A trademark, whether federally registered or not, may be adopted and used to identify and distinguish the source of goods or services of one party from those of others. The first user of a word, phrase, symbol or design used as a trademark has common law and state-law rights without federal registration, so why register your trademark? Federal registration has numerous benefits, both offensively and defensively, such as:

• Designating and recording a property right for the trademark.

• Providing constructive notice nationwide of the trademark owner’s claim.

• Blocking federal registration of confusingly similar trademarks.

• Providing evidence of ownership and the registrant’s exclusive right to use the trademark with the goods or services specified in the registration.

• Allowing for incontestable status after filing the appropriate declaration.

• Permitting jurisdiction of federal courts.

• Allowing for filing with U.S. Customs to prevent importation of infringing foreign goods.

• Serving as a basis for obtaining trademark protection in foreign countries.

• Granting the right to use the circled “R” symbol, ®, with the registered trademark.

A registration delineates the rights in a trademark. It duly records and secures exclusive use to the registrant. A registration can be sold as property, normally with the goodwill associated with the mark. Assignments and even security interests can be federally recorded for a registration.

Constructive notice begins the date a trademark is federally registered and has the legal effect of notifying the public that the trademark is in use by the registrant. Thus, competitors are deemed to be aware of a registered trademark regardless of whether they uncovered it with proper research. Competitors have a duty when adopting or using a new trademark to search U.S. Patent and Trademark Office records to avoid selecting confusingly similar trademarks. Claims by others of good faith, lack of knowledge or innocence in adopting a trademark are typically not viable defenses. A trademark adopted after registration by another is used at the new adopter’s peril with rights inferior to the registrant’s rights.

Although competitors who are properly diligent in adopting a new trademark should avoid using a confusingly similar trademark that is already registered or pending, the USPTO should, in necessary cases, reject confusingly similar trademarks from later registration. Also, a party challenging a registered trademark may be barred from bringing legal action because of constructive notice.

A federal trademark registration is presumed to be valid in legal proceedings. It also provides evidence of validity of (1) the registered trademark itself, (2) the registrant’s ownership of the trademark, and (3) the registrant’s exclusive right to use the trademark on the goods or services covered by the registration.

Federal law also allows for incontestability, which is the highest status of trademark protection. With the appropriate declaration, an owner’s right to use a registered trademark can become incontestable with limited exceptions. After five years of registration, no one can assert prior use against a trademark registered on the Principal Register, nor can registration be challenged on many other grounds, such as asserting that a trademark is merely descriptive.

Registering a Trademark permits jurisdiction in a U.S. federal court where a judge may grant injunctions and award damages for infringement. Recovery for violations of rights may include (1) defendant’s profits, (2) any damages sustained by the plaintiff and (3) the costs of the action. The amount of actual damages may be trebled in certain circumstances. Also, in exceptional cases, attorney fees may be awarded to a prevailing party. If a trademark is known to be counterfeit and is intentionally used, the court shall enter three times the amount of profits of damages with reasonable attorney fees, unless extenuating circumstances exist. An election can be made for statutory damages, which can be between $500-$100,000 per counterfeit trademark per type of goods or services, or if willful, up to $1,000,000 as the court considers just. A court may also order the destruction of infringing articles and other remedies.

Federal registration also helps an owner enforce its trademark rights in more than just federal courts. Recording a registered trademark with Customs can help protect goodwill and reduce losses due to infringement and counterfeiting. For example, Customs can prevent the importation of infringing goods, seize counterfeit goods, impose fines after infringement determinations and detain imported goods bearing confusingly similar trademarks.

A federal trademark application can serve as a foundation for obtaining registrations in foreign countries in two ways. First, since 2004, a Madrid Protocol application can be linked with a U.S. national application or registration as the basis for an international trademark registration. A Madrid Protocol application requires only a single filing in English with one registration authority to secure trademark protection in designated member countries. Second, under the Paris Convention, corresponding applications that are filed in many foreign countries can receive the benefits of a U.S. filing date if filed within six months of that date.

Only federal registration permits use of the circled “R” symbol, ®, which adds a professional appearance to a trademark and shows that the owner deems the trademark important enough to protect. Without federal registration, a trademark may be used with a “tm,” which is merely an assertion that the user believes it has trademark rights. The federal registration symbol should only be used with the trademark on or in connection with the goods and/or services listed in the federal trademark registration.

The cost for these benefits is reasonable. The typical cost for preparing and filing federal trademark applications in one class is approximately $1000, which includes the filing fee, and about the same cost for straightforward and trouble-free prosecution to issuance. For information on how to search, protect, register and enforce your trademarks, contact Timothy Engling. Tim is a registered patent attorney in the Intellectual Property Department of Miller Canfield. He can be reached at 312.460.4241 or engling@millercanfield.com.