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WHAT'S IN A NAME?
VALUE WORTH PROTECTING
WHEN, WHERE, AND WHY YOU SHOULD REGISTER A TRADEMARK.
By Dan Block
Whether your business sells products or services, the name or logo design attached to those products or services is, or may become, very valuable. Unless you operate your business under someone else’s trademark or service mark (such as in a franchise relationship), if you have not registered that name or logo as a trademark or service mark, you may be missing the boat. That name or logo should be protected. A U.S. trademark or service mark registration is the best protection available in this country.
The term “trademark” is often used to refer to both trademarks and service marks. Technically, a trademark is applied to goods (products), and a service mark is used in connection with services. The same “mark” (i.e., words or a logo design, or both) may be registered as both a trademark and a service mark if both products and services are sold under that mark. The discussion below will use the terms “trademark” and “mark” for both trademarks and service marks.
The legal name of the business is not a trademark. It is a trade name. Thus, XYZ Automobiles, Inc. is not a trademark, although XYZ can be a trademark for cars sold by XYZ Automobiles, Inc. Also, an Internet domain name registration is an address, not a trademark (although Internet domain names may also be registered with the appropriate government agency as a trademark). An Internet domain name registration is not a substitute for a trademark registration.
Once a business begins using in commerce a mark associated with its product or service, the business acquires common law trademark rights to that mark. However, the common law rights only apply to the territory in which the name is being used, and only if that business has the first use of the mark for the particular product or service in its territory. Thus, a restaurant operating only in Denver may have common law trademark rights to its business name only in the Denver metropolitan area.
The next level of protection is available with a state trademark registration. With a state trademark registration, the business acquires the rights to the mark in its trade area in that state (which may be the entire state); provided that no individual or entity has a prior claim to the mark in that state (or a portion of that state).
Maybe because of the cost involved in getting a federal trademark registration, which is much more that an Internet domain name registration or a state trademark registration, some small business owners decide not to pursue a federal registration. Or, a small business owner may take the view that he or she is only operating at one location, so common law protection is sufficient. Or, maybe he or she is only operating at a few locations in Colorado, so a state trademark registration will be sufficient.
As some business owners later discover, that view may be short sighted. If the business takes off, the business owner may decide to expand into more states; or if the business is really successful, the business may go “national.” With only common law or state trademark protection, if the business begins operating in one or more states a few years later, it might be unable to use its name there, because another business is already using the name.
A U.S. trademark registration puts other businesses and individuals throughout the U.S. on notice that you are claiming rights in your mark, and that you may claim those rights anywhere in the U.S. In contrast, with a state trademark registration, you are only staking a claim to that mark in that state. A business or individual in another state could register and use the same trademark in that other state and prevent your business from using your mark in that other state.
Once a business files a U.S. trademark registration application, it establishes a priority date for its mark. If the business eventually succeeds in getting the trademark registration, it can stop other businesses and individuals who begin using the mark on a date after the priority date from using that mark, or a similar mark, in connection with the same or similar goods or services.
To qualify for a U.S. trademark registration, the business must be using the mark in interstate commerce. Essentially, if the business operates in more than one state, or if the business sells products or services to customers who reside in more than one state, the business is using the mark in interstate commerce (and there are other ways of doing business in interstate commerce). Thus, even the restaurant with only one location in Denver is most likely using its mark in interstate commerce.
If the business is already using the mark in interstate commerce at the time it files an application for registration, it can file an “actual use” application. The filing date of the application is the priority date. A business that has not yet begun using the mark, but intends to do so in the near future, can file an “intent to use” application to establish an earlier priority date. Then, when the business begins using the mark in interstate commerce, it files the appropriate document with the U.S. Patent and Trademark Office, and if the mark meets the qualifications for registration, it will have the application date as its priority date.
If a business has a logo that includes both a design and a word or words, the business should consider registering both the logo and the word(s) as two separate marks. The reason for registering both is that if the business registers only the word(s), the business is not protecting the design in the logo. However, if the business only registers the logo, and it decides years later to significantly change its logo design (which is not uncommon), it may have to abandon that registration. However, by registering both the logo and the word(s) as separate registrations, the business will be able to maintain its registration on the word(s).
To be registerable, a mark must not be a generic term or merely descriptive of the goods or services sold under the mark (unless the mark has acquired “secondary meaning,” such that the public associates the mark with the particular source of the product or service). A mark that is fanciful (a made up word) or arbitrary (a word that has no relationship to the product or service it identifies) is the most distinctive, and thus, the strongest type of mark. The next level of distinctiveness is a suggestive mark (a word that suggests some quality of the product or service). At the bottom level are descriptive marks, which describe the product or service, and as mentioned above, can qualify for registration only if they have acquired secondary meaning.
The significance of a stronger mark is that any later applicant for trademark registration must adopt an increasingly distinctive mark, depending upon the strength of the original registrant’s mark.
The following are examples of the various levels of distinctiveness for marks used for automobiles: Acuraâ is a fanciful mark. Grand Cherokeeâ is an arbitrary mark. Land Roverâ is a suggestive mark. General Motorsâ is a descriptive mark, which long ago acquired secondary meaning.
Further, to be registerable, a mark must not be so similar to an existing registered trademark as to cause a likelihood of confusion among the public as to the source of the goods or services under the mark. A mark may cause a likelihood of confusion among the public because it looks like another mark, it sounds like another mark (when spoken), or has a similar meaning as another mark (for example, a similar word in another language). If similarity is present between an existing registered trademark, and a mark for which an application for registration has been filed, the trademark examiner will then consider whether the goods or services sold under the marks are the same or similar (such as substitutes for each other), or complementary (such as golf clubs, golf bags, and sportswear). If the marks are similar, and the products or services are similar or complementary (among other factors), the mark for which registration is sought probably cannot be registered.
How do you determine whether your mark is similar to another mark? After all, even if you choose a mark that is very different from any other marks you are aware of for similar goods or services, you do not know about every mark that is being used in the U.S. The best course of action is to have a comprehensive trademark search conducted, which compares your mark against all federally registered trademarks, all state registered trademarks, and various common law databases, covering marks for similar products and services. Fortunately, businesses exist that specialize in running these comprehensive trademark searches. Once the search is completed, an attorney with experience in trademark law can advise you as to what those search results mean, in terms of the likelihood of you succeeding with a trademark registration application for your mark.
Dan Block is an attorney at Robinson Waters and O’Dorisio, P.C. in Denver. His practice includes trademark law and business law. He can be reached at dblock@rwolaw.com or (303) 297-2600.
