Bet You Don’t Know the Difference Between Copyrights and Trademarks – Part 2

A trademark is any unique word, name, symbol, letter, figure, design or mark used to indicate the “source” or “origin” of goods or services and to distinguish those goods and services from the goods and services of competitors. In other words, a trademark identifies the company or “source” ultimately responsible for a particular product or service. Trademarks also indicate to consumers the quality of the goods or services sold under the mark. Consumers may be more likely to purchase a product or service sold under a “famous” or known mark with a reputation for quality than to take a chance on one sold under unrecognized or generic branding. In these instances, the mark serves as a shorthand quality indicator.

When a mark is used in commerce on a good or product, the mark is known as a “trademark”. When a mark is used in commerce in connection with a service, the mark is known as a “service mark”. There is little functional difference between a trademark and a service mark, and we will refer simply to “marks” or “trademarks” to denote both trademarks and service marks.

Companies work hard on their reputation and branding. The use of trademarks is only one aspect of branding, but it is an important one. Companies invest considerable time and money developing the association between their designated marks and the products and services they are selling under the marks. Use of a recognizable trademark can have a significant impact on a company’s sales of its product or service, especially as the company builds a reputation for quality, excellent service or other positive attributes. Marks can become very valuable, and companies place great importance on protecting those marks. In fact, trademark owners have an obligation to police use of their marks; failing to do so can lead to loss of rights in the mark.

To take the “Coca-Cola” mark as an example, it is easy to see the power and value of a recognized mark. A consumer knows exactly how a cola sold under the Coca-Cola mark will taste, no matter where it is purchased, and customers have come to rely on the mark. Coca-Cola’s reputation for quality, taste and consistency, as represented by its mark, has a great deal of value in the market. Consumers often don’t know from where or how a Coca-Cola cola is delivered, but as long as the cola bears the trademark, they know which company ultimately produces the cola and that the beverage will meet their expectations.

Symbols, colors, and sounds are used as trademarks in addition to words and names. A company logo, like the Twitter bird, is a good example of a symbol mark. Companies may adopt colors as signature identifiers and marks, such as the color brown has come to signify United Parcel Service. The NBC Chimes are a great example of a sound mark.

Trademark rights give the mark owner the legal right to prevent others in the market from trading on the mark owner’s brand and reputation. The trademark owner has the right to stop uses of identical or “confusingly similar” marks for similar or related products or services. For example, if someone adopted the name Koca-Kola for their own carbonated beverage, the Coca-Cola company could stop that use because consumers could be confused by the similarity of the marks and products as to who actually made the beverage. Use of the name Coca-Soda for a cola would also likely be too similar to survive a challenge from the Coca-Cola company.

Trademark rights arise from use of the mark in commerce. If you have designed a company logo but do not yet have a product or service for sale that is identified by that logo, no trademark rights have yet arisen in the logo. Similarly, if you organize a company and register the company name only as a trade name to designate the entity itself, the company name is not a trademark. When your product or service enters the stream of commerce identified by a particular mark, trademark rights will begin to accrue in the mark.

Because trademark rights arise from use, no registration is required to have valid trademark rights. An unregistered mark is protected under common law. The application of common law trademark law can be somewhat unpredictable, so many companies elect to register their marks at the federal and/or state level. An application for registration can be filed with the United States Patent and Trademark Office (USPTO) to obtain a federal registration. Federal registrations give the trademark owner a nationwide presumption of priority of use. Application for registration can also be made at the state level, usually with a state’s Secretary of State’s office. A state registration applies only within the geographical borders of the state in which it’s registered, but it will prevent someone from later filing a national application for registration that usurps the state trademark owner’s rights – unless the use claimed by the national applicant pre-dates that of the state registrant.

To qualify for registration, a mark must be unique. Unique means that there are no other marks currently in use that are similar enough to cause customer confusion as to the source or sponsorship of the goods or services. Note that unique does not mean unique everywhere. For trademark purposes generally, the name need be unique only among similar or related products and services. For example, the mark “Viking” is registered for use with appliances, but it is also registered for use in conjunction with cleaners, cruises, hardware, etc.

There are other limitations on what can and cannot be used as a trademark. Generally, trademarks cannot be registered if they are generic for the product or service or a literal description of it. “Cookies” cannot be registered as a mark for chocolate chip cookies. Neither could one register “Crunchy” for cookies, even if it happened to be spelled “Krunchhhyy Cookies”. Made-up or “fanciful” names, like “Frezotricious” cookies, are eligible for registration and are easiest to register since they are often wholly unique. Arbitrary marks also make strong trademarks and are registrable, such as the name “Apple” for computer hardware and phones. Suggestive names, such as “Sugar Sandwiches” for cookies, are also registrable. A suggestive name is one that, with a little thought, suggests a characteristic of the product or service with which it is used.

The trick is to come up with something to use as a mark that other people are not already using for goods or services similar to your own. It is sometimes easier to create a unique logo or symbol than to find or create a unique name. Beware adopting a trademark before doing your research to determine if there are already identical or similar marks in use in your market! Failing to identify pre-existing marks can lead to a significant loss of time and money if it turns out your mark is not available for use and you have to repackage or re-manufacture products or recreate advertising. At worst, adoption and use of a mark that is confusingly similar to someone else’s earlier-adopted mark may lead to a claim for infringement.

If your application is successful and your trademark is registered federally by the USPTO, you are entitled to use the Circle R symbol (®) with your mark. If your registration is at the state level, or if you simply want to give others notice that you are claiming trademark rights in whatever mark you are using, you may use the TM symbol. The TM symbol is also used for applied-for but not yet registered federal marks.

A federal trademark registration lasts for 10 years. State registration terms vary somewhat, but most are 5 years. Trademarks can be renewed indefinitely for so long as they are actually being used. Indefinite duration, combined with the creation of a strong, positive association between the mark and your product or services, create one of the most powerful forms of intellectual property.

This blog does not provide legal advice and does not create an attorney-client relationship. If you need legal advice, please contact an attorney directly.

Anne T.

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