What to Do If You Receive a Cease and Desist Letter

The mail comes and you notice a letter from a law firm you do not recognize. As you open the letter you hope for the best but you are nervous in anticipation of what the letter says. You read the opening paragraph of the letter:

“We represent the ABC Company in the protection of their intellectual property rights. It has recently come to our client’s attention that you are using the trademark…”

You continue reading your heart now racing. A law firm is demanding that you immediately stop you or your company’s trademark, its brand, its very identity.

Anger, frustration, and denial set in. Everything in the letter is wrong. Your trademark is spelled differently from the other trademark. Moreover your goods or services are not identical to those provided by the law firm’s client. You begin formulating your planned response before you even reach the end of the letter.

You decide to pick up the phone and call the lawyer who wrote the letter to explain to he or she how there is simply no infringement here. Better yet, you’ll put it in writing and begin typing a responsive yet somewhat emotion-fueled email.

Does this sound familiar?

Before you do anything please stop, do not rush your response, take a few deep breaths, and make sure you understand a few basic principals about the situation you now find you or your company in before writing that email or making that call. Quite simply, a little reasoned thought may make the difference between keeping and losing your trademark.

Trademark Law 101

First a primer on the basics.

A trademark includes any word, name, symbol, or device, or any combination, used, or intended to be used, in commerce to identify and distinguish the goods of one manufacturer or seller from goods manufactured or sold by others, and to indicate the source of the goods. In short, a trademark is your brand name.

Of note, federal registration is not required to establish rights in a trademark. Common law rights arise from actual use of a mark. Generally, the first to either use a mark in commerce or file an intent to use application with the U.S. Patent and Trademark Office has the ultimate right to use and registration.

Priority of Use

With this basic understanding of trademarks in hand, one of the initial steps in evaluating any cease and desist letter is to determine who has priority of use (i.e., who used their mark first) of the respective trademarks. This may be the most effective defense to an allegation of infringement insofar as if you can establish that you or your company actually used your trademark before the other’s first use of their mark it is the other party that may be infringing upon your rights and not the other way around.

Surprisingly law firms issuing cease and desist letters often fail to accurately establish the priority of use of their clients’ trademark before sending the letter. Often this is understandable in that even with the Internet, available corporate databases, and other methods, determining when a business truly first began use of a trademark – especially where the business does not have a federal registration – is often a function of the law firm’s best guess as to priority of use based upon all available information it can gather.

In the alternative, the cease and desist letter you receive will, more likely than not, list the earliest date of priority of use the opposing side can claim for its trademark. This key bit of information is usually phrased to the effect “Our client has been continuing using their trademark since as early as ….” In this regard, rather than conducting initial research on the use of the other party’s mark you are instantly presented with the date they will, most likely, rely upon for their priority date should the matter progress further (i.e., into litigation).

Note the legal wiggle room “since as early as” which is almost always the way dates of first use are referred to in cease and desist letters. Through experience lawyers know to use this language so that if you respond with an earlier priority of use date they have not locked themselves into one date for their client but can fall back on amending that date since the original one listed in their letter was only “as early as” but the true date could be, in theory, a date they have yet to reveal.

With this in mind, you should evaluate whether you began use of your trademark prior to the opposing party’s first use of its mark. In other words can you beat their date of first use?

Often the answer to this question is simple. If you just opened your business and the other party has been using its mark for 70 years they more likely than not retain priority. On the other hand, perhaps you have been using your mark in the New York tri-state area for 20 years but have never registered the trademark. The other party sends you a cease and desist letter alleging a date of first use in 2008. Who has priority? You do, more likely than not.

But beware, the issue of priority is often a far more complex question. Let’s say the other party has been using their mark for four years, has a federal registration for their trademark, and now wants you to cease using your mark. You are a California-based business but have never taken the time to register your trademark. You have also been using your trademark for four years in Southern California and for almost that entire time the goods you offer have been and continue to be advertised in California, Arizona and even in Northern Mexico. In this case the legal definition of “use in commerce” and “use in interstate commerce” sufficient to grant federal and/or state trademark rights becomes very significant. In this scenario you may actually have priority of use. You may not. More complex legal analysis would need to be performed.

As such, if there is a clear answer to the priority of use issue and you have priority of use that will, more likely than not, be the strongest argument in defense of a cease and desist letter. If priority of use is unclear or if you do not have priority of use have heart and continue to the next step of the evaluation: whether your trademark infringes upon the other’s pre-established rights.

Infringement Analysis

The next part of the analysis must focus on the traditional elements of infringement. While the various U.S. Circuit Courts of Appeals may differ slightly in their interpretations of the elements for infringement, universally the inquiries ask (1) whether the marks are similar in appearance, connotation, or otherwise; (2) whether the goods and services with which the marks are used are identical, similar, and/or otherwise related; (3) whether the goods and services of the parties travel in similar channels of trade; (4) whether the marks are marketed in similar manners; (5) whether consumers of the respective goods and services are sophisticated; and (6) if there are any instances of actual confusion among consumers as between the marks.

To determine the validity of the accuser’s allegations you must determine whether the factors support you or the other party in their allegations.

In regard to the first element, ask whether your mark is generally similar in appearance, meaning, or connotation to that of the party alleging infringement. In this regard, the less similar the marks are the less likely infringement will be found. In most instances the marks are not identical. As such, in large part there is usually a bit of subjectivity involved in the evaluation of this element. If both marks are WIDGET they are definitely similar, in fact they are identical. But what if your mark is WIDGET and theirs is WIDGET MAX? Are they similar? Similar enough to create confusion? Perhaps. But as stated before there is a great amount of subjectivity involved in this element as well as sub-rules too numerous to mention and analyze in the context of this article.

Concerning the similarity of the goods and services, if your goods are shoes and the party alleging infringement also makes shoes that is pretty much dead on hit. But what about if you make shoes and the other party has a shoe store? Are the shoe store services sufficiently related to shoes such that confusion may arise among the relevant consumers of your respective goods and services? Possibly. So when analyzing this element always but yourself in the position of the average consumer and ask: Would I be confused between the two? Would I think that the same people who make the shoes run the store that sells shoes? Again, as above, the less similar the goods and/or services are the less likely infringement will be found.

The next consideration is whether the goods and/or services of the parties travel in similar channels of trade. In other words, how do the goods or services reach the end consumer. If you sell your goods exclusively through the Internet and so too does the other party they travel in the same channels of trade. If the channels of trade are diverse, this favors you. If they overlap, this favors the accuser.

The fourth element is how the respective marks are marketed. If you both advertise exclusively through major television campaigns this factor will favor the opposing party’s case. In the alternative, if the opposing party uses television and major magazine advertisements to promote their goods yet yours are sold exclusively by door-to-door salespersons then the factor will favor you. So if the marketing channels are similar, that favors infringement. If they are not, that favors your position of non-infringement.

Next, are the consumers for the respective goods or services sophisticated? The best way to determine this is to ask whether purchasers of the goods or services are discerning in regard to their purchasing decisions. For example, traditional “impulse” buys in a super market checkout line would not be considered discerning as consumers are less likely to pay significant attention to the manufacturer of goods which cost under $1.00. In the alternative, in purchasing decisions which involve more substantial capital resources, such as the purchase of a new luxury automobile, consumers would be deemed more sophisticated insofar as it is presumed that consumers of such luxury goods are more likely to have conducted research and be educated in regard to such a purchase. In this regard, the more sophisticated the consumers are who purchase your respective goods and services the less likely infringement will be found.

Lastly, are there any instances of actual consumer confusion between your goods and services using the disputed mark and those of the accuser? If there are, that is strong evidence of confusion in the marketplace which would favor a finding of infringement. Actual confusion may manifest itself in emails intended for one party but submitted to another in an attempt to reach the other. It could also be in the form of complaints received by one party concerning the quality of products of the other.

In conclusion concerning these elements, the more that favor you the less likely that infringement will be found.

Other Defenses

There are also other defenses to allegation of infringement which must be considered depending upon your unique circumstances. Two of these are discussed below.

First, the Doctrine of Acquiescence provides a defense when a trademark holder fails to adequately enforce its trademark in a uniform and consistent manner. For instance, while analyzing the cease and desist letter you discover that you are not the only company using the mark WIDGET for shoes. If numerous other parties are using the same mark and the accuser has yet to enforce its mark against them the accuser may be precluded from enforcing the same against you for their failure to properly enforce their mark against all known alleged instances of infringement.

Second, the Doctrine of Laches provides that an accuser may not enforce its trademark rights against another if it has waited an unreasonably long period of time to do so. This inquiry involves (1) understanding when the accuser knew, or should have known, about your use of the trademark at issue; (2) how long they took to initiate action against you to cease use of your trademark; and (3) whether this delay imposes any undue hardship upon you for their failure to more timely enforce their mark (i.e., you invested significant sums of revenue in a new advertising campaign for the trademark after they knew about your use thereof but before they issued the cease and desist letter notifying you of their objection to your continued use of the trademark).

