Trademarks are based on the principle of protecting those who register first, which means unregistered trademarks generally do not have legal rights.
However, trademark law also aims to protect consumer trust, which is just as important as safeguarding the rights of trademark owners. Unlike copyright law, which protects creation, trademark law protects choices. Although trademark rights are established through registration, they ultimately rely on the business reputation or renown that is built through use.
So what happens when an unregistered trademark has become widely recognized by consumers, with established goodwill? If hearing the name immediately makes people think of a particular brand, should the lack of registration mean there are no legal protections? Should another party be able to register the trademark without consequence?
Under Korean law, trademarks that are widely recognized and have acquired business goodwill, even without registration, are protected through various legal mechanisms.
1. Unfair Competition Prevention Act
Even without registration, trademarks that have become widely known through use can be protected under the Unfair Competition Prevention Act. This law allows trademark owners to send cease-and-desist letters, claim damages, or even file criminal complaints to stop imitation by third parties.
Unlike trademark law, which focuses on preventing confusion regarding the origin of goods or services, the Unfair Competition Prevention Act aims to prohibit any unfair acts. As a result, it covers a broader range of issues than trademark infringement.
For example, parody trademarks may not always be prohibited under trademark law. The parody may involve non-similar marks, unrelated goods, or make it obvious to consumers that no confusion exists. However, under the Unfair Competition Prevention Act, if a parody exploits the reputation of a well-known brand or damages its prestige, it may still be considered unfair competition.
In a 2016 court case, a Korean fried chicken restaurant named “Louis Vuiton Dak” (a play on the luxury brand Louis Vuitton) was ordered to stop using the name and pay damages under the Unfair Competition Prevention Act. Although consumers were unlikely to believe that Louis Vuitton had opened a fried chicken shop, the court ruled that the use of the name harmed the distinctiveness and reputation of the luxury brand.
2. Prior Use Rights
Unregistered but relatively well-known trademarks also have the right to continued use under prior use rights.
Trademarks involve a matter of choice, meaning that an unregistered mark might have been in use by coincidence before someone else registered a similar or identical trademark. If the prior user can prove that their trademark was already known to some extent—at least within a certain geographic area—they can continue using the mark within their original scope of business.
This right is called prior use rights and is typically recognized to protect small business owners and local entrepreneurs who have built up goodwill with consumers, even if they never registered their trademark.
However, prior use rights do not allow the user to register the trademark. Instead, it serves as a defensive right, which can be asserted if the trademark owner sues or files a criminal complaint for infringement.
3. Opposition and Invalidation Actions
If someone files to register a copycat version of a well-known but unregistered trademark, that application can be opposed during the registration process. If the trademark is already registered, it can be invalidated through legal proceedings.
Many trademark disputes arise from efforts to block the registration or use of imitation trademarks. Since trademarks aim to protect business goodwill and prevent consumer confusion, it is crucial to prevent bad-faith registrations. Recently, the Korean Intellectual Property Office (KIPO) has revised its examination guidelines to help trademark examiners actively identify and reject imitation applications during the examination process. As a result, most copycat applications are now rejected before reaching registration.