This is the fourth in a series of introductory articles on the topic of trademark law. To view the third in the series please click on the Previous Page link below
No one can guarantee that a new trademark is completely available for use and federal registration, or that use of the mark will be 100% risk-free from third party claims. Over the years, however, trademark practitioners have developed standard legal practices for evaluating the level of risk associated with the use and registration of a new trademark.
In our last article, we explained that conducting a preliminary trademark search helps a company avoid the expense of obtaining a full trademark search if the proposed mark is "knocked out" based upon the preliminary search results. Trademark counsel will generally advise the company to select another mark in such a case. If the company does not follow the advice of its trademark counsel, the company risks a finding of willful infringement and an award of treble damages if the company is later sued for trademark infringement. See 15 U.S.C. §1117. Also, if the dispute involves the company’s use of a domain name and the company did not first conduct a trademark search that would have revealed a confusingly similar federally registered trademark, or a pending application for the same, it is possible that an arbitration panel will find that the failure to conduct a trademark search is evidence of the company’s "bad faith" use of the domain name. See Kate Spade, LLC v. Darmstadter Designs, D2001-1384 (WIPO Jan. 3, 2002).
The preliminary trademark search should be conducted by one who possesses the proper training and expertise in trademark searching. An inexperienced person conducting the preliminary search will often miss a third party mark that conflicts with the proposed mark. Sometimes the preliminary search results reveal marks that require further investigation in order for trademark counsel to determine whether the marks present a potential conflict. For example, suppose the company’s proposed mark is SIMPLY WISE for a new variable annuity product and the preliminary search shows a cancelled federal service mark registration for the mark SIMPLY SMART for a variable annuity product. The fact that the competitor’s registration has been cancelled is not sufficient reason to believe that the company may proceed with use and an application for registration of the mark SIMPLY WISE. This is because, in the United States, trademark rights arise from actual use of the mark, not registration of the mark. Therefore, if the mark SIMPLY SMART is still in use, or in a period of excusable non-use, the company would be wise not to adopt and use the mark SIMPLY WISE. Rather, the company would likely want to select a new mark and begin the preliminary screening process again.
If the proposed mark has passed the initial screening, trademark counsel will often recommend obtaining a more comprehensive search report from a commercial trademark search firm. The scope of the full trademark search report will depend upon the company’s proposed uses of the mark (e.g., state corporation records should be included if the proposed mark will also be used as a company name and/or trade name). In addition to a more in-depth review of the Federal Register, a comprehensive U.S. search report usually includes records from state trademark databases, thousands of common law sources, Internet content, and domain name registration records. The report provides the basis for trademark counsel to evaluate the level of risk associated with the use and registration of the company’s proposed mark.
When the company plans to use the proposed mark outside of the United States, there are a variety of online preliminary screening search and comprehensive search options available.Therefore, if the mark SIMPLY SMART is still in use, or in a period of excusable non-use, it might be wise for the company not to adopt and use the mark SIMPLY WISE. Rather, the company might want to select a new mark and begin the preliminary screening process again.
In the next installment in this series, we will discuss the basics of proper trademark and service mark usage in the United States.
This article does not constitute legal or other professional advice or services by JORDEN BURT LLP and/or its attorneys.
JORDEN BURT LLP is a law firm with a unique focus on financial services and a national reputation in high stakes litigation, financial regulation and product counseling.
