The fundamental role of a trademark is to clearly identify for customers that your business is the source of the product or service. It is not the role of a trademark to describe what the product or service is. Because of this the less descriptive and more unique a trademark is the greater the strength of legal protection.
The selection of a good trademark is often a challenging balancing act between finding something that the law will afford sufficient protection to, and also something that will adequately serve the marketing and promotion needs of the business in generating sales of the product or service. This guide provides an important overview of what a business should consider when selecting a trademark.
CHOOSING A STRONG DISTINCTIVE MARK
The strength of legal protection available for a mark depends on its distinctiveness (the ability to distinguish the source of the goods), and generally falls into one of the following categories:
- FANCIFUL MARKS (strongest): These are coined names which are unique combinations of letters that have no dictionary definitions, or arbitrary images that don’t depict the product or service. Fanciful marks are afforded the greatest trademark protection under the law. Examples of coined names that serve as trademarks are “Exxon” or “Kodak”. Examples of arbitrary graphic images that don’t depict the product are service are the bitten apple logo for Apple Computer, or the golden arches of McDonald’s.
- ARBITRARY MARKS (stronger): These are words that are found in the dictionary, but which have no descriptive meaning in connection with the product or service. An example of an arbitrary mark would be “Camel” for use in connection with cigarettes, or “Polo” for use in connection with shirts. Arbitrary marks are generally afforded strong protection under the law.
- SUGGESTIVE MARKS (strong): A suggestive mark is a name, slogan, or image that does not directly describe the product or service, but alludes to the quality or characteristic or the product or service. There is a subtle distinction between suggestive marks and descriptive marks, in that a suggestive mark requires the consumer to use some imagination to see how the mark relates to the quality or characteristics of the good or service, whereas no imagination is needed with a descriptive mark. Examples of suggestive marks are “Greyhound” for bus services, and “Citibank” for financial services. Suggestive marks are not as strong in the eyes of the law as fanciful or arbitrary marks. However, they are still considered to be inherently distinctive and provided relatively broad protection without the need for the owner to show secondary meaning.
- DESCRIPTIVE MARKS (weak): These are names that simply describe some quality or characteristic of the goods and services. As such, descriptive names are never considered to be inherently distinctive, and will not receive any protection under the law unless the owner can show that the descriptive name has acquired secondary meaning. A term which is descriptive may, through usage by one producer with reference to his product or service, acquire a special significance so that to the consuming public the word has come to mean that the product or service is produced by that particular manufacturer. To establish secondary meaning, it must be shown that the primary significance of the term in the minds of the consuming public is not the product but the producer.
- GENERIC TERMS (no protection): Generic terms are common words or terms, often found in the dictionary, that identify products and services and are not specific to any particular source. Generic terms can never be trademarks. Examples of generic terms are animal food, automobiles, telephones, etc. . . .
AVOID LEGALLY PROHIBITED MARKS
Various federal statutes and regulations prohibit or restrict the use of certain words, names, symbols, terms, initials, marks, emblems, seals, insignia, badges, decorations, medals, and characters adopted by the United States government or particular national and international organizations. Some subject matter areas where trademark usage may be prohibited include:
- Immoral or scandalous matter
- Deceptive matter
- Matter that disparages, falsely suggests a connection, or brings into contempt or disrepute
- Flag, coat of arms, or other insignia of the U.S., State or Municipality, or Foreign Nation
- The Greek Red Cross
- The Words “Red Crescent” or “Third Protocol Emblem”
- Matter Related To The U.S. Olympic Committee or Olympics
- Name, portrait, or signature of particular living individual or deceased U.S. President without consent
NOTE: In some cases use of a prohibited mark may be a criminal offense.
INTERNET DOMAIN NAMES
A mark composed of a domain name can be registered as a trademark or service mark only if it functions as a source identifier. The mark must be presented in a manner that will be perceived by potential purchasers to indicate source and not as merely an informational indication of the domain name address used to access a website. If the proposed mark is used in a way that would be perceived as nothing more than an Internet address where the applicant can be contacted, registration will be refused.
