If you have a company, a brand, a tagline, a design logo or you offer products or services to the public, you probably have a trademark that should be registered. Many clients, regardless of sophistication, do not register their trademarks because of the assumption that common law trademark rights will protect them. There are many benefits to trademark registration and often common law trademark rights are not enough. While it is true that use of your trademark in commerce will garner common law trademark protection for your marks, common law trademark protection is limited. Many clients also mistakenly believe that registration of a corporate entity is tied to trademark protection. Registration of your company name with the Secretary of State’s office is not related to trademark registration and does not provide any trademark protection for your company name. If there is ever a possibility that you may expand your business, sell your business or become engaged in trademark disputes or litigation, you should consider federal trademark registration.
Do you plan to expand your business or use of your trademark?
Common law trademark rights are limited to only the geographic area where the mark is currently being used in commerce. This means if you are a local company who doesn’t register your trademark, a competitor from another state could register your exact mark and prevent you from expanding in the future. The registered mark would have priority rights in the entire United States with the exception of a carve-out for the small geographic area of actual use of your unregistered mark. This is true even if your unregistered mark was used decades before the registered mark owner filed its application. A federal trademark registration establishes a legal presumption of ownership of the mark and the exclusive right to use the mark in the entire United States.
Also, if you advertise your products or services online or have a website, you have worldwide exposure to your trademark but, without a registration, have extremely limited common law trademark rights.
Further, if you want to pursue trademark rights internationally, a United States federal application or registration can serve as a basis for obtaining registration in foreign countries.
Do you plan to sell your business or trademark?
Trademarks are often overlooked as assets because of their intangible nature. However, trademarks and other intellectual property can be the most valuable assets owned by a company. If you ever plan to sell your business or trademark, registered trademarks can significantly increase the value of your company. Prospective purchasers are often very aware of the differences in protection between registered and unregistered trademarks and analyzing a company’s intellectual property is almost always a part of the due diligence in a business sale.
Do you plan to enforce your trademark against infringers or defend your trademark if someone accuses you of infringement?
A federal trademark registration serves as constructive notice to the public of your ownership of the trademark and allows you to bring a trademark infringement claim in federal court. If you have a federal trademark registration, the court will assume your mark is valid and the burden will be on the infringer to prove otherwise. United States laws also provide additional remedies for infringement of a federally registered trademark, such as triple damages for willful infringement and repayment of attorneys’ fees.
Further, if you own a federal trademark registration you can register your mark with the United States Customs and Border Protection service. This allows Customs officers to block unauthorized and counterfeit goods from entering the United States if they are marked with your registered trademark.
Federal registration of your trademark also allows you to use the ® symbol in conjunction with your trademark. Only federally registered marks can use the ® symbol. The ® symbol tells your competitors, with just a quick glance, that you are concerned about your trademark protection and that you registered your mark. Also, the ownership of a federal trademark registration can be instrumental in domain name disputes if someone else is using your trademark as a domain name and can result in a forced assignment of the infringing domain name to you.
The costs of federal trademark registration are relatively minor for the broad scope of protection and long duration of protection that a registration provides. There are only a few instances where reliance on common law trademark rights offers adequate protection. More often than not, a federal trademark registration is necessary to provide the type of protection and benefits that clients seek.