Why it's worth registering a trademark

US companies that use a trademark acquire them protectable trademark rights and the shipping of goods throughout the nation.

 One of a company's most valuable assets is its name — the label that distinguishes the goods and services provided by one company from those of its competitors. Fortunately, laws are in place to protect a company's trademarks and service marks from misappropriation by others.

Unlike many other countries, U.S. trademark rights are acquired through trademark use. Therefore, if a company uses a trademark, it acquires protectable trademark rights, even without obtaining a trademark registration. In the United States, the type of use required to obtain trademark rights is use in interstate commerce. For goods, this generally means that products bearing the mark must be sold and shipped from one state to another, or within a U.S. territory that is not a state, such as Washington, D.C. Service marks are considered to be used when included in advertising and/or promotion of services associated with the rendering of the services.

In this day and age, with the ubiquitous use of the Internet for sales, more businesses than ever before are engaged in interstate commerce. However, "token" use, which is considered a shipment made only to attempt to establish trademark rights, rather than based on the genuine sale of goods or advertising of services, is insufficient to establish trademark rights.

In addition to using a mark in commerce, it is worthwhile to retain records of this first use. Such proof may be necessary if another party claims prior rights in a similar mark. Further, parties should retain examples of use of their trademarks throughout the time the trademark is used. Such examples could be photographs showing goods or packaging bearing the mark and shipping records proving interstate commerce. Again, these can be used to show continued use if a party's trademark rights are challenged or if a party must show its own use when challenging another.

Trademark registration although trademark rights are enforceable without obtaining a registration, it is much easier and less expensive to enforce trademark rights with a registration than without one. A U.S. trademark application can be placed on file for as little as a $275 filing fee plus a couple of hours of attorney time, if the applicant chooses to use an attorney to prosecute the application. These amounts are far lower than a legal battle over trademark rights can cost.

A U.S. trademark registration is prima facie evidence of the trademark owner's rights in the mark. This means that the registrant is presumed to be the owner unless another party submits evidence rebutting this presumption. Consequently, if another party challenges a trademark owner, it is the challenger's burden to prove that it has rights superior to those held by the trademark owner.

 Another advantage of trademark registration is that the registration puts others on notice of a party's trademark rights. If one company has been using a mark, but has not filed an application to register the mark with the U.S. Trademark Office, it is possible that a subsequent party conducting an availability search would be unaware of the first company's use and adopts a similar trademark. In this case, the first user must take steps to stop the subsequent user's infringing use. Such action would be unnecessary if the junior user had been able to find that the senior user had registered the trademark. Such a discovery by the junior user before commencement of use would likely be enough to cause the junior user to choose a different mark and save both parties the time and expense of any conflict over the mark.

In addition to the advantage of notifying others of a party's claim to a trademark, a U.S. registration has the benefit of incontestability after five years of registration. This means that once a U.S. trademark has been registered for five years, the grounds on which it can be canceled are limited.

Before adopting a new trademark, it is worthwhile to conduct a search of the Trademark Office records, as well as common law databases, to ascertain whether the mark is available for use and also registrable. There are companies that provide such search reports for a reasonable fee. If a party has intent to use a mark, but has not yet commenced use, it is possible that another party could file its own application to register the mark in question before the first party. In order to avoid this, a trademark application should be filed as soon as a party has decided on a trademark. This way, if a trademark registration ultimately is obtained, the filer will be protected from its filing date, even if it has not yet used the mark on that date.

Although the task of registering a trademark initially may seem time-consuming and superfluous, it actually is a worthwhile exercise for a company to protect its trademark rights in the most efficient manner available.