Do Your Clients Need a Competitive Edge in the Market? Trademarks Work

Trademark My Brand

The origins of trademarks can be found in the earliest days of the circulation of goods. As merchants moved goods in local markets, they began to mark their respective goods with a distinct designation in an attempt to differentiate their goods from those of others. By doing so, they found that customers could look for the mark to find the same product again. As consumers returned to purchase the marked product, a competitive advantage was gained and repeat business was born.

Today, our global marketplace is far more advanced than the local barter and trade markets of times past, but the competitive advantage gained by modern-day merchants through the use of distinctive trademarks remains the same. Accordingly, providers of goods and services around the world should seek to acquire rights in distinctive trademarks and to thereafter enforce these rights.

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History has shown that as soon as a provider of goods and services achieves any level of competitive success in the market, others try to capitalize or encroach on this success. Oftentimes, this involves trademark infringement, which places trademark owners at a competitive disadvantage and misleads consumers. When counterfeit goods and services are sold in the place of the successful product, the trademark owner loses sales and the consuming public is misled, even confused, as to the true source of the successful product and service.

To protect not only the competitive advantage of the trademark owner but also the consuming public from confusion, courts have developed a test to evaluate the presence or lack of confusion which forms the basis for trademark infringement claims. The likelihood of confusion test is utilized by the United States Patent and Trademark Office (USPTO) in evaluating whether federal trademark protection should be extended to an applied-for-mark, as well as by both state and federal courts in evaluating whether one trademark infringes another. Here in the Ninth Circuit, the likelihood of confusion test includes an analysis of the following “Sleekcraft factors”1:

1. Strength of the mark;
2. Proximity of the goods;
3. Similarity of the marks;
4. Evidence of actual confusion;
5. Marketing channels used;
6. Type of goods and the degree of care likely to be exercised by the purchaser;
7. Defendant’s intent in selecting the mark; and
8. Likelihood of expansion of the product lines.

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An accurate understanding of how this test is applied can help clients acquire federal trademark rights in a mark as well as maintain the existing rights in a mark.

During the process of acquiring federal trademark protection, the USPTO may refuse to protect a particular mark, asserting a likelihood of confusion with an existing registered mark. Applying the Sleekcraft Factors in the client’s favor, the USPTO can be convinced to withdraw the initial refusal and protect the mark. Successful arguments oftentimes include identifying how the respective marks are not similar because of variations between the marks in sight, sound, and meaning. Other successful arguments include demonstrating how the respective goods and services associated with the marks are not similar because they move in different channels of trade, may be purchased by sophisticated buyers, and may not be interchangeable by buyers for the same purpose. Once the USPTO approves the mark, each federal trademark registration expands the trademark rights of the business owner across the nation, establishing a potential advantage over competitors.

Similar to the above, asserting the Sleekcraft Factors in a trademark infringement matter can protect the strength and integrity of the client’s mark in the market. When it is explained to potential infringers how an examination of the Sleekcraft Factors weighs in favor of the trademark owner, the potential infringers typically cease and desist. By enforcing the trademark, trademark owners, among other remedies, can stop the sale of products that display the infringing trademark, can stop services offered under the infringing trademark, and can shut down websites and domains utilizing the infringing trademark. Indeed, enforcing the rights of the trademark owner using a detailed presentation of the Sleekcraft Factors preserves the strength of the trademark in the market and protects the goodwill associated therewith, thus maintaining the competitive advantage the trademark owner has worked so hard to achieve.

In today’s global economy, any competitive advantage in the marketplace is coveted. Here at Schmeiser, Olsen & Watts LLP, because of our unique focus on intellectual property matters, we understand how acquiring, enforcing and defending a strong trademark, both domestically and internationally, can set a business apart from its competitors. We are dedicated to helping providers of goods and services understand these rights and profit thereby.

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