Imagine that your family has slaved away building up the reputation and good name of your cupcakery, “Jimmy’s Delights.” In fact, your name is on your business cards, your delivery vehicle, and your boxes. While you are visiting friends in a neighboring state, you are puzzled and offended to see the same name in a similar font on a nearby cupcakery. What should you do in this situation? Is the knockoff cupcakery in the wrong? Can you prevent them from continuing to use your name? If so, how?
If you have or are currently experiencing something similar to this, you might be the victim of trademark infringement. Before you pick up the phone and call an experienced Arizona intellectual property attorney, here is a brief summary of what constitutes trademark infringement, including possible remedies you might have as a victim of such misconduct.
According to the United States Patent and Trademark Office, “[a] trademark is a word, phrase, symbol, and/or design that identifies and distinguishes the source of the goods of one party from those of others. . . . Some examples include: brand names, slogans, and logos. The term ‘trademark’ is often used in a general sense to refer to both trademarks and service marks.” While registering your trademark is not actually required by law, it is always a good practice to register it for the most complete protection under the law.
Understanding how trademarks work is critical to your business, especially when it comes to competing against other businesses on the market.
Both federal and state law prohibit deceptive and misleading advertising. If you have a registered trademark, then the legal system will be on your side. We will discuss this in more detail below.
Let’s face it, to say the marketplace is crowded is an understatement. Trademark law prevents businesses from misleading consumers by disallowing use of the same or similar business names and other identifiers. If I want to buy a Coca-Cola at the store, then I can rest assured that the can that actually says Coca-Cola is from Coca-Cola and not some mediocre knock-off. Customers viewing a trademark immediately recognize who they are actually buying from, which also helps to preserve the reputation of the business and discourage consumers from finding an alternative.
Trademarks prevent marketplace confusion by giving customers the ability to protect themselves from wasting money on a product they do not like. For this reason, consumers tend to return to the brands that work well for them. For example, let’s imagine that you are a marathon runner and you love using Brooks running shoes. In fact, you keep going back every few months to buy a new pair because they fit so well. Without trademark law, you would run the risk of buying a product from a different company every time you purchase another pair, even though they all bear the Brooks name and logo. Furthermore, confused consumers would not know where to return defective products. With trademark law protecting business brands, consumers may trust that what they are buying is from the brand they expect.
Your brand name is the first thing potential consumers will see while searching on the internet or scrolling through their social media. By having a unique brand, unshared by others competing against you in the market, you can facilitate higher traffic on your social media and websites, which in turn leads to higher rankings in search engines and even greater traffic. Without trademark laws, it would be extremely difficult for businesses to form a strong presence online. For example, during the internet boom around the year 2000, the domain name peta.org was originally taken by an organization called “People Eating Tasty Animals,” instead of “People for the Ethical Treatment of Animals” (PETA),. Today, the domain name links to the actual PETA organization; however, it would still link to “People Eating Tasty Animals” had there not been trademark laws.
Amazon owns a lot of stuff, especially with the recent purchase of Whole Foods, but it’s most valuable asset by far is its brand, which is valued for 2018 at about $150.8 million. As your business and brand grows, so will the trademark value of your business’s brand. Your trademark can be purchased, sold, licensed, franchised, or even used as a security interest to obtain more money for your business. Additionally, trademarks are able to be leveraged in that they can make it easier for a company to expand beyond its core business into another realm. For example, Apple expanded from computers to personal music devices, Kellogg’s expanded from cereal to breakfast bars, and Amazon expanded from a delivery service to tablets. While each of these businesses could have started from the ground up, their name is ultimately what allowed them to expand their business successfully.
The United States Patent and Trademark Office charges anywhere from a mere $225 to $400 to obtain trademark registration. When you stop and consider the value of protecting your brand and the risks avoided by registering your trademark, the administrative fee becomes even more miniscule. After your trademark is registered, maintaining registration will only cost a few hundred dollars every ten years. As long as the trademark is being used in commerce, you will be allowed to renew it each time for this relatively low price.
In 1877, Quaker Oats registered “a figure of a man in ‘Quaker garb,’” with the U.S. Patent Office. Nearly 150 years later, this trademark (the first trademark for a breakfast cereal) is still valid. Like Quaker Oats’ “man in ‘Quaker garb,’ your business trademark will not expire so long as you renew its registration and continue to use it in commerce.
