As someone starting a business, a crucial question to ask is, “What is a trademark?” A trademark represents any word, name, symbol, or design that a seller uses in commerce to distinguish their products from those of competitors. It functions as a visual or auditory window to the outside world, acting as the primary image of a business.
It is understandable for an entrepreneur just getting a venture off the ground to focus on other issues, including funding and human resources. However, that focus can cause a business owner to overlook intellectual property rights. This neglect can be a significant mistake because trademarks are the legal rights to a brand. They ensure that competitors do not unfairly profit from or harm a company's reputation.
Trademarks differ from other forms of intellectual property, like patents or copyrights. Patents protect inventions, and copyrights protect original creative works. Trademarks, on the other hand, specifically link the goods or services with its source. Why is protecting this source identifier critical? Securing and defending it is essential because seeing a familiar mark has a positive impact on sales: It builds customer faithfulness over time; it establishes a company’s goodwill.
Consumers come to associate a trademark with a specific level of quality and reputation. For small and medium enterprises, this differentiation is the foundation of market survival. Trademarks can be perpetual and their value grows with time. As the company’s reputation grows so too does the value of its trademarks.
As a business owner, you likely have questions about how to obtain a trademark and how having one protects your brand. Some of the more common questions and answers include:
● What is the difference between ™, SM, and ®? The ™ symbol is used for unregistered marks to notify the public of common law claims to a trademark for a product, while the SM symbol specifically identifies services rather than goods. You should only use the ® symbol once your mark has been officially registered with the government.
● Should I register my trademark? Yes, you should register your trademark because it grants nationwide rights and notice to others of your brand. Registration also increases the overall value of your business during asset valuations by enabling the ability to deter and prevent others (competitors) from using confusingly similar marks for similar products or services.
● How long does the trademark application process take? The application process includes an examination by a government official followed by a period where the public can oppose the registration. The length of time from submission to approval varies depending on the complexity of the filing, but it often takes 12 to 18 months and can take years in some cases.
● What is an "intent-to-use" application? This is an application filed by a person or company that has a bona fide plan to use a trademark in commerce in the future but has not yet started doing so. This filing allows you to reserve your rights while you prepare to bring your product to market. Once the mark is allowed a company has approximately 2 and ½ years to demonstrate that the mark is being used in commerce.
● What is a "Likelihood of Confusion" refusal? This refusal occurs when a mark is so similar to an existing one that the public would likely be confused or misled about which company produced the goods or services. This standard is designed to protect consumers from making uninformed purchasing decisions. This is also the standard for enforcement.
● What does "in use" mean? Being "in use" means that a mark is actively being utilized in commerce to identify the source of specific goods or services. This is a fundamental requirement for establishing and maintaining exclusive rights to a trademark.
What’s the Difference Between Branding, Marketing, and Trademarks?
Business owners frequently confuse marketing with branding, but these are distinct concepts in the legal realm. Marketing is the process of describing a product or service to potential customers. In contrast, a trademark used for branding should not describe the product if the owner wants it to be legally protectable.
There is a natural tension here because marketing teams often want names that tell consumers exactly what the product is. However, the best brands utilize a secondary cognitive process that leads the consumer to a conclusion rather than stating it outright.
Take the name Land Rover, for example. The works “Land Rover” does not describe an automobile, but it gives the powerful impression of a vehicle that can travel anywhere the driver desires. This is a classic example of effective branding that retains a strong legal standing.
If a mark is too descriptive, it may be denied registration because it does not sufficiently distinguish the source from other providers in the same industry. Companies must think about long-term brand equity rather than short-term clarity when choosing their names.
What Makes a Trademark Strong?
Legal professionals typically categorize trademarks by distinctiveness to determine the level of protection they deserve. The strongest marks are fanciful or arbitrary names.
Fanciful marks include made-up names like Exxon, while arbitrary marks involve common words used in an unexpected way, such as Apple for electronics. Because these marks have no inherent connection to the products they represent, they receive the highest level of legal protection.