If either of these two defenses is available both may strongly support a defense of any claimed infringement.

Everything You Say May Be Used Against You

Finally, we all have heard the famous Miranda charge in tv shows and movies: “You have the right to remain silent. Anything you say may be used against you in a court of law.”

While this derives from criminal law there is a civil law component every trademark owner must be aware of: Everything you say, be it well-intentioned or not, can be used against you in a subsequent court action under a Federal Rule of Evidence concerning admissions against your interests.

You may not intend to sabotage your case, but if you are not savvy to all of the ins-and-outs of trademark law responding to a cease and desist letter without assistance can be rife with peril.

For instance, you receive a cease and desist letter and are of the opinion that there is no likelihood of confusion between the marks. You call the lawyer for the accuser convinced you will be able to make this just go away. During the conversation you innocently state the following: “I know the marks are similar but your client makes t-shirts – we make pants. How could there be any problem?”

In this conversation you have just made two critical admissions. First, that the marks are similar. Second, that the goods are both clothing and, by nature, similar. How damaging is this? You have just proved 2 of the 6 elements of infringement above for your accuser. Congratulations. Do you think you should continue the conversation now?

So be careful and, if at all possible, seek professional assistance from an experienced trademark counsel. Not only will they be able to determine your rights and liabilities in the matter, but counsel can also discuss the matter with opposing counsel without the same being used as admissions against your interests.

Summary

In conclusion, if you receive a cease and desist letter demanding that you cease use of a trademark do not, under any circumstance, call the accuser or their counsel while still dealing with the emotions the allegations have undoubtedly evoked.

Rather, take as much time as you need to analyze the situation so that you can more objectively consider a planned response to the allegations.

Next, try and determine who has priority of use. If you do, fantastic. If not, there is still hope.

Next review the infringement factors listed above. Who do they favor?

Are any other defenses available?

Lastly, consult a trademark lawyer regarding your rights and how best to respond to the letter. You’ll be glad you did.

The Trademark Company

Allowing Others to Use Your Trademarks? Get it in Writing!

Whenever you or your company allows others - such as members, chapters, affiliated entities, or endorsed vendors – to use you or your company’s trademark(s), name, logos, copyrighted works, or other intellectual property, put the terms and conditions of the license in writing.

While oral or implied non-exclusive licenses can exist, they can be difficult to interpret, difficult to enforce, limiting in nature, and otherwise problematic for you or your company.

So be safe rather than sorry. There are many terms that should be included in such an agreement and competent representation can assist you in the drafting of the same. At a minimum, however, an agreement should spell out what can be used, how it is to be used, who owns the trademarks at issue and how long the same can be used or the conditions under which use must cease.

The Trademark Company

How Much Does it Cost to Register a Trademark? Here's What You Need to Know.

How much does it cost to receive a U.S. Trademark Registration? Here is what you need to know about the costs involved in registering a trademark in the U.S.

The ETEAS and ETEAS PLUS Systems

The United States Patent and Trademark Office (“USPTO”) charges either $275 or $325 per class of goods or services to file an application for a U.S. Trademark Registration. Whether the cost per class is $275 or $325 depends upon system the applicant uses at the USPTO.

The traditional filing system, known as the TEAS system, permits applicants to write their own identification of goods or recitation of services with which they wish their trademark to be registered. For instance, Nike would seek registration for a trademark using an identification of goods such as “athletic shoes” in International Class 25. If Nike writes their own identification of goods using the TEAS system the cost is $325 per class of goods or services in which the application is filed.
We’ll explain below what “per class” means.

As an alternative to the traditional system, in recent years the USPTO initiated a new system known as the TEAS PLUS system. The TEAS PLUS system is designed to both reduce the cost of the trademark process while speeding up the registration process. In this regard, provided that applicants meet certain specific criteria and use only identifications of goods or recitations of services from a pre-approved list the cost to register their marks is reduced from $325 to $275 per class of goods or services.

Accordingly, the base price to apply to register a trademark with the USPTO is either $325 or $275 depending upon which system is used.

U.S. Filing Fees Are Per Class

Next, applicants should understand that the USPTO’s filing fees are per class. U.S. Trademark Registrations are goods or services specific. This means that when you seek a U.S. Trademark Registration you must specify the goods or services with which the trademark is, or will be, used.

For instance, Nike undoubtedly owns registrations for NIKE in Class 25 for running shoes whereas McDonalds retains registrations in Class 42 or 43 for restaurants.

There are currently 45 classes of goods and services recognized by the USPTO. Goods and services are defined into these 45 specific classes to both create certainty for the USPTO in regard to the goods or services for which specific Trademark Registrations will apply but also to allow for greater uniformity among international trademark offices of various countries as the world moves toward a unified global system of trademark protection.

As such, an application by a music band who also intends to sell CDs of their music would apply to register a mark in two classes:

Class 9: Pre-recorded music CDs.

Class 41: Live performances by a music band.

If they file using the TEAS system, their total filing fees would be $650 (2 classes x $325 per class). In the alternative, if they are able to use the TEAS PLUS system their filing fees would be reduced to $550 (2 classes x $275 per class).

As such, prospective applicants must be savvy in regard to not only the system which they use but also the classification system and how many classes their requested application may fall into to understand the true cost of the U.S. Trademark Registration for which they seek.

The Distinction Between Use and Intent-to-Use Applications

Next, if your trademark is in use at the time of filing the application should be filed as a use-based application under what is known as Section 1(a). However, if the trademark is not in use as of the date of filing it is required to be filed as an intent-to-use application under Section 1(b). If it is filed as an intent-to-use mark, additional fees will apply in order to get the mark registered.

In short, should the USPTO deem the application worthy of registration rather than receiving a Certificate of Registration like a use-based application, an intent-to-use application receives what is known as a Notice of Allowance.

The Notice of Allowance is akin to a permission slip which allows the applicant to complete the registration process and receive its Certificate of Registration upon filing what is known as a Statement of Use. This subsequent filing, however, requires an additional charge of $100 per class of goods and services.

Accordingly, if you have a 2-class intent-to-use application filed under the TEAS system the fees to register the mark would look something like this:

Application Fee = $650 (2 x $325);

Statement of Use Fee = $200 (2 x $100);

Total Fees to Register a 2-Class Intent-to-Use Application = $850.

But it does not end here. We mentioned above that to file the Statement of Use costs $100 per class. Of note, from the date of the Notice of Allowance an applicant has only 6 months to file their Statement of Use establishing use of the mark. If the mark is yet to be in use by this date an applicant may file for an extension of time in which to file their Statement of Use. An extension of time to file the Statement of Use costs $150 per class. An applicant may file up to 5 extension requests per mark or may extend the due date of the Statement of Use for up to 2 and one half years (5 x 6 months) following the conclusion of the initial Notice of Allowance Period.

So let’s look back at our example above changing the situation slightly to reflect a need to file the Statement of Use 8 months after receiving the Notice of Allowance. Recall, this would require one extension of time to file the Statement of Use as an applicant is only permitted 6 months to file the same following receipt of the Notice of Allowance. Under that scenario the same would look something like this:

Application Fee = $650 (2 x $325);

Extension of Time in Which to File Statement of Use = $300 (2 x $150);

Statement of Use Fee = $200 (2 x $100);

Total Fees to Register a 2-Class Intent-to-Use
Application with One Extension of Time = $1150.

As you can see, the base price to apply for a U.S. Trademark Registration can vary widely depending upon the (1) USPTO system used, (2) the number of classes for which the application is made, (3) whether the application is use-based or an intent-to-use, and (4) whether, if an intent-to-use, an extensions of time are required prior to filing the Statement of Use.

Law Firms and Filing Services

Lastly, we would be remiss if we did not mention the cost of assistance in the trademark filing process. The cost to have a law firm and/or filing service file for a trademark on your behalf typically ranges from $149 to well over $3000 depending upon the size of the firm or company and the level of experience they retain in the trademark arena.

The obvious expense to using a law firm or filing service is the additional costs involved in employing the same. The benefits, however, typically far outweigh the burden of the costs insofar as a skilled firm can not only reduce or minimize the costs involved as referenced above but also retain invaluable experience in what can be a complex system to garner a U.S. Trademark Registration.

Often the cost of the legal services are fully offset by the firm or company’s ability to have an applicant’s application filed in the TEAS PLUS system versus the TEAS system, reducing the number of classes filed for, and even working with the applicant to determine whether an application may be filed as a use-based application versus an intent-to-use or otherwise.

Moreover, as the USPTO’s filing fees are non-refundable most consumers prefer the added confidence of knowing that their application is being prepared and prosecuted by a seasoned professional.

Summary

In conclusion, there is much to know about the costs involved in filing for a trademark. Whether it is that the costs involved are dependent upon the filing system used, the number of classes filed for, or whether the application is filed once use has begun or not will all affect the price of your trademark application. Additionally, most consumers prefer to rely upon the experience of seasoned professional to sort through the filing costs, reduce filing fees whenever possible, and advise them as to the availability of their mark prior to incurring non-refundable filing fees.

