Trademark Basics: Questions and Answers

What is a Trademark?

A trademark (or for those which relate to a service, a “service mark”) is any word, phrase, design, picture, logo, symbol, or any combination of these used by a business to: (1) identify its goods and services; and (2) distinguish them from the goods and services offered and sold by other businesses. A trademark forms a part of your company’s valuable brand identity.  Registering your company’s trademarks provides it with certain benefits.

What is Registration and What Benefits Does it Provide?

A trademark is registered when it is filed with, and recorded by, the government.  Trademarks may be registered in the U.S. with the United States Patent and Trademark Office (USPTO) or with any of the 50 states.  In most cases, federal registration is recommended as it provides the broadest rights for your trademark.

Federal registration adds significant value to your company’s already valuable trademarks and carries with it several important benefits.  First, federal registration allows your company to sue in federal court for trademark infringement to recover lost profits, damages, and costs from an infringer and, under certain circumstances, treble (triple) damages and attorneys’ fees.  This is an important deterrent to would-be infringers.  Further, registration establishes the legal validity of your trademark, its ownership, and your company’s exclusive right to use the mark in commerce.  This, in turn, will allow you to monetize the value of the trademark through licensing and other means.  Finally, federal registration allows you and your business to proudly display the symbol “®” with the trademark.  This serves as universal notice of the trademark’s legal validity and identifies the mark as a valuable company asset.

In addition to the role they play in developing a powerful brand for your company, registered trademarks possess an economic value as well that can often be quantified and realized in a variety of ways.  Like any asset, trademarks may be sold for a price or used as collateral for asset-based business financing.  Perhaps the most common use, however, is licensing.  In a trademark licensing transaction, your company allows another company to use the trademark in marketing its own products and services in exchange for a royalty fee.  Trademark licensing has grown exponentially in the past decade and is no longer just for large corporations.  Even smaller or niche-market businesses with recognized products or services can benefit from trademark license agreements.  The advantage is two-fold: (1) increased revenues from the royalty payments under the agreement; and (2) wider exposure for your company’s brand.

The Lawson Firm, LLC (“TLF”) can help your company determine an appropriate valuation for its trademarks if it plans to sell, collateralize, or license them.  TLF can also assist with structuring the trademark licensing agreements themselves.  The first step, however, is to register your trademarks…

What does the Registration Process Involve?

As a first step, a TLF attorney will meet with you, either in person or over the phone, to review your trademark to determine if it may qualify for registration.  Not all trademarks qualify for registration.  There are a number of reasons why, and these will be discussed and explained to you as necessary during your initial meeting or call.  If it appears that your mark may be qualified for registration, TLF will then conduct a “trademark search”.  A trademark search will determine if your trademark, or one very similar to yours, is already being used by others in connection with the class or classes of products or services offered by your company.  Using a trademark that is the same as, or “confusingly similar” to, one already being used by another company will not only disqualify your trademark from registration, but it could also expose your company to liability for trademark infringement.

If it is determined that your trademark may be used without exposing your company to liability for infringement, TLF will prepare and file a registration application.  You may be asked to supply a digital image of your mark along with sample products or ads showing how you are using it, or how you plan to use it, to sell your goods and services.

How Long does it take to Register a Trademark?

Each trademark application submitted to the USPTO must be reviewed by a trademark examiner.  Because hundreds of thousands of trademark registration applications are submitted to the USPTO each year, there is a long line of applications that must be reviewed. During 2016, the typical registration application took about 8-10 months to wind its way through the review process.  TLF uses application submission methods and procedures that typically result in less waiting time (and cost) than average.

What if the Trademark Belongs Another Company?

If a trademark search reveals that a similar mark is already being used by another company to sell the same class of goods or services as your mark, it is still possible that your company may go forward with using the mark under a co-existence agreement with the other company.  A co-existence agreement delineates the ways in which the owners of the two marks may use them simultaneously in the marketplace while avoiding the likelihood of confusion between them.

Alternatively, if it is determined that the trademark is registered to another company, but is not being actively used by that company, a proceeding may be brought to cancel the registration.  A successful cancellation challenge would pave the way to registration of the trademark by your company.

Can Our Trademark or Service Mark be Filed for Registration Before We Launch Our Product or Service?

Yes, a trademark or service mark may be filed for registration on what is known as an “Intent-to-Use” (ITU) basis.  This allows your company to initiate the registration process before the trademark or service mark is actually used in commerce.  To fully complete the registration process, however, it will be necessary to file a Statement of Use (SOU) providing proof that the trademark or service mark is actually being used in commerce.  The SOU must be filed within six months after the USPTO issues a Notice of Allowance for the mark.  The six-month period may be extended for up to an additional five, six-month periods.

Can the USPTO Refuse to Register Our Trademark?

Yes, in some cases the USPTO may refuse to register your company’s trademark.  They may view the mark as too similar to an existing mark, or as not eligible for registration for a variety of reasons.

It is also possible that another trademark owner will oppose your company’s mark.  In this case an opposition proceeding may take place during which both parties will be allowed to state their positions.  If either a USPTO refusal occurs, or an opposition proceeding is initiated by another trademark owner, TLF will discuss the matter with you, explain your options, and work with you to develop an appropriate strategy going forward.

To protect your valuable trademarks, please contact us to start the registration process.

Contact the Lawson Firm

Related Information

Trademark Registration and Protection

Intellectual Property Protection

Report Notes Trademark Counterfeiting Issues Remain

Attorney Advertising. The Lawson Firm, LLC (“TLF”) is a law firm providing legal counsel and value-added legal services to its business clients. This article is intended to provide general information only and is not intended to provide solutions to specific issues. Readers are cautioned not to attempt to solve specific issues solely on the basis of the information contained in the article. TLF does not claim expertise in the laws of jurisdictions other than those in which our attorneys are licensed. Certification in any of the practice areas mentioned in this article is not available in Ohio.

© Copyright 2016-17. The Lawson Firm, LLC.