Trademark Essentials for Your Business
Trademarks are one of the most valuable assets a business can own. They represent your company’s identity, distinguishing your products or services from competitors. Trademark infringement—where a competitor uses a confusingly similar name, logo, or symbol—can threaten your business. In one high-profile case, Starbucks successfully defended its brand when a smaller chain tried to use the name “Freddocino,” cutting into the brand equity Starbucks had built with its “Frappuccino” trademark.
As an IP attorney, I help businesses safeguard their trademarks and their brand equity. In this article, we’ll explore what trademarks are, how to establish and protect them, and how to avoid costly mistakes.
What is a Trademark?
A trademark is any word, name, symbol, or other element used to distinguish goods and identify their source. It gives its owner the legal right to prevent others from using a confusingly similar mark. This not only protects businesses but also helps consumers identify the origin of the goods they purchase.
Examples of well-known trademarks include the Coca-Cola logo, the Nike Swoosh, and names like “Google,” “Chrysler,” and “Lululemon.” Trademarks can even include sounds or colors, such as the MGM lion roar or Tiffany’s iconic blue packaging. Trademarks like these signify trust, quality, and reputation.
Why Trademark Protection is Crucial
Trademarks do more than identify your business, they stand for your company’s hard-won reputation and brand equity. If a competitor uses a logo or name that closely resembles yours for a similar product or service, that can confuse customers and damage your brand. This brand erosion can in turn lead to reputational harm and financial loss.
How to Establish Trademark Rights
Use: At the most basic level, trademark rights are established by use in commerce. That is, a trademark must be used in the ordinary course of trade to identify either a product or a service. If you don’t use your trademark, you risk losing rights to it. In other words, "use it or lose it."
Registration: While you can acquire some trademark rights simply through use, it’s highly beneficial to register your trademark with the U.S. Patent and Trademark Office (USPTO). Registration gives you several key benefits:
- Nationwide priority over other trademarks
- Nationwide notice to competitors and the public
- Presumptive ownership validity in legal disputes
- Incontestability after five years
- Access to federal courts and remedies
Once your trademark is registered, it’s crucial to monitor the marketplace for infringement. This vigilance helps protect your brand from unauthorized use and ensures that your trademark continues to serve its purposes of distinguishing and showing the origin of your products and services.
Tips for Selecting a Strong Trademark
To strengthen the protectability of your trademark, it’s important to choose one that is distinctive. Here’s a quick overview of the different levels of distinctiveness a trademark can have:
- Generic: If you call popcorn “popcorn,” it’s generic and cannot be trademarked. For more on this, check out my blog post on Peloton’s petition to use the word “spinning.”
- Descriptive: A name like “Jiffy Lube” is descriptive—that is, it spells out what the service is that it represents—but it can acquire distinctiveness over time.
- Suggestive: A suggestive mark does not directly describe a product or service but instead implies something about the product or service. For instance, “Greyhound” suggests speed.
- Arbitrary/Fanciful: The strongest types of trademarks are arbitrary or fanciful. They stand out because they don’t have any descriptive element. Think “Exxon” or “Apple” or “Rolex.”
It’s also worth considering all the elements that can act as trademarks, such as logos, slogans, colors, or even packaging. For example, Cadbury sought to protect the specific shade of purple it uses in its chocolate packaging. Although initially successful, Cadbury lost a later court case when the court ruled that the trademark was too vague, underscoring the importance of specificity when protecting colors or other unique brand elements.
Trademark Disputes: Lessons from Real-World Cases
Trademark disputes often highlight the fine balance between protecting a brand and promoting fair competition. In addition to the Starbucks case, here are some notable cases:
- Louis Vuitton vs. Louis Vuitton Dak: A South Korean restaurant attempted to use a name and logo that closely mirrored the luxury fashion brand Louis Vuitton. The court ruled in favor of the designer, ordering the restaurant to pay significant damages for the infringement.
- Jack Daniel’s vs. Bad Spaniels: Whiskey maker Jack Daniel’s sued the manufacturer of a parody product—a bottle-shaped chew toy called “Bad Spaniels.” After a protracted battle, the Supreme Court ultimately ruled that the chew toy infringed Jack Daniels’ trademarks.
- Apple Corps v. Apple Inc: The Beatles’ record label Apple Corp. had a long-running dispute with computer-maker Apple Inc. The case ultimately settled, with Apple Inc. reportedly acquiring all rights to the “Apple” brand for $500 million and licensing it back to Apple Corp.
Protect Your Trademark and Brand
Trademark protection is essential for preserving your brand identity. Whether you're a business owner or an attorney advising clients, understanding the nuances of trademark law can help avoid costly mistakes. Choose strong trademarks, register them, actively monitor for infringement, and take action when necessary. Proactive steps today can safeguard your business tomorrow.
