Warning: This Web page is not legal advice to anyone, including you. Your reading this information does not form an attorney-client relationship with this law firm. The following information is general and may not apply to your situation. Also, this page provides only a brief, high-level and partial summary of an extensive body of U.S. trademark law. This page could become out of date as trademark law evolves. Please do not email us with questions about the content of this page. If you are interested in contacting us about possible legal representation, please call us.
Please see our separate website Brand Bodyguards®, in which we detail our trademarks infringement monitoring and policing services, which includes protections with the new top-level domain names.
More Information – Clients-Only Advisories. Beyond the content of this Web page, we have created a substantial set of client advisories on various aspects of the trademark registration process and trademark issues generally. We make these available only to our clients. Through these advisories, we provide a level of guidance and information regarding trademarks that greatly exceeds what many other trademark practitioners provide.
Links to Content on this Page:
- What is a Trademark?
- How Are Trademark Rights Formed?
- Tips for Choosing a Sturdy Trademark
- The Importance of Trademark Clearance Research
- Trademark Registration – Process and Benefits
- Trademark Marking
- Duration of Trademark Rights
- Trademark Infringement
- Trademarks in Business Transactions – Be Careful
- Dealing with Cybersquatters
- Use a Watching Service
- Our Trademark Experience
What is a Trademark?
A trademark is a word, name, phrase or symbol used to identify the origin of goods or services. (Actually, a service trademark applies to services, and a trademark applies to goods, but we’ll call both a “trademark” for simplicity’s sake.) Under the right circumstances, a trademark can be a product name, a service name, a business name, a logo, a character, a domain name (when used as more than just a domain name), a tagline, a sound, a color or a shape.
Examples of famous trademarks include: the word EXXON, the phrase “WE BRING GOOD THINGS TO LIGHT,” the curvy shape of a Coca-Cola bottle, the McDonald’s golden arches and the sound of the NBC chimes (the musical notes G-E-C, which stand for “General Electric Corporation”).
How Are Trademark Rights Formed?
Common Law Rights. Generally, you gain common law rights to a trademark just by beginning to use it on goods in conjunction with performing services. In other words, a “common law trademark” is a trademark that hasn’t been registered with the United States Patent & Trademark Office (“USPTO”) or with a state. Yet, generally speaking, common law rights only extend to the geographic area of the use of the trademark. Also, you must be the first in your area to use that trademark. If another entity began using a confusingly similar trademark for similar goods and services before you begin your trademark, then that other entity may have superior rights to the trademark, thereby preventing you from using your trademark.
State Registration. Statewide trademark registration is obtained by registering your trademark with your state registry of trademarks (e.g., in Virginia, the State Corporation Commission). A state trademark registration conveys much less power, protection and prestige than a federal registration. In most situations, we recommend seeking state trademark registration only when federal trademark registration is unavailable for some reason. To obtain a Virginia trademark registration, you must have begun using your trademark to promote the sale of your goods or services.
Federal Registration. Federal registration is obtained through the USPTO. You can file an application for a trademark already in use or for a trademark you intend to begin using. A federal registration carries far more power than a state registration. Below, this page explains the advantages of federal registration.
My Company Has Registered Corporate Name – Does That Protect Me? No. A corporate name issued by a state is not a trademark and does not create any trademark rights. Even “trade names” that can be registered with a state or on the local level are not trademarks. Only a trademark allows you to prevent others from using a confusingly similar name for similar goods and services.
My Company Has Registered A Web Domain Name – Does That Protect Me? No again. To be clear, “registering a domain name” means securing the right to use it, usually from an entity such as Network Solutions or Register.com. All a domain name registration does is rent usage of the domain name for a period of time. A domain name registration by itself does not create trademark rights. Operating a Web page at a domain name under the same name as the domain name might create trademark (or trade name) rights if you promote the sale of goods or services there.
Tips for Choosing a Sturdy Trademark
If possible, Choose a Strong Trademark. A pecking order exists for the strength of trademarks. All other things being equal, choosing a trademark higher in the pecking order will allow you to keep your competitors further away from imitating your trademark:
- The strongest trademarks are fanciful trademarks, which are made-up words (for example, EXXON for gasoline).
