Questions and Answers on Trademarks and Service Marks

by Ronald J. Kransdorf, Peter C. Lando, Edward F. Perlman, David Wolf

What are trademarks and service marks?

A trademark identifies the products and a service mark identifies the services of a business.They distinguish such products or services from those of others.Collectively, trademarks and service marks are referred to as “marks.”What constitutes acceptable marks varies for different countries and may include words, names, symbols, logos, package shapes, designs, devices, fragrances, colors, or sounds.

What is the difference between trade names and trademarks?

A trade name is a name under which a company does business.”General Motors Corporation” is an example of a trade name.A trademark is the word or symbol under which a product or service is advertised and sold. “Chevrolet,” and “Pontiac” are examples of trademarks.

While the same word or name may function as a trade name and trademark, either in whole or in part, the two are legally distinct and serve different legal functions. Therefore, while a word or name may be clear for use as a trade name in a particular state or country, this does not mean that the word or name is available for use as a trademark.A separate clearance procedure must be performed for trademark purposes.

What criteria should be used in selecting a mark?

Selection of a trademark is driven primarily by business considerations.However, there are also legal considerations.If the selected mark is geographical or highly descriptive of the product or service, protection may be more difficult to secure and may not be possible in some countries.On the other hand, if the mark selected is wholly arbitrary or fanciful, promotion and development of trademark value may be more costly but legally more valuable.Care must also be exercised to assure that the mark does not have a negative connotation in any country of the target market.

The mark should be capable of registration and use in each target country.Ability to register and/or use in a country depends on a number of factors including: whether conflicting or confusingly similar marks have already been registered; whether the selected mark contravenes specific laws, such as prohibitions against registration of certain governmental emblems or symbols; and, whether the mark is generic or merely descriptive of the particular product or service.Because selection of a mark is a mixed issue of business and law, a trademark attorney should be consulted early in the selection process.

Should a mark include common terms in the relevant industry, such as “data,” “compu” or “tech”?

Such common descriptive terms are used so extensively in the relevant industry as a prefix, suffix or other part of a mark that they alone no longer function to distinguish the goods or services of the owner from others.Although there may be important business reasons for using them, marks containing such terms may be legally weak marks.They are also difficult to protect internationally.Highly descriptive, geographically descriptive, and two- or three-letter combination marks may also be considered incapable of distinguishing the goods in some countries.These problems should be considered before using such terms, especially if the mark is intended for use as a primary mark for multiple lines of goods or services.

How do I know whether a selected mark is legally available?

After selecting a mark, but before initiating use, a legal clearance search should be conducted to uncover any registered or unregistered users of the mark.Searches may be limited to a preliminary screening search in a domestic country, or may be a more detailed search in several countries.Typically, a detailed search will uncover marks which are similar in sound, meaning or appearance, for use on similar goods.In order to determine whether a mark is legally available for your use and registration, it is critical that the results of any search be interpreted by a qualified legal professional.

How are rights to a mark obtained?

In most countries, rights to a mark are initially obtained by filing an application for registration.In certain countries, rights are obtained by use.Usually, applications are examined and a registration is granted only if no conflicting mark is found and the mark is capable of distinguishing the goods or services.In a number of countries, the examination of the application takes many months.If the application is found allowable, it is frequently published for review by interested parties.If others believe they would be damaged by issuance of the mark, they may initiate an opposition proceeding which may significantly delay or prevent issuance of a registration.

When should the registration process for a mark start?

Since significant rights to a mark in most countries are obtained by registration, applications should be filed on important marks in the countries of concern, preferably before the mark is used.Filing before use begins also provides time to change a mark in the event a competing mark is found or registration is otherwise not possible.If the product or service is already being marketed and a domestic mark is being used, it is especially important to file as soon as possible because in some countries other parties may legally obtain title to the mark by filing first.The original mark owner may benefit from an international convention which allows the filing date of a domestic application to be the filing date of foreign applications filed within six-months.

What does the registration process cost?

Registration costs vary significantly, depending on the nature of the selection process and the countries in which the registration is sought.Obtaining cost estimates should be a part of the process of international registration.In countries in which there are significant government application and registration fees and substantive examination, the cost may be several thousand dollars per mark.In other countries, the total cost may be less than a thousand dollars.Total cost may include fees for clearance searches, local and supervising attorneys, legalization charges, drawing costs, advertising fees, amendment, extension and issuance fees.After a registration is issued, periodic charges arise in most countries for renewals and in some cases, for periodic proof of use.On some occasions, significant expenses may be incurred if the registration is opposed or cancellation is sought by another party.

Once a mark is registered, how long will the registration remain in force?

While the term of a registration varies from country to country, ten years from the date of issuance of the registration is typical for major industrialized countries.An unlimited number of renewals are permitted in most countries.In many countries, though, the term may be cut short for non-use.

Does registration in a country protect the mark for all goods or services?

