TRADEMARK: "Everything You Need to Know about Trademark Protection and Registration"
In my experience, trademark protection and
enforcement is one of the most often neglected areas by small business
owners and management. Unfortunately, failure to take some simple
steps can be a crucial mistake and can have devastating consequences to
a business of any size. I have seen too many situations where a
terrorizing attorney has sent the ever-feared “cease and desist” letter
to the unsuspecting business. These businesses are then faced with
a “catch 22” decision: either 1) change their name or product mark
after investing substantial funds over time building goodwill in a mark;
or 2) litigate the issues of trademark rights at a substantial cost and
with no guarantee of successful results.
The costs of changing a name to a business can be
enormous, and often can’t even be quantified. For example, imagine
that a fast food chain with 500 restaurants was forced to change its
name. If the average cost to change the signs on each restaurant
was $10000, this would amount to 5 million dollars. This does not
even begin to account for all of the other items that would need to be
replaced, such as uniforms, to-go bags, menus, letterhead, and business
cards. In addition, the damage in the nature of lost goodwill in
that had been generated over time may not be clearly quantifiable. In some cases a change of name may even effectively mean the end of a
I have represented clients that prior to my
representation have been in existence for over ten or fifteen years
without even considering trademark issues. I suspect that there
are many reasons for this, including lack of advice from counsel, lack
of knowledge or information, a misunderstanding of the procedures,
costs, or perhaps a misalignment of priorities. However, a simple
understanding of trademark issues may help a small business owner to
curtail the devastating potential involved with the failure of a
business to take these simple measures.
Essentially, the owner of a company providing goods
or services by using a name and/or logo should first consult a trademark
attorney to get a search and opinion. This search will be
comprehensive, and will lend insight to others using a similar mark with
respect to similar products or services or in the same or related
industries. This immediately will lend further insight as to what
rights the business currently has or could have in the mark, and what
chances the owner might have of another company challenging the mark
during the registration process or in the future. In addition,
some marks are not registerable because they do not meet the definition
of trademark or otherwise comply with federal trademark law. An
attorney’s opinion will address these issues as well if applicable.
Next, if the search and opinion are favorable, the
informed business owner should apply for state and federal trademark
registration. Federal trademark registration is a crucial element
in a business’s IP protection strategy, accomplishing many goals.
For example, a registered owner is presumed to have exclusive nationwide
rights to use any mark that is confusingly similar to their mark.
This allows the user to enforce its right against other businesses that
are trying to pass of similar goods and services as that of the
registered user’s. In addition, after a period of five years from
the date of registration, a registrant has the right to declare the mark
“incontestable”, adding further protecting the user against attacks from
unknown users. Because even the application process is
complicated, it is generally wise to allow an attorney to prepare, file
and prosecute the application on your behalf.
In general, a search and registration can be
relatively inexpensive. Our current fees and expenses range from
about $500-$1000 for a search and opinion, and start at about $1000.00
for a registration, although in some circumstances this can increase.
However, for the business owner that has not taken the time to make
these efforts and later finds themselves faced with a dispute, fees
could easily exceed $10,000 or even $20,000.00. Therefore, it is
wise to explore these issues now and at least seek basic consultation
from a trademark attorney.
I. What is the difference between a trademark
and a copyright?
A trademark, or "mark," must be used in business,
and must be used to identify the source of the goods or services being
provided. Specifically, a trademark is any word, phrase, symbol,
design, sound, smell, color, product configuration, group of letters or
numbers, or combination of these, adopted and used by a company to
identify its products or services, and distinguish them from products
and services made, sold, or provided by others.
A copyright, on the other hand, protects original
works of expression, such as novels, fine and graphic arts, music,
photography, software, video, cinema and choreography by preventing
people from copying or commercially exploiting them without the
copyright owner's permission. But, copyright laws specifically do not
protect names, titles or short phrases. That's where trademark law comes
There are, however, areas where both trademark and
copyright law may be used to protect different aspects of the same
product. For example, copyright laws may protect the artistic aspects of
a graphic or logo used by a business to identify its goods or services,
while trademark may protect the graphic or logo from use by others in a
confusing manner in the marketplace. Similarly, trademark laws are often
used in conjunction with copyright laws to protect advertising copy. The
trademark laws protect the product or service name and any slogans used
in the advertising, while the copyright laws protect the additional
creative written expression contained in the ad.
