Your trademarks are likely the most vital assets your business will ever own. Consequently, your understanding of how to effectively adopt a trademark which distinguishes you from the competition is essential to the development and future goodwill of your brand. An inadequate trademark adoption process can embroil your company in contentious and protracted legal disputes, impede your marketing efforts, and interfere with licensing and expansion efforts. While there are no hard-and-fast rules of what constitutes successful trademark adoption, below are some useful guidelines to aid in your selection.
The two most important steps in adopting a trademark are: (1) creating a list of potential marks and (2) performing trademark clearance searches.
STEP 1. Develop List of Potential Trademarks
Before starting a new business venture, introducing a new product, or launching a new marketing campaign, you should create a list of potential or candidate trademarks. This is an important step because as you will learn later, a trademark clearance search should be conducted. If your search trademark clearance search yields unfavorable results for any of your marks, you will have an alternate list of marks to consider. Therefore, do not get too attached to any of the marks, as you may have to abandon the idea of using the favored mark or otherwise undertake the risk of continuing to use the favored mark with the knowledge that it may present future legal issues.
Inherently Distinctive Marks are the Strongest and Most Protectable
As you are developing the list of candidate marks, it is important to understand that the mark’s relative “strength” or “weakness,” will have a direct bearing on its performance in the market as well as the scope of legal protection the mark will be afforded. Trademarks generally fall into one of five categories: fanciful, arbitrary, suggestive, descriptive, or generic. These categories will significantly impact both the registrability as well as your ability to enforce your rights in the mark. The strongest and most easily protectable category of marks are fanciful marks and arbitrary marks - they are regarded as inherently distinctive. Conversely, descriptive and generic marks are regarded as less distinctive “weak” marks. Weak marks should be avoided - they simply do not have the same legal protections of a stronger and more distinctive mark.
Fanciful Marks. Fanciful trademarks are the strongest, most well protected, and have the highest probability of proceeding to registration. They are invented words with no dictionary or other known meaning. Some well-known examples of fanciful marks are: GOOGLE®, EXXON®, PEPSI®, and KODAK®.
Arbitrary Marks. Like fanciful marks, arbitrary marks are afforded a broad scope of protection against third-party use. Arbitrary marks are common words with a dictionary meaning, but the meaning is unrelated to the product or service to which it is applied. As is the case with fanciful marks, while the level and ease of protection is generally high, there is no direct association between the mark and the product or service, thus greater marketing power is required to create an association in the mind of the consumer. Well-known examples of arbitrary marks are APPLE® for computers, SHELL® for gasoline, CAMEL® for cigarettes, and BLACKBERRY® for mobile phones.
Suggestive Marks. If you are unable to or decide not to adopt a fanciful or arbitrary mark, a suggestive mark is your next best option. They are registrable and regarded as “strong” marks. Suggestive marks suggest some quality or characteristic of the products or services, but they do not directly describe the product or service. Thus, they require some imagination, thought, or perception for the consumer to come to a conclusion about the exact nature of the products or services. Examples of suggestive marks are KITCHENAID® for kitchen appliances because it suggests that the appliance is helpful for use in the kitchen; GREYHOUND® for bus services, because the customer has to use their imagination to conclude that the bus travels as fast as a Greyhound dog; JAGUAR® for vehicles for the symbolic value of the animal's speed and sleek body.
Descriptive Marks. Descriptive marks are generally considered “weak” and therefore more difficult to protect than fanciful, arbitrary, and suggestive marks. They are words or designs (e.g., depiction of a cellphone for mobile phone services) that describe a significant ingredient, quality, or characteristic of the goods or services. In addition, use of merely laudatory terms such as “best” or “quality,” which merely describe attributes of the product and likely to be unprotectable. These marks are difficult to register and equally as difficult to protect against infringement. The rationale behind this is to prevent businesses from monopolizing terms that competitors and others need to use in order to accurately describe their goods and services. However, if as a result of years of extensive and exclusive use, consumers begin to identify the descriptive mark as being associated with a single source of origin for that goods or service that mark acquires secondary meaning (or sometimes referred to as acquired distinctiveness). Once a descriptive mark has acquired distinctiveness, it becomes registerable and protectable. For example, COLD AND CREAMY as a trademark.