- The next strongest trademarks are arbitrary trademarks, which are words that have nothing to do with the product or service (for example, AMAZON for book selling).
- The next strongest trademarks are suggestive trademarks – words that suggest attributes of, but don’t describe, the goods or services (for example, CHAMPION for sporting goods).
- Next in the order of strength are descriptive trademarks – words that describe the goods or services (for example, U.S. NEWS AND WORLD REPORT for a news magazine). Descriptive trademarks do not afford any trademark protection, and cannot be registered in the Principal Register of trademarks maintained by the USPTO, unless you can prove that consumers recognize that trademark as identifying your goods or services.
- Next come generic words – words that state what the goods or services are (for example, CAR for an automobile). You cannot have trademark rights in a generic word or phrase and, accordingly, you cannot register such a word or phrase as a trademark.
Don’t Get Attached to a Trademark Too Soon. Often someone will come to us committed to using a particular trademark, perhaps after making a substantial investment in it. Sometimes that person unfortunately learns from us that the proposed trademark is weak, potentially infringing on the trademarks of others or faces other serious legal obstacles.
If possible, come to us in the beginning with a short list of trademark candidates; five to ten is a good number. We can advise you on the comparative strength of the candidates, and do preliminary clearance research on the candidates, in order to identify the best candidate for full trademark clearance research and possible registration.
Use a Three-Part Strategy in Picking a Trademark. When possible, try to pick a company name that’s available (1) as a trademark for your intended goods or services; (2) as a Web domain name (so prospective customers can find you easily); and (3) as a corporate name (if you are picking a company name instead of a product name).
The most desirable Web domain names are those ending in “.com.” Many of the good ones are taken, so you may find it worthwhile to purchase a “.com” domain name from a broker or an individual owner. We can assist you in investigating the ability of the domain name holder to give good title to the domain name (e.g., checking whether there likely are trademark claims of others concerning the domain name) and with closing the transaction in a safe manner. There are more workable domain names available in other top-level domains (e.g., .net, .biz, .info), but we generally recommend against using such a domain name.
The Importance of Trademark Clearance Research
Don’t Skip It! It’s tempting for budget-conscious clients to skip trademark clearance or to not do full trademark clearance. Skipping clearance research almost always is risky and a mistake. You might save $1400-$2000 in the short run by skipping clearance research, but you run the risk of picking and building goodwill in a name you may be forced to drop later. You might even have to pay damages to the entity that forces you to change your name, not to mention the substantial attorneys’ fees you’ll incur in examining and initially resisting the demand for a name change. (John Farmer wrote a column on June 28, 2004, about this issue.) We have seen businesses spend substantial six-figure sums to take care of trademark conflict issues that could have been avoided by proper clearance research.
Do It Even for Existing Trademarks. Even if you are seeking registration of a trademark you already are using, usually you should perform trademark clearance research. Doing so may uncover an obstacle to registration that otherwise might not come to the surface after you have spent a couple or several thousand dollars and many months in the registration process. Also, the earlier you uncover a trademark problem, the cheaper and less painful it is to fix it.
Step 1 – Preliminary Trademark Clearance Research. Usually, the best first step in trademark clearance research is for this firm to check the online database of the USPTO, mainly for registered trademarks and applications still in process. Also, trade publications can be consulted and search engine results examined for potentially conflicting common law trademarks. Think of this research as the “80/20” rule in action; you can find 80% of the likely trademark problems with about 20% of the expense/effort of full trademark clearance research. The purpose of this step is to weed out obvious problem trademarks at low cost. (We discuss legal fees below.) Preliminary clearance research doesn’t clear a trademark for usage; it just identifies a top candidate for full trademark clearance research. You can attempt to do your own preliminary clearance research on the USPTO Website (www.uspto.gov), although we often can get more out of that system than our clients can due to our familiarity with it and with trademark law.