Whether you are looking to register a trademark with the US Patent and Trademark Office (“USPTO”), need experienced Mesa trademark litigation attorneys, or need trademark infringement defense lawyers in Scottsdale, the top-rated trademark attorneys at Denton Peterson Dunn, PLLC can help. Contact the #1 trademark law firm in Arizona today to schedule a consultation.
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Trademarks are regulated under both federal and state law. Even though trademarks originally developed from state common law, federal law has become the predominant workhorse, providing the most extensive source of trademark protection. The primary federal statute relating to trademark infringement is the 1946 Lanham Act, amended in 1996.
Arizona state trademarks are governed by Arizona Revised Statutes (A.R.S.) 44-1441-56 et seq. If you plan to operate under your brand name exclusively in Arizona, then you might be fine to register only in Arizona. Generally, it is better practice to get a federal trademark as opposed to a state trademark because of the breadth of protection provided as well as its numerous other benefits (as will be discussed below).
Registering a trademark is fairly quick and straightforward. In fact, you will likely finish your online application in less than a couple of hours. The most efficient way to register is by going to the U.S. Patent and Trademark Office’s Web site, www.uspto.gov.
Before completing the application, it is critical that you do some research on the Trademark Electronic Search System (“TESS”) to make sure that no businesses have already registered a same or similar trademark as you. If an entity has taken the name, then you might be okay to proceed with your trademark as long as your business will operate under a different category of goods or services offered. When you are registering your trademark, the challenge comes in making your trademark description just narrow enough to be accepted, but broad enough to gain greater protection. Often an experienced Gilbert business lawyer can help with that process.
After submitting the application, you should receive a response indicating the acceptance or denial within six months of filing. While filing an application for the registration of your trademark is quick and easy on its face, the nuances associated with gaining the broadest protection possible for your brand can actually be quite complicated. For help registering your trademark with the U.S. Patent and Trademark Office, contact an experienced AZ intellectual property attorney today.
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In practice, it is much more common to register your trademark with the U.S. Patent and Trademark Office because it carries more weight and doing so will allow you to sue in any court in the land. However, in certain cases, you might find that state trademark protection is sufficient for your needs.
Overall, even though the protection guaranteed by registration may not be enough to safeguard your brand completely, registration will give your business more teeth to enforce your intellectual property rights, and registration will allow your brand protection to cover a greater amount of geographical territory. If you have any questions or would like to meet with an experienced Arizona litigation attorney to discuss the possibility of registering your trademark, give our office a call today
U.S. trademark protection is granted to the first person (or entity) who uses the mark, whether it be trademark or tradename, in the geographic area where the mark operates, regardless of whether it is actually registered. However, if your chosen mark is already registered by another company (even if you used the mark first) your registration with the U.S. Patent and Trademark Office will be rejected and you will need to find an attorney to help you get some sort of relief. For this reason, you want to register as soon as possible. In addition, five years after you register your trademark, it is possible for you to apply to have your trademark declared uncontestable. That declaration will make your exclusive use of the mark irrefutably established in court.
Registering your business name or trademark secures a certain level of protection outside of the courtroom. Registering your trademark will also allow you to preliminarily enforce protection without actually filing a lawsuit against the infringer. For example, if someone used a Twitter name that was identical to your registered trademark, you can file a complaint with Twitter. In your complaint, you can say, “someone is illegally using my registered trademark in your system, please help me prevent them from continuing such unauthorized use.” Twitter will review your complaint along with your federal registration and respond according to the facts of your case. Usually, internet companies will side with the owners of the registered trademark. With its continuous expansion and evolution, the internet is sometimes the “Wild West.” Sometimes, litigation can be lengthy and insufficient to address your particular concern, and even when it works it’s terribly expensive, so it is critical for you to be able to resolve these kinds of disputes with internet companies to save precious time and money.
By registering with the U.S. Patent and Trademark Office, you put others on constructive notice of your ownership of the trademark. Without a registered trademark, you would have to prove that someone who copied your mark had actual notice that the mark belonged to you before the infringement. With a registered trademark, however, you will not have to prove actual notice because registering your trademark and its existence in the U.S. Patent and Trademark Office’s database is notice enough.
Under 15 U.S.C. 1125(a), you do not have to have a registered federal trademark in order to bring a lawsuit in federal court; however, registering your trademark will automatically allow you to bring your claim in federal court, if you so choose. Bringing your registered trademark infringement claim in federal court will help your case, because one of the several main factors considered by federal courts when assessing and weighing evidence is whether the trademark is registered with the U.S. Patent and Trademark Office.