II. Why should a client register his/her trademark?
The primary purpose of a trademark is to prevent
consumers from becoming confused about the source or origin of a product
or service. Marks help consumers answer the questions: "Who makes this
product?" and, "Who provides this service?" Trademarks make it easier
for consumers to quickly identify the source of a given good. Instead of
reading the fine print on a can of cola, consumers can look for the
Coca-Cola trademark. Instead of asking a store clerk who made a certain
athletic shoe, consumers can look for particular identifying symbols,
such as a swoosh or a unique pattern of stripes. By making goods easier
to identify, trademarks also give manufacturers an incentive to invest
in the quality of their goods. After all, if a consumer tries a can of
Coca-Cola and finds the quality lacking, it will be easy for the
consumer to avoid Coca-Cola in the future and instead buy another brand.
Trademark law furthers these goals by regulating the proper use of
As consumers become familiar with particular marks,
and the goods or services they represent, marks can acquire a "secondary
meaning," as indicators of quality. Thus, established marks help
consumers answer another question: "Is this product or service a good
one to purchase?" For this reason, the well-known marks of reputable
companies are valuable business assets, worthy of nurturing and
. What laws govern trademarks?
The basic rules for resolving disputes over who is
entitled to use a trademark come from decisions by federal and state
courts (called "common law"). These rules usually favor the business
that first used the mark where the second use would be likely to cause
A number of additional legal principles used to
protect owners against improper use of their trademarks derive from
federal statutes known collectively as the Lanham Act (Title 15 U.S.C. §§1051 to 1127).
All states have statutes that govern the use and
protection of marks within the state's boundaries. In addition to laws
that specifically protect trademark owners, all states have laws that
protect one business against unfair competition by another business,
including the use by one business of a name already used by another
business in a context that's likely to confuse customers.
There are five common situations in which there is no
trademark protection. In any of these situations, the intended trademark
cannot be registered and the owner has no right to stop others from
using a similar mark.
marks. If the owner of a
trademark has stopped using it in commerce and indicated an
intention not to resume use, the mark is no longer protectible.
terms. If a company attempts
to use the name of the goods themselves (for example, the term “Lemonade” for a lemonade drink) the name will not be protected
because it is a generic term.
that are confusingly similar to existing marks. A
mark that is confusingly similar to another mark is unprotectible if
it used for similar goods (for example, a company cannot use Kedz as
a trademark for athletic shoes because it is confusingly similar to
Keds's brand of shoes).
marks that have not achieved secondary meaning.
A weak (or descriptive) mark is not protectible without proof of
Functional features. A
functional element of a product shape or of a product’s packaging,
as opposed to a purely decorative element, is not protectible as a
V. What are a trademark owner’s
Assuming that a trademark qualifies for
protection, rights to a trademark can be acquired in one of two ways:
(1) by being the first to use the mark in commerce; or (2) by being the
first to register the mark with the U.S. Patent and Trademark Office
15 U.S.C. § 1127(a).
(1) The use of a mark generally means the actual sale
of a product to the public with the mark attached. Thus, if I am the
first to sell "Lucky" brand bubble-gum to the public, I have acquired
priority to use that mark in connection with the sale of bubble-gum
(assuming that the mark otherwise qualifies for trademark protection).
This priority is limited, however, to the geographic area in which I
sell the bubble gum, along with any areas I would be expected to expand
into or any areas where the reputation of the mark has been established.
So, for example, if I sell pizza in Boston under the name "Broadway Pizza," I will
probably be able to prevent late-comers from opening up a "Broadway
Pizza" within my geographic market. But I will not be able to prevent
someone else from opening a "Broadway Pizza" in
Los Angeles .
(2) The other way to acquire priority is to register
the mark with the PTO with a bona fide intention to use the mark in
commerce. Unlike use of a mark in commerce, registration of a mark with
the PTO gives a party the right to use the mark nationwide, even if
actual sales are limited to only a limited area. This right is limited,
however, to the extent that the mark is already being used by others
within a specific geographic area. If that is the case, then the prior
user of the mark retains the right to use that mark within that
geographic area; the party registering the mark gets the right to use it
everywhere else. So, for example, if I register the mark "Broadway" in
connection with the sale of pizza, the existing "Broadway Pizza" in Boston retains the right to use the name in Boston , but I get the
right to use it everywhere else.
