Trademark Traps: Don't Sink Your Brand
There is much to consider when selecting a new trademark. The initial joy of playing with possible names and sketching logo designs should be tempered with a realistic perspective on the rights and responsibilities of the trademark owner.
The logical initial considerations of identifying the business to the market it serves and the ease of finding the business with an Internet search are important. However, often overlooked in the process are the more technical aspects of trademark rights.
The initial trademark assessment should entail a careful analysis of your business, your target sector and your potential client/customer base. This should be followed with a proper search of the trademark “universe” and the results of that search may affect your decision to choose a particular trademark.
Finally, the mark chosen should serve your business from the outset but also should have the ability to grow with your business into a strong, recognizable brand.
Below are common traps you can fall into when you are in the process of deciding on a new trademark, clearing it for use and protecting it. By taking simple steps to avoid these traps, you are more likely to end up with a strong trademark that can be the cornerstone of a sustainable brand.
1) Choosing a mark that is highly descriptive of your product or service
There is great temptation to use a mark which shouts to the world the purpose of your business, for example The Internet Toy Store. However, this perceived advantage can be to your detriment in the long run. The primary problem with descriptive marks is that the Trademark Office will refuse to issue a registration. Unless a descriptive mark has been in continuous use for many years and there is a showing that the mark has meaning to consumers as a trademark, the registration will be denied. Even if the Trademark Office grants the registration, the scope of rights is narrow and can only be asserted against those using an identical or nearly identical mark.
The other drawback to a descriptive mark is that the potential for conflict is greater. A mark of this type requires constant, vigilant policing against infringers as there will likely be many businesses intent on using at least a part of your mark. This type of policing is time consuming and costly. In addition, if an infringer is found, you may need to take legal action against the infringer to prohibit their use of the mark.
2) Becoming emotionally attached to a proposed mark and failing to generate any alternatives
It is quite common to commit to a mark too early and become emotionally attached to it, often to the exclusion of considering other possibilities. There's nothing wrong with having a favourite candidate but you need to have some alternatives in mind as well. Otherwise, when the trademark search turns up problems for the favoured mark (and trademark searches rarely come back completely clear), it becomes difficult to be objective about the situation. You may find yourself more willing to press ahead with your preferred mark, accepting its inherent problems instead of dropping it in favour of an alternate mark that may ultimately be the better choice.
3) Not properly searching the mark
There are real dangers in failing to properly search to determine whether your chosen mark is already in use. While most business owners conduct at least a limited search, often their clearance searches are simply inadequate. Checking to see if the mark is available as a domain name and running it through a search engine to see what comes up isn't enough. A properly conducted, thorough trademark search will encompass a review of such things as registered trademarks, pending trademark applications, unregistered trademarks, domain names, company names and an overview of the usage of the term on the Internet. Whether the proposed mark conflicts with another mark requires careful analysis and balancing of a number of interrelated factors and is best performed by a trademark professional.
4) Not searching broadly enough
Trademark rights are territorial, typically granted under national systems with national effect. Consequently, it is necessary to make a realistic assessment of where you will be conducting your business, targeting your advertising efforts and/or using your mark. Your search needs to include those countries.
5) Promoting the mark before it has been cleared
This trap can arise as a result of attempting to use a mark after an inadequate search or even using a mark in a preliminary way before conducting any search at all. Unfortunately, if a subsequent trademark search discloses conflicts it may mean having to select a new mark entirely. As even preliminary advertising efforts can be expensive, requiring replicating all promotional materials, as well as substantially revising your website (even likely changing your domain name), this is devastating to a new business. In addition, any goodwill or business reputation that you have achieved may be lost in this change in your business identity. Finally, the time involved in making all of the above changes is substantial and valuable time you could have spent promoting your business will instead be spent with re-branding.
6) Failing to use appropriate symbols (TM SM and ®)
A business should always protect its intellectual property in any appropriate way. The superscript TM symbol denotes a trademark and should be used with marks that identify goods. The superscript SM denotes a service mark and should be used in connection with a mark that is used to promote services. It is not necessary to have a trademark registration or even to have filed an application in order to use either of these symbols. They don't confer any sort of protection like a trademark registration does, but put others on notice that the mark is considered to be proprietary.
However this zeal to protect the business's valuable intellectual property should not tempt you to use the ® designation when not entitled to. The ® denotes a registered trademark and can only be used in connection with a mark that has been properly registered. In some jurisdictions, its use with an unregistered mark is an offense subject to penalties. Therefore, the best practice is to use the TM or SM designation when the mark is first adopted and during the time that the trademark application is pending. Once the mark is registered, the TM or SM can be replaced with the ®.
7) Failing to register the mark
Although some jurisdictions grant limited rights from use alone, in general trademark rights flow from obtaining a trademark registration. Remember that trademark rights tend to be national rights with notable exceptions such as the Community Trademark, which confers rights throughout Europe through a single registration. Consequently, as is the case with conducting searches, when it's time to register, the mark should be registered in the jurisdictions that are relevant to where you use your mark. A trademark professional can assist in determining a registration strategy that offers appropriate protection that is commercially practical.
8) Failing to police your mark
Once your mark has been registered and has become an important and valuable business asset, take care to monitor others' use of similar or identical marks. If infringing use is found, take necessary action to prevent others from encroaching on your rights. A failure to do so can lead to an erosion of the trademark rights that you worked so hard to acquire.
9) Failing to renew the registration
Typically, trademark registrations are valid for a period of ten years. At the end of the term, if the mark is still in use, the registration can be renewed. Thus, unlike other forms of intellectual property, such as patents which expire after a certain period of time, a trademark registration can have an indefinite lifespan.
A properly selected trademark is often a company's most valuable asset. Steer clear of the above traps and and you will build, from the inception of your business, a strong, protected brand. This distinctive mark will reflect your unique business identity and set you apart from competitors. It will capture goodwill and allow your company to thrive in a competitive environment.
Byron Jacobson is a US and UK qualified lawyer based in Bath, England who specialises in intellectual property law. He can be reached by email here.