Trade Marks and Innovation: how strong is the link?

This particular Kat spent a very interesting morning yesterday at the Westminster Legal Policy Forum Keynote Seminar – “Intellectual property, innovation and the UK economy”. The event, held in central London, gathered a number of individuals involved with, and/or interested in, the IP system in the UK to discuss two main issues: Research, knowledge transfer and realising the social value of intellectual property; and Intellectual property rights and the economy.

However, rather than celebrating what an entertaining morning he had, this Kat wishes to raise an issue in the hope that some further debate might be forthcoming. Therefore:

During the course of the event, the Kat provided a very brief (10 minute) overview of the IP system, so as to set the scene for the remainder of the speakers. He set out his stall by detailing the main rights falling under IP’s umbrella (another IP Umbrella (left)), and then quickly discarded those that, in his mind at least, were not directly linked with the subject under discussion: innovation. Patents, designs and copyright therefore received most of his attention, and trade marks were left to one side; explained away rather rapidly on the basis that they did not really concern innovation, being more involved with facilitating consumer choice within a market economy.

His rather blithe dismissal of trade marks was, quite properly, investigated by questions from the floor, forcing the Kat to justify his views (or at least attempt to do so). The point made to him was to the effect that the brand often provides an aspirational statement that may, itself, induce a firm to innovate – the example given was Gillette’s trade mark “Gillette: the best a man can get”. Furthermore, reputation, as bottled in the brand itself was a spur to innovation as goodwill required topping-up from time to time, and you could do this by creating better products - innovating. (I probably do great injustice to the question-setter in this summary, but was not taking detailed notes at the time and so must rely a consumer's imperfect recollection...)

To the Kat, this appeared to be a simple market-induced innovation point, - that there are some innovations that the patent system is not required to incentivise - and so the answer given in return essentially boiled down to the assertion that patents and copyright were just ‘different’ to trade marks with different justifications and a different purpose in life.

Thus, the Kat noted that whereas there are some links between the ideology of patents and copyright, there is no such link between these two and the trade mark/brand. He therefore instinctively saw trade marks/brands as less directly concerned with the innovative process than copyright and patents. Accordingly, while the latter pair provide incentives and/or rewards for innovation by creating artificial scarcity (and thus a market) in information products – the non-rivalrous and non-exhaustible nature of information being constrained by legal intervention thereby creating “property” in the patented invention or copyright work – the trade mark is not directly concerned with this process. It provides a degree of secondary protection that is focused more on the ex-post gathering of profits than any ex-ante incentives.

However, mulling this over when walking back from the event, the Kat began to wonder whether his initial, knee-jerk, dismissal of the trade mark, discarding it as substantially irrelevant to innovation, was in fact correct. Whilst he maintains that trade marks are (obviously) fundamentally different in ideology than patents and copyright (at least to a far greater extent than the latter pair are ideologically different from each other), he is less sure that his initial reaction did not underplay the innovation|trade mark link.

So, what is the brand's place in the innovative process? Does it play a more direct role than this Kat erstwhile appreciated? Was he simply wrong when he sidelined the trade mark in his initial presentation and instead focused on patents, copyright and designs? Or is the brand a secondary citizen in the innovation party? Comments, as ever, are encouraged.