Intellectual Property Law

Chapter 2 Lecture Notes

Major points to be addressed in the chapter include the following:

1. Trademarks perform two critical functions: they provide assurances to consumers that
goods are of a certain quality and consistency and they assist consumers in making
informed purchases. Both businesses and consumers benefit from protection of
trademarks: Businesses benefit because they see the rewards of their investment in
developing and marketing quality products, and consumers benefit because they can
readily identify and purchase the goods they desire.

2. The value inherent in achieving consumer loyalty to a particular brand, product, or
service is called goodwill.

3. There are four types of marks:

• Trademark. a word, name, symbol, or device (or combination thereof) used to
identify the goods or products of one person and distinguish them from the goods
of another
• Service mark. a word, name, symbol, or device (or combination thereof) used to
identify the services of one person and distinguish them from the services of
another
• Certification mark. a word, name, symbol, or device (or combination thereof)
used by one person to certify that the goods or services of another have certain
features, generally as to quality, material, or some other characteristic (examples:
Underwriters’ Laboratory or Good Housekeeping Seals of Approval and
STILTON®, certifying that cheese originates in a certain region)
• Collective mark. a mark used by a collective membership organization, such as a
labor union or fraternity, for its goods or services or used to identify that the
person displaying the mark is a member of the organization
4. Trademark rights are acquired through use of the mark, not through registration, as is
the case in many foreign countries. A person thus has rights in a mark even though
the mark is not registered with the USPTO or in the state where it is used. One
exception to this rule is the intent-to-use application (which allows people to file an
application for a mark that they have a bona fide intent to use; registration issues,
however, only upon proof of actual use of the mark). The use required is bona fide
use, not a token use, and the use must be interstate use.

5. A person who uses a mark without registering it is said to have a common law
trademark. The mark can be protected in any geographical area in which it is used
(and a reasonable area of expansion beyond).

6. Marks can be registered with the USPTO. Although registration of a trademark is not
required, it offers several advantages, including the right to use the ® symbol, ability
to bar importation of infringing goods, right to obtain registration in various foreign
countries based upon the U.S. registration, right to bring an action in federal court for
infringement, and receipt of a registration that is nationwide in scope.

7. If a mark does not qualify for federal registration (generally because it is not being
used in interstate commerce), its owner can file a state trademark registration. Once a
mark is used in interstate commerce, however, a federal registration should be sought,
and there is no advantage in securing a state registration in addition to a federal
registration.

8. The various laws and treaties governing trademarks are as follows:

• Lanham Act. The Lanham Act is the federal statute governing trademark rights.
In addition, regulations relating to trademarks are found in C.F.R. Title 37, and
the USPTO follows the Trademark Manual of Examining Procedure as a
reference work on trademark practices and procedures.
• NAFTA. NAFTA is an agreement among the United States, Canada, and Mexico.
NAFTA prohibits registration of marks that are primarily geographically
deceptively misdescriptive.
• TRIPS. TRIPS is a treaty signed by the United States in 1994, which bars
registration of a mark for wine or liquor if the mark identifies a place other than
the origin of the goods and was first used after 1996.
• TLTIA. TLTIA, effective in 1999, simplified several requirements relating to
trademark registration and maintenance.
• Anticybersquatting Consumer Protection Act. The Act protects the public from
acts of Internet “cybersquatting,” which is the bad faith registration of Internet
domain names.
• Madrid Protocol. The Madrid Protocol facilitates international trademark
protection by allowing applicants to file a single “international” application
designating several countries in which trademark protection is desired.
• Federal Trademark Dilution Act. The FTDA protects famous marks against
marks that are likely to cause confusion with famous marks.

9. There are five categories of marks:
• Generic marks. generic marks are not really marks at all but merely the common
name of a product such as “pencil,” “cereal,” or “computer.”
• Descriptive marks. descriptive marks tell or describe something about the good
or service offered under the mark, such as describing some quality or feature of
the good/service (example: MIGHTY GOOD JUICE). Descriptive marks are not
registrable unless secondary meaning is shown (secondary meaning or acquired
distinctiveness refers to the association consumers make with the mark)
• Suggestive marks. suggestive marks do not directly describe the good/service,
but rather suggest something about the good/service (example: SOFT-AS-SILK
for cake flour or FROOT LOOPS for fruit-flavored cereal)
• Arbitrary marks. arbitrary marks consist of dictionary words used for unrelated
products (example: BUMBLE BEE tuna)
• Fanciful/coined marks. fanciful or coined marks are invented words (examples:
PEPSI, KODAK)

10. A trade name is one used to identify a business. It cannot be registered as a trademark
unless it serves to distinguish the goods and services offered by the business.
(Example: the use of DELL on the letterhead of Dell Computers is use as a business
name; placing the mark DELL on the computers sold by the company is use as a
trademark).

11. In addition to words, names, and symbols, various other matter is protectable as
trademarks, including the following:

• Slogans, letters, and numbers
• Logos and symbols
• Names of performing artists (where the owner of the mark controls the quality of
the goods or services or the goods are provided in a series)
• Domain names and hashtags (if they function as an identification of the source of
goods and services and not merely as an Internet address or tool to facilitate social
media searching, respectively)
• Foreign terms (so long as they are not descriptive)
• Shapes (so long as they are not functional)
• Trade dress
• Color (so long as it is not functional)
• Fragrances, sounds, flavors (possibly), and moving images
• Designs and ornamentation (if distinctive)
• Serialized literary and movie titles

12. Not every word, symbol, or slogan can function as a trademark. There are several
exclusions from protection, including the following:

• Disparaging or falsely suggestive marks
Note: In December 2015, the Federal Circuit held that the
provision of the Lanham Act that prohibits registration of disparaging
trademarks is unconstitutional because it violates the First Amendment. In
re Tam, No. 2014-1203, 2015 WL 9287035 (Fed. Cir. Dec. 22, 2015). The
court held that the USPTO’s refusal to register the mark THE SLANTS
for a band on the basis that the mark was disparaging to Asians chilled
free speech and that the government may not prohibit speech merely
because it is offensive. Although the holding was limited to the
disparagement provision of the Lanham Act, the court noted that other
provisions of the act, such as the provisions barring registration of
scandalous or immoral marks might also constitute unlawful government
regulation of expression. At the time of the writing of this text, the U.S.
Solicitor General had filed a petition for a writ of certiorari with the U.S.
Supreme Court, asking that the Court determine whether the provision in
the Trademark Act that forbids disparaging marks violates the Free Speech
Clause of the First Amendment. In the interim, the USPTO has suspended
action on any pending trademark applications involving marks subject to
refusals on the grounds that they are disparaging or comprise immoral or
scandalous matter and has conceded that disparaging and scandalous
marks should likely be treated the same way.
• Insignia, coats of arms, and flags
• Immoral or scandalous matter
• Names and portraits of living persons (unless permission is given)
• Deceptive matter
• Mere surnames (unless secondary meaning is shown)
• Geographical terms (if they are geographically descriptive they cannot be
registered without proof of secondary meaning; under NAFTA, geographically
deceptively misdescriptive marks cannot be registered even with proof of
secondary meaning; and geographic marks used after 1996 in connection with
wines and spirits must truly indicate the place of origin)
• Descriptive marks (unless secondary meaning is proven)
• Confusingly similar marks
• Functional devices
• Statutorily protected marks (marks of the Red Cross, Olympic rings, etc.)

13. The agency responsible for registering trademarks is the USPTO. It offers a wealth of
information on its website.