, but the existing protection would not necessarily cover ‘takeaway food services’ or ‘delivery services’.

Regular reviews of IP portfolios and discussions with specialist IP advisors to address issues arising from these unusual times will go some way to reducing the impact of the pandemic and ensure that the portfolio remains robust and in good shape for when “it is back to business as normal”.

This article was prepared by HGF Senior Trade Mark Attorney Claire Jones. If you would like further advice on this or any other matter, please contact Claire. Alternatively, you can contact your usual HGF representative or visit our Contact page to get in touch with your nearest HGF office.