The traditional short answer is:  ”Yes, if at all possible, you should register your trademarks!”  This advice has been widely echoed by qualified intellectual property attorneys.

However, the reality of this economy is that small businesses, non-profits and individuals aren’t able to do everything a lawyer says they SHOULD do.  In Indiana and abroad, the bottom line counts now more than ever.  Thousands spent on obtaining a trademark registration are thousands not spent on other aspects of your business, like R&D, Marketing or Payroll.  As such, I often find it helpful to discuss with clients not only what they SHOULD do, but what they CAN do and what they MUST do.

The purpose of this post is to give you additional financial information with which you can decide whether to register your trademarks. Some lawyers will tell you it’s “expensive.”  The same lawyers might tell other clients that it’s “not expensive.”  I’ll lay out some real numbers that you can actually put into your budget.

First, keep in mind that registration of  trademarks is not required.  Common law rights arise naturally from actual use of a trademark.   Generally, the first entity to either use a trademark in commerce or file an intent to use application with the PTO has the ultimate right to use and registration.  However, filing for and receiving a federal trademark registration on the Principal Register provides several advantages:

• constructive notice to the public of the registrant’s claim of ownership of the mark;
• a legal presumption of the registrant’s ownership of the mark and the registrant’s exclusive right to use the mark nationwide on or in connection with the goods and/or services listed in the registration;
• the ability to bring an action concerning the mark in federal court;
• the use of the U.S registration as a basis to obtain registration in foreign countries; and
• the ability to file the U.S. registration with the U.S. Customs Service to prevent importation of infringing foreign goods.

Optimally, all trademark owners who consider their trademark a valuable business asset (…and, if not, why continue using the mark?) would like to obtain these advantages.  But registration is not free.  Here are some of the likely fees (based on the PTO’s 2012 Fee Schedule, last revised 1/10/12) that you will face before and during the registration procedure:

Clearance Search – Before adopting and using a trademark, it’s advised that a trademark clearance search be performed to determine the availability of the trademark.  This will help determine whether there is another user already using the trademark, i.e. having superior rights in the trademark.  By performing an initial trademark clearance search, a business can avoid incurring liability for trademark infringement and avoid investing resources in a trademark which could be unusable because it infringes another’s trademark rights. Most attorneys will conduct a clearance search at their standard hourly rate. Expect the clearance search to cost $200-400.

A commercial research service like Thomson CompuMark, which conducts a search across numerous databases (federal, state, common law, business databases) will cost around $625.  Add attorney time to review and report on the results.

Application Filing Fee – The official filing fee is $275-$375 (paper submissions cost more than applications filed online). Your attorney will charge a fee for the application preparation and filing, likely ranging between $400-$1000.

Response to Office Action – Office actions are letters from the USPTO that set forth the legal status of a trademark application.  Typically, the examining attorney will set forth various requirements that the applicant must meet before an application can be approved for publication.  A majority of your attorney’s time in the application procedure will be spent reviewing and responding to the office action.

Looking into the future, you’ll want to keep in mind the renewal costs which will be paid after five (5) years.  Expect to pay $300 for each class of goods and services that your trademark protects.  (For example, if a band has registered its band name for both “musical services” and “t-shirts,”  it will be paying filing fees for two separate classes of protection.  This applies to filing fees also.)

Notwithstanding the renewal costs, and assuming that no extensions, etc. are required, you’re looking at approximately $800-$1000 to file a federal application for one trademark protecting one class of goods and services.  On top of the PTO fees, you’ll be paying your trademark attorney for time spent preparing documents and communicating with the PTO.  Therefore, choosing a trademark attorney who provides excellent service at a lower cost can greatly enhance your bottom line.  Also, these are just some of the more common fees you will face in registering your trademark…there may be additional filings/costs associated with your trademark registration, depending on the specifics of your trademark and the strategy of your attorney.