Without assistance, the cost for a U.S. Trademark Registration can be as low as $275 for a one-class mark filed using the TEAS PLUS system. However, if the applicant does not satisfy all of the requirements of the TEAS PLUS system additional fees will apply.

In the alternative, applicants may seek to assistance from an experienced law firm to assist in the registration process. In that case they should expect the lowest cost to be in the nature of $424 for a One-Class Mark filed using the TEAS PLUS system ($275 for the USPTO filing fee, $149 for the law firm’s services).

TheTrademarkCompany.com

Why You Should Work Smarter, And Harder

I was recently speaking to Dan Hanlon, CEO of Excelsior-Henderson motorcycle company, one of the greatest U.S. motorcycle companies of all time. He told me that for over twenty years he kept a small box on his desk and on its lid it read "The Secret to Success." Upon opening the box there was a single-word engraved–"Work." While we chatted he asked me what had contributed to The Trademark Company’s success. I replied "Ask me at 6 a.m. on any given Saturday." He loved my response.

In recent years there has been a host of books out about how to work smarter, not harder. These books lead the reader to believe that by simply working smarter and not harder you may be able to break free of the chains of full-time work with a fraction of the weekly effort.

But while the temptation to work less and make more will always be present, ask yourself will that truly get you and your business to where you want it to be?

There is an old saying that most overnight success stories were twenty years in the making. Richard Branson is known for rarely taking a day off and even when he was vacationing at his luxurious Necker Island estate (prior to the recent fire) was known to hold early-morning board meetings remotely for his various companies during his stays.

Gene Simmons of the iconic rock band Kiss insists upon working seven days a week. To paraphrase his rationale, if you work four hours on Saturday and another four on Sunday that’s eight extra hours per week or 416 hours more per year. It’s like finding an extra 10 weeks of work by merely putting in a little work on the weekends.

This is not to discount the theory of working smarter, not harder. You should still work smarter, just continue to work hard while doing so.

So how do you build your business? How do you beat out your competitor? Work harder. You have to dedicate yourself to putting in the time if you want to achieve the goals you set.

Does this mean you have to ignore your family or friends to do so? No. It just means you need to find those times in the day or week when you can put down the remote, turn off the TV, and enjoy putting in a little extra effort in building your business and love doing so.

The Trademark Company

The 2:00 A.M. Test for Hiring

For anyone who has known me for any period of time you will, from time-to-time, hear me extoll the virtues of the 2:00 a.m. test. No, it’s not the SATs, ACTs or any other number of our immeasurable acronym-driven societal placements we use to measure our station in the world. It is a simple axiom which I have held for as long as I can remember: the people you want in your life are the ones that are there for you at 2:00 a.m.

What am I talking about? It’s really quite simple.

Think about all of the people in your life. Your friends, your co-workers and, of course, family. Who are the ones who are really there for you? Who are the ones that truly have your back? The measuring stick I have always used is this. If I call someone at 2:00 a.m. and say "I blew a tire and need some help" the people of value are the ones who immediately respond "Where are you, I’ll be right there." If the response is anything but this, for instance "Do you know what time it is?" you know that although they may be your buddy, in the end they don’t really care. And by the way, the response to "Do you know what time it is?" in that context is "Yup, time to get a new friend."

But the test is not just limited to your personal life. It is equally applicable to business.

Who do you want to hire? A person that could care less about your company but for the fact they know their pay check is going to cash every two weeks? How about the person that when you call them at 2:00 a.m. and say "A water line broke in the building. Can you get in and help us get the computers off the floor" they say "On the way." (By the way, this actually happened to us years ago in our first space before we built our own building. Bonus tip: Never lease space with an adjoining wall to the building’s water pump room).

So when hiring come up with your own set of 2:00 a.m. questions unique to your business. In this economy there is, fortunately but also unfortunately, too many qualified people to choose from to fill your ranks. So when deciding, why not go ahead and add this additional level of selectivity? After all, at the end of the day wouldn’t you like them to pass the 2:00 a.m. test?

The Trademark Company

3 Types of Lesser-Known Trademarks That Can Help You Protect Your Business

We generally recognize that a trademark is any word, slogan, or symbol used to identify the source of goods or services used therewith. McDonalds for restaurant services, the Nike “swoosh” for shoes, and the iconic apple for, what else, computers. But did you know that you also can protect colors as trademarks? Sounds? And even the overall look and feel of a business? You can, and here’s how.

1. Trade Dress

Trade dress is a type of trademark that generally protects characteristics of the visual appearance of a product, its packaging, or even the overall look and feel of a business so long as it signifies the source of the product to consumers.

What can be considered trade dress you may ask? We’ll let’s look at some examples:

A. Product Design

The design of product packaging can be registered as a trademark provided that the packaging identifies the source of the product and is not attempting to be registered to protect some functional element of the packaging (that would be a patent). The best example of this we know of is the shape of a Coca Cola bottle. Everyone recognizes the hour-glass looking design as containing that little slice of heaven from those folks from Atlanta. So when you see the design of the traditional Coca Cola bottle and you recognize it as the bottle in which Coca Cola provides its product, that is the perfect example of packaging which functions as trade dress and, correspondingly may be protected by a Trademark Registration.

B. Color Schemes

Color schemes of restaurants as well as similar features of businesses can also be protected as trade dress under U.S. Trademark Laws. For instance, if you have been operating a uniquely designed or themed restaurant or business for some time and then begin to franchise the same the color scheme and other elements of your business may be protectable as trade dress. For instance, on the East Coast we have a restaurant franchise that is expanding rapidly called Five Guys. Five Guys offers great burgers and fries. For our purposes today, however, it is important to know that no matter how the restaurants appear on the outside they all have one common theme on inside: red and white checkerboard tile walls. So when you walk into the restaurant, even if you did not see the sign on the front of the building telling you that you are in a Five Guys, you know that those red and white checkerboard tiles mean that you are about to have a bacon double cheeseburger with a side of double-fried french fries like no other. You know you are in a Five Guys. And if you know this merely by looking at the color scheme on the walls that is the fundamental point of trade dress protection.

C. Overall Appearance

Additionally, and drawing upon the above, an overall appearance of a trademark used in connection with a product or service can be protected. This is where trade dress gets a little broad and often difficult to digest. But for our purposes we’ve talked about color schemes and package designs. The law has also been used to extend to generally recognized images and manners of presentation as well. We think the ongoing story of the Naked Cowboy best captures this concept.

For any of you who have been to New York City in the past decade or so there is symbol of America right in Times Square that cannot be missed. The ball that drops every year at the stroke of midnight you may ask? No. The giant billboards and flashing neon and LED screens 30 stories high? Nope. We are talking about Robert John Burck, aka - the Naked Cowboy.

Since 1997 the chiseled and tanned Naked Cowboy has strolled through Times Square wearing nothing but a pair of white briefs, white boots, matching cowboy hat, guitar and a smile singing to tourists and posing for photographs. Like the U.S. Postal Services’ age-old motto neither rain nor sleet nor dark of night can stop the Naked Cowboy. You can catch him strolling through Times Square during the dog days of summer through the coldest days of winter – all still in his iconic skimpy manner of dress.

A few years back Mars, Inc., the owners of the M&M brand of candies, opened M&M World in Times Square. As the popularity of the Naked Cowboy grew Mars thought it would be a great marketing ploy to parody the Naked Cowboy with a Times Square billboard of one of their M&M characters dressed in white briefs, white boots, the white cowboy hat and white guitar. Well the Naked Cowboy wasn’t down with that tune. He sued. And guess what? He won (or at least won a settlement). In short, his lawyers argued and convinced Mars that the Naked Cowboy’s overall likeness and image was protectable and, accordingly, by posting the billboard Mars was infringing upon the Naked Cowboy’s trademark – and trade dress - rights.

So as the Naked Cowboy teaches us even the overall appearance of a performer or otherwise can be protected as trade dress if that overall appearance has sufficient recognition value.

A post script to this example, as of press time it has been reported that the Naked Cowboy is now enforcing his rights against a performer who has materialized and is calling herself the Naked Cowgirl. Given that he has already enforced his trade dress against one of the world’s largest candy manufacturers, our recommendation to the Naked Cowgirl: get outta Dodge.

2. Colors

Another form of trademark protection can be found in the ability to protect colors. Not color schemes as above. Just colors.

There is perhaps no better example of this in recent times then UPS’s attempts to register the color brown in connection with shipping services. In the early 2000s UPS determined that it wanted to lock up the color brown. The U.S. Patent and Trademark Office initially denied their efforts.

Ultimately it was held that a business can protect a mere color as a trademark, but only if it can show substantial evidence of acquired distinctiveness in the color as a trademark. In other words when consumers see a specific color they think of your goods or services. That’s why, for the past several years, UPS has run the ad campaign “What Can Brown do for you?” They are ingraining in the minds of the consumer that when they see the color brown they think about UPS’s shipping services.

So you can protect merely a color, but it will cost you a lot of green.

