Common Law Trademark Rights vs. Federal Trademark Rights
A trademark can be one of a business owner’s most valuable assets. That’s because it’s your business’ “identifier” – a name, logo, or slogan – so your products and services can be clearly distinguished from competitors. (Learn more about the different types of intellectual property in our free resource here!)
In the United States, trademark rights automatically come from using a mark you have created or own in commerce (or in connection with providing a good or service), but there is another step that can provide important additional protections: federal registration with the United States Patent and Trademark Office (USPTO).
Understanding the difference between these automatic (known as “common law”) and federally registered trademark rights can help businesses make informed decisions about protecting their brands (and read our free resource about registering before launching here).
Common Law Trademark Rights
Common law trademark rights are established when a business uses a distinctive trademark in commerce to identify its goods or services. There is no application or government registration required to create or recognize common law trademark rights. Common law rights are generally tied to the geographic areas in which the mark is actually used and where the business has established a market. This can create challenges for businesses that expand into new markets. A company may have enforceable rights in one geographic area while another business may have rights over the same business name or similar logo somewhere else.
For example, with common law rights, a Pittsburgh, Pennsylvania business owner — say a coffee shop— could have the same name as another business across the country, but another Pittsburgh coffee shop would not be able to open with the same name.
Trademark owners who only have common law rights may face difficulty pursuing someone to stop using or using a confusingly similar name without permission or otherwise proving, establishing and enforcing their common law rights. This is because they often have to provide more evidence to support their claims (i.e., evidence showing when the mark was used, how the mark was used in connection with the goods/services, and the geographic location). They also cannot as easily seek monetary damages if someone is infringing.
Federal Trademark Rights
Federal trademark rights are established through registration with the USPTO. Although registration is not required to own trademark rights, federal registration provides significant advantages over common law rights.
One of the most important benefits is nationwide protection. Generally, a federal registration provides nationwide constructive notice of trademark ownership and can establish nationwide priority, subject to certain exceptions such as the rights of prior users (such as those who were already using the business name, but never filed for federal trademark protection).
That same Pennsylvania business looking to expand into another state, even to start an Ohio location a mere 40 miles west, could consider registering the business with the USPTO and would be granted the rights to their name nationwide. (Note, however, the existing business across the country would still have rights to exist since they were in existence before the federal trademark began!)
Federal registration also provides a stronger foundation for enforcement. A registration provides more teeth to cease and desist requests of those using the mark unlawfully and without permission. Owners of federal trademarks can be used to bring an infringement action in federal court and may provide access to important enforcement tools such as takedown demands, domain disputes, and statutory damages.
Key Benefits of Federal Registration
Federal trademark registration offers several advantages, including:
Nationwide priority: Registration can establish nationwide priority in the mark, subject to certain existing rights.
Constructive notice: Registration puts others on notice of the registrant’s claimed rights.
Federal court enforcement: Registration provides an important basis for pursuing infringement claims in federal court.
Use of the ® symbol: Once a mark is federally registered, the owner can generally use the federal registration symbol with the registered mark.
Deterrence: A federal registration can discourage competitors from adopting confusingly similar marks.
Additional protections over time: Continued use and maintenance of a registration can provide stronger rights, including the potential for incontestability after statutory requirements are satisfied.
Brand and business value: A registered trademark can be licensed, assigned, and treated as an identifiable intellectual property asset.
The Bottom Line
Common law trademark rights can provide meaningful protection through use, and it’s important to understand what your rights are to a trademark even without registering (and respect the rights of others), but they may be geographically limited and more difficult to establish and enforce. Federal registration generally provides broader rights, stronger enforcement tools, and greater certainty for businesses building a brand.
Learn More about Trademarks with other blogposts and free resources below:
DISCLAIMER: This blog post is meant for informational purposes only and does not constitute specific legal advice or create an attorney-client relationship. Readers should discuss their specific situation and considerations with an attorney.
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