Ten Reasons to Register Your Trademark
The most valuable intangible asset of a company is its trademark—it accounts for about one-third of corporate value. In addition to serving as a source identifier for a product or service, a trademark symbolizes the value or goodwill that consumers can expect from a company. The greater a company’s goodwill, the greater its assurance of consistent quality—and the more valuable the brand.
The value of a strong trademark cannot be underestimated. In Forbes’ 2019 annual list of the most valuable global brands, Apple ranked first with a brand value of nearly $205.5 billion, Google ranked second at $167.7 billion, and Microsoft ranked third at $125.3 billion.
Companies truly live and die by their brand value. If Forbes’ numbers aren’t proof enough, here are ten more specific reasons why it’s critical to guard your brand value by registering your trademark.
1. A Registered Trademark Provides Nationwide Rights.
Registering a trademark gives its owner the exclusive right to use the mark nationwide in connection with the goods or services listed in the registration. By contrast, the owner of a state trademark has the exclusive right to use a mark only in the state for which it is registered, and the owner of a common law (or unregistered) mark has the exclusive right to use a mark only in the geographic area in which it is doing business.
For example, the owner of a Georgia state trademark can’t stop a competitor from using the same mark in Florida. On the other hand, the owner of a federally registered trademark can stop anyone in the U.S. from using a similar mark, even if the registrant is not using the mark nationally.
2. A Trademark Registration Provides the Presumption of Validity and Ownership.
A federal registration establishes the legal presumption of validity and ownership. This is a significant advantage when it comes to litigation: The infringer will have to rebut this presumption and affirmatively prove that the trademark is invalid and not exclusively owned by the trademark registrant.
Without a trademark registration, the owner of a common law mark shoulders the burden of proving validity and ownership before it can turn to proving infringement. Accordingly, by easing the evidentiary burdens, a federal registration makes trademark enforcement more efficient and less expensive.
3. Registering Your Trademark Means Having the Right to Expand Your Business and Brand.
As a business expands, so should the protection of its trademark. A registration provides a basis for companies to grow by claiming nationwide rights in a brand. In order to secure a federal trademark registration, you must prove that you are using your mark in interstate commerce—essentially, that you’re selling branded products across state lines or providing services to out-of-state customers. The beauty of a federal trademark registration is that it grants you rights that span the entire country, even if you’re only using your mark in two states.
Mark Speece, CEO of innovative Atlanta-based branding firm StokeSignals, has the following advice for new and emerging companies: “We always recommend our clients register their names even when they ‘don’t think’ they’ll ever move beyond their current geographic market. Business plans evolve, outside factors change, companies are acquired—possibly with plans to move beyond that original market… A registered trademark is a key step in building a futureproof brand.”
If a local business chooses not to federally register based on a disinterest in expansion, they may be out of luck if they change their minds later. Companies can lose the right to expand outside their original business area if a similar mark becomes federally registered and asserts its rights in areas outside the original business area. This is a challenge for companies looking to expand or sell, as it hinders nationwide business opportunities, thereby lowering its company’s value.
4. A Registered Trademark Provides Notice of Ownership of the Mark Nationwide.
Registration of a trademark provides constructive notice nationwide that the trademark is owned and cannot be used without permission. Even if a company does business in only a few states, a federal registration still provides nationwide notice. This type of notice also prevents infringing parties from claiming that their use of a similar mark was in good faith or innocent use, simply because they didn’t know or hadn’t heard of the registered mark.
5. A Trademark Registration Discourages Others from Using Confusingly Similar Marks.
A federal registration serves as a deterrent to other companies from using or even registering a similar mark. When choosing a trademark to represent their products and services, many companies run a comprehensive trademark search. These searches will reveal any existing registered marks that are similar to the mark a company is looking to register, thus preventing infringement issues before they even arise.
A company that doesn’t perform a comprehensive trademark search may end up choosing a mark that is confusingly similar to an existing mark. The results of that decision can be everything from customer confusion and infringement lawsuits to damages owed and eventual rebranding.
Emerging brands should also note that a trademark registration and its associated rights can last forever, which means the owner of a registered trademark can assert its rights against a similar mark for an indefinite period of time. To avoid the endless possibility of an infringement suit, perform a comprehensive search first.
6. A Trademark Registration Grants the Right to Use the ® Symbol.
A federally registered mark has the right to use the registration® symbol on any goods and services listed in the registration. This coveted symbol gives products instant marketing value: It tells consumers that the parent company is trademark savvy and serious about protecting its brand, thereby increasing its goodwill. The registration symbol® also puts competitors on notice that the mark is protected.
7. The U.S. Patent and Trademark Office will Not Allow Registration of a Similar Mark for Similar Goods or Services.
One of the functions of the USPTO is to prevent people from registering marks that are confusingly similar to previously registered marks for similar goods and/or services. The USPTO will actively refuse confusingly similar marks, which means the Office provides policing services to the owners of registered trademarks at no additional cost.
8. The Federal Registration is a Basis to Obtain Registration in Foreign Countries.
Under the Madrid Protocol, the U.S. registration may form the basis for filing an international application in certain foreign countries. In addition, if you file a foreign trademark application within six months of the filing date of your U.S. application, your U.S. application filing date will serve as your priority date. This means that companies filing in the countries in which you file during that six-month timeframe will be refused in light of your priority.
9. A Federal Registration Gives You the Right to Sue in Federal Court and Seek Treble Damages and Attorney’s Fees.
A federal trademark registration allows a company to sue infringers in federal court for infringement. This is beneficial because federal court judges are usually more well versed in trademark law than state level judges. Additionally, plaintiffs filing in federal court are entitled to substantial monetary damages (e.g., lost profits or a reasonable royalty), injunctions, and treble damages in cases of willful infringement, as well as attorney’s fees in certain cases.
10. A Federally Registered Mark is Eligible for Incontestability.
After five years of continuously using your trademark without any challenges to your trademark rights, you can seek incontestability status with the USPTO. This status provides conclusive evidence regarding the validity of the mark and of the owner’s exclusive right to use the mark. That makes a trademark significantly less vulnerable to attack by preventing claims that your mark is confusingly similar to another mark.
Ready to have your mark registered? Read more about our trademark services here, or message us below—and let’s discuss how we can help with the first step towards guarding your brand.
