Trademark Law: Everything You Need to Know
Trademark law is the set of laws and legal regulations that are set up to protect trademarks.Learn About Trademark Law Why. Who,Cause & Losses 21 min read
Trademark Law: What Is It?
Trademark law is the set of laws and legal regulations that are set up to protect trademarks.
A trademark is a legal protection given to any word, name, symbol, or design that is used in commerce to identify the product of one manufacturer from another.
For example, the Nike Swoosh is a trademark that distinguishes it from other sports companies such as Reebok and Adidas. "Coca-Cola" is also a trademark that distinguishes the soda from other soda companies such as Pepsi.
All brands are entitled to trademark their brand and logo, as long as that mark isn't already in use by another company.
A trademark is also known as a service mark, collective mark, certification mark, or trade name.
Extension of Trademark Law
Trademarks aren't simply words and phrases anymore. The laws protecting trademarks or the trademark law has been extended to protect other parts of a company's brand.
The pink color of fiberglass insulation is trademarked by Owens-Corning. The shape of the glass Coca-Cola bottle is trademarked by the Coca-Cola brand. These two things have become synonymous with the brands that own them and is, therefore, able to be protected under trademark laws.
This extension of trademark law to these parts of a brand's identity are known as "trade dress." To be protected under the trade dress aspect of trademark law, the aspect must be associated with the manufacturer and not the product in general.
What that means is that if the feature gives the brand any function or competitive advantage, it cannot be protected under trademark law. For example, if the Coca-Cola bottle had been deemed as easier to hold than other shapes of bottles, Coca-Cola would not have been able to trademark that shape and enjoy the protection of trademark law.
Why Is Trademark Law Important?
A trademark can be massively important to a brand. Consider how important the Swoosh is to Nike. The Nike Swoosh is on every piece of Nike clothing and advertisement you've probably ever seen. If another brand could use that same mark, it would make the mark less valuable.
Trademark law protects trademarks from dilution and improper use. A trademark allows a consumer or buyer to quickly identify the brand that they are buying from. Brands want to build trust with consumers and a consistent brand identity and trademarks allow a brand to more quickly and easily build that trust.
If you taste Coca-Cola for the first time and dislike it, you want to be able to identify Coca-Cola in the future to make sure that you can avoid it. As well, the opposite is true. If you try it and love it, you want to be able to identify it in the future to be able to have it again. Think about how many times you've tried a product, loved it, and the only thing you could remember was the color or symbol on the packaging. Trademarks and brands are vitally important for customers to be able to later identify the brand and product.
Trademark law regulates the use and protection of trademarks, protecting those trademarks as well as consumers from product and trademark confusion.
Trademark law also allows companies and brands to protect their trademarks from use by other brands. Unauthorized use of trademarks is punishable under trademark law. The reason that companies don't want other brands using their trademarks is that it betrays the trust of the consumer and possible dilutes the perceived quality of their products.
Trademark law allows a company to protect its investment in its brand by preventing others from misusing their brand and trademarks.
Limitations of Trademark Law
Though almost any word, phrase, symbol, name, or device for distinguishing a brand can be trademarked under trademark law, there are limitations.
A marks eligibility for protection under trademark law is limited by the functionality doctrine. If a mark falls under the functionality doctrine, it can be denied trademark protection. The functionality doctrine incorporates two categories that must be met:
Use in commerce
Use In Commerce
For a mark to be eligible for trademark protection, it must be used in commerce. This is because trademark law is grounded in the ability of Congress to regulate interstate commerce granted by the Constitution.
The Lanham Act defines a trademark as "a mark used in commerce, or registered with a bona fide intent to use it in commerce."
There is an exception to this rule. If a mark isn't in use in commerce at the time that the applicant files a trademark application, it's OK. But, the applicant must establish in writing that he will make a good-faith attempt to use the mark in commerce sometime in the future. The Lanham Act also grants exclusive rights to a trademark to the person who uses it first in commerce.
So, while a trademark application that is submitted to the USPTO is important when attempting to register a trademark for your business, it is also vitally important that you use the trademark.
A Trademark Must Be Distinctive
The second requirement is used to make sure that a mark is identifiable and distinctive from other marks. If a mark is generic or non-distinguishable from other marks, it isn't eligible for protection under trademark law.
