Sometimes clients ask if they can get a trademark infringer thrown in jail.
Wouldn’t that be awesome?
However, jail is not usually one of the things a trademark lawyer can deliver. Trademark infringement is mainly a civil wrong, meaning that a trademark owner is limited to civil remedies like an injunction, damages, the profits the infringer wrongly obtained through its infringement, and, sometimes, attorney’s fees.
Trademark statutes also provide that some egregious forms of trademark infringement, like counterfeiting, also constitute criminal acts. However, whether to prosecute such offenses is up to the prosecutor. It’s not up to the aggrieved trademark owner, and it’s not included as part of a civil lawsuit.
Sadly, prosecutions are rare. Unsurprisingly, resources are thin, and prosecutors usually have bigger fish to fry (such as prosecuting murderers and bank robbers).
To increase the chances a prosecutor will exercise her discretion and file criminal charges, I’d suggest making her job as easy as possible. Do your own investigation, collect all of the evidence needed to prove the case, and deliver it to the prosecutor wrapped in a bow. Even then, the chances of getting the offending counterfeiter thrown in jail are pretty slim.
That’s not to say that trademark owners should despair. Though jail isn’t likely, they can still maximize civil remedies to stop the infringement and put themselves in the position they would have been in had the infringement never occurred. That’s usually where trademark owners should devote their resources.
One of the main benefits of federal trademark registration is national coverage.
Once your registration issues, you are presumed to be the exclusive, nationwide, user of your trademark in connection with the goods and services listed on your registration. By illustration, this gives a Seattle owner the right to sue someone in Miami who adopted a confusingly similar mark after the date the Seattle owner applied to register its mark.
That’s right — the rights that flow from a trademark registration relate back to the date a trademark owner files its application for federal registration. That’s the day the world is legally put on notice that the registrant sought to claim national rights in its mark.
Here’s how conflicting trademark rights commonly sort out.
If you sell branded product in Seattle, Tacoma, and Portland, you have automatic common law rights in Seattle, Tacoma, and Portland. That means you can go after copycats in those markets who adopt a name that would likely confuse consumers into believing they are you, are authorized by you, or have some association with you.
But what about the rest of the country? Let’s say the brand owner is called ABC123, and it operates restaurants under that name in Seattle, Tacoma, and Portland. Can it do anything about a new restaurant that opens in San Francisco that is also called ABC123 (or a confusingly similar variant, like ABC124)?
Not without a federal trademark registration. Without obtaining national rights that a registration provides, the restaurant owner probably wouldn’t have any trademark rights in San Francisco available to enforce. In other words, without regularly making sales there, the brand owner probably wouldn’t have any legal basis to complain. That’s why a federal registration is valuable — it gives the trademark owner the legal basis to complain about any conflicting trademark use, anywhere in the United States.
What if there’s another restaurant called ABC123 in Miami that was open at the time the owner of the Seattle, Tacoma, and Portland restaurants applied to register its mark? As long as a registration issues, the Miami owner would locked into the geographic area in which it had been making sales (in this case, Miami) that existed at the time the owner of the Seattle, Tacoma, and Portland restaurants filed its application. This means the Miami owner would have superior trademark rights in Miami, and the Seattle, Tacoma, and Portland owner would have superior rights everywhere else. In this way, a registration whitewashes the map of the United States, giving the registrant superior trademark rights everywhere except for the local areas in which competing users had rights at the time the registrant filed its application.
This usually is the most valuable right a federal trademark registration provides. It can give the brand owner a powerful advantage over its competitors.
Here’s the last installment of “Basics of Trademark Protection in Plain English.” It focuses on “defensive” considerations in protecting trademark rights; remedies; and trademark law resources.
D. “Defensive” Considerations
The “offensive” considerations discussed above focus on the things a trademark owner should consider in order to maximize and enforce its rights. There are “defensive” considerations as well, which mainly focus on not infringing a prior user’s trademark rights. This involves not selecting (and wasting money by investing in) a trademark that would cause a likelihood of consumer confusion with a senior user – both at common law in the same geographic market, and through the statewide or nationwide rights that a prior owner might have through registration. This, in turn, requires one to search the PTO’s database, Google, domain name registrations, and industry databases to learn the trademarks that other sellers have selected, and with which goods and services. Truly comprehensive searches can involve engaging a sophisticated vendor like Thomson Reuters to capture a large universe of relevant hits, which trademark attorneys can analyze to determine the risk of triggering a trademark infringement claim. Again, the relevant jurisdiction’s multi-factor test will control, and it’s up to the trademark lawyer to help her client avoid a likelihood of confusion. While it’s impossible to avoid all risk, doing one’s due diligence can minimize the chance that a prior trademark owner will demand that your client stop using the trademark it has adopted.
A trademark owner’s main remedy in a lawsuit is the injunction – a court order enjoining the trademark wrong from continuing. A trademark owner can also seek lost profits and to disgorge any wrongful profits the infringer received through the infringement. However, proving damages to the reasonable degree of certainty that a court requires can be difficult. Therefore, damages usually take a back seat to the injunction. A successful litigant (either plaintiff or defendant) can also seek an award of its attorney’s fees and court costs incurred in the litigation, but such awards are not routine. (Under Washington law, they are discretionary, and under federal law they may only be awarded in “exceptional” cases.) For this reason, both sides usually assume they will pay their own freight in trademark litigation, win, lose, or draw.
