If you’re like most business owners, you went to incredible lengths to find just the right name for your business, your services, or products. You invested a huge amount of time or money to pick a name that reflects the right emotion, characteristics, and image to your customers. All of that effort makes sense because a word – a name – means a lot.
What Is a Trademark?
In last week’s IP Primer, I briefly explained the concept of a trademark; now we’ll dive into the details of what actually constitutes a trademark, and how you can protect your trademark rights.
The key function of a trademark is to help consumers identify the source of the countless goods and services in the marketplace. A trademark is essentially a shorthand way for consumers to distinguish between different businesses when it comes time to make a purchasing decision. Think about it: when you walk into the grocery store, you know that an OREO brand cookie will have a cream filling sandwiched between two chocolate wafers. You know how the cookie should taste because of its name – the trademark.
Not every name associated with your company will be considered a trademark. For example, if you own a deli on Main Street that’s called “Main Street Deli,” that would simply be a trade name or business name, technically not a trademark.
Trademarks don’t always have to be names, either. Any one or combination of the following can serve as a trademark:
Yes, that’s right – even smells can be trademarked!
How Do I Earn Trademark Rights?
Trademark ownership in the U.S. is founded on the principal that the first to use a name (i.e. a trademark, or mark) “in commerce” is the owner of that mark, with the right to exclude others from using a mark that is identical or confusingly similar to theirs. Registration with the U.S. Patent and Trademark Office (the “USPTO”) isn’t necessary to own rights in a trademark. Rights may be earned through “use” alone; these “use” rights are known as common law trademark rights.
Of course, this being the law, it isn’t black-and-white. Common law rights are generally limited to the geographic region in which you are doing business and to regions into which you may “naturally expand.” However, for most companies who sell online, that geographic region tends to be pretty broad.
There is another exception to this if someone files an “intent-to-use” application with the USPTO. Their rights will date back to the date of the filing of the application. This means that someone can have superior rights to yours, even if you starting using your mark first IF three things occur (1) they filed an intent-to-use application before your first actual use, (2) their application is allowed by the trademark use; and (3) they actually use the mark before registration is allowed (this third requirement is sometimes waived for non-US companies).
You can also use the ™ symbol to denote that you’re using your name, slogan, or design as a trademark without registering with the USPTO. The ® symbol is reserved federally registered trademarks.
What Constitutes “Use in Commerce”?
“Use” of a trademark occurs when you use your trademark in connection with your goods or services.
From U.S. Trademark Law 15 U.S.C. § 1127:
“The term ‘use in commerce' means the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark.”
This means that you must be conducting business using this name, not just making a sale or offering a service only in order to reserve your naming rights.
Goods: In order to qualify for trademark “use” on goods, you must meet the following two criteria:
- Your mark must appear on the goods themselves, their tags or labels, on their containers, or in certain cases on the displays associated with the goods,
- the goods are sold or transported in commerce.
Services: In order to satisfy use requirements for services, the mark must either:
- be used or displayed in the sale or advertising of the services and the services are rendered in commerce,
- the services are rendered in more than one state or in the US and a foreign country.
A business, especially a startup or small business entering the marketplace, may be using its mark in a variety of ways. But not every use is enough to acquire trademark ownership rights.
Here are a few activities that qualify as “use” on goods:
- Placement of the Mark affixed to goods on their containers.
- Distribution of goods to the ultimate consumers free of charge (ex: placing the mark on a restaurant menu that is given to a take-out customer at no additional charge, could be used for menu items if you have a sandwich name like THE BIG GORILLA on the menu).
- An offer to perform a service can suffice, even before it has been accepted. (ex: If you’re a web designer, using your mark on a proposal for a job or project is satisfactory, even if the client does not hire you.)
- Use on a website: If you are selling or offering goods for sale, your site could qualify for use as an online retail store.
And here are a few examples of what is not considered use for purposes of acquiring ownership rights:
- Domain name registration
- Using the company name on social media
- Incorporation with a State
- Filing a “d/b/a” with the state
- Coming up with a business plan (whether it is public or private)
Be sure to check back next week for Part II on trademarks. We’ll talk about what makes a “strong” trademark, and why/how to protect your mark.
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Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.