The Basics of Trademark Law
Intellectual property (“IP”) is the broad name given to the area of law that protects the rights of individuals who create original works. There are three main areas of IP law: trademarks, patents, and copyright. IP law is a complex, often technical area of law, and for this reason most lawyers who do not focus their practice on IP inherently shy away from litigating IP matters. This article focuses exclusively on trademarks and aims to provide a basic explanation of what constitutes a trademark and the type of conduct that amounts to trademark infringement.
A trademark is defined as a word, symbol, or phrase that is used to identify a particular manufacturer or seller's products and distinguish them from the products of another. 15 U.S.C. § 1127. When such marks are used to identify services rather than products, they are called service marks, although they are generally treated the same way as trademarks. Trademarks are governed by both state and federal law. The main federal statute governing trademarks is the Lanham Act, 15 U.S.C. §§ 1051, et seq., which gives a seller or producer the exclusive right to “register” a trademark, § 1052, and to prevent his or her competitors from using that trademark, § 1114(1).
Prerequisites to Serve as a Trademark
A mark must meet two requirements to be eligible for trademark protection: it must be used in commerce and it must be distinctive.
- Used in Commerce
The requirement that a mark be used in commerce arises because trademark law is grounded in Congress’ constitutional power to regulate interstate commerce. U.S. Const. Art. I, Sec. 8, cl. 3. The Lanham Act defines a trademark as a mark used in commerce or registered with a bona fide intent to use it in commerce. 15 U.S.C. § 1127. Both at common law and under Lanham Act registration procedures, exclusive rights to a trademark are awarded to the first to use the mark in commerce.
A mark must also be distinctive, meaning it must be capable of identifying the source of a particular good or service. Courts generally group marks into four categories when determining if a mark is distinctive: (1) arbitrary or fanciful, (2) suggestive, (3) descriptive, or (4) generic. Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 9 (2d Cir. 1976). The category in which a mark falls is based on the relationship between the mark and the underlying product or service. The legal protection afforded to a particular mark depends on the category to which the mark belongs.
- Arbitrary/Fanciful marks
The most stringently protected type of mark is known as an arbitrary or fanciful mark. Such marks consist of words or images which have some dictionary meaning before being adopted as trademarks, but which bear no logical relationship to the underlying product or services. Two examples are “Apple” in reference to computers, or “Kodak” in reference to cameras. Arbitrary or fanciful marks are inherently distinctive, meaning they are capable of identifying an underlying product, and in turn receive a high degree of protection.
- Suggestive marks
Another category of mark that falls one step below the arbitrary/fanciful mark is known as a suggestive mark. A suggestive mark evokes or suggests the nature, quality, or a characteristic of the underlying good or service, but does not describe this characteristic. It also requires some exercise of imagination on the part of the consumer to associate the word with the underlying product or service. Thompson Medical Co. v. Pfizer Inc., 753 F.2d 208, 216 (2d Cir. 1985). At the same time, the word is not totally unrelated to the underlying product. One example of a suggestive mark is “Coppertone” for sunscreen. While the word “Coppertone” is somewhat suggesting of sun-tan lotion, it does not come right out and describe the product. Another example is “Microsoft,” which suggests the product is software for microcomputers. Like arbitrary/fanciful marks, suggestive marks are considered inherently distinctive and are given a high degree of protection. Id.
- Descriptive marks
The third type of mark is known as a descriptive mark. A descriptive mark merely describes, rather than suggests, a particular characteristic or quality of an underlying product or service. Courts have determined that descriptive marks are not inherently distinctive, and instead are only protected if they acquire a “secondary meaning.” A descriptive mark acquires secondary meaning when the consuming public primarily associates that mark with a specific producer, rather than the underlying product. The public need not be able to identify the producer, only that the product or service comes from a single producer. Zatarain's, Inc. v. Oak Grove Smokehouse, Inc., 698 F.2d 786 (5th Cir. 1983). Examples of descriptive marks that have acquired secondary meaning include “All Bran” and “Holiday Inn.”
