TOP 10 MISTAKES MADE BY TRADEMARK OWNERS

In most jurisdictions, the majority of trademark filings are made by small businesses and entrepreneurs or solopreneurs. When starting a business, it is easy to get caught up on getting your business off the ground. Below outlines the TOP 10 mistakes trademark owners can make (and we will teach you how to avoid them and MUCH more in our seminar, ABC’s of Protecting Your Brand, on February 20, 2019).

1. Not Realizing That Protecting Trademarks Could Create Value for Your Business.

Most new businesses should analyze the value of their business from the start. While most businesses operate out of rented/leased space or straight out of the owner’s home and rely on loans to promote their services or financing for product inventory, businesses fall short in adding value to their own brand name. When it’s time to sell or liquidate businesses are left with little or no assets apart from their client lists and intellectual property, if any. Not investing in protecting their trademarks will diminish the value of their business in the future.

2. Not Conducting A Trademark Availability Search Prior To Selecting Your Brand(s).

In order to minimize expenses, solopreneurs avoid hiring a trademark attorney to conduct a trademark availability search. Often relying on their own internet searches to vet the brand selected. Businesses that follow this process forgo the trademark availability search, which includes the federal trademark registry and each state trademark registry as well. A properly conducted trademark availability search will look for active trademarks and cancelled or abandoned marks. Additionally, the trademark availability search offers a limited search of the web for use of same and/or similar marks and a search of not only identical but phonetically equivalent marks. Its highly recommend that all businesses conduct a trademark availability search before proceeding with the filing of a trademark application.

3. Waiting for The Trademark Office to Approve Your Trademark Application Before You Start Using It in Commerce.

Under U.S. law, the actual use of a mark in commerce creates rights and priority over others. The rule for “ownership” of a mark starts with the “first to use”, not the “first to file". Thus, if a trademark availability search was performed and it showed that the mark may be available, we recommend that you immediately start using the trademark to secure your priority of ownership over potential claimants.

4. Not Expanding Trademark Protection to Countries Where You Intend to Manufacture Or Commercialize Your Brands In The Near Future.

The ability to market and sell your product internationally is more feasible than ever. With viable overseas manufacturing opportunities becoming more attainable, it is now very common to find small business manufacturing or using their brands in foreign countries. It’s important for those international businesses to follow the requirements for proper ownership rights in foreign jurisdictions. While in the US ownership is based on the “first to use” system, most foreign jurisdictions follow the “first to file” system – meaning that outside of the United States you are encouraged to file your registration for your trademark as quickly as possible. The “first to file” system has made it easier for some manufacturers or potential distributors to file for trademark protection in bad faith with the sole intent of holding them for ransom from the real trademark owners. Thus, if you are or intend to expand operations such as manufacturing or commercializing your brand overseas, we highly recommended to preemptively file for trademark protection in those jurisdictions before proceeding with any initial contact or negotiation for said manufacturing or commercialization

5. Incorrect Use of the ®, TM or SM denominations.

Although the use of intellectual property symbols is not required, it’s highly recommended that mark owners use them appropriately to make sure that the public knows that their brand is protected by a federal registration or they are simply claiming common law rights over the mark. These symbols represent:

• ® Registered mark symbol is a federal registration symbol reserved for registered marks, not pending, with the United States Patent and Trademark Office. Should be noted that it’s prohibited to use the ® before the actual certificate of registration is actually issued by United States Patent and Trademark Office.

TM and SM are reserved for use by unregistered marks.

• TM: is intended to be used on unregistered marks that identify PRODUCTS such as sodas, cereals, produce, and canned products.

• SM: is intended to be used on unregistered marks that identify SERVICES such as those of restaurants, hotels, travel agencies, and import/export agencies, etc.

It’s very common to find service mark owners using the TM next to their mark even when the correct denomination should be SM. Properly identifying your rights over the mark will help solidify it.

6. Use of Generic, Descriptive and Suggestive Terms On Your Mark.

A trademark or service mark includes any word, name, symbol, device, or any combination, used or intended to be used to identify and distinguish the goods/services of one seller or provider from those of others, and to indicate the source of the goods/services. The more arbitrary the word(s) used on the mark, the better. Generic, descriptive, and/or suggestive terms are non-distinctive and weakens the protection granted on the mark. Therefore, selecting a strong and unique trademark is highly recommended.

