18 Reasons You Should Register Your Trademark
Consulting with business owners and clients over the years, I have noticed that a lot of people delay filing an application for registration of their trademark. Some even actively avoid it. After all, there is no requirement to register a company or brand name, and the process can seem intimidating and costly. Regardless, there are several reasons to file an application for registration of a trademark in the US Patent and Trademark Office (USPTO).
It will act as a deterrent. Registration of a trademark will act as a deterrent against someone else developing or using the same or a similar trademark. Details regarding a registered trademark are easy to find on the USPTO database, so most anyone developing a brand can find your registration, prompting them to choose another name. Seeing a brand or company on the registry will let someone know that you are serious about your brand and intend to protect it.
It is easier to stop an infringement. While brand owners, both registered and unregistered, have recourse against infringement of their trademark, approaching an infringer with a registration in-hand makes stopping them a lot easier. Generally, the first step in stopping an infringer to send them a Demand Letter or Cease and Desist Letter. The stronger the letter, the more effective the letter is. It goes without saying that having a registration makes the letter stronger.
Retail anti-infringement services and Brand Registration. Online retailers such as Amazon.com or Alibaba.com actively monitor for infringement and counterfeiting. They also allow trademark owners to submit notifications if they identify infringing activity. Activation of and participation in these services requires a trademark registration or application. The much sought-after Amazon Brand Registry will look for a national registration or application before including you in their roster.
Social Media anti-infringement services. Meta FKA Facebook and Instagram have similar services, where if you send them a registered trademark, they will quickly remove infringing posts or activity.
US Customs and Border Patrol (CBP) registry. Trademark owners can place their trademark on the US customs registry. This is a free service by the CBP, where they will monitor shipments into the US, checking for counterfeit goods. The CBP will place only registered trademarks into their registry.
Access to ICANN’s UDRP. A valuable resource available to trademark owners, especially as internet marketing and retail becomes more important, is ICANN’s Uniform Domain Name Dispute Resolution (UDRP). If you are, say, a clothing retailer and someone is selling counterfeit goods on a webpage similar to your trademark, ICANN can require the domain registrar to transfer ownership of the infringing domain to you. This service is only available for registered trademarks.
It will make your company more valuable. A company with a book of registered intellectual property will include that in their valuation. Whether you keep your company closely held or grow it to IPO, there will likely come a time where a higher company value leads to money in your pocket. This could come up when you selling your company to retire, bring in a partner along the way, or if you are simply growing the company as an investment buyer.
It will be a selling point to investors. Having registered trademarks, especially for your brand name, makes your company more legitimate, safer from competitors and, as explained in point 7, creates a higher value. This all in turn attracts investors and makes them feel safer to invest.
It may end up costing you less. While filing a trademark application is certainly more expensive than using an unregistered trademark, the cost of protecting an unregistered trademark can prove far more costly. Between USPTO fees and attorney’s fees, the cost of registering a trademark can range anywhere between $1,200 and $3,500. On the other hand, owners of unregistered trademarks can find themselves filing Trademark Trial and Appeal Board proceedings to stop someone else from registering their unregistered trademark. That can cost anywhere between $5,000 to $150,000 or more (more on the TTAB below).
Easier Access to the TTAB. The TTAB is best described as a hybrid between a traditional US court and an arbitration board, where trademark owners can file Opposition and Cancelation proceedings. While access to the TTAB is also available to owners of unregistered trademarks, the presumption of validity that comes with owning a registration is beneficial (which brings me to my next point).
Presumption of validity. In any type of legal “fight,” the importance of a presumption of validity cannot be overstated. Not only is it easier and less time consuming to prove something that is assumed true, it will also leave the other party with the hefty burden of proving that your registration is invalid. Without a trademark registration, it will be your burden to prove you have trademark rights.
Licensing and contract enforcement. A common way to profit from your brand or intellectual property is to “lease” it to others through a licensing agreement. Having a registration helps define the terms of the agreement, outlines exactly what they are using, and helps to enforce it if anything goes wrong.
To help prevent “generi-cide.” Under US law, for a word, phrase, or logo to qualify as a trademark, it must not be generic. Even where a trademark starts off as unique, it can become generic through common use. Popular examples of that include “Kleenex” for tissues and “Escalator” for moving stairs, which were both once registered trademarks. Legally, generi-cide can be prevented if a trademark owner takes steps to protect their trademark (like “Velcro” has, for their brand of hook and loop closures). This type of protection is next to impossible without a registration.
Protection for your product once your patent expires. Once a patent expires, a trademark can help a trademark owner retain their customer base through the goodwill and trust that comes with the brand. In fact, it is sometimes the only intellectual property left for an invention-based venture. One of my favorite examples is with the toy brand, Lego. When their building block patent expired, the imitators were so successful that Lego almost went out of business. However, they managed to get past the initial blow and stayed afloat with the help of their trademark.
Use of the Circle-R logo. While there is technically no legal value for using the Circle-R logo, it just looks more official. Heads-up, though, using the Circle-R on an unregistered trademark is a big no-no.
Priority date. An argument over who owns a trademark ultimately rests on who filed an application first or who started using it first. While US trademark rights are based in use, an individual who has imminent plans to use a trademark can by filing an application on an “intent-to-use” basis. Because application date and use date is on equal footing, applications for registration of a trademark can be a great tool to secure your brand before it is fully developed. This is especially true for foreign companies just breaking into the US market. For applications based on foreign priority, there is an assumption of use at the time priority is established. In fact, owners of trademarks that are subject of applications with a foreign filing basis do not have to show use until 5-6 years after registration.
Incontestibility. After 5 years of registration, a trademark owner can file a Declaration of Incontestability under §15. Once this filing is accepted, the trademark will defeat even someone who started using the same or similar trademark well before them.
In rare cases, you could lose it. Albeit rare, a nightmare scenario would be if you end up on the other side of the scenario in point 17. Say you use your trademark for many years without filing an application, and in the meantime, unbeknownst to you, someone with a similar brand is about to file for incontestability. You will no longer have superior rights to them and they could force you to stop using your trademark.
As you can see, the reasons for registering a trademark are compelling. For a growing or stable company, prioritizing the protection of your intellectual property rights is paramount. For more insight into the process, contact our firm for a free consultation.