Southwest Intellectual Property Svcs., LLC
9400 Holly Avenue NE, Building 4
Albuquerque, New Mexico 87122
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This article has been prepared in response to requests for information concerning trademarks, including the basic steps and costs in creating, registering and protecting trademark rights in the United States. This memo only provides a brief overview. It is not intended to cover all possible situations and every exception. It is not intended as a substitute for legal advice. Consultation with an attorney experienced in trademark law is recommended.

After reading this, if you wish to consider this firm representing you or have any questions on trademarks, please call so that we can discuss whether there are any conflicts that would prohibit an attorney-client relationship, and whether we can reach a mutually agreeable arrangement.

What is a Trademark?

A trademark is a "word" which is adopted and used by manufacturer, importer or merchant (either wholesale or retail) to identify its products and to distinguish them from those manufactured or sold by others. For trademark purposes, "word(s)" generally include: words or names or their phonic equivalents, symbols, logos, slogans, articles or an alphabet, numbers, or any combination of these elements. Words may also be used for services, such as transportation, insurance, entertainment, or advertising. When used in association with services, such words are called service marks. The comments which follow with regard to the selection, use and/or registration of trademarks also apply to service marks.

Though commonly interchanged, trademarks and trade names are not synonymous. A trade name is the business or commercial name of a company, partnership or individual. In contrast, a trademark identifies a product or group of products. In some situations, a word or group of words (e.g. Coca-Cola, Ford, Kodak, etc.) may function as both a trademark and a trade name.

Selecting Trademarks

When selecting a trademark or service mark, it is important to choose a word which you can prevent competitors from using for the same or similar products or services. Words can be classified or distinctive, suggestive, descriptive or generic. From a legal point of view, distinctive terms are preferable to suggestive terms; both are preferable to descriptive terms. Generic terms cannot function as either trademarks or service marks. For reference, these terms are defined as follows:

(a)   Distinctive terms generally include invented, coined or meaningless designations or symbols which convey no information about the product or its use. Examples include Kodak (for film) and Exxon (for gasoline). Distinctive terms also include words, and their phonetic equivalents, which are arbitrary and meaningless in relation to the products with which they are used. An example in this category would be Arrow for shirts.

(b)   Suggestive terms include words, and their phonetic equivalents, which suggest some quality, function or use of a product, but which do not actually describe such a product.

(c)   Descriptive terms are words used to describe the function, a characteristic, a use, the components or the origin of a product to a person who has never seen or has no knowledge of such product. This category typically includes adjectives and verbs used in their ordinary sense, geographically descriptive or misdescriptive terms and sir names. Ordinarily, these terms do not function as trademarks.

(d)   Generic terms include nouns used in their commonly understood sense. They cannot function as a trademark or service mark.

Clearing Trademarks

After selecting a trademark but prior to using the trademark, it is strongly recommended that a comprehensive search be conducted in order to determine if there are prior uses (whether registered or unregistered) that may affect the ability to use a mark. Prior clearance is also recommended where an existing trademark is to be extended to a new product, product line or service.

Searches may be conducted through computer data bases (usually costing less than $50), or by an outside search organization (about $300). Computer database searches cover federal trademark registrations only, while outside searches also include state registrations, and unregistered uses for those goods (and\or services) which are identical or similar to those for the proposed mark. Typically, search results will be received within ten days to two weeks of ordering.

Search results should be reviewed by an attorney to make recommendations as to whether the mark should or should not be adopted. The cost of this review depends on the time spent.

Establishing Trademark Rights

Traditionally, trademark rights in the United States were established (and maintained) by making continuous use of the mark in commerce "on or in association with" goods or services. Under the traditional system, which is still in effect, registration though recommended is not necessary.

In addition to use, since November 16, 1989 (the effective date of the Trademark Law Revision Act of 1988), trademark rights on the federal level, may be established without use if an "Intent to Use Application" is filed with the U.S. Patent and Trademark Office. See "Intent to Use Applications," below. If such an application is approved and the applicant, within the time frame allowed by the statute, makes subsequent actual use of the mark, the rights are effective from the filing date.

"On or in association with" typically includes:

    1.   Printing on or molding into the product;
    2.   Applying the mark to a tag or label attached to the product;
    3.   Use on product containers;
    4.   Use on inserts enclosed with the product (but not operator's manuals); and
    5.   Use on displays associated with the product at the point of sale.

Using a word in advertising and/or manuals is not, under federal law, "on or in association with" and, thus, not sufficient to satisfy federal registration requirements.

Steps in Filing and Prosecuting a Federal Trademark Application

The following outline lists the basic steps in preparing, filing and prosecuting a trademark application. It is not intended to be exhaustive, only to give an overview of the basic process, both in terms of the steps, costs (both official and attorney fees) in the time frame involved.

1. Preparation of the Trademark Application.
This includes preparation of the application papers, including identifying the mark to be registered, specifying the goods and/or services with the mark is used (or in the case of a proposed use application the goods or services with which the mark is to be used), and identifying of the date of first use and, if different, the date of first use in interstate commerce.

The process is normally not labor intensive, unless there are problems such as; identifying all the goods covered by the mark; or identifying the date(s) of first use or first use interstate commerce; or investigating ownership issues. Fees are based on the number of attorney hours.

The official federal government application fee is $335.00 per class of goods (or services) covered by the application. Thus, if the goods or services covered by an application cover more than one class, additional fees will be required (i.e. $490 for two classes, etc.).