Suggestive marks offer a good balance between marketing needs and legal strength. These marks suggest a quality or characteristic of the goods without being purely descriptive. For example, a name might imply that a product is fast or durable without using those specific words.
On the other hand, descriptive terms and generic words are difficult or impossible to protect. A generic term like "computer" for a laptop can never be a trademark because it refers to the entire class of products rather than a specific brand.
When considering trademarks, you should do the following:
● Aim for distinctiveness over descriptiveness.
● Think in terms of long-term brand equity, not short-term clarity.
● Avoid choosing names that are too literal.
● Merge marketing and legal considerations.
● Prioritize early registration, as some jurisdictions grant rights to the first party to file rather than the first to use the mark.
● Secure rights in countries where your products are manufactured.
Do I Need To Do a Trademark Search Before Launching?
The answer to this question is yes—a comprehensive trademark search is essential. One of the most expensive mistakes a company can make is investing in branding and marketing before performing a thorough search. A trademark search validates that no other entity already holds the rights to a chosen name or logo. Skipping this step creates a significant risk of an unpleasant outcome, such as receiving a cease-and-desist letter after a company has already invested significant capital in production tooling, signs, packaging, and advertising.
If a conflict is discovered after a product launch, the company may be forced to undergo an expensive rebranding process. Just as importantly, an abrupt change can lead to a loss of goodwill because customers may not recognize the business under its new name. Additionally, the legal costs of defending an infringement claim are significantly higher than the cost of an initial search.
It is also important to remember that registering a domain name or a company name with the state does not grant trademark rights. You can still infringe on a federal trademark even if the government allows you to register your business name for tax purposes.
What Are Trademark Channels of Commerce and Classes?
Business owners often ask, “Can two companies use the same trademark?” The short answer is yes. This is managed through trademark classes.
What are trademark classes? The federal government divides trademarks into 45 groups based on the type of goods or services offered. This system allows two different companies to use the same trademark if they operate in completely different channels of commerce.
For example, one company might use a specific name for a brand of soap while another uses it for a line of industrial heavy machinery. Consumers are unlikely to confuse a soap manufacturer with a tractor company. Consequently, it is acceptable for both to use and register the same trademark.
However, famous marks often receive broader protection that goes beyond their registered classes. For instance, Apple is so well-known in the electronics sector that it effectively occupies multiple classes of commerce. Using a famous mark for unrelated goods is generally unwise because courts often assume that consumers will believe there is some connection to the famous brand. This can lead to liability even if the goods do not directly compete in the marketplace.
Who Do Trademarks Actually Protect?
The core purpose within trademark law is to protect consumers, not companies. The legal system wants to stop individuals from being misled or confused about the source of a product.
When a court considers an infringement claim, it uses a two-party test to determine whether the consumer is being harmed by likely confusion. If the average person would not be confused about who made the product, there is often no case for infringement. This standard is known as the likelihood of confusion.
Simply adding something specific to your brand to a competitor's trademark is usually not enough to avoid this problem. If the dominant portion of two marks is the same and they are used for similar goods, they will likely be considered confusingly similar. Protecting the integrity of the market makes certain that consumers can use trademarks to simplify their research and guide their purchases.
Global Considerations and Manufacturing Risks: Do I Need Trademarks Outside the U.S.?
Companies that manufacture or sell products globally must also consider international trademark rights. Importantly, many other countries grant rights to whoever files the application first. This means a foreign entity could register your brand name in their country and effectively block you from doing business there under the same brand.
A common risk involves export rights in foreign jurisdictions. If a local entity in another country owns the trademark for a product you manufacture there, they may be able to prevent you from exporting goods possessing that brand.
Do Government Entities Follow Trademark Law?
It is a common misconception that government agencies do not have to follow trademark laws, i.e. they have sovereign immunity. In reality, the federal government has waived sovereign immunity in trademark cases. This means they have no special immunity when they infringe upon a private company's trademark. The government also frequently files its own trademark applications to protect its programs and initiatives.
