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May 4th, 2010 admin No comments

The Truth About Trademarks

A trademark is one of the most important things any company can own, and yet many people with new businesses know next to nothing about them.

Here's what I've learned for my part, some of it painfully, but thankfully not fatally.

Trademarks are for phrases, names, and logos. The most important thing to trademark is usually your company name. If you haven't already, do it immediately, it only costs a few hundred dollars to do it yourself. You can check to see if there are likely conflicts by searching the Patent and Trademark Office's website at: www.uspto.gov. An an entrepreneur, this is a site you're going to get to know quite well over time, believe me.

File the trademark for your company name alone. If you have a great logo, you can file for that too - but if you wind up changing your logo, then it's no good anymore, which is why I always file for the name itself without a particular logo.

Also file of course on your tag line if it's good and important, and major product names that you have. Several hundred dollars now can save you millions or bankruptcy later.

I like to do trademark filings myself and save on the legal fees, but I've been at this for a while.

TM vs. ®

Most people don't know exactly what TM and ® signify. TM simply means that you claim rights in the mark. You don't have to file with the Trademark Office to use TM. If and when your mark is officially registered with the Trademark Office, you can then use the federal registration symbol - ®. There's no reason to not start using TM immediately without having filed anything or researched availability. Many people think TM means you have the mark, so it makes you look good to them, and to those who do know the difference, it still looks like you know what you're doing.

Here's the Trademark Office's FAQ:

www.uspto.gov/web/offices/tac/tmfaq.htm

My Close Call

I have a product called EZ Numbers. I got the domain name back in 2005, and didn't file for the trademark since I didn't think anyone else would. Last year I finally got around to it. My application was rejected in an "Office Action." Ouch! The examiner cited the likelihood of confusion with another mark "Easy Number," which had been filed after I got my domain name. Doh!

At this point, I had three choices:

1. Appeal the rejection.
2. Abandon the trademark and continue selling without it.
3. Change the name and try again with a new filing.

Changing the name would mean coming up with a new name, domain name, logo, new artwork in the application, etc. etc. I'd also lose the brand awareness I'd built up, and then for Google I'd lose the four years of history. Because Google relies in part on how old your site is, the newer the site the less likely you are to be found by someone doing a search related to your site. Plus I'm just too ornery to change the name, so this option was out.

I could forget the trademark and just keep using the name EZ Numbers, and hope nobody came after me. But what if a couple years from now, I got a letter from some lawyer stating that I had willfully infringed on their client's trademark? I couldn't plead ignorance since I'd filed and been rejected. This could easily drive me out of business.

I figured I had no choice but to appeal the rejection. I found a great consultant, who although not a lawyer, knows trademarks in and out. He had his own horror story from which he learned everything you could possibly know about trademarks. I hired him, and over a couple of months (you have six months to appeal) we worked together on the response.

I felt pretty good when I submitted the response. I submitted the appeal on a Tuesday, and on Wednesday morning the examiner called to say that if I'd accept a slight change in the description of the mark, one I had proposed in my appeal hoping that she would ok it. I was ecstatic! She had previously mentioned to me "multiple grounds for refusal" so I was surprised to get it overturned overnight.

I wasn't out of the woods just yet, though. My trademark was now "Approved for Publication." This meant that three weeks from now, the potential mark would be published for opposition in the Official Gazette. Then anyone who felt that the mark would infringe on an existing one would have thirty days to either oppose it or ask for an extension of time to oppose it.

If someone does oppose your mark, it's basically a federal law suit in which you are the defendant, and this is the big leagues. You're in it for tens of thousands of dollars at the very least, and easily millions.

Oppositions aren't all that rare, so every day during the thirty day opposition window I checked my mail and uspto.gov to see if I had been opposed. Thankfully I wasn't, and now EZ Numbers has ® following it. However, trademarks aren't forever. Just like anyone can sue anyone anytime, your registered mark can still be challenged, but you're far better off with a mark that's registered.

About the Author

Paul Hynek is a Wharton MBA and creator of EZ Numbers® (www.EZNumbers.com) the world's easiest pro forma software for entrepreneurs.