3. Sound Marks

Lastly did you know you can protect sounds as trademarks? It’s true. The rumble of a Harley Davidson. The “Bum ….. bum bum bum bum” of Intel. Even the message alert sound of plane that Southwest Airlines uses in its commercials. These can all be protected as trademarks provided, as above, the trademark holder can show that in the minds – and in this case ears – of the consuming public when they hear that specific sound they think of the specific company’s goods or services.

Conclusion

So why do these matter? In protecting your brand identity people are often constrained to thinking about protectable trademarks as being merely a slogan, a logo, or a company’s name. But as we see above, a Trademark Registration can extend to protect a whole host of other things that consumers use to identify the source of a product or service.

So if you are a performer with a unique image and persona, a business that uses a specific pattern of décor or layout, or package your product in a unique package design that your competitors love to imitate remember the U.S. Trademark Laws are here to help you protect these signature trademarks as well.

The Trademark Company

3 Things to Consider Before Filing a Domain Name Dispute

We are often asked what our customers can do when someone else begins use of a domain name that is similar to their trademark(s) and, as a result, web site traffic – and business along with it – is being stolen by a new, competing new web site. In many instances the answer is clear: Initiate a Domain Name Dispute against the owner of the new site.

How is this done? The answer is simpler than you may believe.

Most domain names, including the ownership thereof, are controlled by the Internet Corporation for the Assignment of Names and Numbers or ICANN. By registering a domain name with any approved domain name registrar (e.g., GoDaddy.com, Register.com, etc.) the registrant of the domain name is required to agree to ICANN’s Uniform Domain-Name Dispute Resolution Policy or UDRP.

The UDRP allows you to enforce your trademark rights against registrants of confusingly similar domain names and force them to transfer those domain names to you where:

(1) the domain name is identical or confusingly similar to your trademark;

(2) the domain name owner has no rights or legitimate interests in respect of the domain name; and

(3) the domain name has been registered and is being used in bad faith.

Having successfully prosecuted domain name disputes in our experience here are the three (3) questions you should ask when considering whether you should initiate a domain name dispute against the registrant of domain name you feel is likely to cause confusion with your trademark:

(1) Trademark Rights. Did you have rights in your trademark through use, a Trademark Application, or a Trademark Registration, prior to the other person’s registration of the domain name at issue? If yes, continue to inquiry number 2. If no, you generally cannot maintain a Domain Name Dispute against the other party.

(2) Legitimate Interest. Does the owner of the domain name have some legitimate interest in respect to the domain name (e.g., the domain name owner is commonly known by the domain name even if they have acquired no trademark rights therein, the domain name is being used for legitimate non-commercial use)? If the answer is no continue to inquiry number 3. If the answer is yes you generally cannot maintain a Domain Name Dispute against the other party.

(3) Bad Faith. Was the domain name at issue registered and is it being used in bad faith (e.g., registered primarily to sell the same for a profit (aka domain name trafficking), to disrupt the business of a competitor, to divert customers away from a competitor by creating confusion with their trademark)? If the answer is yes you may be able to successfully maintain a domain name dispute against the other party and have the disputed domain name transferred to your ownership.

As always, a fact-specific analysis of your rights vis-à-vis the alleged cybersquatter should be conducted by someone experienced in the field. However, the above-referenced information should give you a fairly simple overview of whether enforcement may be possible if another registers a domain name which is confusingly similar to your trademark.

The Trademark Company

The Trademark Dilemma

As a former trademark examining attorney for the U.S. Patent and Trademark Office and founder of The Trademark Company I am often asked for suggestions on how to select a great trademark by our start-up business customers. The response is always the same, "It depends on what you want out of your trademark."

There are two schools of thought in selecting a great trademark that every new business must consider. On one hand do you want to use a completely coined name? Something that no one has ever heard of such as Google or eBay.

On the other, do you want a trademark that creates instant interest in the product or service because it tells your prospective customers what you provide and what they’ll get (e.g., FROSTED MINI WHEATS for breakfast cereals, VISION CENTER for retail store services featuring eyewear).

Both schools of thought have their benefits. Both also have their detriments.

Which should you choose? Like I said above, it depends upon what you are looking for out of your trademark. Coined trademarks, those that are completely made up, are the strongest form of trademarks and, in theory, the easiest to protect (e.g., Google, eBay, Hulu, etc.). But beware, although easier to protect, such trademarks do not tell the consumer what you do or what goods or services you provide. As such, if you intend to coin your own trademark be ready to spend more to promote your brand name as there will not be instant recognition by consumers of what you do or provide.

Descriptive trademarks, on the other hand, provide the owner with instant recognition for what their brand does (e.g., NEW YORK PIZZERIA). This comes at a cost, however. Descriptive trademarks are very hard to enforce and, as a result, may not provide the owner the ability to enforce their trademarks (e.g., the owner of NEW YORK PIZZERIA, more likely than not, cannot stop someone else from using NEW YORK CITY PIZZERIA even though the trademarks are very similar). As such, if you are looking to adopt a trademark that instantly drums up interest in your goods or services and will cost less to brand adopting a descriptive trademark may be best for you. You simply need to know that the rights you will acquire in any such trademark may never entitle you to exclude others from the use of similar trademarks.

So in the end how do you select a great trademark? It depends. What are you looking for?

The Trademark Company

How Do You Acquire Rights in a Trademark. Here’s What You Need to Know.

One of the most popular questions we receive here at The Trademark Company is when do you acquire rights in a trademark?

In the United States there are two ways that you can acquire federal trademark rights. First, you can acquire rights by using the trademark in interstate commerce. Second, you can acquire rights by filing to protect the trademark with the U.S. Patent and Trademark Office.

In regard to use-based acquisition, a person or entity acquires rights in any trademark they begin use of in interstate commerce for the purpose of identifying their goods or services. In short, when McDonald's first started selling hamburgers way back when they did not have to file to protect their trademark with the U.S. Patent and Trademark Office. They acquired rights as soon as their restaurant services began affecting interstate commerce.

On the other end of the spectrum, once you file for protection of your trademark with the U.S. Patent and Trademark Office and provided that the application matures into a registration your trademark rights will revert back to the date of the filing of your trademark application.

So we truly have a two-way acquisition system here in the U.S. for trademark rights: use and filing.

Many will then ask why then should we register our trademarks? Well, for a relatively modest fee the registration of your trademarks in large part quiets title for you in the trademark, makes it far easier to enforce the same, and provides the holder thereof with a host of additional remedies in the event the trademark is ever infringed upon.

So if you are using a trademark get it registered. It will deter others from infringing upon the same and provide you with a host of additional remedies should enforcement ever be required. If you are yet to begin use of a new trademark but know what you want to use therefor file an intent-to-use application with the U.S. Patent and Trademark Office as soon as possible. You will be glad that you did.

The Trademark Company

How to Protect Your Trademark

When thinking about launching a new business, brand, or product line here are some tips to make sure you secure the rights to your trademark before you spend your time and effort building your brand.

1. Clearance Report: Once you have selected the trademark you would like to use always have a research report performed to make sure that the trademark you want to use is available. A properly performed research report will clear use of your trademark or let you know if someone else already has rights in the same thus requiring you to select a different trademark. The time to find out if your trademark is available is before you begin use of the same, not after you have already spent money and effort in developing the brand only to learn you must now cease use of the trademark due to another’s earlier use of a similar mark.

2. Register Your Trademark: Once your trademark has been cleared apply to register the same with the U.S. Patent and Trademark Office. A registered trademark enjoys many statutory benefits that help its owner in the enforcement of the same.

3. Enforce Against Infringement: Once you own your trademark it is your most important nosiness asset. Protect it. Think about it, if someone tried to steal your work computer wouldn’t you try to stop them? Why should it be any different when someone tries to steal the good will your brand has developed? That is your trademark, your good will. Don’t let others wrongfully trade on your goods and service’s good name. Once you own your trademark you must be prepared to enforce it against those who would infringe upon you.

The Trademark Company

How to Select a Great Trademark

Our clients often ask us for suggestions in selecting a Trademark for their products or services. Our response to the question "How do I select a great trademark?" is always the same – "It Depends."

On one hand, do they want to create a completely coined name (i.e., something no one has ever heard of like eBay or Google) or use an arbitrary mark (i.e., a term we have heard of but that’s use is arbitrary in connection with the goods or services provided such as AMAZON for online retail store services or APPLE for computers).

On the other, do they want a mark that creates instant interest in the product or service because it is suggestive or describes of trait thereof (e.g., ORANGE CRUSH for orange-flavored soft drinks or COPPERTONE for suntan oil).

No matter what they decide a great name should be catchy and memorable, should create interest in the product or service, and most importantly be registerable as a trademark - that is capable of registration on the principal register maintained by the United States Patent and Trademark Office ("USPTO").

A common problem in selecting a trademark that would create instant interest is the temptation to use descriptive or generic terms - marks that directly convey characteristics of the goods (e.g., RED SHOES for shoes that are red).

