So maybe you’re just starting up a company and you’ve landed on a great name for your business. It’s a perfect name – it describes your business, it holds sentimental value, and it has already been incorporated into your website and letterheads. It’s safe to say that this is the name your business is meant to have and you’re ready to write it in stone.
This is when you start thinking about making your brand official and cementing your place in the market. You want to protect your brand and you’ve learned that the most straight-forward way how is to register your company name with the United States Patent and Trademark Office (USPTO). After all, what’s more official than the federal government?
But, wait. You’re a business owner. So that means you do your homework before you make any big decisions. You take to the internet and figure out what experts and fellow business owners are saying about trademarking. You want to know if registering a trademark is worth it and you want to know how trademarks work before jumping right into it.
So, without further ado, here’s what you need to know before you start investing too much time into your bright-eyed business:
You may be surprised to learn that you may already have rights to your trademark. If you have already started regularly using your company name, logo, or slogan, then you have common law rights to that trademark. This includes using your company name at the bottom of emails, handing out your business card with your company logo or advertising online with your slogan. Sure, your trademark isn’t in an official government database, but that doesn’t mean it’s meaningless. You’ve poured your blood, sweat, and tears into it, after all.
So what are common law rights, how do I know I have them, and what do they get me? First, you should be clear about what a trademark is so you know the rights associated with it. A trademark is any word, phrase, symbol, sound, or combination thereof that identifies and distinguishes your business. This could be your company name, logo, slogan, jingle, product name, etc. Common law trademark rights protect your company name, logo, slogan, etc. from being used by other businesses. These rights extend to other businesses using confusingly similar marks to yours. For example, if your company name is ideasPLUS and another competitor across town tries to use ideaPLUS, then that’s not okay. The competitor company may not be using your exact company name, but it’s close enough to confuse customers and is therefore off limits.
How do you know if you have common law rights? You have to have started using the trademark first. Unless unusual circumstances exist, common law trademark rights always go to the person or company that first used the trademark. So, if you started using the slogan “Polka Dots Mark the Spot” in 2010 and a competitor in the town over starts using that same slogan in 2012, then you win. You have the common law rights in that slogan and that means you can tell your competitor to find a new slogan.
So what do these common law rights get you? You’ve already read that common law rights allow you to tell a nearby competitor to stop using your mark if you started using it first. In other words, you have exclusive rights to your company’s name, logo, slogan, etc. But did you notice that you kept reading the words “nearby,” “across town,” and “the town over”? That wasn’t by mistake. Like all rights in the U.S., your common law trademark rights are limited. Specifically, your common law rights are limited to the geographic area where your trademark is used. This means if you’re using your trademark only throughout the southeastern United States, then a competing company may be able to use your mark in Oregon or Pennsylvania. You could tell a company in South Carolina or Georgia to stop using your mark, but a company in Philadelphia or Phoenix is free to use the same mark. They may even have their own common law rights to that trademark in their area.
But many business owners want more than common law rights for their trademarks. They want to register their trademarks with their state or with the USPTO to receive extra protection. As you may have guessed, federal registration protects your mark nationwide. So your competitor in Philadelphia can no longer use your mark. This is particularly useful for companies who want to expand in the future or have a customer base they want to tap outside of the geographic area where they are already using their mark. Additionally, the marketplace is becoming more digital and it’s becoming more common for distant companies to cross paths online.
Further, federal registration allows you to sue in federal courts and gives you the legal presumption that you have rights in your trademark. Through federal registration, you may also protect a trademark that you have not yet begun to use. You can file an intent-to-use application with the USPTO that allows you to claim your trademark without even having common law rights yet. This option buys you time without sacrificing your priority in the rights of that trademark.
In short, you may already have rights in a trademark now. These common law rights are valuable but limited. If you want to expand your rights, then federally registering your mark with the USPTO is the most useful way to secure your rights in your brand for years to come.