There are four categories of distinctiveness under this clause:
Arbitrary or fanciful
The four categories that fall under the distinctive clause help the examiners at the USPTO to decide whether or not the mark is distinctive enough to deserve protection under trademark law.
Arbitrary or fanciful. If a mark is considered arbitrary or fanciful it is inherently distinctive. A distinctive mark is awarded trademark protection under trademark law by priority of use. This means that the first person to use the mark owns the trademark. This type of mark also bears no connection to the underlying product. For example, Exxon, Kodak, and Apply would fall under this category of trademark. These marks are afforded some of the highest degree of protection under trademark law because they are capable of identifying and underlying product while being distinctive.
Suggestive. A mark that is categorized as suggestive is also considered inherently distinctive. This type of mark receives protection under trademark law. A suggestive mark is one that suggests a characteristic of the underlying product, even if some bit of imagination is necessary to make the connection. Unlike arbitrary or fanciful marks, there is some connection to the brand or product, the mark isn't totally unrelated to the product. For example, "Coppertone" the brand name is suggestive of suntan lotion. These marks are also afforded a high level of protection under trademark law.
Descriptive. If a mark is considered descriptive, it might be protectable under trademark law. A mark that is descriptive is considered distinctive only if it has acquired a secondary meaning in the mind of the public. To determine if something has a secondary meaning, the court will look at four factors:
(1) the amount and manner of advertising;
(2) the volume of sales;
(3) the length and manner of the term's use;
(4) results of consumer surveys.
Personal names and geographic terms can receive trademark protection only if they've become descriptive and have acquired a secondary meaning. A mark that is considered distinctive under the descriptive category would take on a second meaning and also describe the brand. For example, Holiday Inn, All Bran, and Vision Center. All of these names are trademarked, are descriptive of the brand that owns the trademark, and are also distinctive.
Generic. Terms that fall under the category of generic are never considered distinctive and therefore can never receive protection under trademark law. A mark might be generic at the time of application, meaning ab initio, or a mark may become generic over time and lose its protection under trademark law from dilution or overuse. If a mark becomes meaningless and generic to the public, it doesn't deserve protection under trademark law.
Trademark Registration Under Trademark Law
Though not required, it is useful to register a mark as a trademark for protection under trademark law. As stated before, a mark that is used in commerce but isn't registered as a trademark is eligible for protection under trademark law. Though this is true, marks that are registered as trademarks receive more protection under trademark law than those that aren't registered.
The advantages that registered trademarks are given under trademark law are:
Incontestable status after five years of continuous use.
Nationwide notice that the trademark is owned and registered.
Ability to bring an infringement lawsuit in federal court.
Ability to potentially recover treble damages, attorneys fees, and other costs.
This reduces the number of possible defenses of claims against infringement that can be used.
The Lanham Act provides federal protection for distinctive marks that are used in commerce. This means that unregistered marks that are in use in commerce can be protected under trademark law.
An unregistered trademark may also be protected under state trademark laws or common law. Under some states' common law, trademarks are protected as a way to reduce unfair competition. Though the laws vary from state to state, the majority of states have adopted something similar to the Model Trademark Bill. The Model Trademark Bill provides for trademark registration. Some states have also adopted the Uniform Deceptive Trade Practice Act, which doesn't provide for trademark registration. It's important to know what laws govern trademark practices in the state where you're doing business.
Trademark applications are governed by the Lanham Act, which is under Title 37, Part 2 of the Code of Federal Regulations.
Trademark applications are reviewed by examiners at the United States Patent and Trademark Office or USPTO. Along with the help of the courts, the USPTO also polices trademark registries for infringement.
If a trademark application is denied by the USPTO, the applicant has six months to reapply or amend the application. This procedure of denial and reapplication can be continued until:
The examiner gives a final refusal.
The applicant chooses not to reapply, amend, or appeal for six months.
If a trademark application is approved by a USPTO examiner, it is published in the Official Gazette for others to review. If someone thinks that your mark infringes upon his trademark, he can oppose it. If someone files an opposition to your mark becoming a trademark, he is saying that he believes that the registration of your mark as a trademark could be harmful to his trademark.
Someone who opposes the registration of your mark must prove:
That his mark is likely to be damaged by the registration of your mark.
That there are legal grounds for why your mark shouldn't be registered as a trademark.
