With the job market still on the rebound, many people chose to start their own businesses, but whether or not you need to register a logo, slogan, or company name, depends on several factors, especially when trying to keep start-up costs at a minimum. Generally, if you are the first person to use a trademark, you acquire some rights to the mark as soon as you start using it to sell goods or services. Registration is not strictly required, but there are several advantages to registering your trademark. In addition, the cost of registering your trademark pales in comparison to the losses you can incur for failing to do so. Here are a few reasons why it's a good idea to register your trademark.
Registered trademarks increase the value of your business
The internet has made many industries fiercely competitive. Using a trademark helps you brand your business and provide a means for customers to recognize your product or service within seconds. Additionally, a registered trademark is an intangible asset that is valuable for your company. Should you envision ever selling the company, having a registered trademark may increase the sale price. If you are not looking to eventually sell your company, but want to build your business, having a registered trademark allows you to use the ® symbol, which adds legitimacy to your business.
Constructive, nationwide legal notice
Registration with the U.S. Patent and Trademark Office (USPTO) puts others on “constructive notice” that you are the owner of the mark. Constructive notice is valuable because if someone else uses your mark or a mark that is confusingly similar to yours in commerce and you take them to court, you won't have to prove that the infringer had actual notice the mark was yours before the infringement. A mere cease and desist letter that references registration of your mark can be a powerful incentive to stop the offender from using your mark. This is important to prevent others from diluting or outright stealing your brand. Furthermore, registration may also help you prevent others from using an Internet domain name that could be confused with yours.
Five years after registration, you can apply to have your mark declared incontestable. This means your exclusive use of the mark is conclusively established in court. Secondly, and most importantly, trademark registration may allow you to collect additional damages and attorney fees if you prevail. It is also worth noting that if your mark is registered, it will automatically be subject to federal jurisdiction and you will be able to bring your claim in federal court, as opposed to state court, which offers many advantages, including ease of discovery across state lines and experienced, federal judges on the bench.
What Can Be Registered
Generally you can register a trademark for any combination of words, names and/or symbols that you use to identify or distinguish the products or services you sell. When used to identify a service (e.g. “Terminix”) they are called service marks but generally, service marks and trademarks are the same. Other features of your products or services may also be protected in addition to the mark, including product color or packaging. These attributes are called trade dress and can also be registered, but if the features are merely functional in nature, they will not be protected. For example, you would not be permitted to register a bottle shape that intends to make it easier to grip the bottle.
It is a good idea to register your trademark to protect yourself against an infringement suit, to add value to your company, to put your competitors and the public on notice of your rights in your own brand and to strengthen the legal protection of your mark. The investment to register a mark is minimal compared to the potential cost of not registering, and compared to the potential benefits registration will bring to your business.
LegalZoom offers a wealth of services that can help you protect your business' trademark including trademark registration, search and monitoring. Go to our trademark center for more details.