2. Not All Trademarks Are Created Equal
Trademarks have five levels of distinctiveness and each level receives a different amount of protection. The more distinctive a trademark, the stronger the mark and the more protection it amasses. The five levels of distinctiveness are: fanciful, arbitrary, suggestive, descriptive, and generic. Here’s a table defining these five levels of distinctiveness and the protection they’re afforded:
From a trademark law perspective, the more fanciful or arbitrary your business name is, the better. But that may not be true from a marketing perspective. For instance, a made-up name may not be easily searchable in association with the products or services provided. A name that doesn’t appear in a search, can lose you customers.
On the other hand, while descriptive marks may be easy to market, these marks can only be trademarked if they acquire secondary meaning. Acquiring secondary meaning requires a large amount of time and money put into marketing and branding. A descriptive mark only acquires secondary meaning when the public associates the trademark with the source of the product rather than the product itself.
Accordingly, your trademark may vary in strength and protection. The strength of your trademark can determine whether it is registrable. If your trademark is registrable, the strength and distinctiveness of your trademark can determine how contestable the mark is and what is required to establish and enforce the trademark. Thus some trademarks are better than others.
3. Trademark Searches are Essential
When picking a business name, it is vital to complete an extensive trademark search. The purpose of this search is to determine whether your business name infringes on another’s trademark rights or whether your business name may present problems down the line.
First and foremost, you must check the USPTO database. This database includes all federally registered trademarks and includes great public information about each registered mark. You can see when a mark was registered, what goods/services are included in the registration, who registered the mark, and what documents the trademark owner submitted to the USPTO during the application process and beyond. You should also be aware of pending applications because these applications provide constructive notice of an applicant’s ownership of the mark and thus signals nationwide protection.
You should also search the appropriate states’ trademark databases to see what trademarks are registered at the state level. For example, if you are conducting business in Kansas and Nebraska then you should check both Kansas and Nebraska’s state trademark databases. Most states’ databases can be found with the Secretary of State but some states have their own trademark department.
But not every protected trademark will be in these government databases. Remember that common law trademark rights exist.
This means that you need to extend your search beyond trademark registers. Importantly, you should extend your search to common law trademarks. This involves conducting internet searches on engines like Google, Bing, and Yahoo. With the prevalence of social media, you may also want to look through Facebook, Twitter, and other social media platforms. Stepping away from these more entertaining platforms, you can also look through business directories, industry-specific search tools, domain name databases, and news databases.
While navigating through all these search avenues, you should keep in mind that your search should not be limited to just your mark as you want to trademark it. You should conduct multiple searches with different versions of your mark. These different versions could include rearranging the words of your mark, adding or deleting a hyphen, adding words together, or making your mark plural. For example, let’s say you want to trademark “ideasPLUS” just as it is written. You should therefore conduct a search on “ideasPLUS.” But you should also conduct a search on “ideasplus,” “IDEASPLUS,” “ideas plus,” “ideas-plus,” “idea plus,” “plus ideas,” etc.
Searching all of these variations of your trademark through all these different search tools can be extremely overwhelming and almost insurmountable. Unfortunately, that is kind of true. This is why you’ll find that attorneys and commercial search databases charge so much for this service.
But trademark searches can vary greatly in thoroughness. Some people only search through the USPTO database and by using Google and they are satisfied. Others spend hours searching through more obscure databases. It all depends on how much time you have and the most effective way to use that time. Sometimes searching through a particular database just isn’t worth your time and money because it isn’t likely to supply you with much information.
However, obviously the more thorough you are, the less at risk you are of infringing on someone else’s mark and being denied registration at the Trademark Office. However thorough you decide to be, it is extremely important that you do some sort of search and that you do the search early. You don’t want to get your heart set on a name for your business to find out that someone else is already using it. New businesses are delicate and so is your mindset in the beginning so you should do your homework before you emotionally and financially commit to something that you may not be able to have.
Congratulations on making it to the end. Hopefully this 5-minute read will save you hours down the line, and maybe some money too. Good luck!