BUSINESS OR COMPANY NAMES
The name of a business or company is a trade name. One can’t register as a trademark a name which is merely a trade name. A designation may function as both a trade name and a trademark or service mark. Whether a trade name also performs the function of a trademark depends on the manner of its use and the probable impact of the use on customers.
When selecting a mark it can be important to take into account how the mark will be used. Specifically, it will need to be used as a trademark indicating you as the source of the good or service, and not in a manner that would be considered simply a description of the good or service. In other words, the mark needs to be used as an adjective, and not a noun. The ability to maintain and enforce correct usage of the mark is important because failure to do so can result in the loss of trademark rights by the mark becoming a generic description of the goods or services.
To help avoid a mark that is otherwise entitled to protection as a trademark from becoming generic it is recommended that you pick a mark that you know you can use correctly in connection with your good or service. The following practices regarding proper trademark usage can help, and should be considered when selecting a trademark:
- Make sure to use the product’s generic name with the trademark. If the mark is an adjective, the generic name of the product is the noun. You should use the generic name of the product in association with the trademark (e.g., KLEENEX tissues, APPLE computers, XEROX photocopiers, EXXON gasoline).
- Use a trademark notice. The use of ® with a registered trademark, and TM or SM to indicate to customers the significance of a name as a trademark or service mark.
- Avoid variations in the use of mark, such as different spellings, abbreviations, plurals, or combinations with other marks. Be consistent in your usage.
AVOIDING LIKELIHOOD OF CONFUSION
When selecting a trademark it is important that there not be a likelihood of confusion between your trademark and the trademark of another person. The issue is not whether the respective marks themselves, or the goods or services offered under the marks, are likely to be confused but, rather, whether there is a likelihood of confusion by customers as to the source or sponsorship of the goods or services because of the marks used thereon.
For purposes of being able to receive the benefits of registering your trademark with the United States Patent & Trademark Office your trademark will be examined and compared with other marks for similarities in appearance, sound, meaning or connotation, and commercial impression. Your goods and/or services need not be identical or directly competitive with someone else’s to find a likelihood of confusion between trademarks. Rather, it is sufficient to show that because of the conditions surrounding their marketing, or because they are otherwise related in some manner, the goods and/or services would be encountered by the same consumers under circumstances such that offering the goods and/or services under confusingly similar marks would lead to the mistaken belief that they come from, or are in some way associated with, the same source.
The question is not whether people will confuse the marks, but whether the marks will confuse people into believing that the goods and/or services they identify come from the same source. For that reason, the test of likelihood of confusion is not whether the marks can be distinguished when subjected to a side-by-side comparison. The question is whether the marks create the same overall impression. The focus is on the recollection of the average purchaser who normally retains a general rather than specific impression of trademarks. If the United States Patent & Trademark Office concludes that there is a likelihood of confusion between your trademark and the trademark of someone else your trademark will be refused registration.
Aside from selecting a trademark that is eligible for registration with the United States Patent and Trademark Office, it is also important to select a mark that won’t result in a legal claim being brought against you for trademark infringement. Someone else may successfully bring a lawsuit against you for infringing their trademark rights if they can prove (1) that they have a protectable ownership interest in a trademark, and (2) that the mark you are using on your goods or services is substantially likely to cause customer confusion as to the source or sponsorship of your goods or services. There must be a substantial likelihood of confusion for there to be infringement of another person’s trademark rights. This means that confusion be probable, not simply a possibility. To determine whether there is a likelihood of confusion between the marks the courts consider a number of factors: For example, the following eight factor test is generally applied in the federal courts in California:
- Similarity of the marks: The similarity of the marks is a critical question in to a likelihood of confusion analysis. The greater the similarity between the two marks at issue, the greater the likelihood of confusion. The federal courts in California have developed certain axioms to guide the similarity analysis: (1) “the marks must be considered in their entirety and as they appear in the marketplace;” (2) “similarity is adjudged in terms of appearance, sound, and meaning;” and (3) “similarities are weighed more heavily than differences.”
