Can you Protect the Layout of Stores and Service Outlets?

A store layout refers to the design of a store’s space and the placement of items within it. If a brand or business wishes to be successful and earn revenue in the long run, it must implement the correct store layout. Now, the question is, “Can you protect the layout of stores and service outlets?” In a nutshell, the answer to this question is ‘Yes.’ Most of the customers believe that the layout of a retail store is equally as important as the brand name of the business. Therefore, it indeed makes sense to regard the layout of a store as a valuable IP worthy of protection.

In today’s highly competitive environment with ever-increasing innovative methods of brand-image building, there has been a rapid increase in the registration and usage of Non-conventional Trademarks. Like color, motion, sound, scent marks, amongst many others, proprietors are now looking forward to obtaining Trademark Protection for the Layouts of their Stores and Service Outlets. Without any second thoughts, the original look of a store’s interiors can be a terrific selling point for a brand and, in turn, prove to be convenient for the customers to recognize the brand without even looking at its name.

Let us have a better understanding of the concept by taking the example of the widely-known multinational technology company, Apple Inc.

Apple has valid registrations for the layout of its stores, which maintain consistency in its look across the globe with flat tables, white decor, clear glass fronts, to name a few. All these aspects enable a consumer to recognize that the store is associated with Apple the moment he or she walks in.

Understanding the Essentials for Registration of a Layout Mark

For obtaining registration on the layout of a store or service outlet, there are a few essentials, which the applicant needs to ensure, and are as follows:

1. Source Indication Function 

The customers must be able to associate the store layout with the brand upon coming in contact with it. The applicant must prove that amongst the relevant sections, the store layout creates a perception of its commercial origin.

2. Graphical Representation

Since a layout mark consists of several elements in an exclusive arrangement, it is critical to protect it from all possible perspectives and angles. The layout mark should be accompanied by a clear and concise description. Adding actual photographs is also helpful.

3. Distinctiveness 

Quite often, an objection arising from the registry is that layout marks are not inherently distinctive unless they are very different from the practices involved in that industry. In such a scenario, the applicant must demonstrate that the mark has ‘acquired’ distinctiveness or secondary meaning. The threshold of distinctiveness for store layouts is pretty high.

4. Functionality  

The marks, which consist of technical features adding value to the product itself, cannot be registered. In layout marks, the arrangement might be necessary for obtaining specific technical functions. In such cases, a combination of elements that consist of the functional as well as non-functional elements can be distinctive.

Why not Protect Store Layouts as Copyright or Industrial Design?

Copyright Protection is available for some architectural designs; however, it falls short because it otherwise does not cover the design of useful articles per se.

Store layouts have been protected as industrial designs in the past. An industrial design constitutes the ornamental or aesthetic aspect of an article and may consist of its three-dimensional features, such as the shape of an article, or two-dimensional features, such as patterns, lines, or colors. An example of this case is KFC’s layout design registration with the European Union’s Design Office (EU Reg. No. 000896618-0002), as shown below:

Drawbacks of Obtaining Industrial Design Protection on a Store Layout

The major drawback of obtaining industrial design protection on a store layout is that it has a limit on the term of protection and the number of renewals, which can be made, as opposed to trademark rights, which can be renewed every ten years (without a limit on the number of renewals), and in practice remain in force perpetually.

Another drawback is that an industrial design can’t be registered if it is disclosed to the public anywhere in the world by prior publication or prior use or in any other way. On the other hand, a trademark on store layout can easily be registered irrespective of the amount of time it was in use. Moreover, showing prior use works well in favor of the owner who wishes to register his proposed trademark.

A Combination Approach to Protect Store Layouts

A brilliant approach for protecting the layout of stores lies in first registering it as an industrial design and then as a trademark. At the initial stage, obtaining an industrial design registration shall prove to be convenient than a trademark registration as the design shall be novel, original (not published anywhere before), and shall also serve the purpose of preventing copycats. Getting a trademark registered for store layout initially may be subject to a very high threshold of examination, specifically if the layout is not on the market. The proprietor will have to demonstrate that the shape and color combination is distinctive as compared to other layout marks. Then once the industrial design registration gets expired, the proprietor can seek trademark registration if the layout enjoys goodwill, and the customers associate the layout with the proprietor and his or her brand.

This approach has been supported in two High Court decisions in India in cases – Crocs Inc USA vs. Bata India and Super Smelters Limited vs. SRMB Srijan Private Limited, where it was held that – “A registered design, after its expiry, may not lose its distinctiveness, and end up fulfilling all the requirements of a trademark. In that scenario, not recognizing that mark as a trademark, because that would extend the design monopoly, would be to conflate two things that exist completely independent of each other.”

Advantages of Registering Store Layouts as Trademarks

• By registering store layouts, the trademark applicants can regulate and limit the unfair commercial use of their store layouts by others.
• The additional advantage of such trademark registrations includes the possible rise in commercial revenue generation through licensing.

*Please note that store layout trademarks are not to be confused with ‘architectural marks,’ which protect the exterior of buildings. Layout marks aim to protect the sophisticated layout of stores, including the interior and distinct arrangement of features, furniture, and color patterns.

Examples of Registered Layout Marks

1. Apple’s trademark registration for the layout of its stores(registered as three-dimensional (3D) marks) is valid in various jurisdictions. The illustration of Apple’s registered store layout is shown below:

2. A registration by the fast-food chain Potbelly Sandwiches for “a multi-level counter structure, a built-in glass front drink cooler, cubbyhole-style shelving, banner stanchions with chains/ropes and tile behind the serving area,” as shown below:
3. A registration by Chipotle for “porcelain keyless bulb sockets suspended from the end of electrical conduit pendants,” as shown below:

 

4. A registration by Shell for “a gas station canopy in yellow with a red strip along the bottom of the canopy,” as shown below:
   

Protection of Layout of Stores and Service Outlets in India

In India, registrations on the layout of stores have recently been granted as ‘device marks’ rather than 3D trademarks, as seen in other jurisdictions. Some of the registration applications are as follows:

1. Mary Cohr, seeking protection for the layouts of its ‘Store Front’ (Application No. 4073262, registered) as well as ‘Salon Area’ (Application No. 4134918, accepted), as shown below:

2. Recently, Godrej & Boyce’s U & Us Home Studio has successfully overcome a lack of distinctiveness objection and been granted a device mark for its ‘Discussion Area Zone’ (Application No. 4169443), as shown below:

Bottom Line

The layout of stores and service outlets helps in influencing a customer’s behavior, which implies when done right – it’s a key strategy to a store’s prosperity. Consequently, acquiring protection on the layout of stores and service outlets is rapidly gaining popularity among brands today. Without any doubt, the competition nowadays has become steep, and imitators are trying to cash in on brand value everywhere, due to which, the protection over the layout of stores and service outlets has become necessary and integral for brands that function with distinctive layouts and franchise models.

As customers and members of the public get more exposed to and acquainted with the layout of a store, the layout acquires goodwill and reputation, just like any other trademark that earns goodwill and reputation after being in the market for some time. Therefore, it is exceedingly imperative to strategize a well thought out approach for protecting the layouts of stores, based on several factors such as novelty, use, goodwill and reputation in the market, and distinctiveness.
*Please note that all the examples given here are registered Trademarks/Industrial Designs. They belong to their rightful owners and have been quoted only for the sole purpose of explanation.