7. Failing to Seek Recordation With U.S. Customs and Border Protection (CBP) to Prevent Unauthorized Importation/Exportation Of Their Products.

CBP recognizes the importance of intellectual property protection and provides assistance in stopping the infringing products at our borders.  CBP’s Intellectual Property Rights Recordation (“IPRR”) system allows holders of registered trademarks and copyrights to record their registration with CBP, so that CBP can police the borders for infringing goods.  Once recorded, it is entered into a online search system named IPRS. Considering the incentives for counterfeiters along with the potential losses for intellectual property rights holders, companies that import merchandise must consider recordation a necessity. Importantly, when you record your marks, you must go to an expert in this area – as this is your opportunity to train CBP on the methods of policing your mark – and only trained experts can work on this proficiently, so you have the best results with CBP, like Hermes did. To learn more about the top four benefits of recording your intellectual property, review this article.

8. Failing to Enforce Their Trademark Rights After Obtaining Registration.

More often than not, trademark holders forget about the trademark once a registration is obtained. Thinking that they now have federal protection over their brand and the USPTO will prevent others from obtaining trademark for the same or similar marks. However, trademark owners must police the market and be vigilant of the registry to prevent:

• Unauthorized use of their mark by others. Failure to enforce your trademark could represent losing the rights granted.
• Prevent a trademark from becoming generic. When the mark, due to its popularity or significance, becomes generic or synonymous for product or service that it is registered for could lose the protection granted by its registration.
• Prevent the granting of similarly confusingly trademarks by the Trademark Office.

9. Not Using the Mark as Registered.

Once a registration is granted, the mark must be used in the same manner as it was registered for all goods/services listed in the certificate of registration. This means that if you filed your trademark in class 25 for clothing items such as t-shirts, shorts, hats and caps, with a word and a logo. Then, after securing registration, the mark is used only on hats and caps and without the logo, not as registered and not for all goods listed in the registration, you are opening the registration to a possible full or partial cancellation attack for lack of use as registered. We recommended to ALWAYS use the mark as registered for all goods/services listed in the original registration. Otherwise, a new trademark application should be filed.

10. Thinking That Obtaining Approval by The Division of Corporations To Open The Corporation Means Your Trademarks Are Protected.

In the US, you are required to register with the Division of Corporations of the state you intend to open or operate a business. When a corporation files its articles of incorporation, the Division of Corporations will search their databases to determine whether an identically named corporation exist on the registry. If no identical namely corporation exist, then you are granted a right to operate in that state under that name. However, the Division of Corporations will often allow a corporation with a similar name to register as long as it not the same. Also, they don’t search based on the similarity of the goods/services being provided. As long as the names are not identical, you are allowed to operate. It is not the same when a trademark owner is granted protection by the Trademark Office. A trademark owner can prevent similarly confusing trademarks from being registered or used in commerce even as a name of a corporation. We have helped countless new businesses and solopreneurs avoid these common mistakes and would like to help you on how to better protect your rights to trademarks, copyrights, and other intellectual property rights in the US and overseas. On Wednesday, February 20, you will have the opportunity to meet our newest Of Counsel attorney, Augusto Perera, who will teach the “ABC’s of Protecting Your Brand” with Jennifer Diaz, and Denise Calle. Attendees will learn:

• Why should I protect my brand?
• What do I do if a similar brand already exists?
• How does CBP protect your brand at the border?
• What is the difference between a CBP detention and seizure case?
• What documentation should CBP provide you upon detention and/or seizure?
• What is the most effective way to respond to CBP during the detention and/or seizure process?
• What is a CBP Recordation?
• What type of enforcement action would CBP take against infringers?
• Does CBP have additional enforcement measures available if you record a trademark or copyright with CBP?
• What information would the brand holder receive upon detention and/or seizure?
• What is the most effective way for brand holders to go after infringers?
• What is the most effective way to respond to CBP if you receive a Notice of Penalty from CBP?
• Register HERE or https://www.eventbrite.com/e/abcs-of-protecting-your-brand-tickets-54886894178