Trademarks 101

How often do we hear that reputation is everything? Well, your company name or product brand connects you to your customers or clients. Your trademark or service mark conveys your reputation for delivering quality products or services. After you’ve worked hard to develop a following for what you sell or what you do, you must be sure you are protected so that competitors don’t confuse or misdirect customers.

Here are basic principles of trademark law that every business owner or nonprofit leader should know when considering a name for a new business or organization or a brand for a new product or service, regardless of whether they plan to try to register it as a trademark.

Go for a Knockout.

I’m not suggesting we don boxing gloves. Rather, I want you to complete what trademark lawyers refer to as a “knockout search.” A knockout search is any preliminary screening search you perform to make sure another organization isn’t already using the name or brand you’ve selected. These days, most searches start over the Internet. A search engine such as Google is an acceptable place to start, but you also will want to check state and federal trademark registries.

Not all knockout searches are created equally, either. You may be able to conduct your own early-stage business name or trademark search, but there are situations where legal expertise and experience in trademark matters will better protect your organization.

When Am I Out of Luck?

If you find another organization with the name or brand you had been planning to use, there still may be options for you. The key question is whether consumers are likely to be confused as to the source of the goods or services when they come upon the two names or brands. This question is answered only after considering many subjective factors. The major factor in making that judgment will be how much the two businesses overlap. Does the other company offer services or goods that are similar or related to yours?

For example, if your business offers hair salon services, and the other business is a real estate agency in another state, a conflict is unlikely. You may both be able to use the same company name or same brand — and register a trademark for its use within your own category of goods and services — without confusing the public.

On the other hand, if your business does home inspections and the other business is a real estate agency selling residential real estate, there is a greater likelihood that consumers could mistake the two businesses or believe that they are related to one another. In that case, the business that began using the name or brand first has priority in the United States, and the rights to stop others from infringing.

Build Your Brand by Using It

Assuming your knock-out search succeeds in identifying your new company name or proposed brand as unique for the applicable category of goods and services, you may begin using it immediately. Trademark rights in the United States build with use in commerce. Trademark protection is conferred from the date of first use, not upon the registration date for the name or brand. As you use your new name or brand, customers will begin to associate a particular level of quality or level of service with you and your name or brand.

Why Register Your trademark?

A U.S. Trademark registration gives you presumptive rights to the trademark throughout the entire United States. If you rely on unregistered “common law” trademark rights, the extent of your market penetration will determine the extent of your enforceable rights. Moreover, your unregistered name or brand may not be found when others are performing clearance searches to evaluate their new name or brand. You will be much more visible if your trademark is registered on the Principal Register of Trademarks. Failure to register could cost you a headache later.

You may file an “intent to use” application to register a trademark, and you will establish a priority date with the filing date of that application, even if you have not yet offered the goods or services using the name or brand. The Trademark Office will review the proposed trademark and assess whether it may be registered. Once the application is allowed, the registration certificate will issue only after you have begun using the trademark. However, the pending application is a searchable record at the Trademark Office and will block others from registering confusingly similar marks for their goods or services.

Or, you may first use the trademark and then file a “regular” application to register a trademark. Proof of use in United States commerce must be submitted with the “regular” application upon filing.

Holding a registered trademark may be essential to force websites to take down infringing content. Holding a registered trademark also allows you to record that trademark with the U.S. Customs Service, which will empower the agency to stop goods that infringe your trademark from entering the country.

You also may decide to register your trademark in other countries, many of which do not recognize unregistered “common law” rights. Having a U.S. trademark registration gives you the benefit to file counterpart applications outside the United States.

Ask Pat what other legal benefits you will receive if you register your trademark on the Principal Register.