Establishing a strong brand is essential for any business. Once the hard work of establishing the brand in the minds of consumers is done, the business must still take steps to ensure the brand’s strength and reputation are protected. That is why it is essential for any brand owner to ensure they have a comprehensive trademark portfolio and strategy in place.

What Is a Trademark and Why Does It Matter?

A trademark is a distinctive symbol, word, phrase, or design that identifies and distinguishes the source of goods or services from those of others. Trademarks serve as a badge of origin, ensuring that consumers can identify the source of a product or service, thereby preventing confusion in the marketplace. Trademarks can encompass names, words, logos, slogans, jingles, and even things like sounds, smells, or colors if they are sufficiently source-identifying.

The primary purpose of trademark law is to protect consumers from confusion regarding the source of goods or services in commerce and to safeguard the goodwill associated with a trademark. In the United States, trademark rights proceed in the first instance from use in commerce in association with goods or services. Such use creates common-law rights in a trademark that may be asserted, independent of federal registration. Federally-recognized rights in trademarks (registered and common-law) are governed by the Lanham Act, which provides federal protection for registered (and unregistered) trademarks and outlines the legal remedies available in cases of infringement.

Types of Trademarks

Trademarks exist on a spectrum of distinctiveness, which affects their eligibility for protection:

• Fanciful or ‘Coined’ Marks: These are invented words with no prior meaning, such as ‘Kodak’ or ‘Xerox.’ They are considered the strongest type of mark due to their inherent distinctiveness.
• Arbitrary Marks: These are common words used in an uncommon way, like ‘Apple’ for computers. These marks are also very strong because of their presumptive inherent distinctiveness.
• Suggestive Marks: These hint at the nature or a quality of the goods or services, such that the consumer’s imagination requires ‘steps’ to connect them. For example, the mark ‘Netflix’ for streaming services suggests that their consumers can watch ‘flicks’ (i.e., movies) over the [inter]‘net.’
• Descriptive Marks: These directly describe a characteristic or quality of the goods or services, like ‘Quick Print’ for a printing service. Merely descriptive marks are only protectable if they acquire ‘secondary meaning,’ meaning consumers associate the mark with a particular source rather than simply describing a good or service. Even when sufficiently distinctive to serve as a trademark, descriptive marks are still entitled to a narrower ambit of protection as against users of similar descriptive marks for the same or closely related goods or services.
• Generic Terms: Generic terms cannot serve as trademarks. These are the common terms for products or services, such as ‘computer’ for a computing device or ‘apple’ for apples. If a proposed trademark answers the question ‘what is it?’ then the word is likely generic in that context.

Understanding these categories helps in selecting a mark that not only resonates with your target audience but also meets the legal criteria for protection.

Goods vs. Services in Trademark Law

In trademark law, the goods and services define the scope of applicability and protection:

• Goods: Products that can be bought and sold (or given), such as books, coffee, cars, hats, pasta, or guitars – you could list them endlessly. There was a time when products were ‘solid’ and services more ephemeral, but the digital world has eliminated that kind of distinction. For example, online downloadable books and mobile apps are considered ‘goods’ under the trademark law, whereas online-only games and streaming audiobooks are services.
• Services: Offerings that involve the performance of tasks or services, like legal consultation, lawn mowing, financial advice, restaurant, wholesale distribution of products, or accounting services.

If one wants to look at one of the most relied-upon guides to how to define goods and services and, indeed, what a ‘good’ or ‘service’ is, the Trademark Office’s “Manual of Acceptable Goods and Services” is a good starting point and one that is critical when filing trademark applications in the United States.

John O’Malley, a shareholder at Volpe Koenig, explains that for trademark registration purposes, all goods and services are categorized into 45 distinct classes under an international classification system, known as the Nice Classification. In the United States, the United States Patent and Trademark Office (USPTO) requires applicants to identify the specific class or classes in which their mark is used or to be used. This classification not only affects the scope of protection but also determines filing fees and may influence whether similar marks can coexist in different industries.

Can You Claim or Register Trademark Rights in a Product Design?

Product design can be protected under trademark law if it serves as a source identifier and meets certain criteria:

• Non-Functionality: The design must be non-functional; that is, it should not relate to the product’s use or purpose. Functional designs may be protected under patent law if they meet the many requirements for obtaining a patent (like that they represent an invention). The design patent is essentially the opposite of the trade dress/design. If it’s primarily functional, it’s not a trademark. If it is not functional, it is not going to be an invention that qualifies the design for a patent.
• Distinctiveness: The design must be distinctive, either inherently or through acquired secondary meaning.
• Non-Infringement: As with any trademark, the design must not be confusingly similar in comparison with existing trademarks.

