[WATCH]: Sarah Stemer's Trademark Tips For Startups and New Companies

From company name to portfolio of registered trademarks here we go!

Going from naming your new company or startup, to having a portfolio of registered trademarks can seem daunting. It’s important though, so we made this video to make the process a little more approachable for you. Trademark Attorney, Sarah Stemer, discusses trademark tips for startups and new companies when they are in the process of developing or protecting their brand, with a brief discussion about trade dress, international trademarks, trademark searches and common pitfalls. Part of Stemer Law’s TM101 series.

"Ornamental" Rejections for Apparel Trademarks

A logo or brand printed on a shirt or baseball cap might not be a trademark.

The use of a brand in that way could be seen as a decoration, or merely “ornamental." The actual trademark is usually printed on the sewn-in tag or on the hang tag where you usually find the price. That is where the brand acts as a "source identifier.".

In order to qualify as a trademark, the brand must be a “source identifiers.” In other words, a consumer would have to be able to look at the branding and know which company is offering the goods or services. When a consumer sees a design on the front of the shirt, it might register as just a design. However, consumers know that the tags are where the brand name can be found. Sometimes, a brand on the front of a shirt or hat can act as a trademark, if the logo is not predominant and looks like a brand instead of a decoration.

This issue arises then new apparel companies come out with their first batch of clothes, but print their logo on the front of plain customizable clothing, such as Hanes or Gildan. The tags will still say “Hanes” or “Gildan.”

As part of the United States Patent and Trademark Office (USPTO) application process, you are required to show that your trademark is being used on your products as a source identifier. For apparel, a common option is to submit a photograph showing the trademark on an article of clothing. Unfortunately, if the photo only shows the brand name on the front of the shirt or hat in a way that looks like a decoration, you will likely receive a rejection from the USPTO. The only way to overcome the rejection is to show your brand name as a source identifier, such as on a hang tag or a sewn-in tag.

Gwyneth Paltrow's Health and Beauty Company, Goop, Sued For "Reverse Confusion" Trademark Infringement

Last week, Good Clean Love, Inc. (GCL), an Oregon-based woman’s personal hygiene and health company, filed a Trademark infringement lawsuit in Federal District Court against Gwyneth Paltrow’s beauty company, Goop. In its complaint, GCL asserts multiple claims, including federal trademark infringement, false advertising, unfair competition, and analogous claims under Oregon state law.

The root of the dispute is that Goop is allegedly using a tagline that is confusingly similar to GCL’s house brand. GCL says it has used “Good Clean Love” for its line of sexual health products for over 20 years, while Goop has used “Good. Clean. Goop.” for its similar sexual health supplement for a much shorter time period.

In order to determine whether there is a “likelihood of consumer confusion,” Courts look at not only the similarity of the trademarks themselves, but also the similarity of the underlying products. Trademarks do not need to be identical - it is enough if they are similar in sound, appearance, meaning, or commercial impression. If, overall, there is a likelihood of confusion, whoever used the trademark in US commerce first, has superior rights, and can stop the junior user from continuing their use of the infringing trademark.

The Goop case is a good example of a “Reverse Confusion” trademark infringement, where a newer bigger company comes onto the market and overwhelms the trademark and commercial standing of the older company, who actually has superior rights, despite being smaller.

“Reverse Confusion” occurs when a newer, bigger company comes onto the market and overwhelms the commercial standing of an older, smaller company’s brand.

In addition to impacting their sales, GCL worries that the confusion will damage their reputation. They allege that Goop uses known harmful chemicals in its products, whereas GCL’s products are “truly clean.” If consumers start to think that Goop produces the GCL’s product, consumers will also believe that GCL’s products contain these harmful ingredients.

Goop, on the other hand, called the lawsuit “meritless.” Interestingly, according to GCL, the day after Goop received GCL’s pre-suit cease and desist letter, they doubled down with their use of the infringing tagline, flooding the market. We will see if this is predictive of how Goop defends their position.

