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Importance of Trademark Clearance

by | Mar 6, 2018 | Trademark, IP points | 0 comments

“Trademark clearance” is a process that identifies whether others are already using an identical or confusingly similar mark in connection with the same or related goods or services, and assesses the level of risk associated with use, registration, and enforcement of a mark. Comprehensive clearance is not as simple as searching for an identical mark on the United States Patent and Trademark (“USPTO”) database, registering the corresponding domain name, or registering the same business name with a Secretary of State. Moreover, in the burgeoning cannabis marketplace, marks registered at the state level can present a major red flag.

Effective trademark clearance requires an understanding of how the principles of trademark law are applied. For example, it is important to appreciate that famous marks, such as APPLE, COCA-COLA, and STARBUCKS, enjoy a broader scope of protection, which means that famous mark owners can enforce their trademark rights against even unrelated products.

A general misunderstanding about clearing marks is only considering registered marks; common law (unregistered) marks cannot be overlooked. While common law marks cannot be cited during the prosecution of an application at the USPTO, an owner of a common law mark can challenge ownership of a mark in an opposition or cancellation proceeding (or a lawsuit). Additionally, for many common law marks, it may not be readily apparent when the owner began using a potentially conflicting mark, and a problematic reference may require investigation to assess priority of ownership.

Significantly, marks need not be identical to create a likelihood of confusion, as minor variations in marks may not be considered legally significant. Variations of a proposed mark, such as phonetic or vowel substitutions, may still be found “confusingly similar.” This is because consumers are generally recognized as having imperfect memories and minor differences in spelling or punctuation are not enough to distinguish marks, e.g., TREE, TREES, TREEZ, TREAS, TREE-S, TREE’S, etc. Even the presence of a logo or the presentation of words as a design may not be enough to distinguish two arguably similar word marks, as consumers naturally place emphasis on the words.

Additionally, the products offered under respective marks do not have to be the same or even be overlapping; rather, the standard is “relatedness.” For example, a mark used for online education services about cooking may present some level of risk as to adoption/registration of the same mark for a chef’s knife kit because cooking instruction and chef’s knives arguably target similar customers and may flow through the same channels of trade.

Before investing financial resources to launch a new brand, by developing packaging, drafting press releases, creating advertisements, establishing a social media presence, etc., it is wise to conduct a comprehensive clearance search. Entering complex search queries in a broad selection of sources, particularly both federal and state trademark registries, as well as common law (unregistered) references, can be extremely useful in evaluating the risks associated with moving forward with a proposed mark. Evoke relies on Corsearch, the premiere provider of clearance solutions, which provides access to international, federal, and state trademarks, as well as an extensive collection of common law sources, including online sources, periodicals, databases, directories, books, and proprietary compilations that are often not accessible through the Internet.

The financial costs of rebranding can be wide-ranging—pulling product from the market, disruption of the business, customer uncertainty, customer re-education, new marketing campaigns, revised product packaging, etc. Because the costs associated with a comprehensive search and potential rebranding before launch are much lower than post-launch, it is recommended to conduct a comprehensive search on proposed brand names prior to implementation.

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