IP and Business: Trademark Coexistence

• Author: Tamara Nanayakkara,
• Position: WIPO SMEs Division; Acknowledgements Marcus Hopperger and Martin Senftleben, Trademarks, Industrial Designs and Geographical Indications - Law and International Classifications Division

Trademark coexistence describes a situation in which two different enterprises use a similar or identical trademark to market a product or service without necessarily interfering with each other’s businesses. This is not uncommon. Trademarks are often used by small businesses within a limited geographical area or with a regional customer base. Almost every French town with a train station, for example, has its own Buffet de la gare restaurant. Often trademarks consist of the family name of the person who started a business and, where that name is a common one, it is not unusual to find similar businesses under the same or similar names. None of this need lead to conflict or litigation, as long as the trademarks in question continue to perform their main function, namely to distinguish the goods or services for which they are used from those of competitors.

The problems start if this distinguishing function no longer works because the businesses for which the trademarks were originally used begin to overlap. Thus trademarks which had happily coexisted at one time may suddenly enter into a conflict. This is particular frustrating where both businesses use their identical trademarks in good faith - in other words, where both have a track record of real use of their respective brands, but because of business expansion start to trespass on each other’s territories. In some cases, when two companies are aware that they are using similar or identical trademarks, they may choose to conclude a formal co-existence agreement in order to prevent the future use of the two marks overlapping in such a way as to become undesirable or infringing. This article outlines situations in which coexistence may arise, and introduces some points to bear in mind when considering a coexistence agreement.

It should be stressed that prevention is better - and cheaper - than cure. One of the most basic precautions when selecting and registering a new trademark, is to undertake as comprehensive a search as possible, using professionals skilled at the task. A thorough trademark search should minimize the risk of a business coming face to face with a similar mark once on the market. But no search is infallible. Identical or confusingly similar trademarks may subsequently be found to exist if the search net was not cast widely enough, or if it did not include other categories of goods and services which might turn out...