Generally speaking, trademark rights in the United States arise in the context of use. Use or acts by others which evidence non-use jeopardize those rights and are legally analyzed as "abandonment." An "abandoned" mark has fallen into the public domain and is free for adoption and use by others. Abandonment can take various forms. This article discusses the failure to prosecute infringers.
Don't allow "dilution" of your trademarks.
While the failure of a trademark owner to prosecute third-party infringers has been characterized by some courts as evidence of abandonment, the more readily-ascertainable harm is a gradual erosion of a mark's distinctiveness, e.g. the power of the mark to identify a particular source of good or service. Third-party use causes the mark to become "weaker" because it appears to coexist within an increasingly "crowded field" of other similar marks.
Don't allow "tarnishment" of your trademarks.
The other harm is "tarnishment," the mental association of the mark with inferior or offensive products or services. Continued unabated, third-party infringers will eventually cause the mark to lose all strength as a distinctive symbol of source, having the same effect as an abandonment. What's worse, so weakened, a mark-owner would be powerless stop future infringers, losing any goodwill associated with the mark. Courts, as a matter of policy, have hesitated to hold trademark owners to a strict policy of pursuing every potential infringer: "an owner is not required to act immediately against every possible infringing use in order to avoid a holding of abandonment. *** Such a requirement would unnecessarily clutter the courts." Wallpaper Mfrs., Ltd. v. Crown Wallcovering Corp., 680 F.2d 755, 766.
Monitor your trademarks
How do mark owners protect against third-party use? Monitoring. Trademark monitoring involves periodic policing of State and Federal trademark databases for applications to register marks as well as policing the Internet for actual use. By monitoring Federal trademark application activity, mark owners can properly object to third party registrations during the statutory, thirty-day "Opposition Period." By monitoring Internet activity, owners can identify and address risks early, before extensive customer confusion can occur and before the third party as invested money to promote the mark, making an early settlement more difficult.
The thirty (30) day opposition period commences with the publication of the mark in the Official Gazette. This thirty (30) day period is the only chance that a party can object to the registration of a proposed mark on the ground that they believe they may be harmed by such registration, e.g. that there exists a "likelihood of confusion."
A mark holder must monitor the Gazette (or the trademark database) on its own. No other notice is provided to trademark owners. An opposition proceeds very much like a traditional lawsuit governed by the Federal Rules of Civil Procedure, Federal Rules of Evidence and case law. The opposer is given the opportunity to present evidence in the form of testimony (depositions) as well as documentation (oftentimes this includes actual or prospective customer surveys) to argue that there is a likelihood of confusion.