No.Registrations in all countries are limited to a particular class of goods or services. Most countries subscribe to an international or other classification system which defines particular classes of goods and services.Registrations, in general, may be issued in one or more classes, with multiple class registrations subject to increased taxes or fees.In many countries, registration of a mark for all goods in a class is possible.In other countries, the description of goods or services must be fairly specific.

Should the same mark be registered more than once in a country?

There are at least two situations in which it may be necessary or desirable to register a mark more than once in a given country.The first situation is where the mark is being used for a variety of goods or services, at least some of which fall in more than one class.A single registration in multiple classes may be filed or a separate registration in each appropriate class may be filed.Where the mark is used on a new type of goods or service not included within earlier registrations, it may also be desirable to file an additional application for registration for those goods or services.Further, a mark may be used in more than one form.Registrations in every form may be desirable to fully protect the mark, including a separate registration of a word mark in block letters.

Does a domestic registration permit automatic registration in foreign countries?

No.While a domestic registration is frequently the basis for a foreign application, allowance of the foreign application based on the domestic registration is not automatic.

When does my protection begin?

Registration is usually a prerequisite to any formal proceedings to enforce rights in a mark.In some countries, concurrent rights arise from registration and usage.In other countries, such as the United States, formal proceedings such as a lawsuit may be commenced without a registration.However, United States Customs will not seize infringing goods unless the mark is previously registered.In most countries, certain presumptions arise when filing an application, which makes early filing desirable, even in countries that award registrations to the first to use the mark in that country.

What are my rights, once I have a registration?

You may have the right to file a lawsuit to exclude others from using the registered mark or confusingly similar marks and to recover damages.In the United States, enhanced damages and attorney fees may also be awarded for infringing a registration.Since registrations are publicly available records, they provide formal notice of the owner’s rights in the mark.Because records are also searchable, a third party can determine the non-availability of the mark in that country.In some countries, registration may also be used to prevent importation of goods bearing the registered mark into the country.

Do I have any rights if I have no registration?

In many countries, the first user retains the rights to obtain a registration and to cancel the registration of the second user within a limited time period.Some countries also permit infringement lawsuits based on unregistered marks.In general, however, the rights that may be asserted on unregistered marks are more limited than those that may be asserted on registered marks.In some countries, special rights are afforded famous marks.However, proof that a mark is famous may be very difficult.

Can a registration be attacked?

Yes, most countries have some form of cancellation proceeding which permits a registration of a mark to be attacked for various reasons.Reasons may include non-use of the mark over some period; that the mark is incapable of distinguishing the goods (i.e., is generic, etc.), or that the mark is confusingly similar to a prior registered or used mark.

If I have a registration, can I stop imports?

Generally,yes.In some countries, it is possible, either by registering a mark with customs or by legal action, to prevent the importation of infringing goods into the country.One issue which frequently arises in this area is the ability to block “parallel imports” of “gray market goods.” These are goods which properly bear the mark but which are being imported through unauthorized channels.Rights to stop parallel importation differ significantly from country to country.

Should local distributors be relied on to register and enforce marks?

Generally, no.A local distributor or agent may sometimes register its principal’s mark in the country as a tactic to prevent termination of the distribution contract, to elicit more favorable terms in the contract, or to force renewal of the contract when the term expires.The distribution contract should, therefore, carefully define rights and obligations of the parties to all relevant marks.

Are there international treaties that will allow one application for foreign rights?

There are several international treaties that allow a single application for multiple countries. The Madrid Arrangement provides an international register for marks for member countries.Since the United States, Japan, United Kingdom and many other countries are not members, their citizens cannot currently use this register.However, the U.S. is considering joining a revised version of the arrangement called the “Madrid Protocol” as part of a worldwide trade and intellectual property harmonization agreement.Among other international treaties, the Benelux Trademark Treaty permits a single registration of a mark in Belgium, The Netherlands and Luxemburg.

International trademark law is presently the subject of intensive study and negotiation, which may result in broader international treaties that will deal more effectively with multiple country registrations.

When should I consider international trademark protection?

An important conclusion from the various answers provided above is that it is advisable to give attention to international trademark protection as early as possible.International markets are of increasing importance to businesses.In some industries such as computer software, for example, international sales may amount to 40-60% of revenue.Strategic international trademark planning should be a part of nearly every business venture to achieve maximum cost/benefit and minimize exposure to liability.

What skills should a trademark attorney have?

Trademark counsel should have a solid working knowledge and experience with the registration process in the United States Patent and Trademark Office and various states, as well as familiarity with the trademark registration process in other countries.Counsel should be a member of a firm with several others of like experience, since many trademark issues involve close questions that are best answered by collective judgment.A carefully selected network of international associates, in- house searching capability of a sophisticated nature, established docket and trademark maintenance software programs and established procedures for regular and routine review of the U.S. Trademark Gazette and other domestic and international publications are also desirable.Counsel should have litigation experience and experience in licensing matters.