Malcolm J. Chisholm Jr.

 


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SELECTING A TRADEMARK FOR YOUR NEW BUSINESS, PRODUCT OR SERVICE

Selecting a trademark for your new business enterprise, new product or new service can be an important step in setting yourself apart from the pack and enhancing customer awareness in a crowded and competitive marketplace. But in so doing, there are several factors to consider and understand in order to make your selection process a success, rather than one subject to legal challenges or other unintended consequences.

In a nutshell, a "trademark" is a "source indicator" that serves a primary purpose of allowing the consuming public to distinguish between competing products or services based upon a mark associated with specific products or services. To minimize confusion amongst the public, governments permit business entities to have limited ownership interests in certain words, phases or graphic art as "trademarks". From non-traditional "alternative health care providers" with nutrient supplements, seminars and books to well established manufacturers with new products, care in selecting an appropriate trademark or service mark is paramount to effectively crystallize within the mark a solid reputation for such new services or products. Virtually everyone knows and appreciates the remarkable good will associated with famous trademarks such as "ROLLS ROYCE", "LEXUS" or "BMW", etc. as well as distinguished service marks including "CANYON RANCH", "TANGLEWOOD" and "WILLIAMS COLLEGE", etc. (Technically, "trademarks" are for "goods" or "products", while "service marks" are for business "services").

One may acquire exclusive ownership rights in a mark simply through use of the mark in association with a product or service by way of our "common law" However, to acquire meaningful commercial exclusivity in a mark, business entities should seek to register their marks with either the state or federal governments. For business entities that only market their products or services locally, or for start-ups on a tight budget, registration with a state government is often satisfactory, and is substantially less expensive and less complicated than registration with the U.S. Government. Such ordinary usage or registration with a state government allows one to use the designation "TM" or "SM" after their marks as a superscript to provide notice to all that the user is asserting exclusive ownership rights in the mark.

If one achieves exclusive rights through registration with the U.S. Patent and Trademark Office, the recipient of such a registration is permitted and indeed should use the designation of a capital letter R within in a circle, such as ®, as a superscript after the mark, or the other official forms of such a notice of federal registration. By achieving such a federal registration, the owner of the registered mark dramatically minimizes the likelihood of a competitor using a confusingly similar mark and thereby significantly reduces the probability of any trademark infringement litigation costs. Additionally, in the event of any infringement of a federally registered mark, the registrant is very likely to prevail and thus such infringement actions typically are resolved long before an actual trial. Moreover, federal registration provides for many other benefits including facilitating U.S. Customs Office seizure of imported counterfeit goods, etc.

Whether a developer of a new product or service elects to rely upon common law rights or federal registration, the most important task in use of a trademark is PROPER SELECTION of a mark prior to usage and registration. Two significant hurdles must be overcome in the selection process. First, one must determine that no other entity is using the same or a confusingly similar mark on related goods or services. If the new product developer simply selects a mark and invests marketing dollars in getting a new product or service into the streams of commerce under the mark, the developer may simply have invested in a devastating trademark infringement lawsuit. Proper trademark selection therefore requires a screening or clearance search to minimize the probability of a prior user asserting rights against a new mark. With the advent of the internet, business entities may undertake limited searches at a database maintained by the U.S. Patent & Trademark Office at "www.uspto.gov" However, one should seek professional counsel in such a selection process.

The second and perhaps more important hurdle is assuring the selected mark is capable of being protected by trademark law. A basic policy underlining trademark legislation is that a business cannot own words that a competitor needs to compete with the business. For example, one cannot own generic words such as "restaurant", "school", "Berkshires", "soccer school", "summer camp", etc.

