Your Brand is an Asset: Basics of Protecting Your Trademark

A business can spend years building a reputation around a name, logo, product line, or slogan—and discover only later that it does not have the trademark rights it assumed it had.

That is one of the peculiar features of trademark law. Unlike many legal issues, trademark problems often begin innocently. A company chooses a name that sounds good, buys the domain, commissions a logo, prints signs, launches a website, and begins advertising. Only after substantial time and money have been invested does a cease-and-desist letter arrive—or a federal trademark application encounter an unexpected obstacle.

For that reason, some of the most valuable trademark work takes place before there is a dispute. Understanding a few basic principles can help a business build a brand that is not only marketable, but protectable.

A Great Marketing Name Is Not Necessarily a Great Trademark

Business owners understandably gravitate toward names that tell customers exactly what the company does. Trademark law, however, often rewards the opposite approach.

As a general matter, trademarks fall along a spectrum of “distinctiveness.” At the strongest end of this spectrum are what are known as “fanciful” marks, consisting of invented words, and “arbitrary” marks, which use ordinary words in an unrelated context.

An example of a fanciful mark might be something made up like “Ulona” for a company that sells refrigerators. An example of an arbitrary mark might be something like “Desert Dunes” for a film production company, as the trademark itself consists of real words, but those words are not at all suggestive of the type of business with which they are to be associated by consumers.

Both fanciful trademarks and arbitrary trademarks are considered “inherently distinctive” and are thus (typically) inherently strong trademarks.

“Suggestive” marks, which require at least a step of the imagination to connect the mark with the product or service with which it is to be associated, can also be inherently distinctive. An example of a suggestive trademark would be the mark “Frawsto” for an air-conditioner brand, in that it calls to mind something relating to cold when spoken aloud, but does not tell you what the product itself is. While suggestive marks are usually not considered to be as strong as fanciful and arbitrary marks, they are still generally sufficient to afford your trademark with adequate protection.

“Descriptive” marks are the weakest potentially protectible trademarks, and such marks may require proof of “secondary meaning” or “acquired distinctiveness” in order to show that consumers have come to associate the term with a particular source. For those in marketing, or really for many entrepreneurs generally, descriptive trademarks are what our minds default to when coming up with a brand name, because we want consumers to know what our product is immediately. This is usually a mistake, from a trademark perspective. An example of a descriptive trademark would be “Heli-Ride” for a helicopter-tours business, and that would likely be a weak trademark.

“Generic” terms are not protectible as trademarks at all. A generic “trademark” might be something like “desks” for a company which manufactures or sells… well, desks. It should go without saying that you cannot, under any circumstances, prevent competitors from using the term “desks” to describe their desk-related products.

To sum this up, consider the difference between naming a new cybersecurity company something like “Secure Computer Protection Services” and giving it an invented or unexpected name. The first tells customers exactly what the company does—but that is precisely the problem. Competitors ordinarily must remain free to use words that describe their own products and services. But what if your cybersecurity company instead called itself “Pokyst,” a term nobody would typically associate with cybersecurity (I say as someone with zero expertise in cybersecurity). That is a mark you would want to be able—and probably would be able—to protect for that business.

A distinctive brand may therefore require more marketing effort at the beginning, but it can create a substantially stronger intellectual property asset over time.

Registering a Business Name Is Not the Same as Clearing a Trademark

Another common misconception is that forming an LLC, registering an assumed business name, obtaining a domain name, or securing a social-media handle establishes the right to use that name as a trademark.

It does not.

Trademark disputes generally focus on whether consumers are likely to be confused about the source, sponsorship, affiliation, or approval of particular goods or services. Two marks do not have to be identical to create a problem. Similarities in appearance, sound, meaning, or overall commercial impression can matter, particularly when the parties offer related goods or services. The United States Patent and Trademark Office (“USPTO”) identifies likelihood of confusion as the most common basis for refusing trademark registration.

That is why a meaningful trademark “clearance search” is different from simply typing a proposed business name into Google or checking whether the corresponding “.com” address is available.

A proper clearance analysis may include federal trademark records, state records, internet searches, industry-specific sources, corporate filings, domain names, and evidence of businesses using similar marks without federal registrations. The question is not merely, “is anyone using this exact name?”

The better question is, “is anyone using a mark sufficiently similar, for sufficiently related goods or services, that my use could confuse consumers who see both of those products or services as to their source?”

That distinction can be worth a great deal of money when the alternative is rebranding a successful business several years after launch, once you have already bought and branded storefronts, vehicles, domain names, paraphernalia, machinery, etc.

Trademark Rights Can Exist Without Federal Registration—but Registration Matters

Federal registration does not “create” a business owner’s fundamental right to use their trademark.

In the United States, certain trademark rights typically arise through actual use in commerce of a protectible mark, in connection with the sale of your goods or the provision of your services. An unregistered mark may therefore possess enforceable rights, although those rights can be more limited geographically and can be more complicated to establish.