Furthermore, bringing your claim in federal court will offer advantages such as easy performance of discovery across state lines, experienced federal judges on the bench, and more established intellectual property presence. Bringing an infringement claim related to your registered trademark in federal court could also allow you to obtain monetary remedies such as infringer’s profits, damages, costs, and possibly even treble (triple) damages and attorneys’ fees. In other words, you are probably going to get more money out of an infringer with a registered trademark than you will with an unregistered trademark.
Generally, intellectual property (like trademarks or patents) is territorial and must be filed in each country where protection is sought. In other words, your registered trademark might mean nothing in Paraguay or the Netherlands. However, by filing just one trademark registration application with U.S. Patent and Trademark Office, you can concurrently seek protection in up to 84 countries. While the protection you have in foreign countries will likely not be as strong as that in the U.S., this is an efficient and effective tool for obtaining broad protection of your property rights.
Now that we have laid a trademark law foundation and discussed the importance of trademark registration, we are going to jump into the nitty-gritty of infringement. Generally, the unauthorized use of someone else’s trademark in connection with the sale of goods or services constitutes infringement if it causes a “likelihood of confusion” in consumers. In measuring the likelihood of confusion, the courts will look to a number of factors, including:
When plaintiffs can successfully win a trademark infringement and dilution cases, they are entitled to a wide range or remedies, including injunctions, monetary relief (e.g., defendant’s profits, damages, etc.), and even treble (triple) damages if the non-owner acted in bad faith.
To avoid trademark infringement and dilution claims against you, it is critical that you perform an extensive trademark search before deploying and relying on a specific trademark. You can do this yourself, or you can hire an Arizona trademark attorney to do it for you. By having an experienced Gilbert litigation attorney perform a trademark search on your behalf, you can continue to build your brand and rest assured that you are in the clear from any trademark claims. If you have already started using a mark and are concerned that it might subject you to trademark infringement, contact us today and we can strategize with you to mitigate your risk of infringement moving forward.
The factors considered by the court in determining the “likelihood of confusion” are not limited to the list below, however, the following factors are the most commonly weighed factors in the federal court system when evaluating whether or not the unauthorized use of the protected mark creates confusion for the consumers.
Because the factors for finding a “likelihood of confusion” are so vast and will vary greatly based on the specific facts and circumstances surrounding each particular case, it is often difficult to determine whether or not a judge will find that trademark infringement has occurred. The use of an identical mark on a same or nearly indistinguishable product would be a clear trademark infringement. However, on the other end of the spectrum, using a similar term on a completely unrelated product would probably not constitute a valid infringement claim. Between these two opposite ends of the spectrum lie countless “too close to call” cases that will hinge on how you argue your case, how the defense argues theirs, and how the evidence is weighed.
The nature of your mark will have a direct influence on its performance in the market and in turn will influence the legal protection it is entitled in the courtroom.
In evaluating the strength of the mark, courts will consider both conceptual and commercial strength. Conceptual strength refers to how distinctive and unique the mark is. The more fanciful a mark is (e.g., Exxon, Kodak, and Xerox), the greater the probability of the mark being a strong mark that deserves protection. When a mark is not unique (e.g., Apple, Lotus, Sun) and commonly used across multiple services, it is considered weak. Commercial strength, on the other hand, is determined based on a business’ number of sales, advertising expenses, and scope of advertising. For example, even though Apple’s mark might be considered weak in terms of conceptual strength, it is likely still strong for determining “likelihood of confusion” because of its commercial strength.
Similarity of the marks is measured by sight, sound, and meaning. It is not sufficient for a business using a similar mark to change around a few letters or a few colors if the mark still sounds and looks the same.
Similarity of products and services does not necessarily mean that the products are in the same broad industry, but that the products under each business might be connected in the mind of the average consumer. If the products are in fact competing within the same industry, then this factor weighs in favor of “likelihood of confusion.” If the products are somewhat related, but are not competitive, then this factor will not be relevant. If the products do not relate at all, then this factor weighs against finding a “likelihood of confusion.”
When two parties are operating in completely different markets and have little possibility expanding and bridging that gap, the courts will weigh this factor against finding a “likelihood of confusion.” However, this factor is losing weight as businesses target broad groups of consumers over social media and internet advertisements.
Courts generally measure similarity of the marks through the lens of how they are encountered by consumers in the marketplace. Evidence of similar marketing channels includes the mediums by which the parties advertise (billboards, internet ads, commercials, etc.) and where each business’ products are found online or in stores.
