Trademarks are incredibly valuable assets that can account for billions of dollars of a brand's value.
For example, how much do you think it would cost to buy the rights to Facebooks's distinctive "f" logo or the name "Coca-Cola"?
With brands such as Apple and Google being valued at more than $200 billion dollars, it's easy to see how a brand's distinctive marketing assets such as a product name or logo can count as essential business assets.
Developing and protecting your brand isn't just a "cost of doing business," but rather an investment in customer goodwill and recognition, leading to an even greater return on your investment in the long run.
A trademark can be almost anything that distinguishes your business's goods and services from those of your competitors.
From words and logos to sounds, shapes, and even colors, pretty much any distinctive "thing" that sets your brand apart from the competition can be registered as a trademark.
Registering a trademark with the U.S. Patent and Trademark Office (USPTO) has many benefits, and generally confers a wide variety of rights to the new trademark holder.
These benefits can include, but are not limited to:
- Nationwide Priority. Generally speaking, the biggest benefit of trademark registration is that you will gain legal priority to the trademark nationwide. This means that you will have an edge in any cases where another brand is using your registered name or logo in a confusingly similar manner. This can be compared to businesses without registered trademarks, which only hold protections in their local area (which is generally limited to the city or county they operate in). This fact is increasingly important as more businesses are moving their services online, as you can only enforce your trademark online in cases where you have registered your brand with the USPTO.
- Constructive Notice and Legal Presumptions. The USPTO maintains a public database of all registered trademarks that go through their offices. This database acts as a public record of that fact that you own the trademark in question and have exclusive rights to that mark. Most importantly, this means that you are giving constructive notice to any business that wants to use a confusingly similar trademark, eliminating any claims of good faith or "I didn't know" from the infringing business. Registration also provides a number of legal presumptions in regards to your trademark ownership, meaning that the court will presume or assume that the claim of the registered trademark owner is correct until proven otherwise.
- Incontestability Status after Five Years. After five years of continuous and exclusive use of your registered trademark, you can file to have your trademark become "incontestable." This is important because incontestable trademarks cannot be challenged in court on the grounds of the validity of the mark, the registered owner's rights to the mark, or to the fact that the registered individual actually owns the mark. Put another way, incontestability means, in general, that the trademark is yours in almost every sense of the term, to the point where courts won't even allow the opposition to contradict this fact in the event of an infringement suit.
- USPTO Registration Policing. The USPTO employs a number of intellectual property attorneys to police new trademark applications and ensure they do not infringe on existing registered trademarks. This means that the USPTO will deny any applications for marks that are (1) confusingly similar to your own (such as by having a similar name or design), and (2) in the same (or a confusingly similar) trademark class. This pre-screening of new marks provides an additional layer of protection for existing trademark owners by automatically rejecting any marks that might infringe on your brand.
- Additional Damages from Infringement Claims. The Lanham Act provides for statutory damages in addition to treble damages for any cases where someone counterfeits your mark for commercial gain. The statutory damages can range from anywhere between $1,000 and $2,000,000 per type of goods or services sold, offered for sale, or distributed by the infringing business. However, the median award per mark or good generally hovers around $20,000 for smaller counterfeiting operations and $240,000 for larger operations. Note that the median total award is usually around 3-4 times this amount when treble damages, willfulness, and numerous cases of infringement are factored in.
- Protections Against Cybersquatters. Most major domain registrars such as GoDaddy and Google Domains have adopted the Uniform Dispute Resolution Policy ("UDRP") as an informal dispute resolution mechanism for challenging the ownership of specific domains that infringe on registered trademarks. In order to successfully challenge a domain name's ownership under the UDRP, you'll need to prove (1) that you have rights over the claimed trademark, and (2) that the domain was obtained by the other party in bad faith. For example, if a business competitor buys https://www.yourbusinessname.com and uses it to redirect customers to his own site, you may be able to contest his ownership in the event that you registered your business name as a trademark. Or, put another way, your claim under the UDRP would be significantly weaker in the event you haven't registered a trademark for your brand.
- U.S. Customs Protections. After registering your mark with the USPTO, you can apply to record your mark with U.S. Customs and Border Protection. The main benefit of doing so is that the CBP will monitor, seize, and detain any imported goods that infringe on your trademark rights, such as counterfeit products made in other countries or items that are confusingly similar to your own.
- Access to Certain Online Sales Platforms. Some online sales platforms, such as the Amazon Brand Registry, offer a mechanism that allows brand owners to control and police products that are sold under your brand across the platform. This can help you stop infringing or inferior products from being sold under your brand on popular e-commerce sites. As with the CPB example above, programs such as these often require (or at least highly recommend) federal registration as a prerequisite for participation.
- Basis for Registration in Other Countries. The United States is a party to the Madrid Protocol, which allows trademark owners from one participating country to extend their trademark protections to other countries that are also a party in the agreement. In order to broaden your trademark protections in this way, your mark must be registered with the USPTO.
Regardless of whether you choose to register a trademark or not, it's important for you to speak with an attorney if you have any questions about your brand or the steps you should take to protect it.
While trademark registration can be a daunting task filled with bumps and twists that you might not expect, the payoff is most definitely worth it.
By registering your brand's name and logo as a trademark, you're taking an important first step in protecting your business on the national level.
As you can see from the benefits we've listed above, trademark registration gives you additional rights and powers over how your branding is used, and can help you fight instances of infringement both faster and easier than if you never registered in the first place.
If you have any questions about trademark law or IP law in general, please feel free to call our office at (804) 477-1720 to speak with an attorney today.
