Trademark protection is one area where Montesino Law helps entrepreneurs protect their interests. We’ve written the following brief summary about trademarks to give potential clients an idea of the issues involved. Please note that this summary is for informational purposes only and should not be relied on as legal advice (full disclaimer available here).
Trademark protection is not given simply because somebody thought of a unique and clever name and registered it with the federal government. Here you will find a summary of what trademarks are and some of the issues related to trademark protection (focusing mostly on the federal registration of trademarks).
What Trademarks Are
Trademarks are words or symbols that a business affixes to its products in order to help purchasers identify the source of goods and to assure them of the quality associated with the source. Therefore, the value of a trademark lies not in the trademark itself, but in the goodwill associated with that trademark. Trademarks exists independently of their registration; registration is not necessary to create or maintain a trademark. However, the federal registration of a trademark has substantial benefits.
Sources of Trademark Law
Trademark rights can be established by state and federal law. State trademark law is often comprised of both statutes and common law (i.e., laws deriving from customs and court decisions as opposed to statutes). For example, Florida’s trademark registration statute explicitly states that it doesn’t adversely affect common law trademark rights or their enforcement. The trademarks registration requirements of many states (including Florida) have many similarities to the federal registration requirements (the aspect that they differ most on is the “use in commerce” requirement that will be discussed later).
Types of Marks
This summary focuses on three types of protectable marks: trademarks, trade dress, and service marks. Other types of marks (e.g., certification mark and collective marks) can be protected, but this summary will not be discussing them.
Trademarks are words, phrases, symbols, and/or designs that identify and distinguish the source of the goods of one party from those of others.
Trade dress is a similar concept to trademark, but refers to packaging product design, or physical appearance (rather than word, phrases, and/or symbols) that is used to identify products. Trade dress faces an additional hurdle in that the aspect of design must not be functional. One example of a design aspect that has been held to be functional (and therefore not protectable) is a traffic sign that used two springs at its base in order to prevent it from being knocked over by the wind. TrafFix Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23 (2001).
A great example of a design that is not functional is the Coca-Cola bottle; the design of the bottle serves to identify that product and does not enhance the ability of the bottle to hold a liquid. A lot of grey area lies between these two examples.
When the words, phrases, symbols, and/or designs are used to identify services, they are referred to as services marks.
Registration is not required to have rights in a trademark (rights are acquired by use of the mark), but there are significant benefits to registration.
Registration of a mark extends the geographic range for which a business has rights to the mark. However, without registration, the rights to the trademark are limited to the geographic area in which it is used. State registration typically extends the rights throughout the state of registration. Federal registration extends the rights to the trademark throughout the United States (even to states where the mark has not actually been used).
Registration of a trademark provides constructive notice to possible users of the registrant’s exclusive rights to use of the mark. If a mark is infringed on, a trademark owner may only seek damages from the time that the user had notice of owner’s rights to the mark. Due to the constructive notice that is achieved when a mark is registered, possible users are considered to have received notice of the owner’s rights (regardless of whether they had actual notice) and damages will begin to be calculated from the time that the mark was first used; constructive notice is a very powerful benefit.
Requirements for Federal Trademark Registration
The two main requirements for a trademark to be federally registered is that the mark is distinctive (i.e., is capable of identifying the source of the goods or services) and that the mark has be used in commerce.
Marks can be categorized based on how distinctive they are. They are categorized (from most distinctive to least) as: arbitrary and fanciful, suggestive, descriptive, and generic.
Arbitrary marks are real words that are used to identify products that have no real relationship to the words. Apple computers is an excellent example of an arbitrary mark; apples are not related to computers in any way. Fanciful marks are words that have no real world meaning prior to being coined by the user of the mark. Medicines are commonly given fanciful names (e.g., Claritin, Zyrtec, Allegra). Arbitrary and Fanciful marks are considered inherently distinctive and are the most distinctive of all the categories.
Suggestive marks are those that “suggest” the quality or characteristics of a product, but do not directly describe the product; they are not as distinctive as arbitrary or fanciful marks, but can still form the basis of a trademark without an additional showing of distinctiveness. Suggestive marks require the use of imagination by the consumer to reach a conclusion about the product. Coppertone sunblock is an excellent example of a suggestive mark. Based on the name, the consumer might imply, with a little imagination, that using the product would result in a tan similar in tone to that of copper. However, there can sometimes be ambiguity about whether a mark is suggestive or descriptive and this is a common subject of litigation; this is significant, because descriptive marks cannot form the basis of a trademark without an additional showing of distinctiveness.
Descriptive marks are those that merely describe the product they identify and cannot, in the absence of an acquired secondary meaning, function as trademarks. Acquired secondary meaning can be shown by proof of substantially exclusive and continuous use of a mark by an applicant for five years. International Business Machines is an example of a mark that, while descriptive on its face, has acquired secondary meaning.
Generic marks cannot be the subject of trademark protection. Generic terms are those that either are the name of the product or have come to be understood as the name for that product. In addition to the fact that a generic mark cannot be registered, Federal law explicitly states that the registration of a mark should be cancelled if it “becomes the generic name for the goods or services, or a portion thereof, for which it was registered.” Aspirin was once Bayer’s trademark for acetylsalicylic acid; however, they lost the trademark rights by allowing other manufacturers to use the name to sell acetylsalicylic acid.
Trademarks must be used in commerce before they can be federally registered. Trademark law defines both what constitutes “use” and what constitutes “in commerce.” Use of the trademark on goods can be achieved by placing the mark on the goods (or their containers or displays). For services, use of the mark can be achieved by using or displaying the mark in the sale or advertising of the services. “In commerce” refers to “all commerce which may lawfully be regulated by congress.” The U.S. Constitution gives congress authority to regulate commerce when it involves more than one state, foreign nations, or Indian tribes. The “in commerce” requirement is not straightforward. For example, if a service mark is used purely within a state, but the services are provided to an interstate clientele, the mark may be capable of federal registration.
Intent to Use Applications
Although trademarks will not be registered by the federal government until the above requirements have been met, it is possible to file an “intent to use” application. If an intent to use application has been filed, and the above requirements have been met, the trademark can be registered with the intent to use application’s filing date as the effective date.