For government contractors, this creates an equal playing field. Contractors should invest in trademarks because they are just as valuable in the government space as they are in the commercial market. Having a registered mark allows a contractor to maintain its identity and reputation even when working on large federal projects.
How Long Do Trademarks Last?
Trademarks can last forever if they are actively used and properly renewed. Unlike patents, which expire after a set number of years, a trademark remains valid as long as the owner continues to use it in commerce. This longevity makes them incredibly valuable strategic assets for long-term brand building.
Some of the oldest trademarks in the United States date back over a century. For instance, Averill Paints, known for its depiction of an eagle with a paintbrush, is often cited as the first registered trademark, filing for protection in 1870. The William Underwood Co. (makers of Underwood Deviled Ham) also registered its brand in 1870 and it remains in use. Samson Rope Technologies got trademark protection for its brand of cords and ropes in 1884. Other long-lasting marks include those for the Coca-Cola logo (1893), Prudential's Rock of Gibraltar (1896), and Campbell's Soup (1897).
To maintain these rights, owners must file periodic renewal and use declarations with the government. If a mark is not used for several years, it may be considered abandoned and open to others to claim.
Can the Same Design Have Trademark and Design Patent Protection?
There is often confusion about whether a specific design can be protected by both a trademark and a design patent. A design patent and a trademark may be obtained on the same subject matter recognizing that the rights are legally separate. A design patent protects a new, original, ornamental design for an article of manufacture, while trademark or trade dress protection covers a shape only to the extent it serves as a source identifier.
That creates a common lifecycle for the same shape. A company may file a design patent first because it does not need to prove consumer recognition. Later, it may pursue trademark or trade dress protection for the same shape, but if the shape is the product design itself, it can never be inherently distinctive and must have acquired distinctiveness or secondary meaning. As a practical matter, that usually means shape-based trademark protection comes later, after substantial use and evidence that consumers associate the shape with one source.
The biggest limit is functionality. Trademark law will not protect a functional shape. USPTO guidance says a design patent weighs against a finding of functionality because design patents protect ornamental, nonfunctional features, but a design patent by itself does not prove nonfunctionality, does not prove the shape functions as a mark, and does not prove acquired distinctiveness. By contrast, an expired utility patent covering the same features is strong evidence that those features are functional, which can make later trademark protection much harder.
A clean way to think about the relationship is this: design patent is usually the early, time-limited right against copying the shape’s ornamental appearance, and trademark is the long-game brand right that may survive indefinitely for that same shape if the shape becomes a nonfunctional source identifier.
Careful analysis of business goals is key to deciding between these two important forms of protection. A design patent grants a strong but temporary monopoly over a look, while a trademark grants a perpetual right to a source identifier.
Practical Trademark Checklist
Trademark protection is best developed in consultation with an IP law firm. However, steps you can take to choose and protect a mark include:
● Perform a search. You must conduct a comprehensive trademark search before you invest any money in naming or branding.
● Select a distinctive name. You should aim for a fanciful or suggestive name rather than one that merely describes what you are selling.
● Identify correct classes. It is necessary to file your application in the specific categories that match your actual commercial use.
● Assess global needs. You should register your mark in any country where you manufacture or sell your products to protect your export rights.
● Monitor your mark. You must actively watch the market for infringers and take steps to enforce your rights to prevent your brand from being diluted.
● Renew consistently. You should keep track of all government deadlines to ensure your registration does not lapse due to a failure to file maintenance documents.
Final Thoughts on Trademarks
Trademarks are much more than just logos or catchy names. They are long-term strategic assets that help a company develop and maintain a loyal customer base.
Consequently, it is critical to understand that the decisions business owners make in the ramp-up period can have lasting consequences for the company’s ability to compete. By combining legal strength with market impact, a venture can build a brand that endures for decades.
At Martensen, we are dedicated to helping our clients overcome these complexities to secure a lasting competitive advantage.Contact us to learn more.
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