In other words, while trademark ownership is created through use of the trademark in the marketplace, federal registration provides several important protections. For one thing, federal registration places the mark in the federal trademark database, creates a legal presumption that your right to the trademark is valid, permits use of the ® registration symbol, and can provide other significant benefits regarding litigation, franchising, and international trademark protection.

Federal law also allows an applicant with a bona fide intention to use a mark to file an “intent-to-use” or “ITU” application before commercial use actually begins. That can be particularly valuable when a business is developing a new brand, product, or service it wants to use, but is not yet ready to launch.

In other words, the trademark application should not necessarily be the last item on the launch checklist. In many circumstances, it should actually be one of the first.

Trademark Infringement Does Not Require an Exact Copy

Popular culture sometimes creates the impression that trademark infringement equates to counterfeiting: someone placing an identical or extremely similar brand name or logo on a competing product.

Trademark law reaches much further, however.

The central question in a typical trademark-infringement dispute is likelihood of confusion. A “junior” user’s mark may create actionable confusion even when the marks are spelled differently or contain different design elements. Courts can consider, among other things, the similarity of the looks and sounds of the competing marks, the strength or distinctiveness of the senior mark, the similarity between the parties’ goods or services, the manner in which those goods or services are marketed, and any evidence of actual consumer confusion.

Consequently, adding a word, changing a letter, altering a logo, or using a different color scheme does not automatically solve a trademark problem.

There is also a separate doctrine known as trademark dilution that can protect truly famous marks against certain uses that “blur” their distinctiveness or “tarnish” that brand’s reputation, even where ordinary consumer confusion is absent. Dilution protection, however, is reserved exclusively for marks meeting the demanding legal standard for “fame.”

Obtaining a Registration Is Not the End of Trademark Protection

A federal trademark registration is an asset, but it is not a trophy that can simply be framed and forgotten.

Owners of a trademark must continuously use their trademark in commerce, or it may be deemed abandoned and all protections therefore lost. Further, owners of a federally protected trademark must not only continue to use their marks, but must make some (usually inexpensive) required maintenance filings with the USPTO at specified intervals. Failure to make the necessary filings can result in cancellation or expiration of the trademark registration.

Trademark owners should also pay attention to potentially confusing uses of competitors’ claimed trademarks in the marketplace. Contrary to the beliefs of some, that does not mean every remotely similar use requires immediate litigation. Trademark enforcement should be strategic, both for reputational and financial reasons. A small local business using a somewhat similar phrase in an unrelated industry presents a very different issue from a direct competitor launching a confusingly similar brand with the intent to outcompete you.

However, continually ignoring infringements of your trademark can effectively bar you from enforcing it against infringers down the line, so it is not advisable to let others walk all over your hard-earned reputation, either.

A thoughtful trademark strategy therefore usually involves three stages:

Clear the mark. Register the mark. Protect the mark.

Each stage is as important as the last.

The Trademark Symbol Question: ™ or ®?

One small detail creates a surprising amount of confusion.

The ™ symbol can generally be used to indicate that a person or business claims trademark rights in a word, phrase, logo, or other designation. Federal registration is not required before using the ™ symbol.

The ® symbol is different. It signifies federal registration and generally should be used only in connection with the goods or services covered by an active federal registration. A business launching a new brand may therefore begin by using ™ and transition to ® once federal registration issues. Do not use ® until you have the Certificate of Registration for that trademark from the USPTO.

Treat the Brand Like the Business Asset It Is

For many companies—and perhaps especially the biggest and smallest of businesses alike—their most recognizable and important piece of property is not their office, inventory, or equipment. It is their name.

A strong brand can accumulate goodwill for decades, or even centuries. It can distinguish an otherwise ordinary product from its competitors, make customers willing to pay a premium, facilitate expansion into new markets, and eventually become an asset capable of being licensed or sold for immense profits.

As such, trademark planning is more than an administrative formality. It is part of basic business risk management, and it is likely the core of every marketing strategy you will ever come up with for your business.

Before investing heavily in a new company name, product name, logo, or slogan, businesses should ask themselves three questions:

1. Is the proposed mark distinctive enough to be protectible?
2. Has an adequate search been conducted for conflicting rights?
3. What steps should be taken now to preserve and strengthen the brand as the business grows?

Answering those questions before launch is generally far easier than answering them after a competitor—or a competitor’s attorney—does it first.

It is true that for many, hiring an attorney to register and defend your trademarks can be expensive. But it is virtually always far cheaper than hiring an attorney to fix avoidable mistakes in selecting, registering, or protecting the mark after the fact. It should go without saying that, at least in this context, it is much better to get it right from the start.

Disclaimer

This article is intended for general informational purposes only and does not constitute legal advice. Trademark rights and disputes require highly fact-specific inquiries. If you have any questions, please feel free to reach out via our “Contact” page!