No. Unlike patent rights, trademark protection does not only arise from registration. Most trademark protection begins when the trademark is used in commerce. When your business starts selling a product under a particular name, you are afforded some trademark protection.
Who Has Priority in a Name?
Priority in a trademark attaches on a first use basis. If your business starts to use a particular mark in commerce, you will have priority over every person or business that attempts to use that mark or a similar mark (assuming nobody is using the same or similar mark prior to your use) in the future (assuming you are continuously using your mark). Trademark law does not use a first-to-file system for determining superior rights, some protection attaches upon use of the mark (although federal registration does carry significant benefits). The following graphic illustrates the varying levels of protection offered to a trademark depending upon whether it is federally registered or not:
What Does This Mean For A Business Trying to Choose a Name?
A brief search of a trademark registry without any results does not mean you are free to use that name. There may be another business out there that is already using the same or a similar mark but has not yet registered it. This business may have superior rights in the name over your business.
What Happens If I Ignore All of These Issues?
Not identifying a business with superior trademark rights can be costly for you in the future. For one, if you select a name that is the same or similar to another business that sells goods or services related to yours, you may find yourself subject to an infringement action. Even if the infringement action does not proceed to litigation (which is extremely expensive), you will likely have to re-brand and market your business under an entirely different name, which means spending more money on marketing materials, business registration documents, and the like.
Another potential outcome of not properly clearing your business’s name is that a prior user of that name may file for federal trademark registration before you do. While this registration may not prevent you from continuing to use your name, it may freeze the geographical area in which you may do so, preventing your business from expanding to new territories. This is because one of the benefits of federal trademark registration is nationwide rights in the mark registered. Therefore, a prior user of a mark will obtain superior rights in every part of the country, except where your business is operating, upon a federal registration. On the other hand, if your business chooses a name that is unique and not previously in use, and then file your own federal trademark registration, you will obtain exclusive nationwide rights in that mark, making it easier for your business to expand to other parts of the country.
What Should I Do Before Picking a Name?
As you can see, selecting a proper business name involves more than simply coming up with something catchy and appealing. Significant legal issues can be involved and for that reason is it important to consult with an attorney that can assist you in choosing a proper name. If you need assistance choosing a business name, or want to register your trademark, contact one of our attorneys for assistance.
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