Unfortunately, descriptive terms are not registerable as trademarks, absent proof of a secondary meaning (i.e., you have been using it for five years or you have spent millions in advertising of the mark).

So what is the best way to select a trademark for your products or services?
Coin or use arbitrary terms if you intend on building the brand from scratch. Note, this will take more effort and resources as consumers will need to be educated via advertising and otherwise as to your product or services provided in connection with that mark.

In the alternative, if you want that instant buzz which comes with suggestive marks, be cautious and avoid generic, descriptive, and non- inherently distinctive marks as they will not be registerable before the USPTO nor protected from infringement by others. Make sure that the terms you use in your trademark do not merely describe an ingredient, quality, characteristic, function, feature, purpose or use of your products or services. Rather, select a trademark that requires some bit of imagination, thought or perception to reach a conclusion as to the nature of your products.

The Trademark Company

What You Can Learn from The Ritz-Carlton

A few months ago we were reminded of what great customer service can do for a business. My wife and I had arranged to get away for a weekend to Charlotte, North Carolina to see one of Cirque du Solei’s latest shows. Having purchased the tickets months in advance we could not have known then that both the Duke and University of North Carolina’s basketball teams would be in town for the opening of the NCAA men’s basketball tournament.

As the masses of fans descended upon this little big town hotel rooms became scarce. Given our limited choices of hotels we decided to splurge and stay at The Ritz-Carlton, Charlotte. In doing so, we received a first-hand reminder of what a great customer service organization looks like and what great customer service can do for your business.

On Saturday morning we wanted to go out exploring. I realized I had forgotten my sunglasses in our car which had been parked with the valet the night before. Rather than have them pull the car around for my sunglasses I called the front desk and asked if they could run to the parking deck and get my glasses. The answer, “Yes sir, is there anything else I can help you with today?” By the time I reached the lobby the valet was there with my glasses.

Later as we were rushing to get ready for the show we realized my wife forgot to pack her hair brush. Again we called down to the front desk. Within minutes a Ritz-Carlton employee was at our door with a selection of brushes from the downstairs gift shop.

Does the Ritz-Carlton have systems in place for misplaced sunglasses or forgotten hairbrushes? Probably not. Rather, they simply create an environment that the customer is always right and that they will do what it takes to satisfy their guests’ needs.

On our last day we decided to get a work out in. In the exercise room every cardio machine has a fresh towel and bottle of water ready to go for guests. How? About every ten minutes a hotel employee sweeps through the gym, wipes down any equipment that has been used, rolls up a fresh towel for all such equipment and places a fresh bottle of water thereon for the next rider.

In short, from top to bottom every moment of the experience at The Ritz-Carlton reminded us of why they are a leader in customer service and why they enjoy the reputation of being one of the finest hotels to stay in the world.
So why is this relevant to your business? What can we learn from The Ritz-Carlton?

The value of becoming a great customer-service organization cannot be understated. It allows you to:

1. Charge a Premium for Your Goods or Services. Where your competitors may compete in a race to the bottom by lowering their prices, a great customer service organization can actually charge a premium for their goods or services. People are willing to pay more for the quality and the level of service they provide. Where would you and your organization rather be?

2. Better Equipped to Handle Customer Issues. Even the best of the best experience customer service issues once in awhile. Obviously we strive to eliminate all such issues prospectively by systemizing everything and training our employees on providing amazing customer service. But despite our best efforts customer service challenges will arise. When they do, if your employees are trained well, they and your organization as a whole will be better equipped to deal with these issues to keep your clientele ecstatically satisfied with the services you provide.

3. Create a Marketing Buzz About Your Business. When is the last time you heard someone recommend something that was just okay? Great customer service creates a buzz about your business which is worth its marketing weight in gold. In essence, great customer service organizations know that as word spreads through their emphatically satisfied customers about the level of service they provide, it will be broadcasted to the relevant consuming public. Before long your business becomes synonymous with a level of service customers want. It creates its own marketing buzz for your goods or services which, in turn, helps you distinguish your business from your competitors.

Does all of this work? Well, as we left The Ritz Carlton that weekend sure we paid a few dollars more for our room but we were happy to have done so. They took care of issues which arose during our stay that we did not even anticipate and did it with a smile. As for a creating a marketing buzz, this customer was so impressed he wrote about it on Inc.com.

So is it worth it to create a great customer service organization? You bet.

The Trademark Company

My Crisis of Conscience

There’s a scene in the movie Pretty Woman where the corporate raider played by Richard Gere, Edward Lewis, has an epiphany about his life. He quips, to the effect, we never build anything anymore. In this moment Edward realizes that his life has been about tearing things apart, not building things up.

Although my epiphany was not as well defined, it was very similar to Edward’s in the blockbuster movie. I began my career as a trial attorney in the greater Washington, D.C. area. For years I was a lawyer paid to fight on behalf of clients, paid to figure out ways to beat the other side at all costs. I wasn’t part of a team tasked with creating great things. Rather, I was a mercenary for hire fighting for whatever side paid the bills. Well, something had to change. I had to change.

Initially I took a job with the U.S. Patent and Trademark Office (USPTO) to transition away from trial work and gain experience in trademark law. While at the USPTO I witnessed an interesting phenomena, a need if you will that had to be filled. On one hand there were small and medium-sized businesses out there that needed help. Not only in understanding the often complex process of receiving a trademark registration, but also in defending oftentimes frivolous lawsuits and actions from existing trademark holders. On the other hand, there were the experienced law firms that, for the most part, were simply too costly for the average small to medium-sized business to afford. Who could help these small businesses?

So we asked two simple questions: Can we create a company that provides the same quality of legal services as major law firms at a fraction of the price? Can we infuse a customer-serviced focus boarding on fanaticism into an industry longing for customer service?

In 2003 we began constructing the models and systems which would allow us to answer these questions in the affirmative. Years in the making the systems are now in place and the dream is being realized.

Today we represent thousands of customers on six of seven continents (No clients from Antarctica yet, go figure). For two consecutive years we have been recognized by the Inc. 500 as one of the fastest growing private companies in America, are the number three trademark filer in the world and recognized as one of the Top Trademark Firms by Intellectual Property Today, all while maintaining an A+ rating with the Better business Bureau.

Most importantly we are true to our original vision, a vision which has guided us along our journey. As Edward in Pretty Woman realized it’s about building businesses. And that is what we do, our passion: protecting our clients' trademarks so they can build their dreams.

The Trademark Company

Trademarks and Priority: What You Need to Know

We are often asked by our customers whether they can register a trademark and then use that registered trademark to force someone else to stop using the same. The answer, it depends.

Many fail to understand how trademark rights are acquired. In general you can acquire trademark rights in one of two ways: (1) use; and/or (2) filing.

First, simply by using a trademark in commerce an entity acquires rights in that trademark in connection with the goods or services with which it is used.

Second, whether or not a trademark is in use you may also acquire rights in the trademark by filing and subsequently registering the same with the U.S. Patent and Trademark Office.

As such, merely registering a trademark with the U.S. Patent and Trademark Office will not give you superior rights to a trademark over another if that other used the trademark in commerce prior to your use or filing of the same with the U.S. Patent and Trademark Office.

So the determination of who retains priority of use in a trademark dispute is often a complex factual analysis. You cannot merely assume that if you were the first to register a trademark you actually have superior rights to all others in that trademark. Due diligence must still be conducted to make sure your use date or filing date predates the other party sufficient to secure your priority of use and, accordingly, superior rights in a mark.

The Trademark Company

Your Trademark is Your Business’s Most Important Asset – Protect It!

What’s in a name? Everything.

We know that when we pop open a can of Coca Cola no matter if you are in Los Angeles or New York you know that you are moments away from that sugary sweet refreshment. Why? Because the trademark on the can tells us so.

When we walk into a McDonalds in Dallas we know they are going to serve us the same delicious Big Mac that we would get in Chicago. Why? Because the trademark on the sign – those famous golden arches – tells us so.

These companies have built their brands, and their products’ identities, on their trademarks. The entirety of your efforts in building your business and a consumer following can be taken away in an instant if consumers can no longer find your brand, your trademark. How can this happen?

Well for one thing if you do not clear use of your trademark before beginning use of the same you could be sued for infringement by another. If they win, they can force you to stop use of your brand altogether – even after years of brand development.
So whether or not you have the greatest product or service in the world it is nothing if consumers can’t find you, if you are forced to change your name after years of effort building your trademark’s brand recognition.

What should you do? You should always protect your trademarks. Conduct clearance reports before using new trademarks. Always register your brand names, slogans, and other matter which can be protected.

If not one day they could be taken away from you and your company’s biggest asset – its recognition among consumers – could become a thing of the past.

The Trademark Company

You Can’t Register Generic Terms as Trademarks So Stop Trying

Many of our customers come to us trying to register trademarks that are generic terms for some good or service. Often the feeling is that if they register the term they will then be able to force others to license back the rights to use their “trademark”.

