10 Jun How a Trademark can Protect Your Online Store
Does your business sell products online using sites like Etsy, Shopify, or Amazon? What about through an ecommerce platform integrated into your website? If it does, have you taken the time to consider the legal implications of your online store on your business?
Of course, running any kind of business is rife with legal matters to consider. Online stores are no different. However, they are also prone to a few intellectual property issues if you haven’t taken the time to educate yourself in advance. At The Brand Protected ®, we work hard to make sure our entrepreneur clients fully understand the intellectual property matters that arise when running an online store.
First, a Trademark Refresher
If you’ve been following our blog, this may be a bit of a review for you. If you’re new to us, (Hi, welcome!) let’s do a little trademark refresher:
A trademark is essentially a source identifier. What does this mean? It’s any mark that helps the consumer identify where a product or service comes from. It can be anything from the colors and fonts on the packaging, to the brand name, to the slogan printed on the box.
As soon as you launch your online store or other e-commerce business, it’s likely that you have a few source identifiers — your marks may be the store name, its logo, slogan, product names, packaging, etc.
It’s important to remember that a trademark is distinct from the description of the product, which can’t be protected. Think of it this way: If you’re selling custom t-shirts online, you can’t trademark the product description, “custom cotton t-shirts,” but you could trademark your specialty portrait printed tees with the name “Face Front Fashion.”
You may have heard that you can get certain trademark protections simply by using these identifiers in the marketplace. While this is true, it’s also misleading. By simply using a logo, brand name, or other product identifier in commerce, you become the automatic, common law owner of the mark. But, this doesn’t mean too much in practical terms. Why? Because you must have registered your trademark to have any real enforcement options if another company starts infringing on your mark (using it without your permission).
We’ve written elsewhere on our blog about the trademark registration process. Make sure to check it out!
Selling Other Business’ Products on Your Site
Once you’ve protected your own intellectual property by trademarking the marks that distinguish your business from others, it’s time to turn your attention to the possibility that your business could infringe on others intellectual property. My guess is you would never intentionally infringe on others’ intellectual property, but how do you avoid unintentionally getting into hot water, especially when you are selling other company’s goods on your site? The simplest answer is to educate yourself — and get a great lawyer to look over your operation.
There are three common ways that you may encounter other companies’ intellectual in your own online store:
Using another company’s distinctive mark on your own goods, with permission.
Think about how often you see immediately recognizable characters on goods in your everyday life. Your kids probably can’t get through a trip at the grocery store without seeing their favorite TV character on a box of cereal, lunch box, coffee mug, or t-shirt. Have you ever stopped to wonder how the owners of those images got their characters onto so many different products? The answer is: they didn’t. Instead, they licensed the use of their protected intellectual property and allowed the images to be reproduced by other companies.
In your own online store, if you are manufacturing your own products, you may wish to include a particular character, logo, slogan, or symbol on your goods. Check first to see if the image is protected by intellectual property laws. Things like logos, slogans, and symbols, as we mentioned, may be protected by trademark law. Other property, like characters from movies, songs, and photographs are protected by copyright law. In either instance, with an appropriate licensing agreement, you may be able to capitalize on the recognizable mark’s popularity in your own business.
A Note about Copyright: Not everything being sold online is eligible for a copyright. Copyright protections are reserved for works of original authorship. So, if your online store sells sunglasses, you are not likely to have any copyrightable IP (unless you’ve written some awesome blog posts or taken original photographs to use on your site!). But, if your store sells e-books, courses, software, music, designs, or artwork, copyright is going to end up being a big part of your online business. That’s because original works sold online are especially vulnerable to sharing, copying, and other forms of unauthorized use.
Including the product’s trademarked name, logo, and any other identifying marks.
Ecommerce makes it uniquely easy to offer goods that are manufactured and shipped from all over the world. That means your store may sell products you manufacture yourself, or it could resell goods you’ve bought elsewhere. It even can sell goods that aren’t in your possession (think: dropshipping).Often, selling products that are manufactured by others requires a reselling agreement. But is there more you need to do to avoid infringing on the goods producer’s trademarks? Probably your reselling agreement will include permission to use the goods’ brand marks; however, it’s definitely worth making explicit. Can you advertise that you sell a particular branded product? What about feature the brand’s logo on your ecommerce site? Make sure you know what you have permission to do before selling others’ goods in your store.
Selling “generic” products that are compatible with a trademarked brand.
A lot of e-commerce websites sell “generic” versions of popular products. You may have heard these called “knock offs.” In general, knock offs are not permitted under intellectual property laws because another company’s brand is being reproduced without their permission.
Another kind of generics, however, is protected under trademark law. This includes compatible products or replacement parts. Think about your phone. When you go online to buy a case or charger, you want to know that the accessory you buy is going to work with your phone. Same thing when you want to buy a replacement mixing bowl for your electric mixer — will it fit? Manufacturers, who of course make money by selling accessories and replacement parts for their trademarked brand offerings, do not want e-commerce sites using their trademarked brand names to sell customers their own generic products. But, trademark law isn’t on the manufacturer’s side on this point. In fact, trademark case law says that an e-commerce store can sell replacement, compatible, or comparable parts — and use the trademarked brand name in its advertisements or product descriptions.
To do so, the store must:
Remember the bottom line test: does this confuse the consumer?
Online Stores May be Easy to Set Up, But Not as Simple as They Seem
With all of the amazing ecommerce platforms available, setting up your online store may be a snap. But, it’s important to remember that it’s still a very real business — with potential liabilities, legal obligations, and vulnerabilities. So, make sure that you are consulting with an experienced business attorney before anything goes wrong. They say an ounce of prevention is worth a pound of cure. In the ecommerce world, they are definitely right about that. Give The Brand Protected ® a call to learn more about how to protect your online business.