Advising Micro Businesses on Trademark Registrations

• Publication year: 2023
• Citation: Vol. 52 No. 10 Pg. 30
• Pages: 30

Advising Micro Businesses on Trademark Registrations Vol. 52, No. 10 [Page 30] Colorado Lawyer December 2023

INTELLECTUAL PROPERTY LAW

BY BRIAN HANNING

This article discusses key factors that micro businesses should consider when making decisions about registering trademarks.

In today's competitive business landscape, even micro businesses—those with five or fewer employees—find themselves navigating significant legal questions about protecting their brand. Trademark registration can significantly impact a micro business's success and longevity, but it is a topic that is often delayed or set aside due to the company's size, budget, or timeline. Whether for solo entrepreneurs, family businesses, or tiny startups, understanding the importance of trademark registration is vital for helping a micro business protect its brand and carve out a lasting presence in its industry. This article discusses various topics attorneys should discuss with micro businesses when helping them determine whether and when to register a trademark, including the realistic market for the business, expectations for registration timeline, value of the brand, scope of trademark protection, and ability to maintain the trademark.^[1] Attorneys will walk away with important discussion points for client conversations, but the specific details of the trademark registration process are beyond the scope of this article.

Factors to Consider for Trademark Registration

A registered trademark^[2] gives a business the exclusive right^[3] to use a particular mark to distinguish its goods or services in the marketplace. Many micro businesses are focused on other critical tasks during formation and early operation and may fail to consider the value of a registered trademark.

Investing in a trademark can require a significant investment of time and money, both of which may be scarce in the beginning stages of a micro business. Helping companies understand whether and when to pursue trademark registration will help them make strategic decisions about how to best use their limited resources. Below are six important topics that practitioners should address when advising a micro business about applying for federal trademark registration.^[4]

How Broad Is the Market?

Federally registered trademarks provide protection in all 50 states, so the first consideration is whether the micro business needs such broad protection. The decision to obtain a registered trademark will largely depend on the type of business and its long-term goals. For example, a local bakery may not need a registered trademark because of its geographically limited customer base. If the owners are not planning to franchise but are instead focusing on one store, a trademark registration may be more of a headache than the owner wants or needs to deal with. Contrast this with a pet food manufacturing company that wants to distribute to every retail store it can logistically service. That may require investors and rapid growth outside of a particular location, leading to sales in multiple states. When sales beyond any one state's borders are reliable, the protection and enforcement tools available from a nationally registered trademark are more relevant and useful to the company.

Trademark Application Timeline

Discussing the trademark application timeline with the micro business can help it determine when to pursue trademark registration or whether to do so at all. Unlike larger businesses with bigger budgets, larger staff, and long-term growth strategies, many micro businesses are balancing their resources with their goals. They may not have time to wait for a trademark registration before they launch their brand.^[5] Additionally, some small startups haven't settled on their brand. Sometimes it takes a couple of years to finalize logos, colors, and messaging, perhaps due to changing preferences or needing to pivot the business model. Waiting to file to ensure that the client is happy with its trademark may be a better option than rushing into the registration process.

When companies are ready to start the process, they need to understand what to expect. The general steps for registering a trademark can be lengthy and include:

1. completing and filing an application with the US Patent and Trademark Office (USPTO);

2. initial review by a trademark examiner;

3. responding to issues raised by the examining attorney (90 days to respond, with an additional 90 days granted upon request and motion);^[6]

4. approval and assignment of a registration number; and

5. 30-day publication in the Trademark Gazette (could start several weeks after approval).

Current statistics show that it can take an application eight months or more to reach an examining attorney—and that's just step 2 in...