For instance, the unique shape of the Coca-Cola bottle is a registered trademark, as it identifies the source of the product and is non-functional. However, it is generally not possible to assert or register a trademark in purely functional aspects of a product design, such as the shape of a wrench necessary to grip a certain size bolt.

The Role of Domain Names in Trademark Protection

While domain names can incorporate trademarks, owning a domain name by itself does not confer trademark rights unless the domain itself is being used in commerce to sell a good or service, like ‘cars.com.’ For example, registering ‘Thehappylawfirm.com’ as a domain name does not confer trademark rights in The Happy Law Firm as a trademark. The name must actually be used in commerce as a law firm name, and the ‘.com’ will not generally be part of that name.

The Importance of Early Trademark Searching

Before adopting a new trademark, it is crucial to identify existing marks that might pose conflicts. Having a competent trademark attorney conduct a comprehensive trademark search is the best way to avoid this kind of trouble. Failing to identify possible bars to use or registration of a trademark often leads to unexpected, costly legal disputes started by a party that feels its rights are being or will be infringed, and wasted money when, say, a rebrand is required. This search should include:

• USPTO Database: Reviewing US-registered trademarks to ensure your mark or one confusingly similar to it is not already registered. A commercial trademark search service (which most good trademark lawyers will have access to and use) will also incorporate Trademark Office records, and often allows searching in other useful databases and in the trademark offices of foreign jurisdictions. While only a trademark lawyer in a given country can conduct a proper trademark search there, it can be useful to know if, say, your identical mark is being used just across the US border for the same goods.
• State Databases: Some states allow direct trademark searching, but unless your use is confined to a single state, to be useful, it is necessary to use a service that allows searching of as many state databases that keep accessible records. This will cover trademarks that are registered at a state level but not federally. State trademark registrations only confer protection within the state, but a state trademark can still be the basis to challenge a federal registration based on state and often also common law rights to the extent the good or service is in fact offered across state lines.
• Common Law Usage: A good search will identify in-use unregistered marks and the scope of their use. The nature and scope of common law rights are among the most vexed and challenging areas of trademark law, and another reason one should hire trademark counsel for clearance.

International Trademark Considerations

As businesses expand globally, protecting trademarks in international markets becomes essential. Trademark rights are definitionally geographic. So, except for famous trademarks, to assert a trademark in another country, one must generally own a registration in that country. However, laws vary by jurisdiction. Some require use as well as registration, and some do recognize some form of rights based on use within a country. Trademarks may be registered directly in foreign jurisdictions, for which one must work through local counsel in that jurisdiction. Additionally, the Madrid Protocol (a treaty-based trademark application system) allows for initial filing to register trademarks in multiple countries through a single central application, simplifying the process for businesses operating internationally at the beginning of the process. Once a Madrid-based application has passed to the individual trademark offices identified in the application, they are treated like any direct application, and any issues that arise will require that one work through local counsel to address those matters. Additionally, not all countries are signatories to the Madrid Protocol, and some regions may require separate applications. A competent trademark lawyer will advise on how to find the help you need where you need it; most have extensive networks of foreign counsel to consult when necessary.

Policing Your Brand

Brand owners have the responsibility of ‘policing’ their trademarks. David Perry, co-chair of Blank Rome LLP, emphasizes the importance of actively monitoring use of your mark in order to prevent unauthorized or infringing use. While no company can or must pursue every infringer, if another company (either intentionally or unintentionally) uses your trademark without permission or in a way that could significantly confuse consumers and disrupt your business, you must act. This can include sending cease-and-desist letters, pursuing online infringing uses through mechanisms offered by various social media sites (if as is now often the case, there is infringing use of this kind), taking advantage of enforcement rubrics on third party seller platforms like Amazon or Etsy, using Trademark Office challenges such as Letters of Protest, Oppositions, and Cancellations, through to civil litigation if necessary.

In particular, online platforms, such as e-commerce websites and social media, have become hotbeds for unauthorized trademark use. The bad news is, infringing use on mega platforms like Amazon can be economically devastating; the good news is, use on mega platforms like Amazon can often be deactivated through relatively inexpensive brand enforcement mechanisms to, say, close down an infringing store.

Practical Steps To Properly Protect Your Trademark

However you do it, as noted above, it is essential to establish clear guidelines for how others can and cannot use your brand in order to maintain your mark’s distinctiveness. So, what are the components of a robust enforcement strategy? This takes many forms.

