When a new business venture is undertaken, so many important tasks need to be completed, which could potentially push trademarking the new company moniker to the side.
Joshua Tropper, partner with Gambrell & Stolz LLP Attorneys at Law in Atlanta, urges business owners not to hesitate. For many legal reasons, he says, a new business should apply for registration of its name as soon as it’s selected.
Smart Business spoke with Tropper about why a new business should go about trademarking its name and what steps it should take to do so.
Should a new business selecting a name trademark that name immediately?
A new business should apply for registration of its name as soon as the name is selected, unless it doesn’t intend to use the name in its marketing. Many private investment funds and holding companies, for instance, never use their corporate names as trademarks, and companies often have subsidiaries whose names are never used as trademarks. A company that doesn’t register its trademark will still have legally protected rights in its trademark, but those rights will generally be limited to the specific geographic area in which it actually uses the mark. Federal registration, on the other hand, has the effect of nationwide use of a trademark retroactive to the date the application was filed. Federal registration also creates a statutory presumption of ownership and validity of the mark, and that presumption normally becomes incontestable five years after registration.
The mere act of applying for federal registration can have the useful effect of alerting others not to choose confusingly similar trademarks for their own businesses, which can save a lot of money and aggravation for everyone involved. The flip side of the deterrent effect is that, if you do a trademark search as part of the process of applying for federal registration as soon as you select a name, you’re more likely to discover that someone else out there is already using the name you chose. If that happens, you know that you should probably pick a different name before you invest too much in promoting a name that’s likely to get you into trouble.
How does a company go about pursuing a trademark?
The application form, along with a lot of helpful information, is available online at www.uspto.gov/teas/eTEASpageA.htm. It’s not necessary to have a lawyer, although experience with the process and appreciation for some of the peculiar subtleties of trademark law can make a big difference. The initial filing fee is between $275 and $375, depending mostly on how routine the application is. If everything can be put into place electronically, it makes it a lot easier for the Trademark Office to examine the application, and that reduces the cost.
If an application is filed before the applicant has started actually using the trademark, there will have to be an extra step later on when the applicant provides proof that it has started using the mark, and there’s an additional $100 filing fee.
Five or six months after the application is filed, an examiner in the Trademark Office reviews the application and notifies the applicant of any problems or questions. After any issues are resolved, the application is published and there’s a 30-day opportunity for anyone else in the world to object. If there’s no objection, a formal certificate of registration will be issued. If things go smoothly, the whole process takes about a year.
How does a trademark protect a company?
The purpose of trademark law is to protect the public by helping to ensure that any goods or services that are marketed under a trademark actually come from the owner of that mark or from someone authorized by the owner. Everything in trademark law ultimately boils down to a ‘likelihood of confusion.’ It’s perfectly legal to use exactly the same trademark to sell accounting services in Macon that someone else is using to sell pizza in Walla Walla because confusion is unlikely. However, the more similar the goods or services are, the more different the trademarks have to be to prevent confusion and vice versa.
In addition to the deterrent effect of a trademark search, once a trademark is registered, the Trademark Office will not register confusingly similar trademarks for other applicants. Also, Customs & Border Protection can block importation of infringing goods and the federal courts can order others to stop selling infringing goods or services.
Are there any other things a new company should trademark besides its name?
Anything that can serve to identify the source of goods or services can be registered. Slogans and logo designs are the most common examples of trademarks that aren’t just business names, but it’s also possible to register colors, sounds and even scents if the examiner can be persuaded that they really do indicate the source of the products or services.
What legal action can a company take if someone violates its trademark?
The standard legal action is a suit in federal court, which can order the infringing party to stop making or selling the offensive goods or services, reimburse for any lost profits or disgorge its own profits, reimburse the trademark owner for its attorneys’ fees and even to destroy any inventory of infringing products. International enforcement is also possible.
JOSHUA TROPPER is a partner with Gambrell & Stolz LLP Attorneys at Law in Atlanta. Reach him at (404) 223-2210 or email@example.com.