Recently I had a discussion with a business who had been using a trademark since about 2004. Unfortunately, it had not registered the trademark. In the meantime, another business had started using a similar version of the mark and also had substantially completed the registration process. Thus the business was in a difficult situation. Sure, the business probably had superior rights. But asserting those rights could be costly and time-consuming. If negotiations with the other company aren’t successful, some sort of proceedings may be necessary to assert rights in the trademark. GULP!
This situation leads to some lessons on the advantage of registering a trademark for a new business.
- The trademark registration is used by the trademark office against other applicants for registration – This advantage is often overlooked because the trademark owner usually doesn’t know when this happens. In some cases, a different startup performs a search before it use the trademark and sees the existing similar trademark registration. It then uses a different mark. In the case where no search is performed, the existence of a registered trademark will serve as a barrier to a second comer’s trademark application when the trademark office performs its search. In both cases, the advantage was achieved at no more cost than the registration itself. Going back to our first business, had the business registered its mark in 2004, the possibility of a proceeding to assert its ownership may not be lingering.
- Presumption of validity – Upon successful completion of the registration process, the registrant has the presumption of validity of the trademark in proceedings. Effectively, that means that the burden is placed on a challenger to show that the trademark is invalid. Thus, if the first business can’t find records and/or other evidence to show that its used the mark in 2004 (before the other party), it loses.
- Public access – A registered trademark (and its owner) is published by the trademark office for the world to see. Because of this, the “he said, she said” scenarios are minimized. Thus instead of a proceeding, a trademark owner may choose to send a takedown notice directly to the host requesting removal of the infringing material. The host is in a difficult situation when two strangers each claim ownership of the mark. The published trademark registration showing the owner makes it easier for a host to decide remove infringing material.
Each of the above advantages enhances the ability of a startup to protect its brand.