• Monitoring: Regularly checking for unauthorized use of your mark in the marketplace.
• Surveillance: Regular trademark surveillance can involve both automated services and manual searches. Setting up Google Alerts, subscribing to trademark watch services, and working with legal counsel to identify and act on potential violations are proactive steps to maintain your trademark rights.
• Enforcement: As noted above, if infringement is detected, the trademark owner must strongly consider taking steps to enforce their rights, such as sending cease-and-desist letters or initiating legal action if necessary. While no company can or must go after every infringer in order to protect its marks, Mark Bloom, director of the NSABP Foundation, warns that not enforcing a trademark can result in losing the right to prevent others from using it through abandonment or legal doctrines that limit recovery where a known use is tolerated for a long time. It is crucial to monitor for potential infringers to maintain the strength and exclusivity and source-identifying power of your brand.
• Quality Control, Brand Standards Identification and Maintenance: Don’t damage your own marks. Develop rules about how marketing material and any public-facing employees use your trademarks to make sure that you aren’t diluting the strength of your own trademarks. When licensing, the obligation of ‘quality control’ by your company as licensor ensures that your licensees keep up your standards, so that the mark isn’t damaged by people who are otherwise permitted to use your trademarks.

The Risks of Generative AI in Branding

As artificial intelligence (AI) tools become more advanced, many businesses are tempted to use them to generate branding elements like logos, slogans, and even brand names. While these AI tools can be helpful for brainstorming, Laura Talley Geyer, a senior intellectual property attorney with extensive experience in trademark, copyright, and internet law, cautions against relying solely on AI for trademark creation or clearance.

AI can assist in generating unique names or visual concepts, but it cannot perform a thorough trademark search as it does not ‘know’ anything. AI-generated content can mimic or outright copy existing trademarks, leading to infringement for which there is no defense. Moreover, generative AI platforms, such as Canva or others, may not guarantee ownership of the generated logos or material unless the specific licensing agreements associated with those platforms provide for ownership by the user. Accordingly, it is critical to carefully review what are likely to be ‘click-through’ agreements to determine what rights the user obtains when using the AI in question. AI is not always bad, by any means; it is quite possible to come up with a nice logo using AI and clear it using good trademark counsel. It is when people use AI as a substitute for ordinary clearance that they can get into serious trouble.

To avoid these risks, businesses should consult a trademark attorney to perform thorough searches before finalizing any brand identity or logo. Failing to properly vet these elements for trademark protection could result in expensive litigation or rebranding efforts.

Financial Considerations: Trademark Valuation and Its Impact on Your Business

Trademarks are more than just a legal tool — they are financial assets. The value of a trademark comes from the brand recognition and goodwill it generates among consumers. Protecting your trademark as described herein means safeguarding this intangible asset, which can significantly contribute to your business’s bottom line in ways that you might not even realize and are difficult to measure.

Understanding the financial value of a trademark is important when considering mergers, acquisitions, or licensing opportunities. Trademarks can be licensed to third parties for revenue generation, but because those third parties will want to license strong marks, they will often probe whether a target mark is being properly protected and enforced. For example, a dairy company might consider licensing its well-known marks to parties it can rely on to maintain the company’s quality standards for related dairy products; use by a licensee inures to the benefit of a licensor and so, thoughtful licensing can provide an income stream and also strengthen a mark or increase its geographic scope through broader distribution.

When valuing a trademark, businesses often consider factors such as market share, consumer loyalty, and the economic strength of the brand. Additionally, brands with robust trademark protection are less likely to face costly disputes or branding issues in the future.

Conclusion: Proactive Brand Protection

Understanding your rights and obligations in the context of a proactive trademark protection strategy is crucial to preserving the uniqueness and value of your company’s brands.

By understanding the nuances of trademark law, conducting thorough searches for new marks, registering your trademarks with the USPTO when possible, and actively policing your mark, you can avoid costly legal challenges and strengthen your mark’s market position. Whether starting a new company or managing a long-established business, taking these steps ensures that your brands will remain valuable assets that support your success for years to come. For any business, maintaining a strong trademark portfolio is more than a good idea; it’s a smart business strategy that enhances brand equity, which in turn helps support long-term growth.

To learn more about this topic view Intellectual Property 201 / Choosing, Building, & Protecting Your Brand. The quoted remarks referenced in this article were made either during this webinar or shortly thereafter during post-webinar interviews with the panelists. Readers may also be interested to read other articles about brand protection.

This article was originally published here.

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