Listen to this article:
There is something about the recently concluded first season of Sony Liv’s reality TV show Shark Tank India that would bother intellectual property (IP) lawyers. While pitching their business ideas to the sharks (potential investors forming the panel of judges) in the hope that they would invest in their ventures, the participants (upcoming startup entrepreneurs) are baring many truths about the strength of their IP – or the lack thereof.
Notably, trademarks chosen by most of the participants for their respective products or services is reflective of the lack of legal strategy and advice that has gone into their creation.
Choosing a trademark is an important exercise by an entrepreneur – it is what the customers identify the entrepreneur with, be it on a supermarket shelf or on the entity’s signboard or business cards. The usual tendency of entrepreneurs is to adopt trademarks that reveal the nature of their products or services to the users.
Unfortunately, this is the very thing that is barred by trademark law – a trademark is weak if it is descriptive of the goods or services for which it is used, or if it indicates the kind, quality, intended purpose or geographical origin of the goods and services. The more a trademark is silent about what the business does, or its products are made of or where it comes from or what purpose its products or services serve, the better it is. It is best to leave it to the product or service itself to convey these attributes. Being low in descriptiveness makes a trademark high in exclusivity. Unfortunately, entrepreneurs often do the reverse, rendering their trademarks non-exclusive and commonplace.
The participants of Shark Tank India reveal that a deep dive into the legal landscape to assess suitability of choice is often skipped by startups before picking a trademark. For example, the trademarks of some of the startups that featured in the first season are, “Peeschute” for disposable urine bags, “INACAN” for canned cocktails, “Beyond Water” for a liquid water enhancer, “Get-A-Whey” for a protein-based ice cream, “On2Cook” for a fast cooking apparatus, “Sneakare” for a sneaker care product, “Store My Goods” for a storage service company, “Devnagri” for an Indian language translation software, “ScrapShala” for a service that upcycles scrap into beautiful household items, “AyuRythm” for a wellness-focused app using Ayurveda and “GROWFITTER” for a wellness platform. Each of these trademarks, at first glance itself, indicates the kind, quality or intended purpose of the goods or services concerned.
While technological innovation is a big market differentiator, lack of innovation and creativity in branding could dilute premium and increase competition. Take the case of Shaadi.com, an online matrimonial service that was denied a favourable order by the Bombay high court in 2016 against secondshadi.com, again an online matrimonial service for those seeking a second marriage. The court rejected the case of Shaadi.com as it found that Shaadi.com and Secondshaadi.com are commonly descriptive of their services. Similarly, in 2021, the Delhi high court denied an order to the owners of PhonePe, who sued BharatPe, alleging trademark infringement due to the use of the suffix “Pe”. The court noted that respective prefixes were different and that deliberate misspelling of descriptive words (“Pe” for “Pay”), did not change the legal position that there is no exclusivity over descriptive words.
These two cases also highlight another important lesson in trademark adoption. Every trader can legitimately describe their wares or services as they are – shaadi.com, bharatmatrimony.com, m4marry.com, simplymarry.com, vivah.com etc – for matrimonial service. However, choosing such a descriptive name for a trademark limits the ability of the entrepreneur to stop others from choosing similar descriptive terms for their trademarks. Ultimately, the trademark will remain as ordinary as the others in the field. Even worse, courts in India have held that just because an entrepreneur is the first one to pick a descriptive term as a trademark, it does not grant them exclusivity in the same – a hard lesson learnt through courts by many enterprises. Interestingly, some of the sharks on the panel have already learned this lesson through lawsuits filed by and against them, yet do not seem to warn the participants or be bothered about it before jumping to invest in a venture.
Another peril of carelessly adopted descriptive trademarks is the failure to make an everlasting impression in the mind of the consumer. If consumers encounter too many products with similar-sounding trademarks, they would be unwittingly confused while making purchasing decisions.
Just as inventors conduct prior art searches before filing a patent for a technology, entrepreneurs can do a pre-availability search before zeroing in on a trademark. Also, just like an innovative technology, an offbeat trademark is an important tool for differentiation. An innovative and creative trademark by a startup to match an innovative technology or business model would be a delightful IP matrix, propelling growth and market presence. That can happen only if startups avoid stereo typicity in selecting their trademarks. The mantra is to stand out and not blend in, because a quirky name will stick in the minds of a consumer than a stereotypical one. Any sharks investing in that brand mantra?
Latha R. Nair is an IP lawyer and is reachable at email@example.com