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Trademark Issues for Small Business: How to Protect Your Trademark

Author: Ginny Cascio
Categories: Corporate and Business Law

You own “Awesome Bagels” the best bagel place in the Washington Metro area. You have four locations in Gaithersburg, Chevy Chase, Silver Spring and Columbia Heights. Your stores have been reviewed by numerous magazines and newspapers as the “Best Breakfast Place,” “A Local Gem,” and “A Must Try.” Everyone talks about those “Awesome Bagels.” After five successful years, a new breakfast place opens in College Park under the name “Awesome Breakfast.” It serves fast and easy breakfast sandwiches made with bagels. A number of your customers have called to complain that your new location in College Park is awful. They are very disappointed with both the quality of the food and the service. You are very upset by these complaints because this new company is ruining your reputation and brand. What can you do to protect your trademark rights?

A trademark protects a word, symbol, or other distinguishing mark that is used to identify a good or service which is sold. There are statutory and common law rights that protect trademarks. “Awesome Bagels” (the “Mark”) is your trademark because it identifies the good that is sold and indicates to consumers a specific level of quality. 

Now: Enforce your Common Law Rights

By using “Awesome Bagels” to identify your bagels, you have established common law rights in the Mark. Common law rights allow the trademark owner to prevent others from using the Mark in your geographic area in a way that is confusingly similar, as long as the owner uses the Mark first. A website does not secure nationwide protection in common law. If someone begins to infringe on the trademark owner’s common law rights, the owner may bring an action to prevent the competitor from using the Mark.

Here, you could bring an action against “Awesome Breakfast” to prevent the use of this name as you used the Mark first in this geographic area and have built a respected brand that is associated with the Mark. “Awesome Breakfast” clearly is confusingly similar to your Mark because it has confused your costumers. A court would likely find in your favor and you should enforce your common law rights.

Later: Federal and State Statutory Rights

In order to increase your trademark protection, consider filing a Federal or State (if your State recognizes it) trademark registration. With a federal trademark, a trademark owner will obtain the greatest legal protection because it grants the owner a right to exclude others throughout the United States from using his trademark in a way that is likely to confuse consumers or dilute his brand. To obtain federal trademark protection, the owner must apply for the federal trademark with the United States Patent and Trademark Office. The level of protection granted is based on the mark’s level of distinctiveness in relation to the goods or services it identifies.

Some states, such as Maryland and Virginia, have state trademark registers that afford some level of protection to the trademark within the state’s borders. The fee for registration is often quite minimal, so it is a good option for smaller, more local, businesses.

Before: Formation of Your Business

“Awesome Breakfast” could have prevented the suit from “Awesome Bagels” by evaluating the risk of trademark infringement when it formed its business. The lawsuit from “Awesome Bagels” will cause “Awesome Breakfast” significant expense because, aside from legal expenses, it will need to change its name, its website, its menus and anything that contains the name “Awesome Breakfast.” When forming a new business, it is important to search the internet and the trademark registers to get an idea of whether others are using the proposed mark or a similar mark and have already registered it. A search helps discover any possible liability for trademark infringement and reduces the risk of future conflict.

For more information about these issues, please contact Ginny Cascio at (240) 778-2308 or gcascio@mcmillanmetro.com.