What Startups Need to Know About Trademarks

According to the US Patent and Trademark Office (USPTO), a trademark is any word, phrase, symbol, design, or combination of these that identifies your company’s goods and services. 

A trademark also :

• Provides legal protection for your brand
• Helps guard against counterfeiting and fraud.

Owning a trademark doesn’t mean you legally own a particular word or phrase. In other words, a trademark doesn’t give you the legal right to keep other people from using that word or phrase.

Instead, you have the legal right to govern its use in a particular context – that is, in terms of how the word or phrase is used with your specific goods or services.

It’s also important to note that not every trademark enjoys equal protection under the law. If a trademark just describes your goods and services, it offers relatively weak protection.

Trademarks that are particularly creative or unique in some way are more effective and easier to defend if challenged in court.

There are five basic types of trademarks: generic, descriptive, suggestive, fanciful, and arbitrary.

Generic Trademark

A generic trademark often confers little, if any, legal protection because it’s so vague. For example, if you ran a clothing shop, you couldn’t trademark the phrase “The Clothing Shop”, because that would prevent all other clothing shops from using that phrase. 

For a generic trademark like that to be legally binding, it also must describe the qualities or characteristics of your specific product or service.

Descriptive Trademark

A descriptive trademark does just what it says: It describes a product or service. According to Upcounsel.com, a descriptive trademark must have “secondary meaning, such as amount and manner of advertising, volume of sales, length and manner of the mark's use, or results of consumer surveys to qualify. This means that consumers must recognize the mark and identify it with the brand.”

To qualify as a descriptive trademark, Upcounsel says, “it should evolve from what the brand represents to who the brand represents.”

Suggestive Trademark

A suggestive trademark implies something about a good or service and usually doesn’t need a secondary meaning. The goal of this type of trademark is to spark customers’ imaginations so they understand what you’re selling. 

For example, a trademark could be a symbol or image that suggests quality, speed, or reliability without explicitly stating your product or service or even the type of company you own.

Fanciful Trademark

A fanciful trademark uses a word or logo that no one else does. As such, it’s relatively easy to register. 

For example, the words Kodak and Nike don’t mean anything to most people (although some might recognize Nike as the winged goddess of victory in Greek mythology). 

Arbitrary

By contrast, an arbitrary mark is a term or phrase that’s well-known but that you’re using in an uncommon way. For example, an apple is a fruit, but Apple is the trademarked name of the electronics company.

Trademarks are sometimes confused with other types of intellectual property, including copyrights and patents. However, they protect different things. As the USPTO explains: 

• A trademark protects a word, phrase, design, or a combination of these that identifies your goods or services, distinguishes them from the goods or services of others, and indicates the source of your goods or services.
• A patent protects a technical invention, such as a chemical composition like a pharmaceutical drug, a mechanical process like complex machinery, or a machine design that’s new, unique, and usable in some type of industry.
• A copyright protects an artistic, literary, or intellectually created work, such as a novel, music, movie, software code, photograph, or painting. The work must be original and exist in a tangible medium like paper, canvas, film, or digital format.

Trademarks are typically one of a company’s most valuable assets. This is especially true for startups, which often don’t have extensive physical or monetary assets. 

Trademarks are valuable for a number of reasons. For example, they can:

Obviously, you want to communicate to consumers why your products and services are better than those of competitors. Trademarks can help do that. 

Trademarks can strengthen your brand, which in turn can attract top employees.

Strengthening your brand has other advantages as well, including helping you penetrate new markets that might otherwise be less accessible.

It’s been shown that trademarks can increase a company’s valuation and profitability.

As mentioned above, the most important step in registering your trademark is to retain an experienced trademark attorney or professional trademark service to help you. If you don’t, you might make crucial mistakes that could weaken your trademark or cause your application to be rejected outright.

That said, here are the basic steps for registering a trademark, as the USPTO lays them out.

Before you apply:

• Carefully select a trademark (or “mark” in USPTO parlance).
• Search the appropriate databases to see if the mark is already taken.
• Determine your “filing basis,” or the basis in the Trademark Act upon which you have filed your application.

When you’re ready to apply:

• Set up a USPTO.gov account to access the Trademark Electronic Application System.
• File the application online.
• Regularly monitor your application’s status through the Trademark Status and Document Retrieval System.
• Maintain and update your address as needed, including your email address.

The examining attorney will review your application to see if it complies with all applicable rules and includes the required fees.

If the examining attorney rejects your application, they will issue a letter explaining why. If there are any technical or procedural deficiencies in the application, the letter will explain those as well. If only minor corrections are required, the examining attorney may contact you by telephone or email.

If the examining attorney raises no objections, or if you address any objections adequately, your application will be approved and published in the “Official Gazette,” a weekly publication of the USPTO.

Becoming the owner of a trademark is as simple as using it in conjunction with your goods and services. That usage establishes your right to the trademark. 

However, that right only extends to the geographic area where your goods and services are provided – not nationwide. For more expansive rights, you need to register the trademark as described above.

You don’t have to register your trademark. However, if you plan to sell something beyond the immediate area where you live – especially if you have an online store – a registered trademark is best.

Here are some common pitfalls to avoid when filing your trademark application.

Although you don’t strictly need an attorney to file a trademark application, retaining one is a good idea. They can help you navigate the sometimes complex trademark laws and make sure your application is complete and error-free.

Choose a brand name or image that’s memorable and identifies with your target audience. If you don’t, even if your application is accepted, it will cost you in sales over the long term.

Mistakes like identifying the wrong party as the trademark owner, incorrectly identifying your goods or services, or trying to trademark a commonly used phrase are guaranteed to torpedo your application. Again, avoiding these is a primary reason to hire an attorney.

Make sure no one else is already using the trademark you want. To do that, you need to thoroughly search all of the appropriate trademark databases. An attorney can help you with this.

Once you secure a trademark, no one else is likely to check to see if someone else is using it without your permission. That’s your responsibility.

Trademarks don’t last forever; they need to be renewed regularly, so check renewal deadlines and be sure to meet them. If you miss a deadline, your trademark can be canceled immediately.