At the federal level, trademark law is largely driven by the Lanham Act, 15 U.S.C. §§ 1051, et seq. In Washington, the largely parallel trademark statute is RCW 19.77. An obvious and unavoidable place to start when learning about trademark law is the statutes themselves, and the cases that interpret the statutes. Federal and state case law also flesh out the contours of common law trademark rights, which predate both statutes, are incorporated in them, can operate independent of them. Trademark owners also can look to McCarthy on Trademarks and Unfair Competition, and Gilson on Trademarks. Both provide encyclopedic, multi-volume analyses of trademark law, including important subtopics like cybersquatting, false advertising, counterfeiting, fair use, online liability, licensing, international trademark rights, and practice before the U.S. Trademark Trial and Appeal Board, the PTO’s administrative law arm. One or both of these invaluable treatises are available at Seattle’s law school libraries, as well as at the law libraries of Washington’s state and federal courts.
This is the second part of excerpts from my materials, “Basics of Trademark Protection in Plain English.” It focuses on the “offensive” considerations a trademark owner should think about when selecting a trademark.
C. “Offensive” Considerations
As a trademark owner, you normally want to select a trademark that is both registrable and enforceable against later adopters. Your ability to do these things is heavily influenced by the technical strength of the mark. To determine strength, courts place the mark on the spectrum of trademark distinctiveness most prominently discussed in Abercrombie & Fitch Co. v. Hunting World, 537 F.2d 4 (2d Cir. 1976). In doing so, they categorize each mark as “generic,” “descriptive,” “suggestive,” “arbitrary,” or “fanciful.”
A mark is generic if it denotes the thing itself, or category of thing. Generic marks have no trademark significance because they are incapable of distinguishing one source from another. If a mark is generic – either from inception, or because it has become generic over time, like the once-proprietary brands “elevator,” “escalator,” “nylon,” and “raisin bran” – it is deemed to be always generic and can never be registered or enforced.
Descriptive trademarks immediately convey information about the good or service being sold. In this way, SPEEDY AUTO GLASS is a descriptive trademark because it tells consumers that the company installs auto glass, and that it does so in a hurry. Descriptive trademarks can only be registered on the lesser Supplemental Register (which doesn’t offer all the benefits provided by the Principal Register), and cannot be enforced against third parties, unless the owner can establish that the mark has acquired distinctiveness, or “secondary meaning.” A mark acquires secondary meaning through longstanding use (usually at least five years) and proof of sales, advertising expenditures, or (most persuasively) consumer surveys. A descriptive mark with secondary meaning can be registered on the Principal Register and can be enforced against later-adopters (though third parties can still use descriptive terms to describe their own goods and services even if such terms happen to be your client’s trademark). These limitations make descriptive marks the weakest form of protectable trademark. Surnames and geographic names are classified as descriptive marks, as are self-laudatory “we are the best” words. For this reason, the very descriptive SEATTLE’S BEST COFFEE trademark is technically weak, though it has become commercially strong through its longstanding use, millions of dollars spent on advertising, and millions of cups of coffee sold.
Suggestive trademarks are one rung up the protectability ladder. They suggest a quality or characteristic of the good or service being sold, but require the consumer to exercise at least some degree of imagination to understand the information being conveyed. Take, for example, CHICKEN OF THE SEA. This mark tells consumers that the good sold under the mark is seafood, and it is akin to chicken. The consumer must process this information to understand that the good being hinted at is tuna fish. Marks with double entendres are likewise classified as suggestive. The distinction between descriptive and suggestive marks can be blurry, but it’s an important one, because suggestive marks do not need proof of secondary meaning. Suggestive marks, therefore, are inherently distinctive and are protectable upon adoption.
Arbitrary marks put a familiar word in an unfamiliar context, such as APPLE for computers. While APPLE as a brand name for fruit would be generic, it has no meaning when paired with computers. For this reason, arbitrary marks are considered inherently distinctive and, indeed, are given wide berth as a strong trademark.
Fanciful marks are perhaps the strongest class of mark. They are made-up words, like GOOGLE, EXXON, and POLAROID. They are accorded great protection because they usually leave the defendant with little explanation for adopting a confusingly similar mark. Given the infinite number of possible trademarks, a court can quickly conclude that a search engine named “GAGGLE” was only given that name to benefit from confused consumers. In this way, both arbitrary and fanciful trademarks are thought to “cast a long shadow,” which later trademark adopters need to avoid.
There also are a number of statutory bars to registration or enforcement that don’t stem from technical strength. Under federal law, they are largely set forth in Section 2 of the Lanham Act, 15 U.S.C. § 1052. These include marks that are primarily surnames, marks that would tend to deceive consumers, marks that include someone’s name without their permission, and marks that include country flags. Other statutes grant exclusive trademark rights to specified owners in the way that OLYMPIC, OLYMPICS, and the five-ring logo may only be used by the U.S. Olympic Committee and its licensees (with a narrow carve-out for longtime users of the OLYMPIC and OLYMPIC names that are located near Washington’s Olympic Mountains). Obviously, one needs to avoid these marks if they want a brand they can register and protect in court.
