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Trademark Infringement Is on the Rise—and Brands Are Spending Furiously to Fight It

A new study suggests that the vital act of choosing and protecting a brand trademark has become fraught with trouble and litigation as infringement becomes increasingly commonplace.

It’s not enough that choosing a unique and legal mark has become overly complicated in an industry crowded with trademarks and new intellectual properties. Protecting existing trademarks has become a costly and time-intensive necessity for brands, according to the study commissioned by trademark research and protection firm CompuMark.

The World Intellectual Property Office estimates that almost 11 million marks were legally filed in 2018, up 15.5 percent from the year prior, and the ninth straight year of growth in the category. China alone accounted for 7.4 million of those trademarks.

Worldwide, active trademarks currently number 83 million, prompting CompuMark to initiate the survey of 351 trademark professionals to better understand the toll this rise is taking on the marketplace.

CompuMark’s study noted an upward trend in the number of professionals that report taking on infringement cases. In 2017, 74 percent of that group experienced infringement, jumping to 81 percent in 2018. By 2019, the percentage hit a high of 85 percent.

“Finding a unique mark is a challenge in itself, but with the sheer number of active trademarks and applications, protecting existing marks from infringement also becomes an issue,” CompuMark wrote in its report. “In fact, infringement is rising steadily year-on-year. It is also taking place across channels and is no longer affecting just traditional word marks.“

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CompuMark set out to measure the cost of trademark abuse, finding four key areas in which brands are harmed by trademark infringement: customer confusion, loss of revenue, damage to reputation and reduced trust in the brand.

“Specifically, 75 percent have started litigation as a result of infringement,” CompuMark said. “This is a costly avenue and impacts on the wider business in terms of publicity, how customers and the market perceive the brand.”

The study found that 47 percent of those surveyed provided their services to organizations that spent more than $50,000 on trademark litigation in their “most challenging” trademark battle. Another 40 percent said their organizations had spent somewhere between $50,000 to $249,999.

CompuMark admitted that not all trademark infringement cases need to be litigated, noting a handful of high-profile cases that were settled amicably, such as Burberry’s lawsuit against Target in 2018. However, brands face numerous challenges when it comes to protecting their trademarks.

Brands participating in the study lamented the overwhelming amount of trademark data to sort through (49 percent), lack of time to act properly (44 percent), too few resources (38 percent) and a lack of access to the right tools (35 percent) to properly defend their legally acquired trademarks.