But among other issues with this business model is the U.S. Patent and Trademark Office’s prohibition against the registration of generic terms. In short, the U.S. Patent and Trademark Office will not register a trademark that so describes the class of goods or services for which it is used as to be considered one in the same (e.g., SHOES for shoes, RESTAURANT for a restaurant).

This issue was recently brought to the forefront of the national media by Apple’s attempt to register APP STORE. Their competitor, and long-time rival Microsoft, effectively blocked the registration of the trademark by arguing that it was generic for online retail store services that sell mobile applications for hand-held devices. Had they been unsuccessful Apple may have been able to claim exclusive rights to the term APP STORE forcing others to license the rights to use the same and, even worse, precluding others from using the terms altogether.

What does this teach us? You can’t register generic trademarks.
If the “trademark” you are attempting to register is the commonly known name for the good or service than it is generic and cannot be registered with the U.S. Patent and Trademark Office.

You are better of selecting a mark that does not immediately convey the purpose, a characteristic, or something otherwise descriptive of your goods – in other words an inherently distinctive trademark – and then spend your efforts building your brand. You’ll be glad that you did.

The Trademark Company

3 Tips for Posting Your Legal Questions in Open Internet Forums

As we are all aware, once something is posted on the Internet it is generally available for public viewing by all. A recent trend that we have seen with potentially damaging consequences is posting one’s legal questions in an open forum or chat room and inviting advice from others on the subject.

The solicitation of the advice is not the issue. Rather, it is the posting of information concerning a specific case or fact scenario which may then, potentially, be used against you in court should the matter ever escalate into a dispute or litigation. As you may not be aware, admissions against your interests, even if made unknowingly, can be used against you in a court of law.

Just this morning we reviewed a very fact-specific question from an individual posted in an open legal forum online. The post detailed the facts and circumstances of the individual’s use of a new trademark, his receipt of a cease and desist letter regarding that trademark, and his reaction to and solicitation of advice surrounding a potential response to the letter. As we scrolled through the replies a very ominous posting was listed about 4 messages down from the actual party who had sent the cease and desist letter to the individual initiating the discussion. In short, it thanked the man for admitting online to the infringement – which he unknowingly had, stated that the post had been copied and was being forwarded to an attorney for inclusion in the lawsuit that would be filed later this week. Wow.

Our advice to all that read this: Don’t find out how small the world really is by posting your legal questions online only to find out the subject of your posting is also a member of the same forum. However, if you feel compelled to use this type of medium here are a few tips we have picked up along the way we suggest you implement:

1. Use a Pen Name. Never use your real name in posts or, if possible, to register an account for posting in a forum. This way you can post your legal questions in anonymity with less fear that the same will be attributed to you down the road.

2. Use Hypothetical Examples. Never use the real facts involved. Always phrase your question or questions in terms of hypotheticals (i.e., “Company A uses the trademark WIDGET for cat food. Company B starts using the trademark WIDGET for dog food. Is this a problem?”)

3. Never Identify the Other Party. As you should not use your own name nor should you use the name of the other party. In addition to potentially alerting them of your posts if they use services such as Google Alerts, you may run afoul of libel laws if your posts are derogatory or otherwise negative in nature towards the other party.

So keep posting if you must. Just please be careful.

The Trademark Company

3 Reasons Why You Should Perform a Trademark Clearance Search for Your Trademarks

We are often asked by our prospective customers why should I perform a trademark clearance report? Our answers are always the same. Here are the top 3 reasons why we feel you should always conduct Trademark Research in the form of a Trademark Clearance Report prior to adopting and beginning use of your new trademark.

1. U.S. Patent and Trademark Office (“USPTO”) Filing Fees Are Non-Refundable

First and foremost filing fees paid to the USPTO are non-refundable. In other words, if you file for your mark and your mark is ultimately block based upon a likelihood of confusion with an existing mark you have forfeited the cost of your filing fees paid to the USPTO in the filing of your Trademark Application.

A trademark clearance report, even one as simple as a Basic Federal Database Search which costs a fraction of what it costs to file for protection of a trademark with the USPTO, is often a cost-effective method to evaluate whether your mark is clear to be registered and, if so, whether you should proceed forward with filing for the Trademark Registration or decide upon another mark if the same is not available.

2. Don’t Develop a Brand You May Be Forced to Give Up

Second, a Comprehensive U.S. Trademark Research Report – one that includes a search of not only the USPTO’s databases but also state trademark and corporate databases – will not only let you know if your trademark is clear to registered but also whether you are likely to infringe upon another’s use of an already-existing trademark whether it be filed with the USPTO or not.

Note, trademarks are not required to be registered with the USPTO to be afforded protection state and federal protection. Rights to trademarks can be acquired merely by use thereof or what is generally referred to as at common law.

So imagine the scenario, you are a California restaurateur. You come up with what you think is a unique name, let’s say Suntopia. You open your first restaurant in Los Angeles. Since you came up with the name you figure it must be available so no research report is performed. Business is great. You open a second location in Palm Springs and later a third in Las Vegas. You register the trademark with the USPTO and life is good. A few years go by and you are now famous. Your restaurants are the toast of the town. You routinely appear on the Jay Leno show as a celebrity guest chef. And then one day you get a letter from a law firm in Florida. The letter reads “Dear so in so ... our client has been using the mark Suntopia in connection with a chain of restaurants in the States of Florida and Georgia for over twenty years. We demand you immediately change your name. P.S. Loved you on Leno. The pesto-encrusted sea bass was great.”

You’re crushed. How could this be? You came up with the mark in a dream sequence fit for a Hollywood film. This must be your trademark.

Sadly who wins? More likely than not the Flori-Georgians. Who looses? You do. What happens to the years of blood sweat and tears building your brand Suntopia? Gone. And to think, all of this could have been resolved if only you would have spent a few dollars up front and had a trademark clearance report performed. Then you would have known to come up with another mark instead of spending years of your life and countless resources building up another’s pre-existing brand.

After all, as most practitioners and entrepreneurs know alike, it is the enterprise that creates the brand. The brand does not create the enterprise.

3. Having a Trademark Clearance Report Performed Is Evidence of Your Reasonableness in Adopting a Trademark

Third, did you know that should you ever get sued for trademark infringement the fact that you had a clearance report issued which cleared the adoption and use of your mark may be used as evidence in that case as evidence of your reasonableness in adopting the mark.

Trademark litigation counsel love it when an accused infringer did not perform a trademark clearance report. In the hands of a skilled lawyer this can be manipulated into showing a callous disregard as to the existing trademark rights of others by the purported infringing defendant.

But if you have a trademark clearance report performed, and if that report “clears” use of your mark, the opposite may be true. Should you ever be sued over the use of the trademark your lawyer can mount a defense on the reasonableness of your selection of the mark backed by objective evidence at or before the critical point of adoption of the mark: your trademark clearance report.

Conclusion

So whenever considering the adoption of a new trademark, be you a small start-up business or a multinational corporation rolling out new product after new product, remember to always have a trademark clearance report performed before you begin use of your mark. It is well worth the investment.

The Trademark Company

IP Law 101: What a Start-Up Needs to Know About the 3 Types of IP Rights

We are often asked do I need a trademark for my slogan? Can I patent my idea? How can I protect my website from copying by others? Here’s a quick rundown of the various protections every business should be aware of in protecting their intellectual property.

Trademarks
A trademark includes any word, name, symbol, or device, or any combination used, or intended to be used, in commerce to identify and distinguish the goods or services of one manufacturer or seller from goods manufactured or sold by others, and to indicate the source of the goods. In short, a trademark is a brand name. It can be your company’s name (e.g., NIKE) or its main advertising slogan (e.g., JUST DO IT). No matter what you wish to use as a source identifier of your goods or services it should be Registered, if possible, with the U.S. Patent and Trademark Office (“USPTO”) to maximize the protection available under The Trademark Act of 1946. Trademarks can last forever so long as they are Renewed as required by the USPTO.

Patents
A patent is a grant of property rights by the U.S. Government through the USPTO. The patent grant excludes others from making, using, or selling an invention in the United States that receives patent protection (e.g., a new and innovative design for a tooth brush, mechanical part, or otherwise). Patents, unlike trademarks, are subject to limits lives. For instance, a utility or plant patent in force on June 8, 1995, is subject to either the 17 year term from grant or the 20 year term from earliest effective U.S. filing date, whichever is longer. A design patent term is 14 years from patent grant.

Copyrights
Copyright is a form of protection provided by the laws of the United States (title 17, U. S. Code) to the authors of “original works of authorship,” including literary, dramatic, musical, artistic, and certain other intellectual works. Copyrightable works include the following categories:

1. Literary Works (e.g., books, articles)
2. Musical Works, including any accompanying words (e.g., music, lyrics)
3. Dramatic Works, including any accompanying music (e.g., plays, screen
plays,scripts)
4. Pantomimes and Choreographic Works (e.g., dance routines)
5. Pictorial, Graphic, and Sculptural Works (e.g., works of art, statutes, AND
web sites)
6. Motion Pictures and other Audiovisual Works (e.g., movies, television
broadcasts)
7. Sound Recordings (e.g., albums, CDs, etc.)
8. Architectural Works (e.g., building designs and plans)

As always, if you have any questions about these or any other matters just Contact Us or post your questions or comments right here on our blog.