Step 2 – Full Trademark Clearance Research. With full trademark clearance research for a word trademark, we order a trademark research report from a commercial service (usually Thomson CompuMark), which report essentially is a data dump of information on registered and potential common law trademarks. We analyze that report and give you a written analysis of the results, namely the level of risk we see in proceeding with the trademark candidate based upon the search results. Usually a client will pick the most promising trademark from the preliminary research round and have us perform such full clearance research on it. The client uses that full clearance research to decide on whether to commit to that trademark and to file a registration application for it.
The Registration Process Alone Isn’t Satisfactory Clearance. Presently it takes, on average, 13 months for a U.S. trademark registration application to mature into a trademark registration. Businesses can’t wait that long to see if a trademark will achieve registration. Thus, a purpose of trademark clearance research is to give businesses the information they need to decide on whether to commit to a trademark in advance of full review and processing by the USPTO. Also, the USPTO trademark examining attorney does not examine or consider common law trademarks when deciding whether to register your trademark. The holder of an older common law trademark can objectto your application during the publication period (the public gets a chance to object to trademark registrations before they are granted), but few owners of common law trademarks monitor the Official Gazette (the USPTO publication of pending, approved trademark registration applications). Yet, the failure of a common law trademark owner to object during the publication period does not bar future action by that trademark owner. The owner of a common law trademark remains a threat to seek cancellation of your trademark registration and might obtain an injunction forcing you to stop using your trademark. Thus, one cannot and should not rely on the trademark registration process to clear new trademarks.
Trademark Registration – Process and Benefits
The Federal Registration Process. The process for registering a trademark with the USPTO involves much more than sending in a document to be recorded; it isn’t automatic like recording a deed to a piece of real estate. Trademark examining attorneys carefully scrutinize applications, sometimes reject them and usually require some changes. After the USPTO approves your application, the public is given an opportunity to object before the USPTO grants registration. On average, this application process takes about 13 months.
The USPTO examining attorney examines many aspects of an application, including: (a) whether the applied-for trademark is too similar to a registered trademark, or previously-applied-for trademark, for similar goods and services; (b) whether the applied-for trademark is merely descriptive or, worse yet, generic; and (c) whether the description of goods and/or services complies with rigorous USPTO requirements.
Two Kinds of Federal Registration Applications. You can apply to register a trademark already in use (an “in-use” application) or a trademark candidate not yet in use (an “intent-to-use” application). Comparing the two, in-use applications are a quicker route to registration and less expensive in terms of both filing fees and legal fees. In addition, several legal routes exist for registering trademarks already applied for or in use in other countries.
State Trademark Registration. Each state, including Virginia, has its own trademark laws. You can register a trademark on the state level. Virginia accepts only in-use applications; it does not accept intent-to-use applications. The sections below compare the relative advantages of federal registration versus state registration.
Why Federally Register a Trademark with the USPTO? Registering your trademark with the USPTO creates many advantages for you over common law trademark status and state trademark registration.
- The Power to Grow. Registration can give you nationwide rights to your trademark. It reserves your right to use it across the country, so that you can push away most imitators as you roll out your products and services across the country or on the Web. On the other hand, if you rely on your common law trademark rights or even a patchwork of state trademark registrations, you may not be able to use your trademark elsewhere as you expand.
- Uncover Problems Earlier. The registration process may uncover problems with your choice of trademark that likely would be much more costly to address later. Companies who try to proceed on common law rights sometimes run into obstacles after spending a lot of money building recognition in their trademarks. Usually these companies face a future without attractive trademark options and with high legal bills.
- Puts Others on Notice. Registration puts others on notice of your trademark, thereby giving you potential access to a powerful set of remedies, such as the potential recovery of damages, perhaps trebled damages. You may not have access to such remedies if you rely on common law trademark rights.
- Coveted Symbol. Only federally registered trademarks can use the coveted ® symbol. Common law and state trademarks may use “TM,” “SM” or similar designations.
- Protect Your Domain Name. If you use your Web domain name also as a trademark, registration helps to protect against someone taking away your domain name in the future, and against cybersquatters registering, trafficking in or using a confusingly similar domain in bad faith.
- Valuable in Sale of Product Line or Business. A registered trademark is more easily sold or licensed to other users than a common law trademark. If you ever intend to sell your business or product line, being able to convey solid trademark rights will be important to the prospective buyer.
