Lesson: Trademarks with Ed Timberlake

Step #3 Edge: Wear the red dress

Without a registered trademark, just simply using something as a trademark, you earn rights in it. You're never required to get something registered. You earn rights out in the market just by using something, and the longer you use it, more rights accrue.

Unfortunately, those rights can be sometimes a little difficult to assert those rights. They're called common law trademark rights, which sounds like a little bit of a put down, like those are very just common trademarks. If you don't have a registration, you may have recognizable trademark rights, then going through the process of taking it to the Trademark Office and saying, "Can we get the circle R for this?", it's almost like some trials that you have to overcome at the Trademark Office in order to pass the test.

If you get there and you get a registration, one big benefit of that is it's very visible. It makes it much easier for you to contact them and to stop them. It just makes a very clear case because the government has already given its stamp of approval to you. So often times, at that point, if you find out, you can just contact the people and say registration and often times they'll say, “Okay, you're right, we'll stop,” or, “We'll go away,” or, “We'll change,” or you can come to some sort of agreement. Really, any time you can stay out of court I think is a good day.

From the trademark standpoint, I think for your business, you don't want to wear jeans. I think for your business, you want your business to show up in the red dress. So I think if you had to keep one idea in mind is come up with something so that your business can be wearing the red dress in the room, can stand out. You don't necessarily want to stand out by wearing a goofy clown hat and big shoes or something like that. I think you want to stand out in a way that you can also be proud of.

Really, the idea is you want it to be easy for people to tell you apart from all the other people who are crowding into your space and the people, frankly, that you want to differentiate yourself from. Because the subject matter is a little bit tricky, we sometimes will shorthand, kind of condense some of the principles and often end up talking to people in terms of protection, like, “Well, you need to protect your stuff, you have to hurry up. You’ve got a good name, you need to protect it.”

I really don't think that the emphasis ought to be on locking down stuff and closing off stuff, because I think that misses the point with trademarks, too, is that it doesn't really do you any good to stake out a totally crappy area and then build a big fence around it and spend a lot of money keeping people off it. It's much smarter to survey the whole landscape and say, “This is a great spot, this is a wonderful spot. There's not already 15 people in this spot. We won't already be fighting with people.”

Without the federal law at all, you still have some protections for trademarks that you're using. If you want the added benefits of federal registration, and they're significant benefits, then it's a little bit of a trade. If you bring to the federal law, if you bring something distinctive, if you bring something that will set your stuff apart, then we'll give you the benefits of federal registration. I think people tend to not characterize it that way. They just think about locking the stuff down. Unfortunately, a lot of the high level lawsuits that you see end up not really being truly about trademarks. They end up being about big companies that are just always going to be fighting each other over something, and so the examples that you hear often times are really just not very distinctive. They're not really very good trademarks in the first place and they're spending millions of dollars fighting over them.

I think, for a small business, one thing that you can do that's cheap is, on your own, just go in a different direction. Go someplace where there aren't already 15 people in that space because, frankly, at the beginning, you're not going to have the budget to fight the other people anyway. So you're not going to have the budget for a giant fence, so you're probably better off going in a different direction than trying to get in a crowded space and beat people.