Unless the opposition is successful, the mark will be registered as a trademark with the USPTO. A certificate of trademark registration will be issued and the notice of registration will be published in the Official Gazette of the USPTO.
Within the first five years of a mark's registration as a trademark, someone can file a petition of cancellation with the USPTO. A petition of cancellation is filed when someone believes that your registered trademark will infringe upon and harm his trademark.
Once you receive trademark protection for your mark, you also receive a certain amount of international protection for your mark. The Tariff Act of 1930 provides protection to U.S. trademarks. This states that it is unlawful to important any merchandise to the U.S. from a foreign manufacturer that is marked with a trademark that is owned by a U.S. citizen.
In summary, there are two ways to gain a trademark for a mark that is qualified for trademark protection:
By being the first to use the mark in commerce.
By registering the mark with the USPTO.
Descriptive marks will likely take a different path towards trademark eligibility than other brand marks. Because a descriptive mark must take on a secondary meaning before it can be registered as a trademark, there may be a long period of time between first use of the mark in commerce and the ability to register the mark with the USPTO as a trademark. Once a descriptive mark acquires the secondary meaning, the trademark protection kicks in.
The two ways of getting a trademark to receive slightly different protections.
Use of a mark in commerce gives the user of the mark protection in a limited geographic area. For example, opening a "Broadway Pizza" in Ohio doesn't allow you to stop someone from opening a "Broadway Pizza" in California. In general, your geographic limitation is given to an area where you might be expected to expand to.
In contrast, if you register your mark with the USPTO and have an intention to use the mark in commerce, you receive nationwide priority to use that mark, even if your sales are limited to a small geographic area. If someone is already using that mark in a geographic area, they retain the right to continue to use that mark.
For example, you register "Broadway Pizza" with the USPTO and receive trademark approval. The guy using "Broadway Pizza" in California retains the right to continue using that name, but you now receive protection to use that name everywhere else.
When choosing the marks that identify your business, it's beneficial to do a trademark search. A trademark search ensures that the mark you choose isn't in use anywhere else. In a trademark search, you should look for any marks that are similar to or the same as the one that you want to use for your business.
If a mark is confusingly similar to another company's mark, you may not be able to trademark or use your chosen mark. Trademark searches can be time-consuming and confusing, but a trademark attorney can help you to discover other marks or to figure out your legal standing in using your chosen mark and then registering that mark.
Trademarks are granted on a first-come-first-served basis, so a trademark search is vitally important when branding a new business. If you use a mark that infringes upon someone else's trademark, you open yourself to the risk of an expensive lawsuit. If you lose a lawsuit, you also lose the right to use your mark and any product that is labeled with that mark. This can destroy a new business from a cost standpoint but also from a loss of ability to brand or advertise the business.
Loss of Trademark Rights Under Trademark Law
Even once you have been granted a trademark, it is possible to lose the trademark. You can lose the rights to a trademark in three ways:
Improper licensing or assignment
When a trademark is abandoned, it means that the owner has stopped using it and has no intent to use it again. The owner's intent to resume use can be inferred under certain circumstances. Non-use of a mark for three consecutive years is considered prima facie evidence of abandonment.
A trademark is only protected if it is being used. This protects people from marks being trademarked and then stored for later use. This would reduce the number of useful marks without adding any benefit to companies or the public. This would devalue trademark law.
Improper Licensing or Assignment
The second way that you can lose your trademark is through improper licensing or assignment. If a trademark owner licenses out the right to use his trademark without quality control on how the mark is being used, the trademark might be revoked.
As well, if a trademark is assigned to a party without the sale of any assets, the trademark privileges will be revoked.
These rules may seem harsh, but they are designed to protect consumers. The purpose of a trademark is to identify a product. If the consumers cannot trust a trademark to identify a product from a certain company or distributor, that trademark loses its value. When a trademark loses its value, it devalues trademark laws and no longer serves its purpose.
Over time, what was once a trademark and brand identifying mark may become generic. If a trademark becomes generic, it can no longer be a trademark. A trademark by definition is a distinctive mark that makes it easy for consumers to identify a specific company.
There are a few examples of this happening. For example:
At one time, these were all trademarked brand names for specific manufacturers. The terms became so popular that they became generic. The terms were overused by the public and became the term for the product, not the brand.