- Helpful Presumptions in Litigation. A trademark registration creates some helpful presumptions in litigation about your trademark, such as a presumption that your trademark is distinctive of your goods and/or services.
- Tax Benefits. When no longer in use, a trademark may be abandoned and the associated goodwill might be deductible for tax purposes.
- Foreign Rights. You obtain a six-month grace period from the time of filing your federal application to file foreign applications and to have them deemed filed on the same date as your U.S. application. That priority is particularly valuable in non-U.S. countries that grant registration on a first-to-file basis instead of a first-to-use basis, because this priority enables you to fend off opportunistic trademark copycats in other countries.
- Can Apply Before Use. You can apply to register a federal trademark before you begin use of that trademark in commerce (this is called an “intent-to-use application”) if you have a bona fide intent to use that trademark and do so within about three years of application.
To compare, these are advantages of state registration vis-à-vis federal registration:
- Cheaper, Quicker. Usually, state registration is quicker and far cheaper than federal registration.
- Fallback Option. If someone else’s common law trademark poses an obstacle to federal registration, then a patchwork of state registrations may be the best way to proceed. Also, sometimes state registration makes sense when a potentially blocking federal registration exists, if you believe that your use of your trademark will not infringe upon the rights of the owner of the federal trademark.
The owner of a trademark should use an appropriate symbol to designate the trademark as its intellectual property. Such a symbol puts the world on notice that the trademark isn’t intended to be a generic or descriptive word that others are free to use for describing their goods or services.
If and when you achieve federal trademark registration, you become entitled to use any one of three designations of registered trademark status: ®, or “Registered U.S. Patent and Trademark Office,” or “Reg. U.S. Pat. & TM Off.” It is illegal to use any of these three symbols of a registered trademark unless and until you achieve federal trademark registration. A state trademark registration does not entitle you to use any of these symbols.
For common law trademarks, you may use the symbol “TM” next to your trademark to designate that you have a trademark for certain goods. Similarly, you may use an “SM” to designate that you have a service trademark for certain services.
Duration of Trademark Rights
Trademark rights continue indefinitely as long as the trademark’s owner does not abandon the trademark or allow the trademark to become a generic term (e.g., “google” used as a term for “Web searching”). For federal registrations, a declaration must be filed during the sixth year after issuance, certifying that the trademark is still in use in commerce. Also, a renewal must be filed every 10 years following initial registration. You cannot perpetuate a federal trademark registration to keep dibs on a trademark if you have abandoned usage of that trademark.
This page cannot do justice to the extensive law concerning trademark infringement in a short summary. In a small nutshell, trademark rights may be enforced in either state or federal court. The relevant federal act, the Lanham Act, provides a range of individual causes of action, such as the following:
- Trademark infringement – unauthorized use of a trademark, or use of a trademark that is confusingly similar to a preexisting trademark and the senior and junior trademarks are used for similar goods and/or services; the classic test for trademark infringement is whether relevant consumers are likely to be confused by the coexistence of the senior and junior trademarks.
- Unfair competition – wrongful trademarking of goods or services in a manner likely to confuse the consumer as to the true source of goods or services.
- Dilution – use of a famous trademark in a way that tarnishes the image of, or dilutes the power of, the famous trademark; famous trademarks tend to be household names, such as COCA-COLA or MCDONALD’S.
- False advertising – false and disparaging trade statements (1) about your product or service, (2) about the product or service of a competitor, or (3) made in a comparison between your product or service and a competitor’s.
Remedies for Infringement. Where trademark infringement is proven, possibly available relief includes temporary, preliminary and permanent injunctions, pre-judgment seizure of infringing goods, seizure of infringing goods by the Customs service, other equitable relief, actual damages, a disgorgement of the infringers’ profits, enhanced damages, and attorneys’ fees.
