The use of personal names is especially common amongst creatives, where a person might start to develop a good name for clothing design, creating ceramic art, or jewellery design. The obvious thing to do in that situation is to use your good name as your brand. It gives you a much-needed head start.
"Personal names function very well as trademarks," says Healy but there can be a few pitfalls that people should be aware of before deciding to use their personal names as trademarks," Healy says.
One of South Africa's leading fashion designers and the founder of the company Jenni Button (Pty) Limited (established to operate clothing retail outlets under the trading style Jenni Button), reportedly concluded an agreement in which she sold her rights in the Jenni Button brand.
The agreement provided for the sale of the name Jenni Button together with the goodwill in the business carried on by Jenni Button (Pty) Limited. Button thereafter used the trademark Philosophy, in relation to clothing designed and sold by her, but continued to use her personal name, Jenni Button, in conjunction with the trademark Philosophy.
"The purchasers sought an interdict restraining Button from using the name Jenni Button in the South African retail clothing trade. Button argued that she was a clothing designer by profession and could not be restrained from using her own name," explains Healey.
The court reportedly found that her continued use of her own name in the course of her clothing business infringed the right to goodwill associated with the Jenni Button trademark, which, by a valid agreement, had been sold to the purchasers. The court found, therefore, that her continued use of her name amounted to 'passing-off'.
"This case illustrates how important it is to decide, at an early stage, whether or not to adopt your personal name as your brand and, if you do, what the consequences are of selling your brand."
Healy points out that while this dilemma cannot be avoided, its effects can be softened and even lawfully exploited through a dual- or multiple-brand strategy.
"Staying with this example, Button could have used Jenni Button as her primary brand in conjunction with one or more other brands, for example, Philosophy. By applying both brands to her clothing, the brand Philosophy would have rapidly gained market acceptance and thus value through its association with the primary brand. She could then have sold her primary brand, Jenni Button, while continuing to use the brand Philosophy. By then, that brand would have been capable of standing on its own feet."
However, this branding strategy will only work if the primary and sub-brand(s) are registered as trademarks. The reason for this is that a registered trademark can be sold with or without goodwill, ie the buyer need not buy the entire business of the seller and need only take transfer of the trademark registration. An unregistered trademark cannot be sold without simultaneously selling the business in connection with which it is used.
"In other words "if the brands Jenni Button and Philosophy were registered as trademarks, it would have been possible to sell either or both of the brands, either with the business carried on by the company, Jenni Button (Pty) Limited, or without that business. This is not possible in the case of unregistered trademarks."