Filing this law suit does not come without risks for GCL. Because their house trademark is comprised of basic words in a somewhat descriptive order (“good”, “clean” and “love”), it could be deemed generic. This would leave them at risk of a viable counter-attack by Goop, which would be a devastating loss for the company. The reality is, there may come a time when a trademark owner finds themselves in a defensive position. The stronger a trademark, the easier it is to defend, which ideally will inform a company owner during the process of choosing their brand name.

A "Shoe"-In This Time, or Will They Get The Boot Again? Timberland Asks Appeals Court for Trademark Protection Over Their Iconic Footwear

Timberland is asking the Fourth Circuit Court of Appeals for trademark protection over their iconic boot (not just the name or logo of the company, but the boot itself!)

The shoe company first filed their unsuccessful trademark application to the United States Patent and Trademark Office nearly 9 years ago and have been appealing their way up the ladder since. Now, they will have to convince the Court that their boot is distinctive enough to serve as a brand, and that the design of the boot has no function.

Product configuration trademark protection is extremely hard to come by, but they are not unheard of, for shoes in particular.

More on this soon.

Stemer Law’s Colorado IP Troll Case Heats Up, As Judge Issues Stark Warning

A few months ago I wrote about a Law360 article that quoted me calling my adversaries “trolls” to a Judge in Federal Court.

Those cases are still moving along, somehow.

In case you missed it - over the summer, a California bong-maker, GS Holistic LLC, filed nearly 50 identical cases in the District of Colorado, alleging that dozens of Colorado smoke shops were intentionally selling counterfeit versions of their bongs. In true IP-Troll fashion, the mass of complaints filed by a Florida law firm were copy and pasted, with big scary words intended to intimidate Defendants into settling, but without any meaningful facts or allegations.

Well, Federal Magistrate Judge N. Reid Neureiter caught wind of these robo-filed cases and issued a strongly-worded Order to Show Cause, requiring Plaintiff and Plaintiff’s lawyer to show up in person to assure the Court that they have a legitimate basis for their cases and that they plan to litigate according to the rules. We all gathered in court for the September hearing, where things seemed to get back on track.

That did not last.

Fast forward to January 12, 2024, after Plaintiff failed to follow local rules, federal rules, and deadlines, the Judge issued another biting order. In the order, which is the subject of the latest Law360 article about the cases, he called out Plaintiff for their “chaotic” prosecution, saying he has “no confidence” they can successfully work on this case load. He issued a stark warning too - if they continue their violations, he may end up dismissing all of their cases.

While the January 12 order did indeed “chide” Plaintiff, as the Law360 headlines says, it is my opinion that it also shows the the District of Colorado and Magistrate Judge N. Reid Neureiter's commitment to finding a fair result for all litigants, in spite of the complications that these mass filings have created. As I am quoted as saying in the Law360 article - "the record is clear that the plaintiff has been given a multitude of chances to course correct, but they continue to flounder.”

Not as blistering as calling them trolls on the record in open court, but it is still the truth … and what I said about my clients is also the truth, "…the Defendants, as small business owners, are an important part of Colorado's culture and economy and will not be cast aside."

Stemer Law's Sarah Stemer Quoted In Law360 Article, In Response to IP Trolls

The article entitled ‘We’re Not Trolls,’ Bong Co. That Filed 850 IP Suits Tells Judge” can be accessed here.

Indeed, a Bong Company filed about 850 federal trademark infringement and counterfeiting cases in various districts around the country, including 45 in the District of Colorado. Unfortunately for Plaintiffs, both Stemer PA and the District of Colorado caught wind of the mass of filings. In response, Federal Magistrate Judge Neureiter issued an Order to Show Cause admonishing that problems seen in other similar filings “will not be tolerated in the District of Colorado.” The Order also set a hearing requiring Plaintiff’s counsel and a corporate representative of Plaintiff to appear in person, which took place last Tuesday.