VI. How does one keep and/or lose his/her rights in
Trademark rights are protected through registration,
maintenance, watching, and enforcement. These precautions and proper use
help preserve the ability of marks to indicate the source of a product
or service to consumers.
Marks may be registered with the United States
Patent & Trademark Office ("PTO"), and similar agencies throughout
the world. In the U.S.
, marks can also be registered within each state and territory,
although such registrations are of limited value to businesses
engaged in interstate commerce. A state registration normally cannot
defeat a federal registration, because federal trademark rights
supersede state rights.
Unregistered marks are
protected at "common law" in the U.S.
-- marks need not be registered to be recognized and enforced.
Nonetheless, marks registered with the PTO have advantages over
unregistered marks. These advantages, which inure to the registered
trademark owner, include:
- The ability to bring actions for trademark
infringement in federal courts, as well as state courts;
- Eligibility for up to treble damages in a
successful trademark infringement action;
- A presumption that the registered mark is
- A presumption that the owner of the
registration owns the registered mark;
- A presumption that the registrant has
exclusive rights to use the mark in commerce;
- A presumption that the registered mark is
not confusingly similar to other registered marks;
- The ability to file applications for
registration in other countries, based upon the U.S. registration;
- The ability to prevent the importation of
goods bearing infringing marks, by recording the registration
with United States Customs.
International registrations provide similar
advantages to trademark owners abroad. International registrations
are subject to similar, periodic, "proof of use" requirements. Some
countries also require the payment of "taxes," or fees, to maintain
If a registered mark is used and maintained
properly, trademark registration can last "forever." U.S.
registrations may be renewed indefinitely for successive ten year
terms. In other countries, terms of registration vary; however,
most allow indefinite, successive renewals, where the underlying
mark is used properly, and the registration is maintained.
Just as registrations must be maintained,
through affidavits, fees, and renewal applications, marks
must be maintained, through proper use and due diligence.
The key to trademark maintenance lies in
the source identification function of marks -- remember,
marks identify the source or origin of products and services.
If, and when, a mark no longer performs this function, it no
longer is a mark; it becomes a generic term. Generic
terms designate a type of product or service, without
calling to mind any specific manufacturer or provider.
A generic term cannot be a mark. Generic
terms are in the public domain, and may be used freely by
anyone. The terms, "escalator," "shredded wheat," "kerosene,"
"aspirin," "yo-yo," "zipper," and "trampoline," all began as
marks. Through lack of proper use, and/or enforcement, these
marks became generic. Today, any company may use them to
describe certain types of products.
Marks generally lose their source-identifying
function through abandonment. As the term suggests, an
abandoned mark is one which has been "thrown away." Intentional
abandonment occurs when an owner fails to use a mark for a
specified period, and does not intend to resume use. Marks also
may be abandoned unintentionally, through improper use.
A mark may be abandoned "unintentionally," when the trademark owner fails
to use it properly, or fails to monitor its use by
others. "Improper use" is use which places the mark in danger of
becoming generic. Thus, marks should be used consistently, and
distinctively, to enhance their source-identifying function.
Many trademark owners
list their most important marks with a trademark "watching
service." Watching services notify trademark counsel of attempts
to register conflicting marks, so that timely oppositions to
adverse applications may be filed. These services are
particularly helpful in civil law countries, where trademark
rights are secured through registration, rather than use. Too
often, a trademark owner seeking to expand its business abroad,
discovers that its flagship mark already has been registered in
a target country -- perhaps even by a local "trademark pirate." In such cases, the rightful owner may have no choice but to
purchase the mark from the thief. If the owner does not submit
to this extortion, it may have to select another mark, or face a
lawsuit for using the mark it created! This outcome might have
been avoided if a trademark watch were in place.