The Trademark Company

4 Things Every Trademark Owner Should Know About Monitoring Their Trademark(s)

If you are a trademark owner did you know that to maintain rights in your mark you are required to police the use thereof?

Unauthorized use of your mark, also known as infringement, diminishes the distinctiveness of a trademark and, correspondingly, reduces your rights in your trademark by diluting it in the marketplace for relevant consumers.

In short, the more trademarks there are out there that look like your mark, the less likely your trademark will be viewed by consumers as an identifier of the source your goods or services.

Whether you have a Trademark Registration or not here are 4 things every trademark owner should know about Monitoring use others are not infringing thereon:

1. USPTO.gov

The United States Patent and Trademark Office (“USPTO”) maintains a moderately user-friendly web site located at USPTO.gov. There users can search the USPTO’s records of pending and registered trademarks using the Trademark Electronic Search System (“TESS”).

For individuals not trained in the more advanced techniques of searching the USPTO’s databases, use of the “New User Form Search (Basic)” is the most user-friendly. Although it may not bring up all of the results that a “Free Form Search (Advanced)” may (e.g., phonetic equivalents (Coco Cola vs. Koka Kola) or foreign translation equivalents (Red Shoes vs. Zapatos Rojos), it is a nevertheless a great, basic, and cost-effective (i.e., free) manner to monitor filings before the USPTO to make sure others are attempting to register trademarks too similar to yours.

2. Search Engines & Google Alerts

Monitoring your trademark(s) on the USPTO will only pick up a fraction of the trademarks that are actually out there and in use. Many entities and/or individuals never file to register trademarks that they are using with the USPTO. As such, to expand your view of trademarks that are actually in use in commerce you should also examine trademarks in use in cyberspace.

In short, monitoring of your trademarks should include regular checks of the major search engines to make sure others, and in particular your competition, have not adopted or are using trademarks similar to yours. There are far too many search engines out there to mention and repeatedly search them all. However, for the purposes of this article we suggest routine searches of the three biggest in the U.S.: Google (@45% of search traffic in the U.S.); Yahoo! (@21%); and Bing (@12%).

Searching for your trademark(s) using these three search engines may identify others wrongful use of trademarks identical or substantially similar to yours. It is also important to note that monitoring of these search engines should not simply be limited to whether someone else has adopted use of a mark which is identical or similar to yours.

Checks should also be conducted to make sure a search of your trademark(s) do not bring up competitor’s sponsored ads (i.e., pay-per-click advertising) which may indicate that your competitors are bidding on your trademark as a keyword.

Moreover, if a competitor and its dissimilar mark ranks highly in non-sponsored or organic search results when you search for your trademark you should examine their html code for their web site to make sure they have not embedded your mark in their html code so that their site appears in search results when consumers are seeking you out online.

Of note, if you do not wish to spend your days fixated searching the Internet for wrongful use of your marks try Google Alerts. Google Alerts allow you to set alerts, delivered via email as frequently as you choose, for any term or combination of terms when Google’s discovers while performing its routine indexing of pages posted on the Internet. It’s a great low-maintenance tool to monitor use of your mark, or wrongful use thereof, on the Internet. Note, it will not alert you to the pay-per-click or html issues referenced above.

3. RSS Feeds & Twitter

Another way to monitor the use of your trademarks online is to follow RSS feeds of relevant blogs and other information in your industry as well as monitoring the use of your trademarks on social media sites like Twitter.

To do this simply identify the most relevant blogs in your industry and monitor them for use of marks similar to yours by subscribing to RSS feeds for these blogs. Additionally, you can set search terms in Twitter and have the same downloaded to your RSS feed as an extra level of protection.

4. State Trademark and Corporate Databases

One final level of monitoring you may wish to undertake is the monitoring of state trademark and corporate databases for filings of new business names or state trademarks which may infringe upon your rights. The good news is that almost every state has an online portal where you can search for business and state trademark filings for free. The bad news, the state web sites are not linked and to search every state’s databases on a routine basis would be quite time consuming.

There are subscription services which allow for the monitoring of all state databases at once. If that is not feasible for you we suggest periodic searches of those states in which your business maintains its most active presence.

As always, there are companies which offer Trademark Monitoring services. However, if you choose to monitor your marks on your own these tips above will provide you with a great road map to get started.

The Trademark Company

When To Enforce Your Trademarks: Think Before you Act.

One of the trickiest questions we get here at The Trademark Company is the question of when should a business enforce its trademark(s) against a likely infringer? The answer, we believe, is a mix of business considerations balanced against legal principals. In short, here’s what you need to know.

The law says that if you do not enforce your marks against all infringement thereof you, to some degree, loose the right to do so in the future. The is primarily due to the interplay of two doctrines of law: acquiescence and laches.

Acquiescence occurs when you generally allow others to use marks similar to yours but do not enforce your rights against them. Then, if you subsequently try to enforce your mark against someone else they can claim that you have acquiesced to their use by not enforcing your mark against all. In short, enforce against all or against none.

Laches is an equitable defense that, in short, means you cannot wait to enforce your mark against a specific individual for an unreasonable period of time. Because they will rely on your not enforcing your mark against them as a license to continue using and building their mark the law says it is not fair to do so at a later date. In short, enforce it as soon as you know about the bad guy or your delay will give rise to this defense against your claims.

So the law says enforce it now or you will not be able to later. But what about business considerations? Does this mean you have to spend every last dime defending a brand you are only beginning to build? This is the toughest question of all.

On one hand, the law says you must. On the other, what’s the point of building a business if the lawyers take all the profit in enforcing your trademarks?

Well, hopefully we can provide some guidance. Although the law say enforce now we often advise our clients to take that with a grain of salt. Enforce them where it makes business sense to do so but not where it does not.

For example, one of our California clients experienced significant diminished sales (roughly 50% loss of sales per month) of its product sold exclusively online when one of their competitors started knocking off their brand. In that regard, they were loosing, let’s say $50 per month. Enforcement would cost them $40. But then in one month’s time they would be gaining back their full sales easily making enough to cover the cost of litigation and enforcement. That was a clear case for a need to enforce a mark.

In the alternative, one of our clients discovered a small mom and pop store using their name in a local community which in no way affected the sales of our larger client. Should they enforce? With no lost sales and a very tenuous argument as to whether actual confusion would really result we were hard-pressed to say that they should.

So against the legal context from above we always ask our clients one simple question: Does it Make Good Business Sense to Enforce the Mark? In time is the cost of enforcement going to be covered by the benefits of enforcement, both tangible (e.g., recoupment of lost sales) and intangible (e.g., the continued ability to enforce one’s trademark without fear of the defenses of acquiescence and laches)?
If yes, enforce it! If no, simply consider keeping an eye on the purported infringer to make sure that loss from their use never materializes.

Above all, however, make a good business decision even if tempered by an understanding of the law in play in doing so.

The Trademark Company

What to Do If You Receive a Cease and Desist Letter

The mail comes and you notice a letter from a law firm you do not recognize. As you open the letter you hope for the best but you are nervous in anticipation of what the letter says. You read the opening paragraph of the letter:

“We represent the ABC Company in the protection of their intellectual property rights. It has recently come to our client’s attention that you are using the trademark…”

You continue reading your heart now racing. A law firm is demanding that you immediately stop you or your company’s trademark, its brand, its very identity.

Anger, frustration, and denial set in. Everything in the letter is wrong. Your trademark is spelled differently from the other trademark. Moreover your goods or services are not identical to those provided by the law firm’s client. You begin formulating your planned response before you even reach the end of the letter.

You decide to pick up the phone and call the lawyer who wrote the letter to explain to he or she how there is simply no infringement here. Better yet, you’ll put it in writing and begin typing a responsive yet somewhat emotion-fueled email.

Does this sound familiar?

Before you do anything please stop, do not rush your response, take a few deep breaths, and make sure you understand a few basic principals about the situation you now find you or your company in before writing that email or making that call. Quite simply, a little reasoned thought may make the difference between keeping and losing your trademark.

Trademark Law 101

First a primer on the basics.

A trademark includes any word, name, symbol, or device, or any combination, used, or intended to be used, in commerce to identify and distinguish the goods of one manufacturer or seller from goods manufactured or sold by others, and to indicate the source of the goods. In short, a trademark is your brand name.

Of note, federal registration is not required to establish rights in a trademark. Common law rights arise from actual use of a mark. Generally, the first to either use a mark in commerce or file an intent to use application with the U.S. Patent and Trademark Office has the ultimate right to use and registration.

Priority of Use

With this basic understanding of trademarks in hand, one of the initial steps in evaluating any cease and desist letter is to determine who has priority of use (i.e., who used their mark first) of the respective trademarks. This may be the most effective defense to an allegation of infringement insofar as if you can establish that you or your company actually used your trademark before the other’s first use of their mark it is the other party that may be infringing upon your rights and not the other way around.

