Trademark Law—Protection, Enforcement, and Infringement

Legal Protection for Your Business Goodwill

An Introduction to Trademark Law

The business world is highly competitive. Your reputation, or “goodwill,” can make the difference between the success and failure of a commercial enterprise. But goodwill rarely comes quick or easily. It’s often the result of hard work consistently done over a long period of time. You don’t want to spend the time, money, and effort to maximize your reputation and goodwill only to have a competitor use your name or other recognizable information to confuse the public and take away sales. That’s one of the key objectives of trademark protection.

What Is a Trademark?

A trademark is any word, phrase, or symbol a company or individual has either registered or established through use as being related to certain goods or services. (Marks related to services are generally referred to as “service marks.”) While trademarks are typically visual representations—logos, images, or words—sounds can also be trademarked. Trademarks are generally categorized as:

• Fanciful marks—A fanciful mark is one that the user has made up—a word or symbol that did not previously exist and is not a combination of existing words. Because fanciful marks are “inherently distinct,” they are the easiest to establish as a registered mark. A good example of a fanciful mark is Xerox.
• Arbitrary marks—An arbitrary mark is an existing word not commonly associated with the goods or service. Arbitrary marks generally require that you establish “secondary meaning,” showing that the public associates the word with the goods or service and not with its primary meaning. Perhaps the best known example of an arbitrary mark is Apple.
• Descriptive marks—These types of marks describe a product or service. An example would be “All-Steel Fencing.” Descriptive marks generally provide protection only when they have acquired secondary meaning.
• Suggestive marks—A suggestive mark is one that suggests or implies some quality or characteristic of the product. It’s typically an existing word or symbol, so an applicant for a trademark must establish secondary meaning. Instant Oil Change is a good example of a suggestive mark.
• Generic marks—Generic marks use words, terms, or symbols that are so common that they tend to describe a category of goods or services. They are generally not entitled to trademark protection, unless they include additional information that distinguishes them. For example, “Hamburger Restaurant” would be considered generic and not subject to trademark; on the other hand, the Olde Hamburger Restaurant at Pismo Beach could get protection but only for the entire name.

What Are the Trademark Laws in the United States?

In the United States, two types of laws govern trademark applications and trademark rights. The federal Lanham Act provides statutory guidance for trademark application and protection of trademarks from infringement. Many states also have trademark statutes that can provide protection against infringement within the borders of the state.

Common law trademark rights arise out of judge-made law and give business owners certain rights once they use a mark in commerce. Common law trademarks are generally protected by state law.

A History of Trademark in the United States

Unlike patents and copyrights, trademarks were not specifically addressed at the American Constitutional Convention. The concept of trademark, though, has been around for millennia, as archaeologists have found marks on pottery, and guildsmen in the Middle Ages were known to put distinguishing marks on their work.

The common laws governing trademarks were carried over from the common law of England into the American colonies and provided some protection at the state level. The first federal trademark statute was passed in 1870 but ruled unconstitutional just nine years later. In response, Congress enacted a new trademark law in 1881. That law was substantially revised in 1905, and in 1946, Congress passed the Lanham Act, which established the U.S. Patent and Trademark Office (USPTO), set up the trademark registration process, and identified the federal protections afforded to trademark owners.

What Is Protected by Trademark Law in the United States?

At its core, the federal trademark law is intended to protect the goodwill of a business by helping consumers correctly identify the source of goods or services obtained. Trademarks offer protection for symbols, words, phrases, pictures, sounds, and other representations used on goods and services. An applicant cannot obtain a trademark unless goods or services are available in the marketplace.

How Do You Acquire Trademark Rights in the United States?

To acquire trademark protection, you must meet the criteria set forth above—your mark must either be inherently distinct or have acquired secondary meaning. In addition, you must show actual use or an intention to use the mark in commerce. There is no requirement that you register your trademark with the USPTO, but if you don’t, you will have protection only under the common law, which tends to be enforceable only in the geographic area where you do business.

What Is Trademark Registration?

The Lanham Act conveys to a seller of goods or services the exclusive right to register a trademark with the USPTO. If you file a registration application, but it is not yet approved, you can put a “TM” (trademark, for goods) or “SM” (service mark, for services) symbol on the mark. Once the USPTO approves your registration, you can note that (and provide notice to potential infringers) by putting an “®” symbol next to your trademark.

What Are the Benefits of Trademark Registration?

Registration of a trademark gives the owner a bundle of rights, including:

• Nationwide protection of the mark
• A presumption that the mark is valid
• Access to the U.S. federal court system to prevent infringement
• A potentially “incontestable” mark—If no one opposes your registration for five years, it becomes incontestable, unless you let it lapse.
• Constructive notice to all potential infringers—If your mark is registered, an infringer can never successfully claim they had no knowledge that you owned the mark.
• The right to have the U.S. Customs Service refuse to allow infringing products into the country
• Additional remedies, including the possibility to treble damages, as well as certain criminal sanctions

In theory, a trademark can be never-ending, but you must renew the mark every ten years. In addition, you must prove that you continue to use the mark in commerce.

What Constitutes Infringement of a Trademark?

The focus of any allegation of trademark infringement will always center on what is known as the “likelihood of confusion.” In most instances, a mark offers protection only within a narrow range of goods or services and allows the owner to prevent the use of the mark only in situations that would interfere with the owner’s market. Accordingly, Apple Computers can’t use trademark law to prevent an apple juice company from using the word Apple to sell apple juice.

Federal courts look at a number of factors when evaluating the likelihood of confusion:

• Similarity of the marks
• Similarity of goods and/or services offered
• Strength or recognition of the marks
• Expected sophistication of consumers/purchasers
• Quality of the potentially infringing goods
• Evidence of actual confusion