In “How to Register a Trademark, Part 1: Determine Availability,” my article last month, I addressed how you could lose your trademark due to improper filings before your trademark is registered — or, in some cases, even after it is registered. This month I will discuss the primary ways you can lose your trademark after you have successfully obtained it.
After you file for your trademark, the typical wait time to receive it is 10 to 14 months. However, it can take longer if there are multiple office actions at the U.S. Patent and Trademark Office, or if there are disputes regarding your trademark. Once your trademark is approved, you will receive a serial number and a certificate of registration from the USPTO.
After you file for your trademark, the typical wait time to receive it is 10 to 14 months. However, it can take longer if there are multiple office actions at the U.S. Patent and Trademark Office, or if there are disputes regarding your trademark.
Registration of the federal trademark gives you certain rights in the logo, name, symbol, or other thing — i.e., color, sound — that you have registered as a trademark. It puts the public on notice that you own the trademark and it gives you a legal presumption of your exclusive use of the trademark in regards to the class of goods that you claimed in your trademark application. You can record the trademark with the U.S. Customs and Border Protection to ward off any incoming counterfeit items, and you can use the registration to attempt to obtain registrations in other countries. Lastly, you can use the “®” symbol to show the public you have a registered trademark and you can go through federal courts to protect it.
6 Ways to Lose a Trademark
However, there are six common ways that you can lose your trademark after you have received registration: (i) dilution, (ii) failing to appropriately monitor the use of the trademark by licensees, (iii) allowing the trademark to become generic, (iv) non-use of the mark, (v) selling or assigning the trademark without the accompanying goodwill of the trademark, (vi) falsifying an application.
- Dilution. Dilution occurs when multiple companies begin using your trademark for the same or similar categories of goods. To protect against this, you must be diligent about stopping infringement when it occurs, especially on a major scale. When you learn that someone else is using your trademark, the first step is to contact the infringer. In many cases, if the trademark infringement is caught before the infringer has invested much money in the trademark, the infringer will likely stop using it after learning about your trademark. In some cases, a simple call, email, or letter from you is the best approach. However, you may want to ask your attorney to write a letter or email and approach the infringer instead. If a cease and desist letter does not work, the next step would be taking the infringer to court. Sometimes, the case will settle before trial but it may end up going to trial and have to be settled by a judge.
- Failing to appropriately monitor the use of the trademark by licensees. If you license your trademark, due caution must be used to ensure that the licensee does not misuse the trademark. This includes ensuring that the trademark is not used as anything other than an adjective (for instance, “Starbucks” is an adjective to define a type of coffee: “Starbucks coffee”), is appropriately cited as a trademark (either by font, color, or other distinguishing characteristics), and is used as prescribed in the licensing agreement. As the licensor of the trademark, you must ensure that the goods or services sold under the trademark by a licensee are of the same quality and have the same characteristics as those sold by you, the licensor. For example, McDonald’s would have to ensure that all franchisees (which possess licenses to use McDonald’s trademarks) produce the same quality hamburgers and fries.
- Allowing the trademark to become generic. While every trademark owner hopes that her trademark is the next “Google” and having the registered trademark itself does bring a certain degree of respect to the products sold underneath it, a trademark owner must be careful that the trademark is only used in relation to its products and not similar products. A trademark becomes generic, and the owner therefore loses it, when the trademark becomes the word for any products created that are similar to the original product. For example, the term “Murphy Bed” was once a registered trademark but due to the phrase becoming common for any type of bed that pulled down from a wall, it was ruled generic in 1989. “Escalator” lost its status in 1950 due to its general use as well. (A historical note: Many place Aspirin and Heroin in the category of words that became generic; however, “Aspirin” and “Heroin” both lost trademark status as part of the reparations in the Treaty of Versailles after World War I since Bayer, who owned the trademarks, was a German company, not specifically due to genericide.)
- Non-use of the mark. To have a trademark, you have to continually use it in commerce. While exceptions do exist — for example, seasonal businesses may just have to use it seasonally — there are very few. If you fail to use it in commerce, you can lose your trademark. This frequently happens in the case of mergers, where one company buys another and replaces the trademark with its own. The second most common way is if a seller takes its product off the market. However, non-use typically does not apply if you are only using the trademark in a small geographical area (i.e., you once sold throughout the U.S. but scaled back and now only sell on the East Coast) or if the reason that you are not using the trademark in commerce is beyond your control (i.e., labor strikes, inability to sell the product due to law).
- Selling or assigning the trademark without the accompanying goodwill. Two remaining ways that you can lose your trademark that are more rare are selling or assigning the trademark to someone else without also giving them the goodwill, or by filing a false application. When an owner either assigns or sells a trademark, the owner must also sell any associated goodwill — or the trademark will become invalid. This is because the goodwill behind the trademark is what makes or breaks the trademark. If you do not sell the goodwill with the trademark, then the trademark is considered worthless and will be invalidated.
- Falsifying an application. Finally, if you register a trademark with a false application, you can lose the trademark. For instance, if you state on the trademark application that you are actually selling the product at the time of application for registration, but you are not, then you can lose the trademark due to this false filing. You could also lose the trademark if your substantiating documents are fraudulent.
Although losing a trademark is easy to avoid, it does happen. After you get a trademark registration approved, you must diligently protect it and avoid certain missteps, so that you don’t become the next cellophane, dry ice, Laundromat, thermos, or videotape.