Intellectual Property Law Knowledge Center

Trademarks 101: Basic Principles Every Organization Needs To Know

June 11th, 2015

Philadelphia and Wilmington Trademark AttorneysWilliam Shakespeare might have asked “What’s in a name?” but in business, the answer is: quite a lot. With apologies to Shakespeare’s Juliet, your goods and services by any other name may not, in fact, smell as sweet.

Your organization’s tradename or brand is a calling card, an advertisement, and, ideally, one way in which the public always will remember you. Unfortunately, if business owners and organization leaders don’t do some research before selecting a name or brand, that moniker also may spawn legal issues stemming from trademark infringement.

Here are basic principles of trademark law that every business owner or nonprofit leader should know when considering a name for a new business or organization or a brand for a new product or service, regardless of whether they plan to try to register it as a trademark.

Go for the knockout.

We’re not talking about stepping into the prizefighting ring, but rather conducting what trademark lawyers refer to as a “knockout search.” A knockout search is any preliminary screening search you perform to make sure another organization isn’t already using the name or brand you’ve selected. These days, most searches start over the Internet. A search engine such as Google is an acceptable place to start, but you will also want to check state and federal trademark registries.

Not all knockout searches are created equally, of course. You may be able to conduct your own early-stage business name or trademark search but there are situations where legal expertise and experience in trademark matters will help protect your organization down the road. If your proposed name or brand includes a logo or other graphic element, for example, you’ll want to do a design search. That is a trickier proposition, and you will want the help of a trademark lawyer to ensure it’s done properly.

Finding someone else using the name or brand you want doesn’t necessarily mean you can’t use it.

You’re in the middle of your knockout search when you find another organization with the name or brand you had been planning to use. Before you let that discovery discourage you, try to determine whether it is really a problem.

The key question is whether consumers are likely to be confused as to the source of the goods or services when they come upon the two names or brands. This question is answered only after considering many subjective factors. The first criterion in making that judgment will be how much the two businesses overlap. Does the other company offer services or goods that are similar or related to yours?

For example, if your business offers home or office cleaning services, and the other business sells auto parts, a conflict is unlikely. You may both be able to use the same company name or same brand — and register a trademark for its use within your own category of goods and services — without confusing the public.

On the other hand, if your business does home remodeling and the other business is a roofing company, there is a greater likelihood that consumers could mistake the two businesses. In that case, the business that began using the name or brand first has priority in the United States, and the rights to stop others from infringing. Which brings us to the next point.

Your business name (or product or service brand) becomes your trademark when you start using it.

Assuming your knock-out search succeeds in identifying your new company name or proposed brand as unique for the applicable category of goods and services, you may begin using it immediately. Trademark rights in the United States build with use in commerce. Trademark protection is conferred from the date of first use, not upon the registration date for the name or brand. As you use your new name or brand, customers will begin to associate a particular level of quality or level of service with you and your name or brand.

Why register your trademark?

A U.S. Trademark registration gives you presumptive rights to the trademark throughout the entire United States. If you rely on unregistered “common law” trademark rights, the extent of your market penetration will determine the extent of your enforceable rights. Moreover, your unregistered name or brand may not be found when others are performing clearance searches to evaluate their new name or brand. Your lack of visibility by not appearing on the Principal Register of Trademarks could cost you.

You may file an “intent to use” application to register a trademark, and you will establish a priority date with the filing date of that application, even if you have not yet offered the goods or services using the name or brand. The Trademark Office will review the proposed trademark and assess whether it may be registered. Once the application is allowed, the registration certificate will issue only after you have begun using the trademark. However, the pending application is a searchable record at the Trademark Office and will block others from registering confusingly similar marks for their goods or services.

Holding a registered trademark may be essential to force websites to take down infringing content. Holding a registered trademark also allows you to record that trademark with the U.S. Customs Service, which will empower the agency to stop goods and services that infringe your trademark from entering the country.

You also may decide to register your trademark in other countries, many of which do not recognize unregistered “common law” rights. Having a U.S. trademark registration gives you the benefit to file counterpart applications outside the United States.

Official registration of a trademark conveys a number of other legal benefits, as well. We would be happy to discuss them with you during a consultation.

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