Last week we explored how at least some of Seth Godin’s trademark advice is a bit dated.
This week, let’s take a close and careful look at his advice concerning trademark registration:
Some lawyers will get all excited and encourage (demand!) that you register your trademark. This involves paying a bunch of money, filing a bunch of forms and earning an ® after your name instead of the ™. While the ® does give you some benefits by the time you get to court, it doesn’t actually increase the value of your trademark. And you can wait. So, when you come up with a great name, just ™ it.
Actually, I’ve never met lawyers who "demand" that their clients register their trademarks. Strongly recommend, yes, and for good reason, yes, but demand, no. That is not a lawyer’s role. Even inexperienced trademark lawyers know to explain the costs, benefits, and associated risks of pursuing or foregoing federal registration. Unfortunately, Mr. Godin appears to misapprehend all three.
We already have discussed the many and substantial benefits afforded to those who federally register their trademarks. These go well beyond what you have, "by the time you get to court." Indeed, in some instances, having the ® will avoid the need to go to court altogether, since the registration is actual proof of the claimed right and may be enough to move a squatter off your mark without even resorting to formal legal action. Good luck with that, if all you have done is "just ™ it." Moreover, in other instances, having the ®, can be the difference between continuing to use or expand the use of your trademark and not, so this is certainly more than "some" minimal benefit.
As to the risks, those who don’t appreciate the value of a federal registration or the importance of filing prompt registration applications likely aren’t aware of or don’t understand this significant risk:
Now, some realize the importance of the protection, but in an effort to save or defer cost, they have considered holding off on filing a federal trademark application — to see how the product does — before making a final decision on the filing. If you or someone you know falls into this category, while I sympathize with your and their efforts to manage a tight budget, understand another risk that goes a step further than the risks already covered in the above-linked Create Magazine article.
To do so, after you have conducted the appropriate due diligence to clear use of the new name and mark, ask yourself how long it will take to get your product with the new name and brand in the stream of commerce and in the marketplace. Without the important benefit of constructive use relating back to the filing date of the federal trademark application, it is important to realize that your investment in preparing for the product launch may be lost altogether if another person or company files an intent-to-use trademark application, for a confusingly similar mark, even one day before you get to market with your newly named product. If this happens you and they may very well "see how the product does" with another name.
Now, as to the issue of cost, given the substantial benefits conferred and the substantial risks avoided, when those are recognized and understood, the financial cost of a federal trademark application seems well worth the $275 governmental filing fee toward the creation of an intellectual property asset of national scope.
Last, as to Mr. Godin’s assertion that federal registration "doesn’t actually increase the value of your trademark," he is simply wrong, so there you go. It stands to reason that national rights are worth more than local rights. Ask any party to a franchise agreement or even their informed bankers who loan money based on them.
Without a federal registration, rights are limited in geographic scope to those areas of operation where the use has been substantial enough to generate common law trademark rights. With a federal registration the trademark owner is deemed to have used his or her mark in every sliver, corner, and county of the U.S., as of the filing date, even though the trademark may never blanket the country with their goods or services. So, one need only consider the world of franchise relationships and trademark licenses to appreciate the enormous power and value a federal trademark registration brings to the table and to the bank.
Some other time, I’ll explain some of the reasons for using the ™ symbol, but suffice it to say for now, doing so confers no legal rights. So, "when you come up with a great name" and you want to use it and have the best chance of expanding that use over time, as your business continues to grow, don’t "just ™ it", instead, seek federal registration at the earliest possible opportunity.