When trying to determine whether a given term has acquired secondary meaning, courts often look to the following factors: (1) the amount and manner of advertising; (2) the volume of sales; (3) the length and manner of the term's use; (4) results of consumer surveys. Id. If a mark is on the principal trademark register, it creates a presumption that the mark is not descriptive. Hindu Incense v. Meadows, 692 F.2d 1048, 1050 (6th Cir. 1982).
- Generic marks
The fourth type of mark is known as a generic mark. A generic mark describes the general category to which the underlying product belongs, and “cannot become a trademark under any circumstances.” Induct-O-Matic Corp. v. Inductotherm Corp., 747 F.2d 358, 362 (6th Cir. 1984). Generic terms are not protected by trademark law because they are simply too useful for identifying a particular product. Park ' N Fly, Inc. v. Dollar Park & Fly, Inc., 469 U.S. 189, 194 (1985). A party may use evidence such as dictionary definitions, newspapers and other publications, and generic use by competitors, the mark’s owners, and third parties to show a particular mark is generic. Nartron Corp. v. STMicroelectronics, Inc., 305 F.3d 397, 406 (6th Cir. 2002). Examples of generic marks are “Super Glue,” “Thermos,” and “Aspirin.”
Acquiring Rights in a Trademark
Rights to a trademark can be acquired in one of two ways: (1) by being the first to use the mark in commerce; or (2) by being the first to register the mark with the United States Patent and Trademark Office (“USPTO”). 15 U.S.C. § 1127(a). Unlike use of a mark in commerce, registering a mark with the USPTO gives a party the right to use the mark nationwide, even if actual sales are only limited to a small area. 15 U.S.C. § 1072. Registration constitutes nationwide constructive notice to others that the trademark is owned by the registering party, and it enables a party to bring an infringement suit in federal court. 15 U.S.C. § 1121. However, to the extent the mark is already being used by others within a specific geographic area, the prior user of the mark retains the right to use that mark within the geographic area; the party registering the mark gets the right to use it everywhere else. After five years, registered trademarks can become “incontestable,” meaning the registering party’s exclusive right to use the mark is conclusively established. 15 U.S.C. § 1065.
Demonstrating Trademark Infringement
If a party owns the rights to a particular trademark, that party can sue subsequent parties for infringing on its trademark. 15 U.S.C. § 1114(1). Three requirements must be met to establish trademark infringement: (1) the marks are valid and owned by Defendant; (2); Plaintiff is using the same or similar mark; and (3) Plaintiff’s use of the mark is likely to cause confusion. Lucky’s Detroit, LLC v. Double L, Inc., 2012 U.S. Dist. LEXIS 8520, *8 (E.D. Mich. Jan. 25, 2012).
In deciding whether consumers are likely to be confused, courts typically weigh eight factors: (1) the strength of the senior mark; (2) the relatedness of the goods or services; (3) the similarity of the marks; (4) evidence of actual confusion; (5) the marketing channels used; (6) the likely degree of purchaser care; (7) the intent of defendant in selecting the mark; and (8) the likelihood of expansion of the product lines. Daddy's Junky Music Stores, Inc. v. Big Daddy's Family Music Ctr., 109 F.3d 275, 280 (6th Cir. 1997).
Remedies for Trademark Infringement
A variety of remedies are available for parties asserting claims of trademark infringement. Successful plaintiffs are routinely awarded injunctions against further infringing use of the trademark. 15 U.S.C. § 1116(a). Monetary relief may also be available, including defendant's profits, damages sustained by the plaintiff, and the costs of the action. 15 U.S.C. § 1117(a). Damages may also be trebled upon a showing of bad faith. Furthermore, in exceptional circumstances, a court may also award reasonable attorney fees to the prevailing party. 15 U.S.C. § 1117. “Exceptional” cases usually involve infringement that is malicious, fraudulent, deliberate or willful.
If you are the owner of a trademark and feel that an individual or business is infringing on your trademark rights, please contact the attorneys at Dalton & Tomich, plc to discuss the matter and your legal options.