The “Trademark” of a Franchise Needs to Be Taken Care Of!
It is the case that almost all franchisors are the owners of at least one federally registered trademark. It is also a general understanding in business that brand owners are required to both monitor and enforce their rights in order to keep the exclusive protection that the federal trademark gives to them. But for franchisors, unlike other businesses, the trademark becomes even more substantial, seeing as that they not only want to make sure that no one else is using their trademarks, but they must also make sure that all of their franchisees are utilizing the trademark in all the correct ways. From advertising to social media to events, franchisees must be made clear on the fact that they can not alter a trademark in any way, shape, or form.
When it comes to monitoring a trademark, all businesses make sure to look for any unauthorized use, as well as any negative comments/references that someone may be attaching to their brand or company over the Web. A variety of threats are possible, such as ‘infringement’ upon their trademark (which means any company or start-up that has taken on a similar name); counterfeiters (any company that sells goods under their trademark); and – what may be the largest issue now that social media has become monumental – dissatisfied consumers. This is one group that uses social media to complain about various brands and to give a company a ‘bad’ name.
Trademarks are an even larger issue for the franchise community, however, simply because of the constant need to ‘keep tabs’ on what their franchisees are doing. Because of this, located in the franchise agreement that’s signed between the franchisor and the franchisee is a ‘license’ that gives the franchisee use of the trademarks, BUT with certain obligations spelled out in black and white.
The ‘license’ section of the franchise agreement also puts restrictions on how the franchisee can use the trademark, as well as where it can be used. And getting franchisees to comply with both the obligations and restrictions in regards to the trademark takes continuing advisement by an attorney – like Mike Rosenthal, who is an expert in franchise law.
A franchisee’s use of the franchisor’s trademark can be monitored in many ways, such as making sure that trademark registrations are not filed in the names of franchisees. Not to mention, monitoring the proper use of a trademark so that franchisees do not add, subtract or redefine what a franchisor’s logo or advertising tag line might be. Take for example a well-known franchise, such as McDonald’s. Their tagline is “I’m Lovin’ it!” If a franchisee were to change the advertising and refer to the slogan as, “I’m Lovin’ the Big Mac!” in any advertising materials, this would be unauthorized. All advertising, company slogans and more, must be used appropriately as per the franchise agreement.
And, again, with the realm of social media growing larger and larger by the minute, the monitoring must be done 24/7.
No, of course, McDonald’s will never be seen in a different light now that it’s been around for decades, but the monitoring of a lesser-known trademark is certainly important for franchisors on several levels. When failing to enforce their trademark rights, a company can have their USPTO trademark registration cancelled, losing all rights completely. And on the flip side, it is the franchisor’s job to make sure that their brand is protected in order for the franchisee to be successful, and not have to run into any trouble along the way simply because the franchisor was laying down on the job.
Brand awareness is what brings success to a company. The brand logo, tagline, etc., is a huge part in becoming a well-recognized name in the industry. So if a franchisor loses control of their trademark, bad things can occur for both the franchisor and their franchisees.
Always remember that you are trying to create a valuable brand, and you need the legal skill and expertise that comes from having a franchise lawyer. Everything from selecting a trademark that is able to be protected, to making sure the trademark chosen is available, to registering and enforcing your trademark rights when all is said and done, are just the tip of the iceberg.
You must keep in mind that selecting a trademark isn’t easy. In fact, there are words and names that are actually incapable of being protected. Another issue your franchise attorney can help with is the fact that there is no ‘solitary’ business owner that can claim exclusivity to generic terms, phrases, or logos, because all business owners need to be able to use “the basics” to identify their brands. Such as, owning a pet grooming business and trying to gain exclusive rights to ‘Pet Pros’ is not possible, simply because a generic description can not be ‘held’ by one person.
It is issues like these where a franchise attorney is necessary. They are there to help the franchisor ensure that their brand is set up correctly, so that their company will have a positive, long-lasting appeal to the consumer.
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