Once a person or business starts using a mark in commerce, they technically have what is called a common law trademark; the protection afforded to this right is extremely limited. Hence, a common law trademark is only enforceable in the geographic area where the mark is used. In most instances, it is hard to enforce common law rights because it is hard to show when use of the mark began. Therefore, it is important for owners of marks to understand the importance of obtaining registered trademark(s) for their brand(s). They must decide whether they need to obtain a state or federal trademark registration. In this article, I will discuss the difference between these two and what can happen if a trademark registration is not obtained.
In general, state trademarks are quick and easy to obtain, while federal trademarks are more costly and complex. Nevertheless, federal trademarks offer way more protection than do state trademarks. State trademarks protect a mark only in the registered state(s), meanwhile a federal trademark protects the mark(s) nationwide and potentially can be used to obtain international trademarks through the WIPO World Intellectual Property Organization. Furthermore, the owner of a state trademark registration cannot use the registered symbol ® next to its mark to put others on notice. The registrant can only put either a TM for a trademark or SM for a service mark next to its mark. Hence, when a federal registration is pending, the applicant can put either one of these symbols next to its mark and once the federal trademark obtains registration, the applicant can put the registered symbol ® next to it.
There are several other benefits of obtaining a federal trademark: You can register your trademark with Amazon or U.S. Customs and Border Protection Service to prevent infringing products from being imported or sold; the registration creates a public record of use of your mark, which may help deter infringers; and you can file a trademark infringement lawsuit in federal court. In federal court, trademark owners of federally registered trademarks can sue for statutory damages, recover profits, receive triple damages for willful infringement and get infringing businesses to pay their legal fees, which is much harder for common law trademark owners to obtain. Common law trademarks aren’t governed by statute as federal registered trademarks are; state law governs them. Hence, none of the foregoing benefits apply to state or common law trademarks. Therefore, obtaining a federal trademark is usually the better choice.
If an individual or business chooses not to trademark their brand name or logo, they may fall upon several other pitfalls. Usually from the day a person is born they are given a name that is used for identity purposes, in order to differentiate and recognize that specific individual. Similarly, brands and companies need to be named in a fashion that will work as an identity marker for their specific goods and/or services. Unlike people’s names, business brands usually cannot legally co-exist under the same or similar name if they are within the same or similar industry. Therefore, obtaining a trademark early on in a business venture is ideal because it can save the entrepreneur a lot of money, headaches and time.
One might ask how can a trademark save money for a business? Well the answer is very simple: If you start using a brand name or logo for your goods and/or services and have not conducted a trademark search and/or filed to register your mark with the U.S. Patent and Trademark Office (USPTO), you’re taking a huge risk. This risk includes (1) someone else is using the same or similar name, which is trademarked, within the same industry and therefore your mark would be denied registration by the USPTO if or when you apply; (2) someone else is using the same or similar name within the same industry and therefore, some or all of your marketing efforts will be directed towards the other person’s brand/company; (3) someone else is using the same or similar name, which is trademarked, within the same industry and therefore, you will need to re-brand in the future if the other company finds out that you are using a similar mark; (4) someone else is using the same or similar name, which is trademarked, within the same industry and therefore they can sue you for damages; or (5) someone else starts using a similar brand name after you start using yours and files to register their mark with the USPTO before you do and, as a result, most likely you will need to file an opposition with the USPTO to get rid of this pending or registered mark. This process is costly and can take a lot of time. Hence, if you don’t do your due diligence and file to register your mark with the USPTO, there is a high chance one of the foregoing dilemmas will arise and you will be forced to spend more money than what you otherwise would have spent if you filed to register your mark early on in your business venture.
Also, one must always remember that time is money. It takes about eight months to obtain a federal trademark if no issues arise during the trademarking process. However, this time period may be extended drastically if the examining attorney finds an issue with your application or another trademark owner opposes your mark from being registered. Thus, any business owner can understand that if they file for a mark early on and something goes wrong, the loss will not be as grave to their company as if something was to go wrong years down the line when they have expended large amounts of revenue into growing their brand. Thus, waiting to file for a trademark after the brand has been established is a bad idea.
In conclusion, an individual or business must always remember that the risks associated with not obtaining trademarks at the onset of launching their company or brands can potentially be detrimental to its business.
Biana Borukhovich is the founder of The Law Office of Biana Borukhovich.