Recently, I was approached by an entrepreneur with a unique business concept. During the conversation, she asked about the process for federally trademarking her logo. Following the appropriate manner of branding she made sure that her logo did not infringe on any prior existing businesses’ intellectual property.
As she explained her short and long-term business goals it became apparent that she wanted to stay local and keep this business privately owned. She didn’t have a goal of world-wide expansion or franchising. The only possibility for extending the business was passing it on to her children.
With that, I told her about a friend’s business and why a federal registration isn’t always necessary for adequate protection.
My close friend runs a restaurant that has been family owned and operated for 35+ years. I told her about the company’s start and my friend’s business strategy of very organized and controlled growth. I told of the company’s reputation and his desire to remain local.
I then explained the three levels of trademarks to show how this business’ brand is protected even though they have never federally registered a trademark.
The basic level of protection is a Common Law Trademark. This automatically attaches to any symbol used in commerce in association with a particular product or service. It gives you protection within your geographic location and areas of natural expansion. The strength of protection received depends on multiple factors including length of use and business notability.
Next is State Trademark registration. This comes with a small cost and gives you protection within the state that you register, rather than just your local geographic location.
The greatest level of protection is a Federal Trademark, granting you nationwide protection. It comes with a greater cost ($275 or $325 depending on the trademark) and has the advantage of putting the nation “on notice” that you own the mark, meaning that no one can use your trademark and claim that they didn’t know you owned the rights. You also gain the ability to bring a federal claim against anyone using your mark, or a very similar mark, without your permission. However, this comes along with certain burdens of protection, such as the requirement that you actively monitor your mark and attempt to stop all acts of infringement that you become aware of. Fail to do this and you may lose out on your federal protection.
After explaining, I told her that my friend was adequately protected due to his common law trademark.
It is important to know what level of protection is adequate for your brand. You can always play it safe and go for federal registration, but in cases of locally owned and operated businesses who may be strapped for capital, or highly noted and long-standing businesses, federal registration may not add that much protection to what you are already receiving.