Under US and California law, a person or business with a trademark — or a service mark — can apply to the US Patent & Trademark Office (“USPTO”) for a registration of the trademark. Each trademark can be registered for a category of goods and services and there are thousands of categories. Trademarks and service marks are extremely valuable, and many businesses spend substantial sums of money creating and maintaining trademarks. These are the marks that create the “brand” and help generate consumer loyalty. That loyalty can drive market share and prevent a competitor from becoming profitable. Registering a trademark allows the owner to file a lawsuit in federal court to prevent infringement of the trademark. Infringement can be direct, as in actually using your trademark on their products or in their advertising. Infringement can also be indirect where a slightly different mark is used, but its use creates confusion among consumers.
One other important aspect of trademark law — and another reason to register your marks — is the ability to obtain “incontestability” status. This can be done after the five-year anniversary of your registration. It is not automatic, so a filing is needed with the USPTO called a Declaration of Incontestability. Among the facts that must be shown to have your mark receive incontestable status are initial registration, continued and consistent use in commerce over the preceding five years, continued use at the time of requesting incontestable status, and use in all the categories for which the mark was registered. Filing fees are, of course, required. There is no deadline by which a Declaration of Incontestability must be filed; the only time requirement is that it cannot be filed until the five-year anniversary has passed.
Receiving incontestability status provides four basic advantages in the event of a lawsuit over infringement. These advantages are the inability of the opposing side in the litigation to argue about the
- Ownership of the mark by the registered owner and
- The exclusive right to use the mark by the registered owner
Without the incontestability status, during a lawsuit, the owner of the mark must prove all four of these issues to the court. Sometimes, that can be time-consuming and expensive with respect to fees and expenses. Incontestability is also important in the lead-up to litigation. If you find that someone is infringing on your trademark or service mark, you must send a cease and desist letter. If your mark is incontestable, the offending business is more likely to take your letter seriously and more likely to stop infringing. This is because, as noted, incontestability removes four possible arguments from their arsenal if the case goes to court.
Contact San Diego Corporate Law Today
For more information, contact attorney Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard can be reached at (858) 483-9200 or via email. Mr. Leonard’s law practice is focused on corporate, securities, contract, and intellectual property law for small and medium businesses. Mr. Leonard can assist with the formation of your business entity — corporations, LLCs, and other forms — financing through the sale of debt and equity securities, mergers and acquisitions, contract drafting and review including commercial leases, and establishment and licensing of trademarks, copyrights, and trade secrets. Like us on Facebook.