Hotelkamerveiling.nl / Hotelveiling.nl: descriptive trade names
Monday, April 4, 2011
Trade names that consist solely of descriptive elements: how does that work again? The District Court of Groningen confirmed what we already knew for some time: there is little scope for protection if such a descriptive trade name has not acquired disctinctiveness due to long-term use (like Ebay’s affiliate Marktplaats.nl, meaning ‘market place’) or demonstrates significant originality. The operator of Hotelkamerveiling.nl (‘hotel room auction’.nl) wanted to ban the trade name Hotelveiling.nl (‘hotel auction’.nl) based on the Trade Name Act and the rules governing unlawful competition. The court did not concur.
The more distinctive the trade name is, the greater the scope of protected use will generally be. Hotelkamerveiling.nl consists of purely descriptive, non-original elements that have not entered into common usage. These exclusively descriptive elements – like the city in which a business operates or the profession being practice – cannot in principle be monopolised.
By choosing a trade name that describes the services provided, the user also accepts the risk that competitors may use the same name. The court did not see any grounds for unlawful competition. Competition based on providing the same services is permissible – even if the competitor is benefiting from the popularity of the service provided by the older company. Only truly exceptional circumstances can make competition unlawful, but such circumstances did not exist in this case.
Descriptive trade names are a handy way to let consumers know what a company does – but be careful: as soon as other parties start operating in the same gap in the market, protection is sometimes nowhere to be found. There is a flip side to every competitive advantage…
Eva den Ouden
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