Trademarks and Your Business

Trademarks are a very important, and often overlooked, part of a company which does business across state lines or over a large geographic area. The more successful a company gets, the more likely someone will attempt to copy that success, and frequently, this involves a new company imitating the identity of the successful company.

U.S. federal law defines “trademark” as any word, phrase, symbol, or device, or a combination of these, used by someone to “identify and distinguish his or her goods…from those manufactured or sold by others and to indicate the source of the goods.” This article will unpack this definition.

First, you should know the different types of protections that copyrights, trademarks, trade secrets, and patents provide.

A trademark signifies your company’s identity, whether the mark is a word or a logo or a slogan. It works much like your personal name; when someone mentions your name to your social circles, others will match you and your reputation to your name. A trademark operates the same way for a business. When you see the Yahoo! mark, or when you see the Google mark, what do you think/feel about those companies? Do you think/feel different when you see the Ferrari or Toyota mark? That’s the effectiveness of a strong trademark which has had millions of dollars invested into it. It’s identity, and it should be protected much like defamation laws protect your personal name.

When your trademark is successfully registered with the U.S. Patent and Trademark Office (USPTO), the federal government essentially guarantees you, the trademark owner, several rights. If someone else tries to imitate your trademark, you can use federal courts to stop the unauthorized use and sue them for profits gained from imitating your trademark. You can see the value in this if you can imagine how much money you could make if you could start a shoe company tomorrow and slap a Nike Swoosh on every pair.

In cyberspace, trademark owners have rights against those who register domain names similar to  a registered trademark, and then uses that registration to drive traffic away and profit from a trademark owner’s webpage. For example, if someone registered <cloroxx.com> and sold their own brand of bleach, or if someone registered <nykee.com> and sold footwear on the site.

When you register a trademark, you own it. Like other types of property, you can lease it to others to use, and for a price. This is licensing. When your trademark is very strong, others will want to use it to harness the selling power of it. This is very similar, and sometimes a part of, franchising: the trademark owner has a tried and true mark which sells products because of its good reputation, and the trademark owner can license that mark to others who want to use the mark to their advantage.

I hope this helps young entrepreneurs with conceptualizing what a trademark is and how registering a trademark can be a benefit. As always, The Law Office of Cliff Kuehn can always be contacted for further questions at ck@cliffkuehn.com.

–  ck