- Relatedness of the two companies’ products or services: Related goods are those which would be reasonably thought by the buying public to come from the same source if sold under the same mark. Related goods are generally more likely than unrelated good to confuse the public as the producers of the goods. To determine whether goods are related, courts may consider whether the goods are complementary, whether the products are sold to the same class of purchasers, and whether the goods are similar in use and function.
- Marketing channels used: Convergent marketing channels increase the likelihood of confusion. Note however that the mere shared use of the internet as a marketing channel is ubiquitous and, thus, does not alone shed much light on the likelihood of consumer confusion.
- Strength of the mark: The stronger a mark — meaning the more likely it is to be remembered and associated in the public mind with the mark’s owner — the greater the protection it is accorded by the trademark laws. The federal courts in California utilize a two-prong test to determine the strength of a particular mark. Namely both the conceptual strength and the commercial strength of a mark are considered. Conceptual strength involves classification of a mark along a spectrum of generally increasing inherent distinctiveness as generic, descriptive, suggestive, arbitrary, or fanciful (see discussion of these above). Generic marks are afforded no protection; descriptive or suggestive are given moderate protection; arbitrary or fanciful marks awarded maximum protection. Commercial strength is based on actual marketplace recognition, and thus advertising expenditures can transform a suggestive mark into a strong mark. Use of similar marks by third-party companies in the relevant industry weakens the mark at issue.
- The intent of the accused infringer in selecting its mark: When an alleged infringer knowingly adopts a mark similar to another’s, courts will presume an intention to deceive the public.
- Evidence of actual confusion: Evidence of actual confusion by consumers is strong evidence of likelihood of confusion. However, the absence of evidence of actual confusion is generally not noteworthy because actual confusion is hard to prove.
- Likelihood of expansion into other markets: In as much as a trademark owner is afforded greater protection against competing goods, a ‘strong possibility’ that either party may expand his business to compete with the other will weigh in favor of finding that the present use is infringing.
- Degree of care likely to be exercised by purchasers: In determining likelihood of confusion, courts also consider the nature of the goods and the type of consumer. Low consumer care increases the likelihood of confusion. The default standard used by courts is “the typical buyer exercising ordinary caution.” However, when the buyers have expertise in the field, courts apply a higher standard.
The above likelihood of confusion factors are applied flexibly, and are not exhaustive.
PERFORMING TRADEMARK SEARCHES
Developing and using a company or brand name can involve a substantial investment. To protect such investment it is important not only to select a “strong” mark that can be well protected legally following some of the general guidance above for trademark selection, but as important to avoid adopting and using a mark that could lead to a legal dispute or liability. The last thing a business needs when bringing a new product to mark is a lawsuit from someone alleging that the company name or brand name is an infringement of somebody else’s rights and demanding damages and injunctive relief – including possibly court ordered destruction of inventory bearing the infringing mark, advertising, and possibly product recalls.
The risk of a legal dispute arising related to a trademark can never be eliminated. However, the risk can be managed and hopefully minimized with smart practices. One such recommended smart practice is performing an appropriate investigation before investing substantially in, or actually using, a trademark. The types of investigations to consider regarding a contemplated mark are discussed below.
The important takeaway is that before adopting and investing in a company name or trademark that an appropriate cost effective investigation be done to evaluate the availability of the contemplated mark for use on the particular goods and/or services. Which type of investigation is conducted is business decision best arrived at after discussion with the attorney.
A cursory search consists a very limited search of the United States Patent & Trademark Office (“USPTO”) database for an exact match of the contemplated mark for the classes of goods and services the mark will be used on. It also includes a limited search for any .com internet domain registrations for the mark being contemplated. An Internet search engine (e.g. Google®) is also queried with the mark being contemplated. Cursory searches are very limited in scope and duration, and do not typically include anything other than what has been mentioned above, and omit searches of such sources as company name registrations, directory listings, and state trademark registrations. A cursory search should not be relied upon for assurance that the contemplated mark is not already in use somewhere in the U.S.
