So you have a trademark. Why go the extra step and register it with the federal government? Several reasons, not the least of which is keeping you out of court. The dozens of advantages of federal trademark registration break down into three basic categories: 1) pre-lawsuit advantages; 2) advantages during trial; and 3) increased payments if your suit is successful. All three of these advantages combine to scare off infringers and keep you out of court in the first place. First, let us examine the advantages a federal trademark registration provides before trial.
Constructive Notice – A federal trademark registration provides nationwide constructive notice of your rights. This prevents infringers from claiming innocent infringement or trying to register your trademark in other parts of the country.
Actual Notice – Once you file your application for federal trademark protection, your trademark will begin appearing on search reports third parties conduct to find available names. Appearing on these search reports reduces the likelihood a reputable competitor might accidentally adopt a similar name in good faith.
Exclusivity – A federal trademark registration grants you the exclusive right to use your trademark in association with particular goods or services. Unlike domain names, more than one company can own a single trademark. One company can use the trademark “Apple” for computers, one company can use the trademark “Apple” for shoes and, of course, everyone can use apple to sell apples. Federal registrations are organized by “classes.” You can obtain federal registration in as many classes of goods or services in which you are using the trademark (and in which you are willing to pay the additional federal filing fees).
Protection for Descriptive Trademarks – Federal registration can turn what would otherwise be an unprotectable “descriptive” trademark into a fully protectable trademark. The Trademark Office will initially require descriptive trademarks be registered on the Supplemental Register. After five years of continued use of the trademark, you may then submit a declaration of the continued use and other evidence the trademark has obtained a “secondary meaning” in the marketplace. The Trademark Office will then move the registration from the Supplemental Register to the Principal Register, granting the formally descriptive trademark full federal protection.
United States Priority – A federal trademark registration gives you priority in every state. Without a federal trademark registration, your common law trademark rights extend only as far as your use. If you are not using the trademark in Iowa, someone else can obtain common law rights to the trademark in that state. It can become a rather unfortunate situation if you were to invest millions of dollars promoting a trademark, only to have someone else reap the benefits in a distant state.
Foreign Filing Priority – Filing a federal trademark application allows you to use your filing date as a priority date if you later decide to file a trademark application in a foreign country. This can come in handy if another company begins to use your trademark internationally, or if a foreign infringer attempts to capitalize on the goodwill of your United States trademark.
Search Customs – Federal trademark registrants can register their trademarks with the United States Customs department. Customs will then run the trademark against imports to check for infringing or gray market (legitimate, but licensed for sale more inexpensively in another country) goods.
Use of the Registered Trademark Symbol ® – Only federal trademarks may bear the ® registered trademark symbol. This symbol puts everyone on notice of the powerful rights behind the trademark. Proper use of the symbol will go a long way toward dissuading infringers and competitors from adopting the trademark without a license from you.
Stop Cybersquatters – Most domain name registrars and the Internet Corporation for Assigned Names and Numbers have domain name dispute resolution procedures which strongly favor federal trademark registrants. Remember though, unlike domain names, more than one company can own a single trademark. Your federal trademark registration will typically not top an identical federal registration for the same goods. Accordingly, a federal trademark registration is a good way to avoid a third party with a federal registration from taking away your domain name.
As you can see, federal trademark registration carries a lot of clout. In my practice, the existence or non-existence of a federal registration is often the determining factor in whether we can avoid a lawsuit. If one party has priority and a federal registration, it is often enough to convince the other party to resolve the matter as amicably as possible. Tomorrow . . . Advantages federal trademark protection provides at trial.