Trademark clearance and registration—sounds like an additional legal expense, right?
Unfortunately, this potential cost is the reason many individuals and businesses forgo the trademark clearance and registration process completely or decide to swim through the trademark process without legal counsel. The United States Trademark and Patent Office ("USPTO") offers many helpful resources for first-time filers and the online filing process has tips to avoid filing mistakes, but often it just isn’t enough to keep an applicant afloat.
The trademark selection and registration process, like the depths of the ocean, has many unseen dangers for the unwary swirling beneath the surface. It is critical to understand the limitations and strengths of the trademark legal current before you select a trademark or file an application. This understanding allows individuals and businesses to avoid the unnecessary time, expense, and business disruptions caused by unenforceable trademarks and a choppy application examination process.
COMMON (AVOIDABLE) TRADEMARK DANGERS
Weak Trademark: When your selected trademark provides little to no legal basis to exclude others from its use and fails to identify the source of your goods or services in the marketplace.
It's tempting to choose a trademark that conveys (describes) something about the products or services that will be provided under your brand. This approach can understandably minimize the expenses required to tie your brand to your goods and services or to otherwise convey certain qualities or characteristics about your goods or services–"hot" for food products, "fast" for Internet services, or "vivid colors" for paint.
However, a trademark can only be considered as such if it is distinctive and capable of distinguishing the goods or services of one party from another. Descriptive terms, which are terms that are not distinctive, are not afforded enforceable trademark rights without longstanding use demonstrating the existence of a secondary meaning.
It can also be tempting to choose a geographic location as a brand. Geographic locations are tricky, and the rules vary by country, but generally if the trademark primarily indicates a geographic location, rather than the source of products or services, it will fail to function as a trademark. As a result, like with descriptive terms, use of a geographic location as a trademark affords limited to no trademark rights.
To avoid the trademark shark, it's important to select a distinctive name. The most distinctive trademarks, in order of strength, are:
- Fanciful (no meaning other than as a trademark—EXXON®, XEROX®, KODAK®);
- Arbitrary (no relation to the good or services—APPLE® for computers and QUICKSILVER® for clothing); and,
- Suggestive—(suggests, but doesn't describe, the goods or services).
Geographically Limited: Delayed trademark registration can restrict the geographic expansion of your business.
Trademark rights exist even without registration—rights are acquired through continuous use of the mark in commerce. While priority is an essential component of trademark law, it is a common misconception that "first to use" means trademark rights are conferred without limitation. However, absent a registration, trademark rights are limited to the geographic area of use. Often this results in senior users (the “first to use”) encountering other users of the same or similar brand in another geographic area, thus limiting the senior user's business expansion or requiring investment in rebranding. Trademark clearance and registration early in the branding process can help you avoid business expansion limitations and potential rebranding requirements.
Likewise, it is a common misconception that a federal trademark registration confers unlimited trademark rights, including the ability to prevent any use of a similar trademark. In fact, federal trademark registrations don't confer an absolute exclusive right, nor does ownership of a federal registration itself determine the right to use a mark.
Common law trademark rights acquired in good faith by one party prior to the application filing date of a federal registration are not diluted, terminated, or otherwise extinguished by a later federal registration. To the contrary, the holder of such common law rights existing prior to the federal registration may exclude the federal registration holder from the areas in which the common law rights exist. This remains true even if the federal registration owner's own common law rights existed in another location prior to the other party's common law rights.
Another party's federal registration obtained after the existence of common law rights cannot be relied upon to force the common law trademark right owner to forfeit such common law rights or to cease use of the mark within that party's established common law area. The result is that, without proper clearance and due diligence, you can be restricted from geographically expanding your business even if you're a federal trademark registration holder.
To avoid the uncertain pull of a rip current, it's important to understand these nuances of trademark law before investing in a brand that cannot be expanded or attempting to enforce your brand against a third party with senior rights.
Unsubstantiated Date of First Use: Failure to understand the importance of, and difference between, “use in commerce” and “bona fide use” can cause the loss of rights and, sometimes, make your registration vulnerable to a challenge.