To determine genericity, the courts often look at dictionary definitions, how newspapers and magazines use the term, and attempts by the trademark owner to police the mark.
In summary, you can lose your trademark through not using and overusing it. It's very important for trademark owners to consistently protect their trademarks.
Trademark Infringement Under Trademark Law
One of the major benefits of registering your trademark is that you then have the right to sue for trademark infringement. Trademark infringement is when a party other than the trademark owner uses the mark without the trademark owner's permission.
The standard used to decide trademark infringement cases if there is a "likelihood of confusion" for consumers. If you are selling a good that is marked with a trademark that you don't own or a mark that is similar to a trademark that you don't own, and buyers are likely to confuse your product with the product of the trademark owners, it likely constitutes trademark infringement.
To determine the likelihood that consumers will be confused, the courts look at:
The strength of the mark.
The proximity of the goods.
The similarity of the marks.
The evidence that there has been actual consumer confusion.
The similarity of the marketing channels that have been used.
The degree of caution used by a typical consumer or buyer.
The intent of the defendant.
For example, using an identical mark on the same product would be clear trademark infringement. If you created a smartphone that had an Apple on it, it would be trademark infringement with the iPhone.
Using a similar mark on the same product could also cause confusion and be considered trademark infringement. For example, "Applet" or even "Apricot" computers could cause enough confusion as to be misconstrued with Apple computers and be considered trademark infringement.
Using the same term on a completely different product isn't likely to cause confusion and therefore isn't likely to be considered trademark infringement. This is why Apple computers and Apple Records can peacefully co-exist.
Trademark Dilution Under Trademark Law
In addition to trademark infringement, some trademark owners can and do sue for trademark dilution. A trademark dilution claim can only be brought against marks that are considered "famous."
To decide whether or not a mark is "famous," the court looks at these factors:
The degree of inherent or acquired distinctiveness.
The duration and extent of use.
The amount of advertising and publicity.
The geographic extent of the mark.
The channels of trade.
The degree of recognition in trading areas.
Any use of similar marks by third parties.
Whether the mark is registered with the U.S. Patent and Trademark Office.
The "famous" test is only necessary for federally registered trademarks. Each state has its own requirements for deciding upon state-level trademark dilution. Under state law, dilution can be detected with these aspects:
The mark has "selling power" or distinctive quality.
The two marks in question are substantially similar.
If prerequisites for dilution are met, the owner of the trademark can bring action against any mark that dilutes the value of the original trademark. Dilution of a trademark happens through either blurring or tarnishing. Proving confusion isn't necessary in dilution cases unlike in infringement cases.
Dilution of a trademark through dilution happens when a trademark is identified with dissimilar products.
For example, if someone started making bicycles under the brand name Kodak, it would be considered dilution of the Kodak trademark through blurring.
Dilution of a trademark through tarnishing happens when a brand is presented in an unflattering light. This might happen through association with an inferior or unseemly product.
An example of this is the recent case where Toys 'R Us won a trademark dilution through tarnishment case against pornographic website adultsrus.com.
Other Causes of Action Under Trademark Law
The two main causes of action against trademarks under trademark law are from the likelihood of confusion and dilution, but a third action is under the state law of unfair competition.
Unfair competition is:
Contributory passing off
Reverse passing off
An example of something that would fall under unfair competition is making computers, labeling them with an Apple, and attempting to sell them as legitimate Apple computers. This would be considered "passing off" under unfair competition.
Contributory Passing Off
If someone assists you in passing off or if you give a false product to someone else to sell, this is considered contributory passing off.
Reverse Passing Off
The opposite of passing off is when you buy a branded product and then try to pass it off as your own. For example, buying an Apple computer and then trying to sell it as a computer made by your own brand. This might be as simple as taking off one label and putting on your own.
This is a complicated and unstable part of trademark law but can create a lot of misuse of trademark claims.
Defense Against Trademark Infringement and Dilution Under Trademark Law
If you're accused of trademark infringement or trademark dilution under trademark law, there are only a few defenses that can protect you from conviction.
The two main defenses for a defendant in a trademark dilution or infringement case are:
Under trademark law, the fair-use defense is described as use in good faith for the primary purpose of the mark and not to create consumer confusion.
