TRADEMARKING 101: CONSIDERATIONS FOR STARTUPS
July 24, 2014
By James Forrest Starting a new business is an exciting time—I know this from first-hand experience when I launched the Forrest Firm a few years ago. Most new entrepreneurs have a great idea, perhaps for a product, service or both – and are often overwhelmed at the litany of day-to-day, operations oriented decisions that must be made at the start of a business that have nothing to do with the “idea” behind the business. One issue of that variety that I often see with start-ups is a tendency to not spend enough time on name selection, both in making sure that the name chosen does not run afoul of current trademarks (under the federal system or under common law, and primarily a defensive measure), as well as procuring federal protection for the chosen name of the business (primarily an offensive measure). Most entrepreneurs treat naming their company like naming a child – they spend A LOT of time kicking around ideas/names and contemplating what “fits” the best. That time-consuming thought process is quite valuable from a market perspective, but the often overlooked part of this analysis is legal. Unlike when choosing a name for a child (i.e., you can name your daughter Mary even though that’s been used before a few million times), no matter how great your chosen name is for your business, if someone else has rights in that name or some variation thereof, you could spend countless hours, dollars and energy unwinding the use of the name and/or in litigation with the aggrieved party. Needless to say, this could cause huge momentum problems for your business and it will be a huge distraction. So, what are businesses to do with regard to name selection and protection? As with many other business pursuits that overlap with legal concerns, it’s all about having the right team in place. Whether you use in-house or agency creatives to generate your names, logos, and packaging ideas, step one is to have them working in tandem with your legal representatives with practice experience and developed acumen in the area of trademark law. Before businesses get too married to particular names or marks, it’s important that your legal counsel performs searches to ascertain the competitive landscape. They can help steer your naming efforts in the right direction. During these searches, your business attorney can see if there are others exercising trademarked rights granted by the US Patent and Trademark Office (USPTO) or simply using the same or similar names, logos, and packaging ideas in the marketplace. Justin Nifong, an attorney with Nifong, Kiefer, and Klinck, PLLC, works closely with many clients of the Forrest Firm. He offers this guidance on name and mark selection: “The best marks are those that are suggestive of the goods and services, but not descriptive. Suggestive marks are easy for consumers to recognize and remember and are entitled to trademark registration as compared with merely descriptive marks. For example, Microsoft® is suggestive of software for microprocessors and computers. Similarly, Coppertone® is suggestive of a sunscreen that provides enhanced tanning characteristics. After consumers hear the name Microsoft or Coppertone, they typically can recall the name later. However, Durham’s finest diner is not trademark registerable for a restaurant because it is merely descriptive of the goods and services offered.” Once your attorney has completed the initial search, he or she can offer guidance to executives and design professionals on creative avenues to pursue free of legal liability concerns. Then, as your creative team completes its development process, the attorney can re-engage to lead the process of filing for registration of any necessary trademarks, whether they are for the company name, names for its products or services, or both. Having registered trademarks will give you enhanced rights in defending your marks against the use by newcomers in a manner that may cause confusion in the marketplace. For more information on trademarks, please contact any Forrest Firm attorney.