In summary, owners selecting a new trademark need to appreciate the ramifications of where the mark would likely be placed on the spectrum of distinctiveness, and avoid the statutory bars to registration and enforcement. Only then can they help maximize the scope of their trademark protection.
Hopefully, this discussion is helpful. The third and final installment — regarding “defensive” considerations in selecting a trademark — will come next.
I’m giving a talk to new lawyers about trademark protection — the nuts and bolts of things to consider to get the most out of a trademark. Following is the first part of an adaptation of the materials I prepared.
A. Enforcement Principles
The main way to protect a trademark is by perfecting and maximizing one’s rights in the mark, which usually occurs by registering it with the U.S. Patent and Trademark Office, and then by enforcing those rights against competitors, imitators, and would-be users in an effort to keep them as far away as possible from the property.
Enforcement, in turn, usually boils down to sending cease-and-desist letters to the wrongdoers in the hopes of obtaining voluntary compliance with your demands, under threat of suit; and if the wrongdoer doesn’t voluntarily comply, to carrying out the threat and commencing suit. In this respect, protection of one’s intellectual property rights is both binary and simple: either the wrongdoer voluntarily stops its bad behavior in response to your pressure, or it doesn’t; and, if needed, you either escalate the dispute to court, or you don’t. There really aren’t any other legal options. (I don’t count hiring the likes of Tony Soprano (R.I.P) to enforce one’s rights as a legal – or advisable – option.)
B. Basic Principles of Trademark Law
Trademarks function the way cattle brands function on a ranch. Cattle brands distinguish one cow from another, so there’s no question which cow belongs to which rancher, even if they get mixed together. Trademarks are the same way. They are unique names, symbols, or tag lines (among many other devices) that tell consumers that a good or service sold in connection with the brand comes from a particular producer. They are affixed to the product itself, or product packaging, or they are displayed on websites or other promotional materials. When consumers see a Nike shoe, for example, the Nike name, Swoosh logo, and “Just Do It” tag line tell consumers that the shoe doesn’t come from Adidas, New Balance, or any other manufacturer – it only comes from Nike. In this way, trademarks symbolize the owner’s reputation and encourage good, consistent, quality by enabling consumers to efficiently identify producers and make repeat purchases. In other words, if you like Nike shoes, you know where to go when you need to buy a pair (or who to avoid if you weren’t satisfied with your previous purchase).
Trademark law is a creature of both state and federal law (and both statutory and common law). At bottom, trademark rights arise through use, which means affixing the mark to a good or product packaging (for goods) or by displaying the mark on websites or signs (for services), and selling the item to consumers. Registration is available through state governments and the U.S.P.T.O. Registration is not required, but it expands the geographically limited rights that automatically arise through use. There is a lot to say about trademark registration, but further discussion is outside the scope of this discussion.
Protecting a brand normally starts with selecting a brand. Protection has two facets, which you can think of in terms of both sides of a coin. You probably want to register your mark (or at least have that option), and you want to be able to enforce it in court. But you also want to choose a brand that won’t get you sued by another trademark owner. In other words, there are “offensive” considerations, and “defensive” considerations. To understand them, you need to know a few basic principles.
First, the maxim of “first in time, first in right” often controls. That means if you start using your mark first, you (usually) can go to court to prevent later adopters from using a brand that is close to yours in connection with similar goods or services. Registrations can change this outcome, but that discussion is outside the scope of this writing. Therefore, we will proceed with the simple notion that when there is a conflict between two trademark owners’ rights, the first user in a given geographic area will have superior rights – called priority – and will win in a trademark infringement lawsuit against a later adopter.
To do so, however, a trademark plaintiff also needs to prove that the later adopter’s trademark use is “likely to cause confusion” with the plaintiff’s prior trademark use. Whether a likelihood (probability) of consumer confusion exists is determined by the multi-factor test that applies in a given jurisdiction. In the Ninth Circuit, it is known as the “Sleekcraft” factors, after the influential trademark infringement case of AMF Inc. v. Sleekcraft Boats, 599 F.2d 341 (9th Cir. 1979). But other jurisdictions have similar tests under different names. Regardless of the jurisdiction, courts apply this test to determine whether an ordinary consumer would likely be confused into believing that the branded goods or services that come from the later adopter (the “junior” user) come from, are approved by, or having something to do with, the earlier adopter (the “senior” user). If the answer is yes, then a court would find the junior user liable for trademark infringement.
The main factors in assessing a likelihood of confusion are the similarity in the parties’ marks (considering sight, sound, and meaning); similarity in the goods or services offered under the parties’ marks; the similarity in how the parties’ goods or services are advertised, marketed, and sold; and whether consumers have actually been confused in the marketplace. There are other factors, but these usually are the most important.
More to come in Part 2.