§ 1.05 Trademarks

• Jurisdiction: United States
• Publication year: 2020

§ 1.05 Trademarks

If copyright is the law of authorship and patent is the law of invention, trademark is the law of consumer marketing and advertising. A trademark is any symbol, word, name, device or any combination of these used to identify products, services, or their producers in the marketplace. Trademarks are not limited to words or written symbols but may include sounds, fragrances, the distinctive features of items and the trade dress of both the packaging of a product and the non-functional features of the appearance of a product.

Trademarks play an important role in a modern consumer driven society. For the merchant or manufacturer, a trademark serves to identify and distinguish the goods or services⁹⁵ of that person or company. This allows manufacturers to create "brand equity" and ensure that customers will continue to purchase their products. In turn, consumers rely on trademarks to distinguish among competing products and to select those which are of high quality. "Without trademarks and the identifying function they serve, competition in product quality could not exist."⁹⁶

While there are important advantages to be gained by registering a mark with the United States Patent and Trademark Office, unregistered marks may be protected under both federal and state law. In particular, the protection of unregistered marks is limited to the geographical area in which the mark is actually used, whereas, federal registration provides the owner with the exclusive right to use that mark in the United States.

Unlike copyrights and patents, Congress's power to regulate trademarks is not derived from a specific constitutional grant. The Supreme Court has ruled that the patent and copyright clause of the Constitution does not apply to trademarks.⁹⁷ The authority for trademark protection is based on the "commerce clause."⁹⁸ The Lanham Act⁹⁹ provides for a system of registering and administering trademarks with the Patent and Trademark Office. In addition to the nationwide protection of trademarks, federal registration also offers a number of other important advantages. First, a registrant has access to the federal courts without pleading any required amount in controversy.¹⁰⁰ Second, evidence of registration is prima facie evidence of the validity of the registered mark, of the registrant's ownership of the mark, and of the registrant's exclusive right to use the registered mark.¹⁰¹ Third, registration may be used to establish priority of trademark rights.¹⁰² Finally, federal registration is a jurisdictional prerequisite to federal criminal prosecution and is an essential element in a prosecution for trafficking in counterfeit goods.¹⁰³

In order to obtain a federal trademark registration from the Patent and Trademark Office, the applicant must establish (1) distinctiveness of the mark, and (2) use or intent to use the mark in interstate or foreign commerce.¹⁰⁴ Marks may be inherently distinctive or non-inherently distinctive.¹⁰⁵ Within these two basic categories trademarks are grouped in descending order roughly reflecting their eligibility to trademark status and the degree of protection afforded, as follows:¹⁰⁶ (1) fanciful;¹⁰⁷ (2) arbitrary;¹⁰⁸ (3) suggestive;¹⁰⁹ (4) descriptive;¹¹⁰ and (5) generic.¹¹¹ Fanciful, arbitrary, and suggestive terms are considered inherently distinctive and are entitled to trademark protection without a showing of secondary meaning.¹¹² In contrast, descriptive terms are not inherently distinctive and before being accorded trademark protection the user must establish secondary meaning.¹¹³ The prime element of secondary meaning is a mental association in buyers' minds between the alleged mark and a single source of the product.¹¹⁴ Finally, generic terms can never be trademarks.¹¹⁵

The second requirement for federal registration is that the applicant is using the mark in commerce or intends to do so.¹¹⁶

Under United States law, trademarks do not expire on any particular date; they continue in force until "abandoned" by their owner. Abandonment results where there is nonuse of the mark accompanied by an intent to discontinue use. In addition, public or common use of the mark in the public domain may undercut the distinctive nature of a popular mark. Such a mark may then become the common commercial name or generic name of the goods, as opposed to a source indicator for those goods. The works "aspirin" and "escalator," for example were, at one time registered trademarks that lost this status by no longer being associated with their owner.¹¹⁷

Ownership of a trademark gives the owner the right to use that particular mark and to exclude others from using the same or similar mark in a manner that is likely to cause confusion in the marketplace. The Lanham Act provides owners of both registered and unregistered marks with a civil cause of action for "trademark infringement."¹¹⁸ A showing of actual confusion among consumers is not required in order to demonstrate infringement.¹¹⁹ Instead, a plaintiff need prove only that a reasonably prudent purchaser is likely to be confused as to source, endorsement, affiliation, or sponsorship between the plaintiff's and defendant's goods or services. Remedies for trademark infringement under the Lanham Act are intended to be equitable and compensatory, not punitive. Such remedies include enjoining further use of the infringing mark by the defendant, damages, and in "exceptional cases," attorney fees.¹²⁰

The Lanham Act was amended in 1995 to provide federal protection to highly distinctive or famous marks against "dilution" of the good will associated with the mark.¹²¹ Dilution is defined as "the lessening of the capacity of a famous mark to identify and distinguish goods or services regardless of the presence or absence of: (1) competition between the owner of the famous mark and other parties; or (2) the likelihood of confusion, mistake, or deception."¹²² Unlike traditional infringement law, the prohibitions against trademark dilution are not the product of common law development, and are not motivated by an interest in protecting consumers.¹²³ A number of state trademark dilution laws also exist. Trademark dilution laws protect trademarks against uses of trademarks even when consumers are unlikely to be confused by the coexistence of the marks in commerce. The purpose of the Federal Trademark Dilution Act is to protect famous trademarks, whether registered or unregistered, from subsequent uses that blur the distinctiveness of the mark or tarnish or disparage it, even in the absence of a likelihood of confusion. The Act applies when unauthorized users attempt to trade on the goodwill and established renown of such marks and thereby dilute their distinctive quality. The remedy under federal law for trademark dilution is limited to an injunction against the defendant's use of the mark unless the plaintiff can establish that the defendant "willfully intended to trade on the owner's reputation or to cause dilution of the famous...