Common Law Trademark Rights – Everything You Need to Know

There is a misconception that circulates Intellectual Property rights in general. A common question is whether a business automatically owns its name, logo, slogan, or other assets without having them trademarked.

Now, imagine this.

You opened a new clothing brand, ‘Sager,’ and received an overwhelming response. Before you filed for a trademark application, a competitor opened a similar brand and named it ‘Sagerz’ right across the block. Now, this confuses your customers, and you’d like to find out whether you can file for a trademark infringement against the competitor.

In this blog, we will introduce and dive into the concept of common law trademarks, the difference a federal registration can make, and more about trademark protection offered in case of no official registration.

Understand Common Law Trademark Rights

Common law trademarks, often referred to as unregistered trademarks or common law rights, are trademarks that acquire protection through regular use in commerce without the need for formal registration with a state, such as the United States Patent and Trademark Office (USPTO) in the US. Common law trademark rights are established based on the principle of “first to use” rather than “first to file,” which is the basis for registered trademarks.

Here’s how common law trademarks work:

1. Use in Commerce: To establish common law trademark rights, a person or business must use a particular mark (like a logo, name, or slogan) in connection with their goods or services in the marketplace. This usage should be consistent and not sporadic.
2. Geographic Scope: Common law trademarks are typically protected only within the geographic areas where the mark is being used. This means that if a business operates locally or regionally, its common law trademark rights may be limited to that specific area.
3. Priority: Common law trademark rights are determined based on who first used the mark in commerce. If two businesses use similar marks but one used it first, that business may have more rights.

It’s worth noting that while common law trademark rights exist without formal registration, registering a trademark provides several advantages, including stronger legal protection, nationwide coverage, and a legal presumption of ownership.

Benefits of Common Law Trademark Protection

Let’s take a step and go back to the hypothetical example given earlier. Going back to the key question, can someone without a federal trademark registration file against the infringement? 

The short answer is, Yes!

Common law trademark owners can enforce their rights against others who use confusingly similar marks in the same geographic area and industry. These include cease and desist letters.1

However, enforcing common law rights can be more challenging than enforcing registered trademarks, as the burden of proof falls on the common law mark owner to demonstrate prior use and protection. In this case, you will have to prove the infringement and how it affects your business. Similarly, you will have to prove that your brand was the first one to use the mark.

Difference between Common Law and Federal Registration

You might be wondering, is it still necessary to file a trademark with the USPTO when you have common law rights?

Common law trademark rights and federal trademark registration differ in several key aspects, including the scope of protection, legal advantages, and the process of establishing and enforcing trademark rights.

Here’s a breakdown of the main differences between the two

Scope of Protection

Common Law Trademark:

Common law trademark rights are limited in scope. They typically apply only to the specific geographic areas where the mark is being used in commerce. These rights may also be limited to the goods or services directly associated with the mark’s use.

Federal Registration:

Federal trademark registration provides broader protection. It grants exclusive rights to use the mark nationwide for the goods and services listed in the registration. This means that even if someone in a different part of the country is using a confusingly similar mark for related goods or services, the registered trademark owner can take legal action against them.

Legal Advantages

Common Law Trademark:

Common law trademark owners must rely on state laws and the common law to enforce their rights. Enforcement can be more challenging, as they must prove prior use and establish the existence of trademark rights.

Federal Registration:

Registered trademark owners enjoy several legal advantages, including a legal presumption of ownership and the exclusive right to use the mark nationwide. They also have access to federal courts for trademark infringement cases and may be eligible for statutory damages and attorney’s fees in infringement lawsuits.

Notice and Deterrence

Common Law Trademark:

Common law trademarks do not provide public notice of the owner’s rights. Others may unintentionally infringe on these rights due to the lack of visibility.

Federal Registration:

Registration with the relevant government agency (e.g., the United States Patent and Trademark Office, USPTO) provides public notice of the trademark owner’s rights through the USPTO’s online database. This notice can deter potential infringers and make it easier for others to identify and avoid infringing on registered marks.

Presumption of Validity

Common Law Trademark:

Common law trademark owners do not have the benefit of a presumption of validity. They may need to provide substantial evidence of their trademark rights in legal disputes.

Federal Registration:

Registered trademarks benefit from a presumption of validity, making it easier for the trademark owner to establish their rights in court. This presumption can shift the burden of proof to the alleged infringer.

Renewal and Maintenance:

Common Law Trademark:

Common law trademark rights persist as long as the mark is consistently used in commerce. There are no formal renewal or maintenance requirements.

Federal Registration:

Registered trademarks require periodic renewals and maintenance filings to keep them active and enforceable. This ensures that the mark remains protected over time.

Searching for Trademarks Under Common Law

To search for common law trademarks in the United States, focus on state trademark databases you plan on establishing your brand.

These resources should be looked for

1. State Trademark Databases: Visit the website of the Secretary of State or the state’s trademark office. Many states maintain databases that include registered and unregistered trademarks within their jurisdiction.
2. Online Search Engines: Additionally, conduct a web search using popular search engines like Google to explore online listings and business directories.
3. Social Media: Check social media platforms for businesses using the mark of interest, especially on Facebook, Instagram, Twitter, and LinkedIn.
4. Industry-Specific Websites:  Explore industry-specific websites, forums, and publications related to your field for trademark usage.
5. Consult a Trademark Attorney: For thorough and expert guidance, consider consulting a trademark attorney to conduct a comprehensive search and provide legal advice.

In summary, while common law trademark rights arise automatically through use, federal trademark registration offers broader protection, legal advantages, public notice, and a presumption of validity. Many businesses opt for federal registration to secure stronger and more comprehensive trademark rights.