Private Full U.S. Availability Investigation
In a full U.S. availability investigation the services of a professional trademark searching firm are utilized by the attorney to perform a more comprehensive investigation by experienced trademark searching personnel with access to numerous business name, domain name, directory listings, industry, and trademark registration resources – including proprietary databases of the trademark searching firm. The trademark searching firm performs a search not only for exact matches of the contemplated mark, but also for similar variations, and in appropriate cases related classes of goods and services. The trademark searching firm generates a report of the results of the search which is delivered to the attorney for review and analysis.
A full U.S. availability investigation typically takes about ten business days for results (expedited service is available for a premium). Such a search is recommended prior to adopting a mark for use in the United States, and if a decision needs to be made in the near future about adopting the mark. Such an investigation is not publicly available, and so should also be used if you are concerned about others learning about your contemplated mark.
Intent-To-Use Trademark Application Searches
If a decision about a contemplated mark for a single class of goods need not be made for a number of months, and privacy of the contemplated use of the mark is not an issue, then it can be more cost effective to use the included search done by the United States Patent & Trademark Office (“USPTO”) in connection with an intent-to-use application for registration of the mark.
When an intent-to-use trademark application is filed with the USPTO, a trademark examiner will conduct an examination of the contemplated mark that shall include a search for any other conflicting U.S. marks. A response from the USPTO with the results of their search on the application can generally be expected within approximately 3 months of filing. If the USPTO does not find a problem with the mark, the USPTO will then publish the mark for a period of thirty (30) days to see if anyone in the public files an opposition to the registration of the mark. If nobody files an opposition then the USPTO will issue a notice of allowance for registration.
With an intent-to-use application registration won’t occur after allowance until you submit a statement of use attesting to the fact that you have in fact begun to use the mark in interstate commerce on the identified goods and services (actual use in connection with the goods is required for registration). The statement of use must include proof of actual use (a photograph of the mark on the product packaging that is used in commerce is typical). There is a six (6) month deadline from the date of notice of allowance for submitting the required statement of use. If the deadline is not met the application will become abandoned. However, if you have still not commenced using the mark, and still intend to use it, a request to extend the deadline by an additional six months can be submitted.
The benefits of the intent-to-use application approach for a word mark to be used in a single class of goods or services is that one will receive the benefit of a professional USPTO search approximately three months after filing, and assuming the results of the USPTO examination are positive (and there is no opposition filed) you will be in a position upon actually using the mark in interstate commerce to have the mark registered and receive the benefits of federal registration. Such benefits include, but are not limited to, a presumption under the law that the trademark is valid for the listed goods and owned by the listed owner (such a presumption can save considerable time and money in a dispute). Some potential disadvantages of the intent-to-use approach it takes longer to get the results of the USPTO search, the USPTO search may not be as thorough as the investigation done with a professional search firm, and your intent to use the mark and USPTO search results will be publicly available to anyone.
It should be pointed out that filing an intent-to-use application does not preclude you from also doing a private U.S. full availability search. You can do both. However, if a full U.S. availability search is done it is generally recommended to do it first, in case the results indicate that further investment in a trademark application may not be worthwhile. The exception to this would be if a need for an early constructive use date is desired. Trademark rights are awarded to the first person to use the mark, and under U.S. law a registered trademark is entitled to a presumption of constructive use as of its filing date, which can help defeat a challenger who only starts to actually use the same or similar mark after such filing date.
International Trademark Registration
Each country has its own laws regarding trademarks, and procedures that must be followed in order to secure trademark rights. Trademark investigations are available for the contemplated use of marks outside of the United States, and it may be necessary to file an international application, or national application, in order to secure trademark rights outside of the United States. This may involve having to retain local foreign counsel, and other associated expenses.
Selecting a trademark for a new product or technology is an important step with long lasting impact on a business. Steps should be taken to select a mark that is strong, avoid any likelihood of confusion, and perform an appropriate investigation before adoption and use of a mark.
For further information about trademark selection for a new product or technology request a free initial consultation with U.S. patent attorney David M. Kleiman.