One of the questions we hear the most from current and prospective clients is whether they should be filing a federal trademark application to protect a certain trademark.
This question is often followed up with the question of which trademarks should they protect. Identifying which trademarks are important to protect and where you will get the most value out of your legal dollars is a common question and – like most legal questions – does not have a simple answer. However, there are a few touchstone questions that will guide you toward the answer that is right for you. These same questions apply whether you are considering a traditional word trademark or whether the trademark you are considering is a logo, design, color scheme, slogan, or other less traditional trademark.
- Do You Care if Someone Else Uses it?
The first question you should ask yourself is whether you would mind if another company or individual used your trademark. If third party use would not bother you, then you will probably not see much value in a federal trademark application. Whether you have a federal registration or are relying on common law trademark rights, owning a trademark requires some level of enforcement and policing the marketplace. If you don’t have the desire to take on this enforcement, your trademark may lose its distinctiveness over time or even stop functioning as a trademark.
One caveat here is a situation where you don’t care if someone else uses it, but you don’t want a competitor or third party to prevent you from using the mark. This type of “defensive” trademark strategy is not unusual and can be appropriate in many situations. For example if you don’t see yourself as an aggressive litigant but you want the peace of mind that you won’t need to change your packaging and branding, you may find a trademark registration to be useful. A federal trademark registration creates a presumption of ownership and validity that can cause potential aggressors to think twice before challenging you. At the very least you might have increased negotiating leverage in a future dispute. For the relatively low cost of prosecuting a trademark application, you might improve your business position substantially in the future.
- Is the Trademark Protectable? Is it a Trademark at All?
Many companies rush to file trademark applications before asking themselves whether their trademark is protectable or whether it is even a trademark at all. Spending time and money on a trademark application and then on future disputes only to discover that your trademark is too weak to be protectable is not an ideal situation. Trademarks can be unprotectable for a number of reasons – for example, weakness in a descriptive sense, genericness, an overly crowded field. It is important to think about this strength and this protectability when choosing a trademark and especially before filing a federal trademark application.
Before filing a trademark application it is also a good practice to think about how you will actually be putting your trademark into commerce. Trademarks are intended to signify the source of a good or service and generally speaking need to have a direct connection to that good or service – for example incorporating a trademark onto a product tag or label instead of using the trademark solely in advertising. If you have an otherwise protectable trademark but don’t have plans to use it in a trademark sense, you may not see value in filing a federal trademark application. Alternatively, if you do want to protect the trademark you may need to adjust how you will be putting the trademark into use on your goods and services.
- Did You Spend a Lot of Time/Money/Effort Creating it?
If your trademark was the result of an expensive brand development effort, you certainly would be more willing to spend the money and time needed for a federal trademark application. Many companies will file multiple trademark applications on potential trademarks during a large branding effort, with the goal of starting the process for several potential trademarks and identifying potential issues as early as possible. Generally speaking, the earlier issues can be identified, the more flexibility you will have in addressing them in a way that avoids significant expense. Even if you did not spend a significant amount of time or effort creating a specific trademark, if that mark is part of a larger family of marks or otherwise has elements in common with other important trademarks you own, having a federal trademark registration can work to strengthen all of your marks.
- Is the Trademark Associated With a Large Product Launch?
On a similar note, a trademark associated with a large product launch is another area where a filing would usually be warranted. A large product launch raises practical issues to consider including marketing/advertising, product labeling, and packaging, just to name a few. Filing a trademark application early in your development process can help identify issues when there is still time available to address them without significant costs. Imagine the cost associated with packaging thousands of products only to find out that a trademark needs to be changed and those products all need to be repackaged. Obtaining a trademark registration can give you some level of comfort during your product launch that you will not see objections from third parties and, if you do, that you have the legal position to defend against those objections.
- Do You Have Close Competitors?
In many industries, companies keep a close eye on new products their competitors are releasing, new brands they are developing, and how those brands are connecting with customers. If you are in that type of industry, you might be more willing to file trademark applications to protect your new brands. A trademark registration can discourage competitors from attempting to mimic your brands, and cement a strong legal position from which to assert your rights. Having a strong trademark and branding policy – including regular filing of trademark applications – can signal to competitors that they should give your brands a wide berth.
As mentioned above, trademark registrations can also serve a defensive purpose. In the event a competitor feels that you have encroached on their rights, you may want the option to rely on a trademark registration’s rebuttable presumptions of ownership and validity. Having the foresight to file a trademark application can improve your legal position in such a dispute and avoid a situation where you are bullied into changing your brand just to avoid legal expenses.
- Do You Have Partners or Investors to Impress?
If you are still on the fence about filing a trademark application on your brand, you might consider how your present and future partners and investors will view a trademark application or registration. While you want to make sure you are being fiscally responsible and not over-filing, having a trademark filing policy in place can demonstrate to your partners that you are protecting your investment and setting a strong foundation for the future. Trademark registration is only a part of a strong branding policy, but it is an important part.
There is no single strategy for when it is appropriate or recommended to file a trademark application on a brand. As with most questions in the legal and business world, there are a variety of factors to consider and you will need to find a strategy that works with your business and with your budget.
As the law continues to evolve on these matters, please note that this article is current as of date and time of publication and may not reflect subsequent developments. The content and interpretation of the issues addressed herein is subject to change. Cole Schotz P.C. disclaims any and all liability with respect to actions taken or not taken based on any or all of the contents of this publication to the fullest extent permitted by law. This is for general informational purposes and does not constitute legal advice or create an attorney-client relationship. Do not act or refrain from acting upon the information contained in this publication without obtaining legal, financial and tax advice. For further information, please do not hesitate to reach out to your firm contact or to any of the attorneys listed in this publication.