Trademarks: Early Stage Advice Is Critical

Article excerpt

Ask any marketing executive in a competitive industry to describe his or her company's most valuable assets, and trademarks will invariably be on the list. Specific examples may include the company name, a key product brand name, a product trade dress and a domain name.

Over the past decade, the definition of a trademark has been greatly expanded. For example, courts now extend trademark protection to trade dress, such as the shape of a product or the decor of a service establishment. Courts also now recognize that certain sounds, fragrances and even color combinations can effectively serve as trademarks. The same legal principles apply to all of the various forms of trademarks.

Although a great deal of time is typically spent to make sure that a new trademark is acceptable from a marketing point of view, often very little effort is expended to make sure that the mark is acceptable from a legal standpoint. Many times company executives become so enamoured with a mark that they fail to consider or appreciate the legal ramifications that can result from use of the mark. Unfortunately, such ramifications can be severe. For example, it is only after a product achieves some degree of success that others attempt to trade on the goodwill and reputation of the company by using a similar trademark. If the mark in question is highly descriptive, the company may not be in a good legal position to stop the problematic use.

Further, it is not uncommon for a company to just get off the ground or finally reach the point of expanding its geographical marketing base only to find that another company has superior rights to a key mark. Despite having invested a great deal of time and money developing the mark, the company may be forced to stop using the mark and may even be liable for damages.

Thus, it is critical for any company developing a new name or other trademark to consider the mark from a legal standpoint at an early stage in the development process. An availability opinion should ultimately be obtained from a trademark attorney. This can generally be done in a relatively short amount of time and for a reasonable fee.

Selection of the mark

Finding a trademark that is acceptable from both a legal standpoint and a marketing perspective is sometimes very challenging. There are generally four categories of trademarks in terms of the legal protection afforded thereto.

An arbitrary mark is formed by one or more existing words that have no relation to the goods or services. An example is Apple for computers.

A fanciful or coined mark is formed by one or more words that are made up and have no built-in meaning. An example is Kodak for cameras.

A suggestive mark suggests some characteristic of the goods and services, but does not describe the goods and services. An example is Whirlpool for washing machines. Arbitrary, fanciful and suggestive marks are the best from a legal standpoint.

The fourth category is descriptive marks. A descriptive mark is formed by one or more words that describe a characteristic of the goods and services. Descriptive marks include laudatory words -- for example, Super Buy for discount stores. Others include geographically descriptive names such as Edmond Laundry laundering services and surnames such as Gallo for wine.

A problem with descriptive marks is that they are not inherently distinctive and therefore not immediately protectable upon use. …