In New Mexico, the cost for obtaining a trademark registration is $50.00. There is no examination and the Secretary of State's office cannot question the validity or enforceability of the application. These issues are left for a court to decide. If you only apply the mark to goods and/or services which do not cross interstate boundaries, you probably only need a New Mexico registration. In contrast, if you apply your mark to goods/services which are send out of state (or, you plan to send them out of state within three years), you probably should consider a federal registration. Because obtaining a New Mexico registration is relatively straightforward, the following text applies only to federal trademark applications.

2. Examination
All applications are examined by the attorneys in U.S. Patent and Trademark Office. This examination will result in an official action that:

(a) is a rejection on such grounds as the mark is descriptive, or that the mark is confusingly similar to other marks; or

(b) an objection on formal matters, such as modification or further identification of the goods or services covered by the application;

(c) or a notice that the mark registerable and that it will be published for opposition.

In the case of rejections and/or objections, the office action is typically reviewed by an attorney experienced in trademark matters, in consultation with the client to determine what, if any, response should be filed. Responses can include:

(a)       Amendment of the goods or services covered by the application; or

(b)       An argument that the rejection by the examining attorney is not appropriate; or

(c)       Abandonment of the application.

Attorney fees are determined by the amount of time spent in reviewing to office action, and in preparing and filing a response.

3.       Appeal
Every applicant has right of appeal to any final rejection from the U.S. Patent and Trademark Office. There are both official fees associated with this, as well as attorney time in preparing, filing and arguing the appeal.

4.       Opposition
Once an application for a federal registration has been allowed, the mark will then be published for opposition in the Official Gazette of the United States Patent and Trademark Office. Within thirty days of the publication date, individuals or organizations who feel they would be adversely effected by the proposed registration of the mark can file a Notice of Opposition, which may result in a protracted inter?parties dispute. If no opposition is filed, the Patent and Trademark Office will automatically issue the certificate of registration.

5.       Application Processing Time
Currently, most applications are examined within, approximately, five months of the filing date. Absent any protracted proceedings before the Patent and Trademark Office, such as based on rejection or opposition, marks are typically published for opposition within five to twelve months of the application date. The typical a registration issues within, approximately, three months of the publication for opposition.

6.       Intent to Use Applications
These applications basically follow the same procedure outlined above, except they are based on a bona fide intent to use the mark by the applicant, not actual use. The cost of the application, and procedure are essentially as set forth above. Formal examination the application will be made and, assuming that the trademark is available and capable of being registered, it will be published for opposition. In the absence of a valid opposition, a Notice of Allowance will be issued by the Patent and Trademark Office. An applicant will thereafter have six months, extensible for up to a total of three years upon showing a good cause, to file a statement of use and specimen(s) showing the trademark as actually used. On submission of the statement of use, the Patent and Trademark Office will conduct a final examination of the application, prior to issuance of the registration.

Length of Trademark Rights

If a trademark is used properly and, preferably, the associated registration periodically renewed, the trademark owner's rights last indefinitely. However, lack of use by the trademark by the owner, coupled with an intent to abandon, results in forfeiting of these rights. Under federal law there is a presumption of intent to abandon after two consecutive years of non-use.

All federal trademark registrations, in order to be maintained, are subject to the use and proof and filing of proof of such use between the fifth and sixth anniversary of the registration. Registrations which are issued after November 16, 1989, are valid for ten years. Registrations granted before that date are valid for a 20-year term. In either case, in order for the registration to be maintained, assuming the mark is still in use, an application to renew the application must be filed prior to the end of the term.

Proper Use of Trademarks

Trademark rights can be lost in ways other than deliberate abandonment. A word may unintentionally lose its distinctiveness as a trademark, such has happened to “aspirin’, “cellophane”, “escalator”, “kerosene”, “lanoline”, “shredded wheat” and "yo-yo", and may become the generic or descriptive name of the goods. In many cases this unintentional loss resulted from misuse and/or carelessness on the part of the trademark owner.

To minimize the risk of such unintentional loss of rights, the following guidelines are recommended:

1. Trademarks should always be given more prominence than the generic name and/or other words used to describe the product. Prominence can be conferred by: using all capital articles; using initial capitals on the trademark; using a special typeface; using color; using quotation marks; or underlining.

2. Trademarks should always be used as a proper adjective, in association with generic or common name of the product. Exceptions to this rule include when the mark is used directly on the goods; in headings or headlines and when the mark is also used with the generic name in the text which follows; and to avoid unnecessary repetition in text where the generic name has already been used and is clearly understood.

3. Whenever possible, trademarks or service marks should be identified with an appropriate symbol.

(a) The ® symbol for trademarks and service marks registered with the U.S. Patent and Trademark Office.

(b) Use the ™ symbol for unregistered trademarks (regardless of whether an application has been filed with the U.S. Patent and Trademark Office), or trademarks registered only on the state level (such as New Mexico).

(c) For both registered and unregistered marks, a footnote, or an asterisk and a footnote may be used.

(d) When a mark is used in a special form on the product or packaging, care should be taken to be as consistent as possible in text. Also, in text, trademark owners should avoid pluralizing the trademark, using a trademark in a possessive sense, and be careful not to abbreviate, hyphenate, misspell or compound the trademark with another word.

While this article is quite general in describing the trademark process, it serves to inform you of the general principals surrounding trademark law. We look forward to assisting you with the protection of your intellectual property assets, if possible.

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