A trademark can be any word, name, phrase, image, logo, symbol, or combination of these elements used to identify the source of goods or services in the marketplace and distinguish it from competitors.
In this article, you will find out whether it is necessary to have a state and federal trademark.
Explaining Trademark Rights – The Fundamentals
An enforceable trademark does not necessarily require registration. Under the Lanham Act, trademark rights do not come from registration but from their use in business. If a registered is not actively used in business, it might not be enforceable.
For example, let’s say a restaurant in Florida called “Gator Country’s Foremost Burgers” has not filed for state or federal trademark registration. If the restaurant’s name identifies the sources of the goods or services provided by the company and serves to distinguish it in the marketplace, it can be considered a trademark.
If another restaurant in the area decides to use the same brand name, the trademark owner can send a cease-and-desist letter asking the infringing party to stop using the mark. In case the notice is not sufficient, the owner of the mark may seek court intervention.
Please note that unregistered trademark rights are limited to the geographic area where the mark is being actively used on business. An eventual business expansion into new trading areas may expose “common law” trademarks to unnecessary risks.
The best approach is to file for trademark registration. There are two alternatives for registration- state registration and federal registration.
Each state has specific regulations on trademark registration. Conversely, federally registering a trademark has only one method, which is filing with the United States Patent and Trademark Office (USPTO).
Do I Need a State and Federal Trademark? – In Detail
Registering a trademark with the state is generally cheaper and simpler than registering with USPTO. The advantages of filing for state trademark registration include a faster processing time and higher approval rates, especially considering USPTO’s requirements are usually stricter.
However, federal registration offers several unique benefits that are not available for trademarks registered at the state level. The first difference is the geographic area of protection.
While state trademarks can only be enforced within state jurisdiction, federal trademarks enjoy nationwide protection.
Registering only with the state does not give trademark owners the right to use the “®” symbol. Instead, it is only possible to use TM or SM depending on whether the state-registered mark is a trademark or service mark.
In addition to the use of the “®” symbol with the trademark to identify the source of goods and services, federal trademarks also grant owners:
- Nationwide usage of the registered mark
- The legal presumption of ownership in case of legal dispute
- The right to sue for infringement in a federal court
- Preventing infringing products from being imported with the help of the US Customs and Border Protection
- A basis for international trademark registration
Once a trademark is listed in USPTO’s database, it becomes part of public records and may automatically prevent competitors from using it. While state registration can be a feasible option for start-up businesses, the cost-benefit of owning a federally registered trademark cannot be compared.