Surprisingly law firms issuing cease and desist letters often fail to accurately establish the priority of use of their clients’ trademark before sending the letter. Often this is understandable in that even with the Internet, available corporate databases, and other methods, determining when a business truly first began use of a trademark – especially where the business does not have a federal registration – is often a function of the law firm’s best guess as to priority of use based upon all available information it can gather.

In the alternative, the cease and desist letter you receive will, more likely than not, list the earliest date of priority of use the opposing side can claim for its trademark. This key bit of information is usually phrased to the effect “Our client has been continuing using their trademark since as early as ….” In this regard, rather than conducting initial research on the use of the other party’s mark you are instantly presented with the date they will, most likely, rely upon for their priority date should the matter progress further (i.e., into litigation).

Note the legal wiggle room “since as early as” which is almost always the way dates of first use are referred to in cease and desist letters. Through experience lawyers know to use this language so that if you respond with an earlier priority of use date they have not locked themselves into one date for their client but can fall back on amending that date since the original one listed in their letter was only “as early as” but the true date could be, in theory, a date they have yet to reveal.

With this in mind, you should evaluate whether you began use of your trademark prior to the opposing party’s first use of its mark. In other words can you beat their date of first use?

Often the answer to this question is simple. If you just opened your business and the other party has been using its mark for 70 years they more likely than not retain priority. On the other hand, perhaps you have been using your mark in the New York tri-state area for 20 years but have never registered the trademark. The other party sends you a cease and desist letter alleging a date of first use in 2008. Who has priority? You do, more likely than not.

But beware, the issue of priority is often a far more complex question. Let’s say the other party has been using their mark for four years, has a federal registration for their trademark, and now wants you to cease using your mark. You are a California-based business but have never taken the time to register your trademark. You have also been using your trademark for four years in Southern California and for almost that entire time the goods you offer have been and continue to be advertised in California, Arizona and even in Northern Mexico. In this case the legal definition of “use in commerce” and “use in interstate commerce” sufficient to grant federal and/or state trademark rights becomes very significant. In this scenario you may actually have priority of use. You may not. More complex legal analysis would need to be performed.

As such, if there is a clear answer to the priority of use issue and you have priority of use that will, more likely than not, be the strongest argument in defense of a cease and desist letter. If priority of use is unclear or if you do not have priority of use have heart and continue to the next step of the evaluation: whether your trademark infringes upon the other’s pre-established rights.

Infringement Analysis

The next part of the analysis must focus on the traditional elements of infringement. While the various U.S. Circuit Courts of Appeals may differ slightly in their interpretations of the elements for infringement, universally the inquiries ask (1) whether the marks are similar in appearance, connotation, or otherwise; (2) whether the goods and services with which the marks are used are identical, similar, and/or otherwise related; (3) whether the goods and services of the parties travel in similar channels of trade; (4) whether the marks are marketed in similar manners; (5) whether consumers of the respective goods and services are sophisticated; and (6) if there are any instances of actual confusion among consumers as between the marks.

To determine the validity of the accuser’s allegations you must determine whether the factors support you or the other party in their allegations.

In regard to the first element, ask whether your mark is generally similar in appearance, meaning, or connotation to that of the party alleging infringement. In this regard, the less similar the marks are the less likely infringement will be found. In most instances the marks are not identical. As such, in large part there is usually a bit of subjectivity involved in the evaluation of this element. If both marks are WIDGET they are definitely similar, in fact they are identical. But what if your mark is WIDGET and theirs is WIDGET MAX? Are they similar? Similar enough to create confusion? Perhaps. But as stated before there is a great amount of subjectivity involved in this element as well as sub-rules too numerous to mention and analyze in the context of this article.

Concerning the similarity of the goods and services, if your goods are shoes and the party alleging infringement also makes shoes that is pretty much dead on hit. But what about if you make shoes and the other party has a shoe store? Are the shoe store services sufficiently related to shoes such that confusion may arise among the relevant consumers of your respective goods and services? Possibly. So when analyzing this element always but yourself in the position of the average consumer and ask: Would I be confused between the two? Would I think that the same people who make the shoes run the store that sells shoes? Again, as above, the less similar the goods and/or services are the less likely infringement will be found.

The next consideration is whether the goods and/or services of the parties travel in similar channels of trade. In other words, how do the goods or services reach the end consumer. If you sell your goods exclusively through the Internet and so too does the other party they travel in the same channels of trade. If the channels of trade are diverse, this favors you. If they overlap, this favors the accuser.

The fourth element is how the respective marks are marketed. If you both advertise exclusively through major television campaigns this factor will favor the opposing party’s case. In the alternative, if the opposing party uses television and major magazine advertisements to promote their goods yet yours are sold exclusively by door-to-door salespersons then the factor will favor you. So if the marketing channels are similar, that favors infringement. If they are not, that favors your position of non-infringement.

Next, are the consumers for the respective goods or services sophisticated? The best way to determine this is to ask whether purchasers of the goods or services are discerning in regard to their purchasing decisions. For example, traditional “impulse” buys in a super market checkout line would not be considered discerning as consumers are less likely to pay significant attention to the manufacturer of goods which cost under $1.00. In the alternative, in purchasing decisions which involve more substantial capital resources, such as the purchase of a new luxury automobile, consumers would be deemed more sophisticated insofar as it is presumed that consumers of such luxury goods are more likely to have conducted research and be educated in regard to such a purchase. In this regard, the more sophisticated the consumers are who purchase your respective goods and services the less likely infringement will be found.

Lastly, are there any instances of actual consumer confusion between your goods and services using the disputed mark and those of the accuser? If there are, that is strong evidence of confusion in the marketplace which would favor a finding of infringement. Actual confusion may manifest itself in emails intended for one party but submitted to another in an attempt to reach the other. It could also be in the form of complaints received by one party concerning the quality of products of the other.

In conclusion concerning these elements, the more that favor you the less likely that infringement will be found.

Other Defenses

There are also other defenses to allegation of infringement which must be considered depending upon your unique circumstances. Two of these are discussed below.

First, the Doctrine of Acquiescence provides a defense when a trademark holder fails to adequately enforce its trademark in a uniform and consistent manner. For instance, while analyzing the cease and desist letter you discover that you are not the only company using the mark WIDGET for shoes. If numerous other parties are using the same mark and the accuser has yet to enforce its mark against them the accuser may be precluded from enforcing the same against you for their failure to properly enforce their mark against all known alleged instances of infringement.

Second, the Doctrine of Laches provides that an accuser may not enforce its trademark rights against another if it has waited an unreasonably long period of time to do so. This inquiry involves (1) understanding when the accuser knew, or should have known, about your use of the trademark at issue; (2) how long they took to initiate action against you to cease use of your trademark; and (3) whether this delay imposes any undue hardship upon you for their failure to more timely enforce their mark (i.e., you invested significant sums of revenue in a new advertising campaign for the trademark after they knew about your use thereof but before they issued the cease and desist letter notifying you of their objection to your continued use of the trademark).

If either of these two defenses is available both may strongly support a defense of any claimed infringement.

Everything You Say May Be Used Against You

Finally, we all have heard the famous Miranda charge in tv shows and movies: “You have the right to remain silent. Anything you say may be used against you in a court of law.”

While this derives from criminal law there is a civil law component every trademark owner must be aware of: Everything you say, be it well-intentioned or not, can be used against you in a subsequent court action under a Federal Rule of Evidence concerning admissions against your interests.

You may not intend to sabotage your case, but if you are not savvy to all of the ins-and-outs of trademark law responding to a cease and desist letter without assistance can be rife with peril.

For instance, you receive a cease and desist letter and are of the opinion that there is no likelihood of confusion between the marks. You call the lawyer for the accuser convinced you will be able to make this just go away. During the conversation you innocently state the following: “I know the marks are similar but your client makes t-shirts – we make pants. How could there be any problem?”

In this conversation you have just made two critical admissions. First, that the marks are similar. Second, that the goods are both clothing and, by nature, similar. How damaging is this? You have just proved 2 of the 6 elements of infringement above for your accuser. Congratulations. Do you think you should continue the conversation now?

So be careful and, if at all possible, seek professional assistance from an experienced trademark counsel. Not only will they be able to determine your rights and liabilities in the matter, but counsel can also discuss the matter with opposing counsel without the same being used as admissions against your interests.

Summary

In conclusion, if you receive a cease and desist letter demanding that you cease use of a trademark do not, under any circumstance, call the accuser or their counsel while still dealing with the emotions the allegations have undoubtedly evoked.

Rather, take as much time as you need to analyze the situation so that you can more objectively consider a planned response to the allegations.

Next, try and determine who has priority of use. If you do, fantastic. If not, there is still hope.

Next review the infringement factors listed above. Who do they favor?

Are any other defenses available?

Lastly, consult a trademark lawyer regarding your rights and how best to respond to the letter. You’ll be glad you did.

The Trademark Company