Rob White of Avidity IP discusses how code names being leaked can result in a costly trade mark dispute.

Software giant Microsoft found out the hard way. Letting a product code name go from internal use to being marketed as the official brand name can be a risky business, especially if you fail to check whether the brand name is available.

Most new software products start with a code name allocated by the development team working on the product. For those product development teams, internal code names for new products often remain just that – internal. When all goes according to plan, they are later swapped for a suitable brand name and marketed to the public.

Metro goes off the rails

Recently however, Microsoft was forced to drop its ‘METRO’ code name for the Windows 8 tile based interface. The internal code name had apparently had leaked into public use as a brand name.

Microsoft had told both developers and the media before the product launch that ‘METRO’ was the code name for the design language. The name stuck. This eventually led to a trade mark dispute. According to Microsoft their use of the name was challenged by ‘an important European partner,’ generally thought to be German retailer, Metro AG.

Microsoft made light of the fact that ‘METRO’ was just a code name all along and then announced that the tile interface would be called ‘Windows 8 Style UI’ – at least for the time being.

A stark and high-profile example of why developers must be vigilant; product code names may be taken on and released by the company’s marketing team without the necessary brand checks taking place.

It was not just Microsoft that was inconvenienced. Because of the dispute over the ‘METRO’ name, device makers, smart phone app publishers and software retailers all had to review and rewrite their content to make sure it no longer referred to Microsoft’s ‘METRO’ interface.  Microsoft’s oversight appears to have led to a lot of expense for some of its important business partners.

How to avoid the pitfalls

Product development teams can adopt some sensible precautions to avoid possible trade mark disputes such as the expensive METRO case:

· Check with your marketing and legal departments that the product code name is to remain internal. Get them to confirm that it will not be released to the public

· If there is an appetite for using the code name as the eventual brand name, highlight to marketing and legal departments the importance of conducting a trade mark search. They should check all countries where the product will be released. Tell them the cautionary tale of Microsoft having to change the Metro code name

· Make sure your company conducts such a trade mark search exercise BEFORE the code name becomes the brand and is released to the public

· Trade mark searches will help your company to assess the risk of infringing any existing third party trade marks covering identical or similar software goods. The same searches will show the likelihood of any objection arising if your company tries to register the brand name as a trade mark

· After carrying out trade mark searches in the countries where the product is to be sold, your company’s legal department should secure registered trade mark protection for the brand name.

Benefits of brand protection

· A trade mark registration gives you a statutory right to prevent any third party later registering or using a trade mark for identical or similar goods

· Enforcing a registration is easier than trying to prove you have an unregistered right in a brand. To claim an unregistered right you have to prove a reputation through use

· A trade mark registration also provides stronger rights to prevent unauthorised import and export of the product through customs procedures

· A registration can be an important weapon for counterfeit software products coming to market.

Carry out checks

The Metro case should send a clear message to developers and users of product code names: if the code name runs the risk of being adopted as the brand, invest in conducting trade mark searches and registering the brand name in good time, BEFORE a product code name goes from being internal to being referred to by the public and the media.

Otherwise, your company could find itself infringing the trade mark of a third party. If there is a challenge, you may well have to change the product brand name and pay damages to that third party, not to mention the potential negative media exposure your company may face in having to explain the change.

Take care not to take the METRO route!