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Trademarks … In a Nutshell

Trademark is the form of intellectual property that protects “source identifiers” for goods or services. The function of a trademark is to inform consumers of the source of a particular product or service. The owner of a trademark has the exclusive right to use that mark in connection with the goods or services associated with that mark as well as any related goods or services.

Trademarks can consist of words (EXXON, Coca Cola) and slogans (“Just do it”, “King of Beers”), graphic images (the Nike “swoosh,” McDonald’s Golden Arches, General Mills’ Jolly Green Giant), sounds (the NBC chimes, the Pillsbury Doughboy giggle), shapes (the Listerine bottle or the Coca Cola bottle), colors (pink for Dow Corning insulation, grey-green for Celotex ironing board covers) and even scents or smells (Smead Manufacturing’s apple cider, peppermint and vanilla scents used on file folders). All of the foregoing examples are trademarks registered with the Unites States Patent and Trademark Office (“USPTO”).

Trademark rights arise with respect to a particular mark through the use of that mark in commerce in connection with a particular product or service. There are trademark rights that arise solely through use of a trademark in commerce without any form of registration; those are common law trademark rights. And there are trademark rights that arise by federal or state statute through a combination of use of the mark in commerce and registration of the mark, either with one or more state trademark offices or with the USPTO. Registration of a trademark with the USPTO is strongly recommended if the mark will be at all used in interstate commerce. The protections afforded under federal statute by registration with the USPTO when the mark is used in interstate commerce are substantially broader and stronger than those available under state statute or common law.

The standard rule in trademark practice is “first in time, first in right.” That means the first person to use the mark in commerce with respect to a particular product or service has a right superior to all others to continue using that mark in connection with the product or service. This rule has some limitations, however. For example, if a person first uses a mark within a particular geographical area and does not register the mark with the USPTO, and another person later uses an identical mark with respect to identical goods in another geographical area but registers the mark with the USPTO, the registration may effectively confine the prior user’s rights to the geographical area of use existing prior to the later user’s date of registration. This is one of the reasons federal registration of a trademark is important.

Generally, a trademark must be “fanciful” or arbitrary; it cannot be merely generic or descriptive of the goods or services with which it is connected. The rationale for this requirement is that it would be unfair to competitors to allow one person exclusive use of a term that is generally descriptive or generic with respect to an entire class of goods. Generally, the courts regard trademarks as falling into four types: fanciful or arbitrary, suggestive, descriptive and generic. Fanciful and arbitrary marks and suggestive marks may be registered and used on an exclusive basis without question. Descriptive marks may be registered and used on an exclusive basis only if the owner can show that the mark has “acquired distinctiveness” or achieved “secondary meaning” in the market such that consumers have come to recognize the term as identifying owner’s goods or services exclusively. Generic terms may never be used as trademarks. A classic example of a fanciful mark is the word “EXXON.” It means absolutely nothing in the English language and cannot be associated in any way with particular goods or services other than through the owner’s adoption and use of the word in commerce with its goods. The word “Apple” is fanciful in some contexts, such as use as a brand for computers, but would be generic if used in connection with the marketing of apples. “Microsoft” is a good example of a suggestive mark. It has no independent meaning, but is a combination of two words suggesting, collectively, software for micro-computers “ATTORNEYYELLOWPAGES.COM” is a trademark that the USPTO has deemed “merely descriptive.” The “yellow pages” component, they reason, is a generic term for a directory, and the word “attorneys” merely describes the intended users of the services. Finally, an example of a generic term is the word “leather” when used in connection with any goods made of leather. The word can never function as a trademark in that context.

Finally, an owner of a trademark should follow a few simple rules in using the mark to avoid losing rights in the mark. First, an owner should never use the mark as a noun or a verb. Examples of this use are, “please hand me a Kleenex” or “please Xerox this.” Use of the mark in this fashion can lead to the mark becoming generic and losing its exclusiveness. Marks that have suffered this fate are “thermos,” “aspirin” and “cellophane,” to name a few. A mark should always be used as an adjective, such as, “Microsoft brand software.” Second, one should never use the federal registration designation ® in connection with a mark until the mark is actually registered with the USPTO. To do otherwise may constitute fraud on the Trademark Office and could prevent the owner from ever obtaining a federal registration. Once the mark is federally registered it may, and should, appear as follows: MICROSOFT®. If the owner is claiming trademark rights in a mark that is not registered with the USPTO, the owner should use the superscript designation TM following the mark, e.g. ACME™. Third, in order for rights in a trademark to be created and maintained, the mark must be used in close connection with the goods or services. If the mark is used in connection with goods, it must be used on labels affixed to the goods, package inserts, on display racks containing the goods or otherwise in immediate proximity to the goods. Because services are intangible and cannot be physically labeled, recommended uses for service trademarks include promotional brochures, letterhead, instructional materials, website pages, business cards, invoices and letterhead.

The term of a federal trademark registration is ten years from the date of registration. The same is true with a Michigan trademark registration. Trademark registrations are renewable indefinitely as long as the mark continues to be used in commerce.


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