Stemer, PA represents two of the Defendants in two different cases, so I appeared in person at the Federal Courthouse in downtown Denver. First, the Plaintiff’s attorney took the podium to explain their position. Notably, he claimed he had never heard of what an IP troll is, then proceeded to call the owners of the mom-and-pop smoke shop Defendants, who maybe sold a handful of counterfeit products on accident, “scofflaws” and “ne-er do wells” who are part of a “criminal enterprise.”

In response, I took the podium and explained that, among other things, “filing a complaint with copy-paste complaint allegations and then robo-filing them is pretty much the definition of what a troll does," which was reported in the Law360 article.

I meant every word.

I agree that it was, as another Defense attorney said as he left the courtroom, “one of the funnest days in court I have ever had.” Joking aside, these are serious matters for defendants and it is my hope is that we are back on track to litigate toward a justifiable result. While it is our fundamental belief that everyone should have equal access to the legal system, no one should be allowed to abuse it.

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).

1. 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.

2. 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.

3. 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.

4. 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.

5. 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.

6. 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.

7. 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.

8. 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.

9. 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).

10. 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).

11. 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.

12. 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.

13. 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.

14. 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.

15. 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.

16. 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.

17. 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.

18. 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.

How to Select the Right Specimens of Use for Your Trademark.

For a mark to be registered in the United States Patent and Trademark Office (“USPTO”), it must be in use. A mark owner is required to submit a Declaration of Use and a Specimen of Use prior to registration, then again 5-6 years after registration and every 10 years after the registration date.

The Declaration of Use is a statement by the owner swearing under penalty of perjury that the mark is in use in United States commerce in connection with each one of the goods and services listed in the application or registration.[1]

Finding an acceptable Specimen can seem Sisyphean.

While the Declaration of Use should not be taken lightly, the process of preparing and submitting it is relatively straight-forward.

On the other hand, locating an acceptable Specimen of Use can seem Sisyphean. In order to demystify this process, we compiled examples of specimens that the USPTO would find acceptable.

Specimens for Goods

Generally, specimens for goods are photographs or digital images that show the mark in use in conjunction with the goods. Specific examples include:

• a label, tag or decal of the mark, affixed to the good

• a label or tag hanging off the product showing the mark

• packaging, boxes or shipping containers with the mark

• a display where the good is shown along with a sign or poster on which the mark is displayed or point of sale display materials

• a packing slip or packaging materials which is shipped with the goods and shows the mark

• a catalog order sheet with an image of the product and the mark, in close association with price and ordering instructions

• a screen shot of a webpage, showing the product, the mark, a price and a “cart” icon

• a photograph of a of a frame of a movie or video tape which shows the mark;

• if the product is downloadable software, a screen shot which shows the mark, with purchase instructions and way to download the software

• a truck with the mark displayed that ships the goods

• a instruction manual showing the mark that is included in the packaging sold with the product

Specimens for Services

Generally, specimens for services are advertisements that show the mark and make a clear reference to the services. Specific examples include:

• internet web page advertising

• advertising appearing in a paper publication, such as a magazine, newspaper or journal or telephone directory

• promotional brochures, direct mail advertising, handbills, posters, leaflets, circulars, fliers

• business signage on a store front or vehicle

• Invoices or proposal letters

• If a restaurant, a menu

• business letterhead, stationery or business cards

• trade show demonstration materials

• displays in a showroom

• billboard advertising

• radio/television advertising

• gift items which service as advertisements, such as T-shirts, hats, coffee mugs, calendars, pencils, pens, coasters, buttons

Once you have located a specimen, take a second look at this list – if it is not there, chances are, it will not be accepted by the USPTO.

While selection, preparation and submission of both the Declaration of Use and Specimen of Use will always require some effort by the mark owner, many of the complications can be ameliorated by the help a qualified trademark practitioner.

[1] “Use in commerce” is defined as commerce that may be regulated by congress. This is further defined in US Constitution, Article 1, Section 8, Clause 3, also known as the Commerce Clause, which states that congress can regulate interstate commerce, commerce between nations and commerce with Native American Tribes.