Article: Alan Davidson


The Small Business Library

March 2, 2000

Five Common Myths About Trademarks

Few problems can be as time-consuming, resource intensive, and costly as a trademark infringement. Armed with a handful of misconceptions, many entrepreneurs unwittingly stumble onto a legal minefield.

"I talk to dozens of entrepreneurs every week," states Alan Davidson, Esq., head of the trademark group at MicroPatent LLC, the leading provider of patent and trademark information on the Internet. "The same frightening themes echo over and over. At least one phone call or e-mail every day includes a variation of one of five basic myths."

Evidence shows that many inexperienced business people haven't any idea of how to avoid disruptive infringements or to secure and protect their prized new names. Following are illustrations about the five most common myths about trademarks and tips to help large and small businesses alike avoid a trademark related disaster.

Myth #1:   My Corporate or Trade Name Registration protects me.

You start a business and incorporate/register your name with the office of the Secretary of State in your home state. Once you incorporate and register your fictitious or assumed name, it's business as usual. Out of the blue, you receive a cease and desist letter or, worse yet, are served with an infringement suit.
Registering your corporate name, assumed names, and trade names is not enough. If the name is being used in commerce as a trademark by another party, it is subject to the infringement laws already in place on the federal and state levels. A corporate name registration is by no measure a trademark registration nor does it protect a business from infringement claims by owners of trademarks, including federal, state and common law trademarks.

Myth #2:   My domain name is my trademark.

With the proliferation of e-commerce, many see a domain name and a trademark as synonymous. Again, misplaced confidence can be costly. Here, too, the law favors trademark holders, not domain name owners. Recent legislation has given the owner of a registered federal and/or state trademark greater authority to stop another party from using an infringing domain name.

Selecting and securing a domain name and a trademark at the same time will insure you've taken every precaution to avoid domain name and trademark disputes.

Myth #3:   Searching Federal trademarks is effective "insurance".

This myth is common to the savvier businessperson who knows that he has to check trademarks before spending money advertising his new "gadget" or business. This person hires an attorney and perhaps does searching himself, but his fatal error is that he only considers federal trademarks. His potential problem occurs when he misses an important state mark that predates his usage or registration and the owner of that mark comes after him and stops him from continuing to use the name, or worse yet, sues him for infringement. The moral of this story is to search both federal and state trademarks as well as domain names or other "common law" trademark resources for maximum protection.

Myth #4:   My mark is not the same and can't be in conflict with the other mark.

Marks don't have to be identical in order to cause confusion. Subtle changes in spelling (QUIK rather than QWICK) and presentation, such as run-on words, not two words (Berger King rather than BergerKing) are as meaningless as the addition of a trivial or generic term. Confusion can result if marks look, sound or mean alike. If the mark is used on "related" goods, confusion is likely. Famous trademarks can cause problems no matter how they are used and get a wide breadth of protection.

Myth #5:   Trademark Searching is expensive/complex.

This is no longer the case. Preliminary "knock out" searches where the objective is to rule out obvious conflicts are not expensive. At MicroPatent, www.micropat.com, for example, a full day of unlimited searching costs only $35. While not a legal opinion, this kind of search may reduce the list of potential names in consideration, and provide a picture of the "landscape" as to the name in that particular market. MicroPatent's MarkSearch database includes federal and state trademarks, and is available 24-7.
For further information and research on Trademarks, visit the Trademark Portal site at MarksOnline.com.