For example, if someone used the term "all bran" to describe the cereal that they were eating and that cereal wasn't "All Bran," that would be considered fair use of the term. The term in this instance is being used in a purely descriptive manner and not to infringe upon the rights of Kellogg's, the trademark holder for All Bran.
Within fair use, there is another understanding and defense that is called nominative use. Nominative use is described as use of a trademark to identify another producer's product, not the user's own product.
An example of nominative fair use is when the newspaper USA Today asked readers to vote for their favorite member of the music group New Kids on the Block. New Kids on the Block sued USA Today for trademark infringement for the use of their name in the newspaper.
The court decided that this was nominative fair use and wasn't trademark infringement. The court stated that the use was nominative because:
The newspaper couldn't have properly identified the group without using the trademark.
USA Today only used the mark as much as was necessary for identifying the group.
There was no suggestion of endorsement or sponsorship from New Kids on the Block.
In conclusion, the use of the mark wasn't considered trademark infringement because the use of a trademark is sometimes necessary to identify another party or product. If the three conditions above weren't met, this would have been considered trademark infringement.
As long as a parody isn't used or tied too directly to commercial use, it isn't trademark infringement. The reason that parody is allowed is that the artistic and editorial value of the parodies serve a critical function. That function is important enough to receive some protection under the First Amendment.
How to decide the value given to the First Amendment protection of parody varies depending on the court. Some courts have upheld that First Amendment rights trump trademark law on all accounts in all situations. Other courts balance the likelihood of confusion clause with the First Amendment rights to come to a decision.
For example, a trademark infringement case against a Muppet named Spa'am from Hormel's Spam upheld that the pig Muppet's name wasn't a trademark infringement upon the ham product because it was a parody.
Most courts do recognize a parody defense against trademark infringement, but how the parody defense will play out can be complicated. Parody defense cases will highly benefit from the help of an experienced trademark attorney.
Plaintiff for Trademark Infringement and Dilution Under Trademark Law
If you find yourself as the plaintiff in a trademark infringement or trademark dilution case and win, you might be entitled to some rewards.
Monetary relief may be awarded to plaintiffs in the form of:
Damages sustained by the plaintiff
The costs of the lawsuit
In trademark dilution cases, damages are only available if the defendant traded on the plaintiff's goodwill on purpose while using the mark.
State and Federal Trademark Law
Trademarks have a number of legal protections under trademark law. Some of those protections come from federal trademark law while other protections come from state trademark law.
Federal Trademark Law
A majority of the legal protections enjoyed by trademarks come from federal trademark law. Federal trademark laws are known collectively as the Lanham Act.
State Trademark Law
The state trademark laws vary in level of protection from state to state. As well, trademark use and laws are limited to the geographic boundaries of the state, which limit how much protection is given to the trademark in the case of trademark infringement.
State trademark laws protect trademark owners from trademark infringement. State trademark laws also protect trademark owners from unfair competition. Unfair competition is considered the use of a business name that is already in use by another business in that state that is in a similar enough context that it might cause confusion for customers.
Most states employ the rules set forth by federal and state courts when resolving disputes over who is entitled to use a trademark. In general, the rules typically favor the person who uses the mark first as the trademark owner.
Trademark Classes Under Trademark Law
Under trademark law, there are also a number of classes under which trademarks can be sorted. Those classes include:
Trademark Class 1: Chemical Products
Class 1 includes chemical products used in industry, science, and agriculture, including those that go to the making of products belonging to other classes.
Trademark Class 2: Paints and Varnishes
Class 2 includes mainly paints, colorants, and preparations used for the protection against corrosion. Class 2 is one of 45 classes used by the U.S.
Trademark Class 3: Cosmetics and Cleaning Substances
Class 3 includes cosmetics and cleaning preparations, including bleaching preparations and other substances for laundry use; cleaning, polishing, scouring and abrasive preparations; soaps
Trademark Class 4: Industrial Oils and Lubricants
Class 4 includes industrial oils and greases; lubricants; dust absorbing, wetting and binding compositions; fuels (including motor spirit) and illuminants; candles and wicks for lighting.
Trademark Class 5: Pharmaceuticals
Class 5 includes mainly pharmaceuticals and other preparations for medical or veterinary purposes. Class 5 is one of 45 classes used by the U.S.