Courts rely heavily on direct evidence of actual confusion in determining whether there is a “likelihood of confusion.” However, such evidence is only sufficient if it also suggests increased confusion rather than mere past confusion that has since settled. If a plaintiff presents significant evidence of actual confusion that extends over a substantial period of time, then this factor will weigh in favor of finding a “likelihood of confusion.”
If non-owner/defendant parties were not aware of the plaintiff’s mark, then they can always argue that they acted in good faith, and this factor will weigh in their favor. However, if the plaintiff can provide evidence that the defendant knew about the mark and acted with intent, then his factor will weigh in favor of finding a “likelihood of confusion.”
Courts have frequently found that sophisticated buyers are less likely to be confused by similar marks. In many cases, the courts have held that consumers of more expensive goods and services make such decisions to purchase with a higher degree of care. For example, a consumer purchasing a car or computer will be a more sophisticated customer than a consumer who purchases a burger and fries.
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Dilution, in legal terms, means that the new mark is likely to cause dilution to the original mark, which can be carried out through either blurring or tarnishment to the mark of the trademark owner. Trademark infringement and dilution are the two most common trademark-related causes of action that are brought in a typical trademark claim. Trademark infringement and trademark dilution claims involve an opposing entity’s exploiting of another’s trademark. The fundamental difference lies in how the consumer reacts to the unauthorized use. In Arizona trademark infringement claims, there are two similar marks that represent two entities who do similar things, which confuses consumers.
Dilution claims can only be brought when the prerequisite, that the mark is “famous,” is met. Whether or not a mark is “famous” is determined by the courts through a number of factors, including:
It is important to note that when you are bringing a trademark dilution claim under Arizona state law, it is not a necessary prerequisite that the mark be famous in order to bring a dilution claim. If the federal court finds that the mark is in fact famous, then the owner of the mark can bring the dilution claim against another party for any use of the owner’s mark that dilutes the distinctive quality of that mark, which can be as a result of “blurring” or “tarnishment.”
Dilution by blurring usually occurs when the distinctiveness of a mark (determined to be famous) is impaired by association with another similar mark or name. Courts will determine if dilution has occurred as a result of blurring by analyzing the facts and circumstances of the case under the following six factors:
Dilution by tarnishment usually occurs when the reputation of a mark (determined to be famous) is harmed through association with another similar mark or name. Tarnishment can be accomplished in a variety of ways (e.g., linking mark to sex, drugs, crime, etc. or providing low quality goods or services), but the thought is that a tarnishing and unauthorized use of the trademark holder’s mark degrades and devastates the commercial value of the mark because consumers associate the one entity with another.
There are a number of defenses to a trademark infringement or dilution claim. The way you structure a defense really depends on the facts and circumstances surrounding your case. All of the claims a plaintiff can bring for a trademark case require the plaintiff to provide evidence of a number of different factors in order to show an unauthorized use. The defendant will assert evidence challenging the plaintiff’s claims for each element. As a general defense strategy, a defendant should challenge the following:
Does the Defendant have prior rights?
Even though the Plaintiff ultimately bears the burden of proving a likelihood for confusion or dilution in court, a Defendant can counter by presenting an argument that confusion or dilution is actually unlikely.
In trademark law, fair use is much narrower than it is in copyright law. Fair use by a non-owner of a mark can fall under one of two categories: nominative fair use and descriptive fair use. To qualify as fair use under either category, the non-owner must first act in good faith. In nominative fair use, a non-owner references a trademark in order to identify the actual goods and services that the trademark holder identifies with the mark.
Generally, nominative fair use is permissible when (1) the service or product in question is not otherwise identifiable without using the actual mark, (2) only so much of the mark as is reasonably necessary to identify the service or product is used, and (3) use of the mark does not suggest any kind of endorsement by the owner of the trademark. Descriptive fair use allows another’s use of an owner’s trademark in order to describe the user’s services or products.
In determining whether a non-owner’s use of a trademark is a parody, courts typically examine the extent to which the non-owner effectively differentiates the original product or service from the claimed parody as well as how much they Involve humor, satire, or ridicule of the plaintiff or its goods or services. The idea here is that if the use is clearly a parody, then it is unlikely to cause confusion or dilution among consumers.
This statutory provision applies only when the parody is a fair use, where the non-owner is not using the mark as a designation of source for its own goods and services.
A non-owner is likely to prevail in a trademark infringement or dilution claim if it can show that its activities involve artistic or expressive work, that using the owner’s mark is relevant to the work, and that the mark is not explicitly misleading to consumers.
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