Intellectual Property Basics - Trademarks

TRADEMARKS AND SERVICE MARKS

A. Definitions.

i. Trademark.  A trademark is a word, name, symbol, device, phrase or expression used by a manufacturer or merchant to help consumers identify and distinguish its goods from those of its competitors.  The right to use a trademark can become exclusive if certain legal requirements are met.

ii. Service Mark.  A service mark performs the same function as a trademark, except that it is used by suppliers of services rather than suppliers or manufacturers of goods.  Service marks and trademarks are often confused, and are entitled to the same legal protection.

iii. Trade or Business Name.  A trade name or a firm name can be identified to a trademark, but it is used to identify a business entity rather than to identify specific goods or services marketed by that business entity.  It is important that a trademark usage be established independently from the firm name usage.  For example, if a business incorporates under the name "Joe's Widgets, Inc." with the intent of manufacturing and marketing a product called "Joe's Widgets", the state will not allow anyone else to register their business under that name.  Absent trademark protection, however, a business named "Steve's Widgets, Inc." could still sell a product called "Joe's Widgets."

B. What Can Be Protected as a Trademark or Service Mark.  A wide spectrum of words and combinations of words or symbols can be used and protected as a trademark.  An arbitrary word or symbol that is has no relationship to the product it represents has the best trademark potential (e.g., Kodak).  A word or symbol that is suggestive of the product it represents has a very good trademark potential (e.g., "Obsession" for perfume).  A descriptive word or symbol is more difficult to trademark and could lose its trademark protection if it becomes used generally (e.g., Lite Beer, Express Mail).  Finally, a generic word or symbol that merely describes the product is not protectable as a trademark (e.g., telephone, desk).

C. Establishing a Trademark.  Under common law, the rights to a trademark are established when the business adopts a particular mark and actually uses it in commerce.  Actual use in commerce requires a sale of goods with the mark either affixed to the goods or to the container for the goods.  Use of a trademark in commerce, not registration of the trademark, is the key to attaining protectable trademarks rights.  Valid, enforceable trademark rights can be obtained at common law without ever registering the trademark, although registration offers certain advantages.

The date of first use of a trademark in commerce is important in establishing the priority of rights over the rights of the use of a conflicting mark.  Typically, the company or person who first uses a protectable mark in commerce is deemed the owner of the mark, at least in the geographic area in which the mark is actually being used, unless someone else has already filed an application for a federal registration of the mark based upon their intent to use it.

Federal registration of a trademark gives the registrant a nationwide right of priority in its trademark.  The registration of a trademark is deemed constructive use of the trademark in all areas of the country, thus giving the registrant priority from the filing date over all others who might use the mark, except those who used the mark prior to such filing and who have filed their application for registration of the mark.

D. The Trademark Registration Process.  An application for federal registration of a trademark is filed in the United States Patent and Trademark Office.  The filing fee is $275.00 to $375.00 (depending on the filing method used - fees are current as of July 1, 2008) per category in which the mark is registered.  Applications for registration are examined by a trademark examiner.  If it appears to the examiner that the applicant is entitled to have the mark registered, the mark is published in the official Gazette of the Patent and Trademark Office, and anyone objecting to the registration of the mark has 30 days after publication in which to file an opposition.  

Assuming no opposition is filed, a certificate is issued certifying that the applicant has complied with the law and that the applicant is entitled to registration of the mark.  A federal Certificate of Trademark Registration remains in effect for ten years, and may be renewed for unlimited additional ten year terms.  During the sixth year after registration, the applicant is required to file an affidavit indicating that the trademark is still being used in commerce.  Failure to file the affidavit will result in a termination of the registration.

E. Trademark Notice.  If a trademark or service mark is federally registered, the circle R symbol (®) should be affixed to the trademark or service mark each time it is used.  If the trademark is not federally registered, "TM" can be affixed with the trademark to give notice that the person using the trademark is claiming common law trademark protection for the mark.  "SM" is the correct notice for a service mark that is not federally registered.

F. Loss of Trademark.  A trademark or service mark can be lost in several ways.  A federally registered trademark is generally considered abandoned when there are two years of unexplained non-use of the mark.  A trademark can also be lost through incorrect or improper licensing procedures.  Any trademarks are lost when they become generic terms, i.e., when consumers no longer associate the trademark with a particular brand of product, but rather with the class of products.

G. Benefits of Federal Registration.  Federal trademark registration provides legal notice to others throughout the United States that a trademark has been established and is not available for use by others.  When a trademark is federally registered, it is more convenient and generally less expensive to enforce the trademark owner's right to exclusive use.  After five years of use, a federally registered trademark becomes incontestable and the defenses available to an infringer are limited.  More severe penalties can be imposed upon the infringer of a federally registered trademark than against the infringer of a common law trademark.