Trademark Class 6: Common Metals
Class 6 includes mainly unwrought and partly wrought common metals as well as simple products made of them. Class 6 is one of 45 classes used by the U.S.
Trademarks, Copyrights, and Trade Names
Trademark law is a branch of intellectual property law. Intellectual property law is an umbrella term that protects different aspects of intellectual property. Intellectual property is intangible property that belongs to a person or business. Trademark is an example of intellectual property.
Other types of intellectual property include:
Copyrights protective creative, original works of expression. Copyrights aren't generally used to protect words or slogans as that is the territory of trademarks. Copyrights usually protect works of expression such as books, poems, and paintings. A logo could be protected by both trademark and copyright law.
A copyright doesn't exclude someone from creating something similar or of a similar design. As long as the work is original and was created independently from the original work.
The owner of a copyright is either the owner or the creator of that artwork. A copyright lasts for 50, 75, or 100 years, depending on the who owns the copyright. Trademark rights in comparison are indefinite as long as they are properly used and protected.
Trade names, also known as business names, are used to identify a business for non-marketing purposes.
Trade names might be used on stock certificates, bank accounts, invoices, letterhead, contracts, or other uses where the business needs to be identified. Trade names can also be trademarks.
Trademark Law and Naming Your Business
When choosing a name for your business, it's important to at least understand the basics of trademark law. Trademarks are important to consider when naming your business because you don't want to choose a name that is already in use, especially if that business is in your immediate geographic area.
When choosing your business name, you can do a trademark search. It's possible to do a trademark search on your own or to hire a trademark attorney to help you make sure that the name you have chosen isn't already in use or registered as a federal trademark.
If the name you choose for your business is already in use locally or is registered as a federal trademark, you could be setting yourself up for trademark infringement and a time-consuming and expensive legal battle.
In most instances, it's better to choose a different name for your business that someone isn't already using.
When choosing your business name, consider these three points:
Your name should be distinctive and original, not generic.
Search for other using that name or similar names.
Consider registering your name as a federal trademark with the United States Patent and Trademark Office so that no one else can then use the name you've chosen for your business.
Registration of your business name and marks with the trademark office ensures that you are then protected from trademark infringement by others using your name or marks.
Frequently Asked Questions
Why should I register my trademark?
Though it's not necessary to register a trademark, to receive the most protection of your mark, it should be registered with the United States Patent and Trademark Office or USPTO.
What advantages do I get for registering my trademark?
When you register your mark with the USPTO, you get the following advantages:
- Exclusive nationwide ownership of the mark.
- Protection from registration of similar marks.
- The right to use the trademark symbol on your products.
- The right to have the mark to become "incontestable" after five consecutive years of use.
- The "good faith" defense becomes less likely to work in the case of trademark infringement.
- What sources of law govern trademarks?
Trademarks are governed by both state and federal trademark laws. Federal trademark law affords the most and wide-ranging protection for trademarks. State trademark law offers local and certain geographic protections to trademarks but can't offer nationwide protection.
What can be protected by a trademark?
Trademarks protect any identifying mark used by a certain brand. Trademarks also help to protect consumers frombeing taken advantage of by companies representing themselves as a brand that they aren't.
Can I register my mark if I'm not yet ready to use it?
Yes. Though it's best to use a mark for commercial purposes before registering it with the USPTO, you can also preemptively register a mark before using it. If you do register your mark with the USPTO prior to using it for commercial purposes, you must file an "intent-to-use" form with your application. This says that you aren't yet using the mark, but in good faith intend to use it soon. The intent-to-use is granted for only six months.
How long does trademark registration last?
Trademark registration is indefinite, as long as the trademark is properly used and defended. A federal trademark must be renewed every 10 years. If improperly used or not defended, trademark rights can be lost in numerousways.
Do I need international registration for my trademark?
Your trademark should be registered in every country where you think you might need trademark protection. Thereare differences between trademark law in the U.S. and in other countries, so be sure to hire an attorney who specializes in international trademark law to help to figure out the process. Your U.S. trademark does afford you some protection from the import of products that carry a similar mark but are made by foreign manufacturers.
Can I trademark a domain name?
Yes, domain names can be protected by a trademark. As long as the domain name is being used in connection with a website that sells goods or services, it can be registered as a trademark.
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