Watching services are available in many
countries, including the U.S. Trademark watches can be
customized to meet the needs of a particular business. A watch
may cover one country, several, or the entire computerized
world. However, watches are unavailable, or more limited, in
countries without publicly-searchable, computerized, trademark
Watching services are not expensive, given
the level of information provided. Pursuing the leads watch
notices produce can be costly, however, depending upon the mark,
and the level of adverse activity. In any event, trademark
watching is an invaluable practice that can help a trademark
owner protect the source-identifying function of its products or
consists of pursuing adverse users. An adverse user is one who
is not authorized to use a mark, but uses it anyway, or who is
authorized to use the mark, but uses it improperly.In most instances, adverse users may be
stopped without litigation, by a friendly contact from the
trademark owner, or a "cease and desist" letter from the owner's
attorney. Most adverse users would rather select a different
mark for their products or services, than defend against a
trademark infringement claim. Yet, where an adverse user is not
convinced that infringement has occurred, and has invested
substantially in the allegedly infringing mark, an amicable
solution may not be possible. Sometimes, a trademark owner will
offer to reimburse the adverse user for the cost of changing
marks, to avoid the higher cost of trademark litigation. In
other circumstances, particularly where willful and large-scale
infringement has occurred, trademark litigation, or arbitration,
may be the only tenable approach.The monetary remedies available in trademark
infringement actions are based on the actual damages suffered by
a trademark owner. These damages may include profits lost to the
infringing activity, and may be trebled where the infringement
is proved to have been intentional. Injunctive relief also is
available, to restrain the infringer from further unlawful
activity, and impound, and destroy, infringing goods. Litigation
should be avoided whenever possible. Nonetheless, trademark
rights should be enforced when adverse uses are confirmed.
. What are the remedies for
Successful plaintiffs are entitled to a
wide range of remedies under federal law. Such plaintiffs are
routinely awarded injunctions against further infringing or
diluting use of the trademark.
15 U.S.C. § 1116(a).
In trademark infringement suits, monetary relief may also be
available, including: (1) defendant's profits, (2) damages
sustained by the plaintiff, and (3) the costs of the action.
15 U.S.C. § 1117(a).
Damages may be trebled upon showing of bad faith. In trademark
dilution suits, however, damages are available only if the
defendant willfully traded on the plaintiff's goodwill in using
the mark. Otherwise, plaintiffs in a dilution action are limited
to injunctive relief.
15 U.S.C. § 1125(c).
Whether the owner of a trademark can stop
others from using it depends on such factors as:
- whether the trademark is being used on
competing goods or services (goods or services compete if
the sale of one is likely to affect the sale of the other)
- whether consumers would likely be
confused by the dual use of the trademark, and
- whether the trademark is being used in
the same part of the country or is being used on related
goods (goods that will likely be noticed by the same
customers, even if they don't compete with each other).
To determine whether
another business is already using a trademark that's identical
or similar to the one you want to use and to ensure that you
won't violate someone else's trademark rights. Searching
minimizes investments in marks that cannot be used, while
preventing the inadvertent infringement of marks held by others.
A mark should not be adopted, or used, if the search indicates
it is likely to become confused with a mark adopted by someone
else.The consequences of failing to conduct a
reasonably thorough trademark search may be severe, depending on
how widely you intend to use the trademark and how much it would
cost you to change it if a conflict later develops. If the
trademark you want to use has been federally registered by
someone else, you will be precluded from using the trademark in
any context where customers might become confused as to the
source of your products or services. Also, a court will presume
that you knew about the trademark registration -- even if you
did not. This means that, if you do use the trademark
improperly, you will be cast in the role of a "willful
infringer." Willful infringers can be held liable for large
damages and payment of the registered owner's attorney fees;
they can also be forced to stop using the trademark altogether.If the search reveals a mark to be available,
the mark may be adopted, and use of the mark may commence.
IX. What does a trademark search look like?
A trademark search report consists of several
sections. One section contains information from the USPTO (U.S.
Patent and Trademark Office). This portion of the report
consists of similar federally registered marks, pending marks
and marks that have been canceled or abandoned. Another portion
of the report is a survey of state registrations. Included are
similar marks that are registered under state trademark law. A
third portion of the report consists of common law information.
It is in this area that trademark search reports are especially
helpful. The search companies examine numerous sources to locate
unregistered users of similar marks, brand names and even trade
names (the names of businesses, rather than those of products or
services).Search reports contain raw data concerning
the use and/or registration of similar marks, culled from yellow
page listings, trade directories, the Patent and Trademark
Office, state trademark registers, and various public and
private databases. The reports do not include opinions regarding
trademark availability. Reputable firms that provide on-line
information about their trademark searching services are listed
in our trademark links. However, "likelihood of confusion" determinations are not for the layperson; they should always be
made by qualified trademark counsel.
