Many start ups begin with limited finances, forcing them to consider what they can and cannot afford at any given stage in development. While most small businesses and start ups question whether they can afford to pursue trademark registration as part of their brand development, what they cannot afford is to wind up on the wrong side of litigation for failing to fully explore on whose turf they may inadvertently be treading. It is easy for businesses of all sizes, whether starting up, re-branding, or expanding their growth into other areas of development, to unwittingly adopt a brand already in use by another business. Learning what, or who, is in a name is a step in the start up process that most cannot afford to skip.
A trademark is generally a word, phrase, symbol, or design, or a combination thereof, that identifies and distinguishes the source of the goods of one party from those of others. A service mark is the same as a trademark, only it identifies and distinguishes the source of a service, as opposed to goods. Trademarks and service marks are commonly referred to singularly as “trademarks.” Trademarks, copyrights, patents and trade secrets each protect different types of intellectual property. A trademark, for instance, protects things like brand names and logos used on goods or in association with goods and services, whereas copyright protects original works of authorship, including literary, musical, artistic, and certain other intellectual works. Knowing which intellectual property device affords the protection you and your business needs is an important first step to learning the ways in which you can and should protect your development.
Not every mark is protectable, so it is important to consult with an attorney before investing time, money and resources into developing a brand. Trademarks are afforded protection under common law without a formal registration. However, common law protection is limited to the geographic area in which is it is used in commerce. Prior common law usage will supersede a federal registration based upon use that comes later in time. Trademarks may also be registered federally with the Patent and Trademark Office. Registering a trademark affords enhanced protection.
Remember that you, as the mark owner, will be solely responsible for enforcing your mark, so it is imperative that should you choose to pursue trademark registration that you also be prepared for the time and expense that may come with enforcing it. Abandonment of a mark can occur for a number of reasons, including failures to act. If a mark holder ceases to use the mark and demonstrates no intention to resume use, the mark can be deemed abandoned. Abandonment also occurs, however, due to failure to properly police the use of the mark such as failing to properly exert control of licensing of the mark – what is commonly referred to as “naked licensing.” This can occur when a mark holder fails to properly control the nature and quality of the goods and/or services associated with the mark. Another way in which a mark may be compromised is due to improper use of the mark. For example, a mark can lose its distinctiveness, and therefore its protectability, over time if the mark holder fails to ensure that the mark properly identifies the specific goods and/or services with which it is associated.
Even if you determine you will not pursue trademark registration, you still must be aware of other businesses who choose to enforce their marks, both at common law and those that are federally registered. The standard for trademark disputes is whether a “likelihood of confusion” exists between the marks such that a consumer could be confused as to the source of those goods or services with which it is associated. That being said, two identical marks can co-exist so long as the goods and services are not related (a good example is Dove chocolate and Dove soap, which can co-exist based on this principle).
Conducting the Search
Conducting a thorough trademark search is equally important whether your business is pursuing a trademark registration or simply seeking to avoid inviting a claim of infringement from another business. While many companies check sources such as the Virginia State Corporation Commission website to ensure a particular business name is available, or may peruse the Trademark Electronic Search System, it is highly advisable to seek the assistance of a trademark attorney to ensure you have completed a thorough search. It is imperative that you learn whether superior common law rights exist, and there are methods of searching the Trademark Search Database in terms of particular classes and methods of registration that will produce much more comprehensive and reliable results. It is far easier to navigate known potential sources of conflict than to react to a claim of infringement or suffer through the painful and expensive process of re-branding.
How to Register and Maintain Your Mark
Pursuing trademark registration as part of your brand management and development is sometimes, but not always, advisable. Start ups in particular should be mindful of the longevity of their business model, as many times individuals involved in the business end up parting ways for a variety of reasons. While a federal registration will provide the mark holder with the broadest protection possible and the strongest position from which to defend against potential infringement, the requirement of policing the mark’s use to avoid abandoning the mark is something the mark holder must also be prepared to do. As mentioned previously, federally registering a trademark affords enhanced protection such as a presumption of validity, enhanced money damages, and potential recovery of attorneys’ fees in the event of a dispute. If you are the mark holder, this is a often better position to be in as opposed to claiming simple common law rights. In contrast, if you are accused of infringement by a mark holder of a federally registered mark, you will generally have a much more difficult if not impossible time overcoming such a claim and can incur serious expenses in defending against such a claim as a result.
How We Can Help
Developing your brand is an important aspect of any company’s development no matter the type of industry or the size of the business. We can help identify your business’s needs, advise you as to the appropriate course of action for your company long term, and ensure that resources devoted to brand development are well spent. Assisting small businesses with identifying and prioritizing legal needs to help avoid of practical pitfalls is our focus. We speak on a number of these topics and would be glad to assist you in any way we can.
Have an intellectual property law, business law, or other legal problem? Contact us to see how we might help.
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