Businesses use trademarks and service marks to develop their brands and increase their market share. A trademark or service mark (also collectively known as marks) includes any word, name, symbol, device, or any combination thereof, used to identify and distinguish the goods and services of one seller or provider from those of others. Trademarks are also used to indicate the source of the goods and services. The owner of a mark may have legal rights even if it is not registered. However, federal registration of a mark has several advantages.
When a business or an individual federally registers a mark with the United States Patent and Trademark Office (the USPTO) that predates another persons use of the same or confusingly similar mark, the registered mark has superior rights throughout the United States. This is important to a business because it gives such business the ability to stop other persons throughout the country from using the registered mark.
After five years of continuously using a mark, the owner of such mark can apply for incontestability status. If incontestability status is granted, you may be able to eliminate most of the difficult and expensive legal issues during litigation.
Attorneys believe that federal courts provide procedural advantages over state courts. Without a federally registered trademark the owner does not have the automatic right to sue in federal court. To sue in federal court without a federally registered trademark may be more costly when proving jurisdiction. Thus, having the automatic right to sue may reduce litigation costs and expenses.
The owner of a federally registered trademark may record his or her trademark with U.S. Customs. After recording, U.S. Customs will monitor and seize merchandise bearing counterfeit and unregistered marks and issue monetary fines against anyone who attempts to introduce counterfeit goods into the U.S..
The default rule in the U.S. is that each party bears their own litigation costs regardless of outcome. With a federal trademark registration, it is possible to recover an infringement award for triple the amount of your actual damages (“treble damages”), plus attorneys fees if someone infringes your mark. Practically speaking, such an award is quite rare, and requires a showing of willful trademark infringement. Nevertheless, it is precisely in these most egregious abuses of your mark that you would like to have the power to recover maximum damages, and doing so is only possible with a registration.
Actual damages and infringer profits can be difficult to prove due to the inherent intangibility of trademarks. Therefore, treble damages may be helpful in leveraging a quick and effective settlement against infringers. Also, being entitled to attorneys fees may make it easier to hire an attorney who is willing to take your case on a contingency basis.
When a U.S. business expands internationally, the business marks may already be registered in the country of desired expansion due to trademark piracy. The date of registration of the U.S. mark becomes the date of priority in the new country if that country is a member of certain international treaties. As such, even if a trademark pirate registers in a country before a business actually expands there, the U.S. company’s priority date may precede the date of the pirate’s registration, thus giving the U.S. company ultimate priority.
If you have any questions, please contact Fahey Intellectual Property Law at (954) 903-1966 or send us an email at [email protected]
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