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| Mon Jun 19, 2006 4:55 am Trademark 101 |
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Trademarks 101: Protect Your Brands
There are many benefits of registering your brands.
December 1, 2003
By: Adam Chernichaw
Most every business that brands its products hopes that its brand name becomes a “household name” – that is, that it becomes the name that customers associate first with a given product or service. One of the first steps to achieving that goal is to choose how you want to identify and distinguish your product among all other products on the market. The identifying name is a trademark (you can also brand your products with designs or symbols, which could also constitute trademarks – e.g. the “golden arches”).
In the U.S., there is no requirement to register a trademark – generally speaking, the first person to use a trademark in commerce establishes rights in that mark. However, without registration, those rights are limited to the geographic area where the trademark is being used. Registering a trademark with the U.S. Patent and Trademark Office (PTO) (http://www.uspto.gov/), often referred to as a federal registration, grants significantly more rights to the trademark holder and is the generally recommended course of action for companies looking to establish and protect their brands. Editor's note: Filing fees for a federal trademark application begin at $335 per class. However, when you take into account the cost for the trademark search and legal fees, you can generally expect to pay upwards of $2000 to get your application on file.
States also allow companies to register trademarks (in New York, registrations are issued by the Department of State, but the rights established by a state registration are limited to the boundaries of the specific state. Because they are cheaper to register, state registrations have sometimes been preferred by companies that have no intention of expanding operations out of state. With the proliferation of electronic commerce, however, state registrations are becoming increasingly obsolete relics from a bygone era.
To the Point
Decide what identifier you want to be your trademark. It can be either a name, symbol, or design that will set you apart from other companies in your field.
Do a trademark search before you decide to brand your own creation.
While you could attempt to file on your own, seek a trademark or intellectual property attorney to help you through the registration process.
Benefits of Federal Registration
Registration of a trademark with the PTO gives the holder (owner) of the trademark specific rights; namely:
It gives nationwide notice of the trademark holder’s claim (it entitles the trademark owner to use the ® symbol, as opposed to the common law TM or SM symbols which do not indicate federal registration), so that no other person or business can lay claim to any rights in the trademark (and should serve to deter those who would consider introducing an infringing mark), except in certain limited circumstances.
Federal registration entitles the trademark holder to sue infringers in federal court and to certain procedural benefits and presumptions in the course of litigation.
The U.S. application date can be used as the trademark priority date (against subsequent users in foreign countries) when seeking registration in certain foreign countries.
Makes it possible in some infringement lawsuits to recover triple the amount of the trademark holder’s actual damages and attorneys fees.
After five years of continuous use, the trademark holder can file an application to obtain “incontestability” status for the mark, which makes the trademark immune from many (though not all) types of third party challenges.
It allows the holder to seek help from the U.S. Customs Service in protecting against the importation of counterfeit and gray market goods (requires recording the trademark registration with the Customs Service).
It helps in proceedings against cybersquatters (people who have registered your trademark as a domain name)
Limitations on Federal Registration
Due to the benefits of registration, it is generally advisable to seek federal registration of a trademark. Limitations on the rights and protections provided by federal registration apply to trademarks generally, both registered and unregistered. Two prime examples of such limitations are that:
Trademark protection does not generally extend beyond the goods on which the trademark is actually being used (for example, a trademark for “Big Bear” outerwear would not necessarily protect against someone establishing a trademark for “Big Bear” honey).
The trademark registration holder will not be able to stop prior users of the trademark from continuing their use (but the prior users will not be able to expand their use outside of the limited geographic region in which their use took place at the time the trademark was registered).
Practical Branding Tips
In deciding on a trademark and how it is to be used, here are some practical tips to consider.
Choose distinctive trademarks and avoid descriptive terms (such as “Frosted Mini Wheats”, “Car Wash”) because the PTO will not generally register marks that are mere descriptions of the products or services (this helps to guard against any one person or entity claiming rights to terms like “food”, “books”, etc.).
Avoid using a trademark that resembles an existing trademark. There can be no guaranty that the mark you choose will not be identical or similar to an existing trademark, but it is a good idea to search for similar marks so that you do not invest time and money in promoting a brand only to later find out that you cannot use it. The PTO website’s search engine (http://www.uspto.gov/) is a good place to start your search because its free (if you find a federal registration listed on the PTO website that is identical or similar to the one you want to use, you would probably want to come up with a different mark), but it should not by any means be your only tool (because it may not be up-to-date and will not reveal state registrations or common law uses). It is a good idea to have a proper and comprehensive trademark search conducted and analyzed in order to avoid inadvertently using a trademark identical or similar to one that is already being used by another company.
As an entrepreneur, you hope that your trademark becomes a household name, but if you cause or permit your trademark to actually define your product or service (if you make it “generic”), you risk losing trademark protection (and the resources and equity you may have invested in developing the brand). This is why you often see companies whose trademarks have become household names invest money in trying to educate the public against using their trademarks generically (e.g., Xerox copiers, Kleenex tissues, Rollerblade inline skates). One of the most well known trademarks that lost its trademark protection because it became generic is “Asprin” (consider how much “Asprin” as a trademark would be worth today if Bayer was the only company to have rights in it). |
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