Trademarks are a huge part of everyone’s daily lives; yet the laws that dictate their use and abuse are not nearly as well known. A single trip to the grocery store may expose you to literally thousands of trademarks. There are the ones you expect to see (e.g., the word “Kellogg’s” on that box of cereal, or that jovial peanut wearing a top hat) and the ones you are hardly even aware of (e.g., the emblem on the front of the car that you parked next to in the lot, or that familiar swoosh on the sneakers of the woman behind you in the checkout line). Each of those words or symbols represents an important mechanism for lubricating the wheels of commerce, providing a shortcut for you (or your intended customer) to make informed purchase decisions. The economic advantage of trademarks lies in their ability to quickly convey, by association, a wealth of information about the quality, value, and reputation of a product, or its producer.
As an example, when someone goes shopping for clothing, they are able to quickly pick out which garments are desirable, and which ones are not, simply by looking at the tag or emblem stitched on the left breast. If you see a silhouette of a man riding on a horse and swinging a polo mallet, you immediately know something about the characteristics of that shirt, whether it’s from your own experience or from what you may have heard from other satisfied purchasers. You know a little something about the quality and whether it falls into your intended price range – all without having to spend the time, effort, and expense of buying one of each brand of shirt and conducting your own comparative analysis. You know, before even opening it, that when you take a sip from that can that has “Coca-Cola” printed on it, it will taste a certain way, and you likely made your purchase (or selected the one with “Pepsi” printed on it instead) based on that knowledge.
This special kind of nonverbal communication of information only works, however, if we let a single shirt maker to use the polo playing man silhouette. If three different companies used the same symbol, no one would know which one is the good one and which one’s seams come undone after one washing. This phenomenon is aptly named, in the parlance of trademark law, consumer confusion – where two or more companies use marks that are so similar that consumers have trouble associating a single producer with a particular product. As a method of preserving the economic advantage embodied in this product/producer association, our federal government, and each state, has created a legal cause of action, which allows a producer to sue others who try to use her trademark in a way that creates consumer confusion. It makes sense to put the job of enforcement into the hands of the parties whose interests are most closely aligned with the government’s, keeping the size of government down and minimizing taxpayer costs. Toyota will be as motivated as the government, if not more, in preventing someone from selling lemons with a rounded “T” symbol on them.
The only potential problem with this enforcement schema is that some producers, usually because they are not informed, misunderstand the purpose of trademarks and try suing anyone who uses their mark, even when there is little or no danger for consumer confusion. Usually, those mark owners believe that they “own” a particular word that they’ve used as a trademark, such that they can prevent the whole world from using that word without their permission. This perception of trademark ownership, while completely incorrect, is unfortunately held by many. As a result, many a demand letter is sent to an unhappy customer who wrote about their unpleasant experience with a particular company, for example, on their Facebook or Twitter page. Preventing criticism couldn’t be further from the intended goal of trademark law, and many companies find out the hard way that trying to use your trademark rights to silence an unfavorable review only draws attention to a bad customer experience – one which is likely an anomaly.
As an entrepreneur, registering and enforcing your trademarks can be an incredibly powerful way of building your brand and, as a result, your business. Just be careful to keep in mind the real reason why the government has given you the power to sue and try to use an attorney who is experienced in these matters, who can help you see the unintended consequences of filing an infringement suit.
This article was originally published on The Tactical IP Blog.