The terms and phrases "use," "date of first use anywhere," and "date of first use in commerce" each have legal significance in trademark law. Trademark rights are acquired through use, and often registration, so it is important to correctly identify these dates in order to establish priority. An understanding of the legal differences and definitions of these terms is vital to ensure date accuracy within your application and for responding to any trademark dispute. Failure to accurately identify these dates can have detrimental consequences for your registration and the results of any trademark dispute in which you become involved.
To avoid the sting of lost registration rights, it is important to ensure date accuracy and advisable to have documentation available to verify them should your date ever be challenged.
No Proof of Use: When your sample of use (the component of your application requiring such samples of use is called the "specimen") you provide to the USPTO is rejected as insufficient to support your trademark application.
For your application to register in the United States, you must demonstrate use of your trademark in connection with the goods or services identified in your application.
Multiple issues can arise with specimens, such as your mark not being prominently displayed, it failing to function, or it not being used in relation to your goods or services in the application. There are also certain forms of specimens required for applications filed in relation to goods versus those required for services. To proceed to a registration, you must understand what your specimen must show and the form in which it must be presented.
Don't let a shore break be your barrier to registration—make sure you understand the legal requirements of your specimen for your application.
Inconsistent Use: Inconsistent use of your trademark can damage and dilute your trademark rights.
Trademark law permits nonmaterial alterations in a mark without the loss of rights; however, proper use of a trademark means consistency. Consistency in the appearance of your mark and how it is used in connection with your goods or services identified will enhance consumers' ability to associate your mark with you and can be a vital part of demonstrating trademark rights in a dispute.
Consistency also improves your likelihood of success in the examination process by mirroring the mark in your application to the specimen(s). Finally, consistency will assist you in maintaining your registration when you file renewal documentation with the USPTO.
If you have variations on your brand name or logos, multiple applications can be filed. Yet, the main mistake to avoid is deviating your use in a way that dilutes your rights and/or puts your registration at risk of abandonment.
Avoid poisoning your trademark rights through inconsistent use.
Identification Issues: Your failure to properly identify your goods or services in your trademark application can cause extended prosecution or ultimately a rejection that requires refiling.
- Too Broad or Vague: United States trademark law requires a certain level of specificity when defining the goods and services in an application. Identifications that are too broad or vague will extend the time and expense of your trademark application process. In addition, your failure to delete goods or services not in use when filing your statement of use or other maintenance document can make your registration vulnerable to cancelation.
- Too Limited: While specificity is required, too narrowly defining your goods or services can result in a registration that does not provide the protection you need. It can also often lead to issues with your specimens of use.
- Goods and Services: Misidentifying your goods or services can result in your need to refile and cause the loss of your federal priority rights.
Whether you sink or swim as a trademark owner may depend upon your identification of your goods and/or services.
Likelihood of Confusion: Your trademark application can be refused if your mark is confusingly similar to a prior application or registration.
Refusals based on the likelihood of confusion are probably the most common and difficult obstacle to registration. Trademark law prevents the registration of a mark that is confusingly similar with another trademark. In simple terms, two similar marks for related goods or services cannot both be registered.
This confusingly similar standard covers similarities such as phonetically sounding the same, roughly translating to similar meanings, and having an overall similar commercial impression. Adding descriptive terms, superlatives, or pluralizing or modifying the tense of a term is not sufficient to distinguish a confusing trademark or overcome likelihood of a confusion rejection.
To avoid the burn of a likelihood of confusion rejection, you must ensure the availability and registrability of a mark before selecting it. More importantly, consider filing strategies that will increase the chances of registration, long-term benefits offered by registration, and any potential infringement risks related to prior existing trademarks.
LIFE JACKETS AND DISASTER RELIEF
Beaches are not always tranquil, and trademarks are not always simple.
These trademark dangers are just a few of the many costly, and sometimes devastating, disasters trademark owners can encounter when navigating the trademark waters alone. Seeking the advice of counsel knowledgeable in trademark law can help you ensure that your brands avoid the fate of the S.S. Minnow.
© 2023 Ward and Smith, P.A. For further information regarding the issues described above, please contact or .
This article is not intended to give, and should not be relied upon for, legal advice in any particular circumstance or fact situation. No action should be taken in reliance upon the information contained in this article without obtaining the advice of an attorney.
We are your established legal network with offices in Asheville, Greenville, New Bern, Raleigh, and Wilmington, NC.