X. What role does an Attorney have in the
If a client consults with an attorney when
acquiring the trademark search, he/she will also get a legal
opinion as to whether your proposed mark is legally safe to use
in light of existing registered and unregistered marks.
Obtaining a legal opinion may provide important protection down
the road if someone later sues you for using the mark.
Some courts have held that the failure to follow the advice of
counsel by not conducting a full trademark search
can weigh as evidence of bad faith. "Such willful ignorance
should not provide a means by which [defendant] can evade its
obligations under trademark law."
International Star Class Yacht Racing
Ass'n v. Tommy Hilfiger, U.S.A., Inc., 80 F.3d 749, 38
U.S.P.Q.2d 1369 (2d Cir. 1996)
XI. Can a trademark become “incontestible”?
Yes. Five years after a mark has been
registered, the registrant may apply to have the mark declared “incontestable.” 15 U.S.C.A § 1065 (1992). Possession of
an incontestable mark is conclusive evidence of the registrant’s
exclusive right to use that mark on the type of goods in
question, subject only to certain defenses that are itemized in
the statute. 15 U.S.C.A § 1115(b) (1992). Thus,
incontestability has two practical implications. First, it
immunizes the registrant from certain claims that that the mark
is invalid when a third party seeks to have the mark cancelled. Second, when the holder of federal registration files suit for
infringement, incontestability will also preclude the infringing
Defendant from asserting certain defects in the mark as
defenses. Park n Fly, Inc. v. Dollar
Park and Fly, Inc. 469 U.S.
189, 105 S.Ct. 658 (1985). The two most prevalent challenges
that are cut off by incontestability are (1) that the registrant
is not the senior user of the mark, and (2) that the mark itself
is merely descriptive and lacks secondary meaning.Thus, incontestability narrows, but does not
eliminate, the grounds upon which the trademark's validity may
be called into question by a defendant. These incontestability
provisions allow a "registrant to quiet title in the ownership
of his mark. The opportunity to obtain incontestable status by
satisfying the requirements of §  thus encourages
producers to cultivate the goodwill associated with a particular
XII. What are the defenses to an
Under 15 U.S.C.A § 1115(b), there
are seven (7) defenses to an incontestable mark. These are:
"(1) That the registration or the
incontestable right to use the mark was obtained fraudulently;
or"(2) That the mark has been abandoned by the
registrant; or"(3) That the registered mark is being used,
by or with the permission of the registrant or a person in
privity with the registrant, so as to misrepresent the source of
the goods or services in connection with which the mark is used;
or"(4) That the use of the name, term, or
device charged to be an infringement is a use, otherwise than as
a trade or service mark, of the party's individual name in his
own business, or of the individual name of anyone in privity
with such party, or of a term or device which is descriptive of
and used fairly and in good faith only to describe to users the
goods or services of such party, or their geographic origin; or"(5) That the mark whose use by a party is
charged as an infringement was adopted without knowledge of the
registrant's prior use and has been continuously used by such
party or those in privity with him from a date prior to
registration of the mark under this chapter or publication of
the registered mark under subsection (c) of section 1062 of this
title: Provided, however, That this defense or defect shall
apply only for the area in which such continuous prior use is
proved; or"(6) That the mark whose use is charged as an
infringement was registered and used prior to the registration
under this chapter or publication under subsection (c) of
section 1062 of this title of the registered mark of the
registrant, and not abandoned: Provided, however, That this
defense or defect shall apply only for the area in which the
mark was used prior to such registration or such publication of
the registrant's mark; or
"(7) That the mark has been or is being used
to violate the antitrust laws of the United States ."
an attorney in the Central Ohio area who practices
entertainment law. This article could not been
written without the generous assistance of Jason Hayward, a former law
student at The Ohio State University College of Law and a former law
clerk in Lee’s office.
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Of course, as an attorney I have to have a disclaimer: DON’T RELY SOLELY
ON MY ADVICE IN THIS COLUMN! LawNOTES is only intended to be a
general overview of some legal issues and cannot possibly be complete in
the amount of space we are dealing with. It is NOT intended to replace
the advice of a competent attorney. Therefore, please consult an
attorney to discuss your rights, and always, please use sound judgment
when making your own decisions, with or without the assistance of an
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Leon David Bass
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