Trademarks in Business Transactions – Be Careful
This page does not attempt to summarize the extensive law concerning how trademarks must be handled in business transactions. We’ll leave it at noting a few problems we often see. Overall, even experienced business attorneys, due to ignorance or misconceptions concerning the requirements of trademark law, frequently mishandle trademarks in business transactions. Common mistakes include attempting to transfer ownership of intent-to-use trademark registration applications before proving trademark usage to the USPTO, failing to transfer goodwill along with the related trademark, and inadvertent sweeping of trademarks into security interest grants or other loan collateral. Such mistakes can extinguish trademark rights. The loss of rights due to such causes often is not detected until the trademark owner tries to assert trademark rights against a putative infringer.
Dealing with Cybersquatters
In some circumstances, trademark law can provide a basis for taking away a domain name if the domain name was registered, used or trafficked-in with a bad faith intent concerning a trademark. A conventional suit in federal court for trademark infringement (or dilution or tarnishment) might attack such cybersquatting. Yet, other remedies exist that specifically target cybersquatting.
UDRP Arbitration. The Internet Corporation for Assigned Names and Numbers (“ICANN”) maintains a Uniform Domain-Name Dispute-Resolution Policy (“UDRP”) under which domain name disputes can be resolved in an administrative process without having to appear in court in person. This procedure often is quicker and cheaper than a federal lawsuit, although it does not offer the full range of remedies available in a federal lawsuit.
ACPA Litigation. A federal act called the “Anti-Cybersquatting Consumer Protection Act,” which is part of the federal Lanham Act, provides specific remedies for cybersquatting. The ACPA permits recovering damages and attorneys’ fees from cybersquatters in some cases, unlike the UDRP. The recoverable damages can be either actual damages suffered or statutory damages of as much as $100,000 per domain name. The threat to recover damages and attorneys’ fees can be an effective lever against cybersquatters who otherwise price their payoff demands just below the cost of extracting a domain name by use of the UDRP process. Also, a procedure exists to sue under the ACPA even if the registered owner of the offending domain name cannot be found or required to litigate in a U.S. court, although recovery of damages and attorneys’ fees is not available under the ACPA in those instances.
What We Can Do for You
Practice Areas. We have substantial trademarking experience at the international, federal and state levels. Our trademark services include:
- Trademark selection counseling
- Preliminary and full trademark clearance research
- Registration with the USPTO or state trademark offices
- Post-registration trademark maintenance
- Counseling regarding the proper care and feeding of trademarks
- Serving as coordinating counsel for obtaining and maintaining trademark registrations in other countries; we can assist you with finding and hiring appropriate trademark counsel in other countries and can coordinate the activities they take on your behalf; we act as your single point of contact
- Applying for trademark registration in countries other than the U.S. that also are members of the Madrid Protocol (John Farmer wrote columns on November 25, 2002, and October 27, 2003, about using the Madrid Protocol)
- Watching for potentially infringing federal trademark applications submitted by others and for infringing trademarks used by others
- Policing your marks by corresponding with potential and actual mark infringers and then, if necessary, initiating mark infringement litigation
- Litigation representation in cases involving trademark infringement, unfair competition or false advertising; we can serve as your sole litigation counsel, or serve as coaches or co-counsel to your litigation counsel
- Trademark licensing, trademark assignments, security interests in trademarks, trademark aspects of franchise agreements, and commercializing products that include trademarks
- Web domain name protection via trademark registration and auditing Websites (for both trademark issues and for other intellectual property and other technology law issues)
Use a Watching Service
Once you commit to using a trademark after conducting research to clear it, we recommend subscribing to a trademark watching service. Such a service will watch for potential infringement of your trademark. You should conduct such watching to preserve the power and potential fame of your trademark and to prevent others from encroaching on your trademark rights, thereby damaging them.
Please see our website dedicated to trademark infringement watching and policing: Brand Bodyguards®.
Our Trademark Experience
We have deep experience and extensive resources. We can file applications on a same-day electronic basis with the USPTO. We maintain an electronic docket of all of our clients’ applied-for and registered trademarks. We provide reminders of important, coming deadlines in the registration process and for registered trademarks. John Farmer has prosecuted many trademark registration applications and coordinated numerous foreign trademark filings. Also, we’ve litigated trademark registration oppositions and infringement cases, and that experience helps us perform better when preparing and prosecuting registration applications.