With a brand value of $7bn and a world wide historic reputation, fashion powerhouse Chanel should be pretty happy with their lot. But this seemingly wasn’t enough, as in December 2014 the Paris based company won its lawsuit against Chanel Jones on the basis of trade mark infringement.
Taking the credit
In September 2014, Chanel filed a complaint against Ms Chanel Jones, the owner of Chanel’s Salon in Indiana. They claimed, amongst other things, that Ms Jones was infringing at least nine of its federally registered trademarks, and that by using the famous ‘Chanel’ trade mark it impaired its distinctiveness by ‘dilution by blurring’.
Whilst recognizable to the majority of customers that ‘Chanel’s Salon’ isn’t the ‘Indiana branch’ of Chanel’s Head Office, it is certainly arguable that the association arising from the similarity between the name of the salon and the name of the renowned fashion house will ‘blur’ the distinctiveness of the registered ‘Chanel’ trademark. Chanel targets multiple sectors, including their hugely successful cosmetics and perfume outfit that has been said to account for around 55% of revenue – revenue that Chanel would not want to shrink due to customer confusion with a salon targeting the same sector. Therefore, it’s easy to see why the Chanel counsel don’t want Ms Chanel Jones to take the credit for the work of the fashion house; they are eager to protect all $7bn worth of brand value that has been acquired over 106 years.
What’s in a name?
For huge corporations with a lot of Intellectual Property interests like Chanel, trademark issues are the bread and butter of their legal counsel. Yet, at the first glance this case isn’t one to follow the usual routine, as the legal issue centers on the use of a name.
In accordance with US Trademark Law, registration with the US Patent and Trademark Office allowing the owner exclusive rights to the mark in the entire country is not usually allowed for a personal name. As explained by a US Court in Peaceable Planet v TY Plc this reluctance is twofold. Firstly, allowing this kind of trademark would be anti-competitive by forbidding a person to use his own name in his own business. Secondly, some names are so common, such as “Smith”, that consumers will not assume the two products as being under the same ownership, therefore there would be little point in trade marking these types of names.
Although this case law seems to favour Ms Jones, therefore allowing her use of the name ‘Chanel’, there is an exception to the law which states that personal name trademarks are possible if the name at issue has acquired ‘secondary meaning’, whereby the public immediately associate the name ‘Chanel’ with the design house and its products. Unfortunately for Ms Jones, the ‘secondary meaning’ of Chanel is not only obvious around the world, but has been confirmed as recently as May 2014 by the Trademark Trial and Appeal Board of the USPTO, stating that the Chanel mark ‘enjoys widespread recognition among the general public and is a household name synonymous with high fashion and style…and is therefore famous for dilution purposes’.
Chanel comes out on top
As expected, the fashion giant was successful in its case against Ms Jones and the Chanel Salon, as on 15th December 2014 the court held that her use of the word Chanel was an infringement and ordered her to cease using it. Whilst Ms Jones was quoted as saying “I had no idea using my birth name for my business would put me in this position” the court stated that “nothing herein may be read to prohibit Jones from using her personal name solely in a personal, non commercial capacity, or to otherwise identify herself, provided that Ms Jones does not use her name in any manner that suggests an affiliation or relationship with Chanel.”
But…what about the UK?
According to the European Court of Justice, Nichols Plc v Registrar of Trademarks confirmed that when wanting to register a surname as a trademark for commercial use, there may be circumstances in which a common surname lacks the necessary distinctive character for such registration, such as the number of people with the same name, and the prevalence of the surname in the particular trade.
Whilst US and UK Law share some similarities when it comes to trademark law, there are fundamental differences, and a lot of legal jargon – but luckily for you, we can sort through the jargon to make sense of it all. The name of your business is one of your most valuable assets as without it, you’re no longer easy to identify from the crowd.
Our Trademark Team can help you determine the uniqueness of your name by providing sound and comprehensive advice on the similar and identical names that are already registered as trademarks. Doing this at the start of your business makes perfect sense as it can identify a serious problem that may arise later on down the line.
Why not contact us today to book your free consultation to discuss your legal requirements in further detail, we’ll be delighted to talk to you.
Ryan has helped a vast number of businesses protect and control their intellectual property as well as drafting and advising on consumer and commercial contracts.
