What Is a Trademark?

Understand how trademark law and registration benefit both consumers and businesses.

A trademark is any word, name, phrase, symbol, sign, design, or packaging that is distinctive and that identifies and distinguishes the source of a particular product or service. A trademark typically appears on the product itself, perhaps its packaging or its branding (signage, a website, and so forth).

A trademark is what allows the consumer to identify the source and therefore potentially the quality of various products. Examples of familiar trademarks are the Cream of Wheat logo, featuring a chef holding a bowl of hot cereal, and General Electric's GE medallion. Both of these recently celebrated 100 years as registered trademarks. More modern examples include the Apple logo with a bite taken from it, and the blue "F" Facebook logo.

Who Benefits From Trademarking

Trademarks serve two primary purposes, one that benefits consumers and one that benefits producers.

For consumers, trademarks create efficiency and predictability. If you are in the grocery store, you can almost instantly recognize the brand of the product that you want or are used to based on its trademark. You recognize or know to look for the name, logo, or distinctive font.

Consider ketchup. There are usually dozens of ketchup manufacturers in any given grocery store's condiment aisle, but based on past experience and your own preferences, you might know that you want Heinz ketchup. Your eye will immediately be drawn to the familiar name and black block lettering on the red bottle with green accents. This saves you time; you need not scrutinize each individual ketchup bottle.

If you imagine all the various goods and services that you purchase, you'll realize how trademarks allow you to maximize time and accuracy.

For producers, trademarks create brand loyalty and a reason to commit to quality. Most obviously, when consumers recognize your company's name and logo, you are likely to invest more resources into making it a product worthy of their loyalty. Your company will also invest more into advertising, since you will want to expand consumers' positive associations with your brand.

Moreover, because the owner of a trademark can exclude another company from using that mark, trademark law prevents competitors from riding off the goodwill and investment of the primary mark holder.

In the example above, imagine that you were a small ketchup company with no brand recognition. You might decide to simply copy Heinz's bottle design and slap the name "Heinz" onto your bottles, correctly assuming that this will boost sales since consumers will believe that your product is the "real" Heinz. Trademark law prevents this sort of nefarious conduct. Heinz would be able to sue for infringement.

In these ways, the twin goals of trademark lawprotecting consumers and protecting producers—create a more efficient and fair marketplace.

Obtaining a Registered Trademark in the U.S.

While it is not required that companies doing business in the U.S. register their trademarks with the government, many will do so in order to obtain stronger protections.

There are two ways to establish the right to register a trademark with the U.S. Patent and Trademark Office (USPTO), the federal agency charged with management of federal marks. The first way is to begin using the mark in commerce.

The first party to use a trademark in commerce has the right to register the mark. Registration of a mark will typically involve some online paperwork and nominal fees. (A party can also file an application of intent to use the mark in commerce with the USPTO).

If two different parties are using the same trademark and neither one registers the mark, it will ultimately be up to a court to decide who has the right to use it. Registration is not required in order to use a trademark, but it can be a good idea, since it creates a presumption that the party is the entitled to use the mark. An attorney familiar with trademark law can explain the advantages of registering your trademark.

An entity's right to use a trademark can last indefinitely, as long as the owner continues to use the trademark. And trademark registration lasts for a period of ten years, but can be renewed without limit.

After the first time a trademark is registered, its registration must be preserved between the fifth and sixth year of registration. This is accomplished by filing an affidavit setting forth information required by the Patent and Trademark office. If the registration is not preserved by this method, it will lapse and be cancelled.

If you are developing a trademark to identify your product, here are some of the most important things to keep in mind: A trademark should be unique. If it is too similar to another trademark it will not be allowed, even if the other trademark is for a completely different product. Also try to avoid using generic terms, because they cannot be trademarked. A trademark should serve to set apart your product and distinguish it from other, similar products.

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