Trademark Goodwill: Why Is It Important?
Weak Marks Have Narrow Protection
But Being First Is Still Rewarded
Two factors affect the overall strength of a trademark: its inherent strength based on the nature of the mark itself (its inherent potential) and its commercial strength, based on the marketplace recognition value of the mark (how much strength is acquired). See Tea Board of India v. Republic of Tea Inc., 80 USPQ2d 1881, 1899 (TTAB 2006); McCarthy on Trademarks and Unfair Competition § 11:83 (4th ed. 2011).
Weak marks are generally descriptive or suggestive or common words where the use of the mark (acquired commercial strength) has not or does not overcome the mark's intrinsic or inherent shortcomings. Weak marks are often accorded a narrower scope of protection.
Ordinary strength marks that are neither weak nor exceptionally strong are entitled to the same scope of protection as other registered marks of the same character, not to the broader protection which an exceptionally strong or famous mark would merit.
Strong marks or famous marks are given broader protection. Fame would play a dominant role in the likelihood-of-confusion analysis because famous marks enjoy a broad scope of protection. Bose Corp. v. QSC Audio Products Inc., 293 F.3d 1367, 63 USPQ2d 1303, 1305 (Fed. Cir. 2002); Recot Inc. v. M.C. Becton, 214 F.3d 1322, 54 USPQ2d 1894, 1897 (Fed. Cir. 2000); Kenner Parker Toys, Inc. v. Rose Art Industries, Inc., 963 F.2d 350, 22 USPQ2d 1453, 1456 (Fed. Cir. 1992).
However, even a weak mark is entitled to protection against the registration of a very similar mark for closely related goods. See King Candy Co. v. Eunice King's Kitchen, Inc., 496 F.2d 1400, 182 USPQ 108, 109 (CCPA 1974) (likelihood of confusion is to be avoided as much between weak marks as between strong marks).
First to file isn’t just a patent issue. The first to file a trademark application has an advantage as well. It has been implicitly recognized that there is a policy of encouraging prompt registration of marks by rewarding those who first seek registration under the Lanham Act. Weiner King, Inc. v. Wiener King Corp., 615 F.2d 512 (CCPA 1980).
Why Goodwill Is Important
"American businesses depend heavily on trademark protection for their brand names and service identities . . . A trademark is often a company's most valuable asset. Consumers also rely on trademarks to help them decide among competing products and services.” (http://www.uspto.gov/news/pr/2007/07-46.jsp).
“Sometimes, a trademark is better known than the company itself.” Brookfield Communications v. West Coast Entertainment 174 F. 3d 1036 (9th Cir. 1999).
But sharing trademark goodwill between products or services or between trademarks depends on creating a consistent commercial impression; goodwill and acquired distinctiveness go hand in hand. Generally, marks with different commercial impressions do not share goodwill. See In re Parkway Machine Corp., 52 USPQ2d 1628 (TTAB 1999) ("The existence of applicant's other registrations covering different marks is largely irrelevant to the question of acquired distinctiveness of the instant mark."); see also In re Dial-A-Mattress Operating Corp., 240 F.3d 1341, 57 USPQ2d 1807, 1812 (Fed. Cir. 2001) ("A mark is the legal equivalent of another if it creates the same, continuing commercial impression such that the consumer would consider them both the same mark."). In re Franklin County Historical Society (TTAB 2012) (COSI too different in commercial impression to be useful to applicant in establishing acquired distinctiveness of "CENTER OF SCIENCE AND INDUSTRY.")
What is Trademark Goodwill?
Goodwill is not easily defined, but it has been described as the "expectation that the old customers will resort to the old place." It typically includes not only the likelihood that customers will return to the old place of business, but the competitive advantage of an established business. "Although the definition of goodwill has taken different forms over the years, the shorthand description of good-will as `the expectancy of continued patronage,' provides a useful label with which to identify the total of all the imponderable qualities that attract customers to [a] business." "Good will has been defined as `the value attributable to a going concern apart from its physical assets — the intangible worth of buyer momentum emanating from the reputation and integrity earned by the company.'" Coca-Cola North America v. Crawley Juice, Inc. (E.D.NY 2011).
Being able to brand a product or service with a strong name or symbol and being able to protect it with the symbol of U.S. Federal Trademark Registration -®- is a strong business tool. Registering your name first and being able to prevent someone else from registering your name as a federal trademark is easier than trying to reclaim your rights based on common law rights.
Purchasing decisions are continually influenced by trademarks by distinguishing products from one another and indicating a level of authenticity and quality about products and services. The International Trademark Association (INTA) in their Top Ten Reasons Why You Should Care About Trademarks calls a Trademark the Most Efficient Commercial Tool Ever Devised. A trademark is strong if it identifies a UNIQUE source for the product or service by not using terms that others have the right to use (like descriptive terms or common terms). A trademark’s uniqueness gives the owner the right to exclude others from using it! (Unlike descriptive words that anyone can use.)
Not Just Patents ® Legal Services provides a very economical package for USPTO Trademark Applications and protecting Trademark Registrations. See What to Expect from a Not Just Patents ® Trademark Attorney for more information on what steps we take to protect your rights and help you develop a strong trademark.
We suggest a Not Just Patents Five-Step Verification as part of a Plan for A Successful Trademark:
To Verify a potential trademark is strong, available to use, and ready to register, the process should be more than a direct hit federal search. To maximize the commercial strength and minimize the weaknesses of a trademark, we start with these steps:
5) Verify that the Goods and Services ID is both the correct and the maximum claim that are user can make and verify that the Goods and Services ID meets USPTO requirements before filing.
*We don’t stop here but this is a good start!
Our rates are very reasonable. We can provide each step individually or as a trademark registration package. Our fixed price per classification for the whole package may be less than what you might pay to another attorney or law firm just to answer a USPTO Office Action Refusal at an hourly rate.
About 30% of TEAS PLUS applications go straight to publication without an office action so don’t be surprised if you are one of the 70% who receive a refusal of some type. Call us at Not Just Patents® Legal Services. We can help. See Why Should I Have A Not Just Patents Trademark Attorney Answer My Office Action if you have already applied and been refused.