Put into a more comprehensive framework, there are essentially three types of trademarks; a. "arbitrary" marks; b. "suggestive" marks; and, c. "descriptive" marks. An "arbitrary" mark means the mark has no direct or inherent meaning related to the goods and/or services with which the mark is associated. Of the approximately ten thousand marks we all see each day, over 95% are "arbitrary" marks. Examples of "arbitrary" marks include "FORD", "APPLE", "CANNON", "HEWLETT PACKARD", "L.L. BEAN" and the list is long and legendary. "Suggestive" marks, such as "SLIM FAST", "BURGER KING", "JIFFY LUBE", "NO DOZ" suggest the goods or services with which they are associated. They are much more difficult to protect because they have often been previously used by competitors, and are frequently used by counterfeiters. Technically, "merely descriptive" marks cannot obtain registration or any other trademark rights, with an exception for some marks that have received massive advertising campaigns over long periods of time. For example, all restaurant owners want to have a "friendly" ambiance within their establishments, so could they own the mark "FRIENDLY" for their restaurants? The answer is technically no, because that describes the atmosphere they seek to market in association with their businesses. However, the "Friendly Ice Cream Corp." of Wilbraham, MA has invested so many resources into the word "FRIENDLYS" in association with their restaurants that the word in that setting has acquired a secondary meaning, and hence is capable of trademark significance. That however, is extremely rare.

More typically a developer of a new product or service will contrive a clever "suggestive" mark wherein words or phrases are juxtaposed in curious relationship to produce a cute turn of the tongue that suggests the goods or services. Although creative, experience teaches that such an approach is virtually always laden with significant risk. My counsel in such circumstances over the years has been to abandon the suggestive word or phrase and select a truly arbitrary mark, or, if that is impossible, to instead preface the clever suggestive word or phrase with an arbitrary word, which may often include the innovatorís business name or family name.

A good example of how ingrained is the "suggestive" mark trend is found in the story of the "INTEL" company initially using numeric characterizations of their computer processing chips, such as their well-known "386" and "486", etc. chips. Because those numbers were suggestive of the actual components or capacities of the chips, the "386" or "486" designations were virtually impossible to own exclusively and therefore could be used by competitors. "INTEL" ultimately selected an "arbitrary" word that it could own exclusively, with the introduction of its well-known "PENTIUM" line of chips. Other companies have likewise transitioned from descriptive or suggestive phrases to "arbitrary" marks, such as "IBM", "AT&T", "BCN", "BBE", "BT&C" etc. An especially effective form of an "arbitrary" mark is a brand new word having no prior meaning, such as "VERIZON", "I-BOX", "PLAYSTATION", etc. Such a new-word mark may often be a phonetic expression of an abbreviation of a suggestive or descriptive phrase.

"Arbitrary" marks have the truly significant advantage of having a high probability of being allowed as registered marks by the U.S. Patent & Trademark Office. That is because of the low probability that any other entity has used such marks on similar goods or services. Experience has taught over the years that selection of a truly "arbitrary" word mark is a difficult concept to grasp, especially for the small business entity or start-up organization. However, within the above-described context, a stroll through a modern retail mall or outlet should provide some measure of comfort and understanding. Consider the following "arbitrary" names of various stores and/or goods: "TOMMY HILFIGER", "LIZ CLAIBORNE", "BASS", "IZOD", "REEBOK", "L.L. BEAN", "MIKASA", "SEARS", and my personal favorite "BEN and JERRY'S", etc., etc. Ask yourself, who would ever have considered those arbitrary words in-and-of themselves to have had a potential for substantial market impact prior to the words being used as we now know them?

So, when it comes to selecting your own "arbitrary" eye-opener of a trademark, simplify your task by considering that your new mark need only be memorable and inoffensive. Typical counsel is to select at least three acceptable, arbitrary marks; have them searched; and, then select the one that is most likely to be registered with the U.S. Patent & Trademark Office. It makes more sense to spend time putting quality efforts into your new goods and/or services and their presentation, rather than spinning your wheels searching for a magic mark with that special and oh-so illusive marketing zing.

Copyright 2005, M. Chisholm

Attorney Malcolm Chisholm has been practicing patent, trademark and copyright law since 1992 in his Main St., Lee office, and has been an Adjunct Professor of Intellectual Property Law at Western New England College School of Law since 1989. He may be reached at www.mjcpatents.com