Generic Terms. A generic term is a word or phrase that is the common term associated with a particular category of goods or services, and thus cannot function as a source indicator. Generic word marks are the weakest types of trademarks marks and are never registrable or enforceable against third-parties. Since generic words are the common everyday name for products and services, everyone has the right to use such terms to refer to their products and services. It is important to note, that even a fanciful mark can, over time become generic, if the owner permits the mark to be used improperly or fails to police use of its mark properly and take appropriate action. Escalator and cellophane are classic examples of terms that once functioned as trademarks, but due to the trademark owner’s failure to adequately protect the marks, both became generic and are now used as the common names for the products. Some examples of generic terms which are nonregistrable and nonprotectable are: DRY CLEANER, SUGAR, or BLEACH.
STEP 2. Have a Trademark Clearance Search Performed
Now that you have developed a list of strong candidate trademarks, it is critical that you conduct a trademark search to determine whether any other parties are using or have already registered a mark which might be confusingly similar to your candidate mark. Failure to conduct a proper trademark clearance search is the most common mistake businesses make when adopting a trademark and can have a detrimental impact on your business. This omission may subject your business to unnecessary risks such as infringement lawsuits, or best case scenario, being forced to market and rebrand.
A trademark search enables a trademark lawyer to determine whether a mark is available for use and likely to be registered. Depending on your needs, a more comprehensive search may be necessary. A comprehensive search typically covers trademark registers, Internet resources, industry specific databases and publications, domain registries, and business name registries. This type of search offers the most comprehensive range of information from which to base your decision relating to adoption of a mark. In addition, the search should be targeted toward countries which you have a real intention to offer your products or services. Some searches may include information about whether your mark elicits a negative connotation meaning. For example, the CHEVY NOVA car did not sell well in many Spanish-speaking countries, because in Spanish “nova” means “no go.” Guidance from experienced trademark counsel can be invaluable and will help you to avoid such costly mistakes.
It is important to note, that approval of a business name does not automatically qualify as trademark use nor does it arise to the level of an effective trademark search. However, depending on how the business name is used, it may qualify as both. Most states require registration of a business name in order to receive a certificate to do business or as an assumed name filing (commonly referred to as doing business as). The registration process typically requires the registrant search the state database to ensure that no one in the state is using the same name. For example, ABC, LLC. If no other business has registered your exact name in that state and you comply with all other requirements, you will likely be issued a certificate and authorized to proceed under your selected name. However, it is important to note that a state’s approval to form a business under a particular name will not automatically arise to acquiring trademark rights. In addition, if another individual or business believes that your mark creates a likelihood of confusion with their mark, they may try to prevent your use of the business name.
Now that you understand how to select a strong trademark, let’s discuss why strong trademarks are important.
Greater Chances of Approval at the USPTO
Strong marks have the best chances of gaining approval. The further down the spectrum of distinctiveness a trademark falls, your chances of approval decrease, and the likelihood that you will encounter similar or identical marks will increase greatly.
USPTO’s approval of a mark which falls in the middle or lower end of the strength does not automatically make your mark immune to challenges. Weaker marks are most vulnerable to attacks from third-parties who may try to argue that your mark is too broad or too close to a generic term to receive exclusive rights and protection. The stronger marks are better line of defense from protected from these particular challenges.
Stand out from the Crowd
The cornerstone of trademark law is to prevent confusion among consumers and serve to clearly identify your products or services in the marketplace. Trademarks which are regarded as strong marks are least likely to cause confusion. The more distinct your trademark, the greater the possibility that consumers will remember your brand name and return for service or repurchase your products, which will generate more revenue for your company. After all, isn’t that the ultimate goal?
Do you have questions about selecting your brand name or trademark? Let Cooper Legal assist you in adopting the right mark to suit your needs and create a strong and successful brand.
This blawg is provided by the firm for informational purposes only and may not be relied on as legal advice. If you have any questions related to your specific business needs, schedule your legal consultation today.