So, should you register your trademark???  The traditional answer still rings true…if fiscally possible, do it.  Trademarks are valuable business assets that are typically far greater in value than any costs associated with registration.  Always bear in mind that economies rise and fall, but trademark rights can continue indefinitely.  Unfortunately, that means that spending less today to protect your trademark rights may allow another party to intervene and lock up important trademark rights for the future.  Also, be sure to consider how licensing opportunities might be affected should you not register your trademarks.

Final practical note:  Any time you claim rights in a mark, you may use the “TM” (trademark) or “SM” (service mark) designation to alert the public to your claim, regardless of whether you have filed an application with the USPTO.  It’s free and reinforces good habits among those wearing the “marketing” hat.

The internet stood up and crushed SOPA/PIPA this week (at least temporarily). It was a pretty amazing day as Wikipedia went dark and citizens across the land let their voices be heard. It’s not over yet and there’s news that a new bill, ACTA, is even worse than SOPA. Stay tuned.

I hope SOPA passes.

Anonymous Attacks Justice Dept as FBI Shuts Down File-Sharing Site

Super Bowl XLVI Gets a Social Media Command Center

The Week That Killed SOPA: A Timeline

“I personally think intellectual property is an oxymoron. Physical objects have a completely different natural economy than intellectual goods. It’s a tricky thing to try to own something that remains in your possession even after you give it to many others.” – John Perry Barlow

More SOPA this week. It’s all coming to a head next week with a big internet protest planned. Stay tuned.

Homeland Security monitors journalists

3 More Reasons SOPA Ought to Scare You

Boycott SOPA: Android app that scans barcodes and tells you whether an object’s manufacturer/publisher supports SOPA

Who Is Flying Unmanned Aircraft in the U.S.?

Why bankruptcy isn’t a brand killer

Full Text of 2012 Indiana State of the Judiciary Address

White House Speaks Out Against SOPA/PIPA, Sort Of…

“The intellectual property situation is bad and getting worse. To be a programmer, it requires that you understand as much law as you do technology.” – Eric Allman

SOPA is THE issue in IP for early 2012. There is plenty of opposition to the bill from all sides but I’m left with so little confidence in Congress doing the right thing that I can’t forecast an optimistic outcome. I’m tempted to mail a copy of William Patry’s new book “How to Fix Copyright” to all of my congressmen. I’m about halfway through and it carries a vital message that hopefully gets to our elected officials before SOPA is passed and does permanent damage to the Internet.

Why Everyone Should Be Against SOPA

Why The Movie Industry Can’t Innovate and the Result is SOPA

National Defense Authorization Act Outrage Continues To Grow Online

Careful, That’s Not a Louis Vuitton

2011: The Year Intellectual Property Trumped Civil Liberties

Homeland Security monitors journalists

Norwood Promotional Products is a large Indianapolis-based promotional products company which sells imprinted “insulated containers for beverage cans” under the KOOZIE® trademark. KustomKoozies, LLC (“Kustom”) is an internet retailer that sold insulated beverage can and bottle holders with customizable promotional imprinting, directly to end-customers in quantities as small as a dozen. On May 15, 2007, the USPTO issued a trademark registration to Norwood for the mark “KOOZIE®” (see abstract below). On May 6, 2008, Norwood sent a letter to Kustom indicating that it had come to Norwood’s attention that Kustom was in violation of the licensing agreement the parties had previously discussed because Kustom failed to set out KOOZIE in all capital letters and set forth the appropriate subscript following the term. In response to the May 6, 2008, letter, defendant Robert Liddle reviewed the agreement and Kustom’s website pages, making changes that he believed cured any noncompliance issues, but he did not succeed in making all necessary changes. Norwood sued for breach of contract and trademark infringement.

After the lawsuit was filed, Kustom did not attempt to make any changes to its website in order to avoid the trademark infringement claim, but it did attempt to terminate the licensing agreement with Norwood. However, the attempt to terminate was unsuccessful. The Court found as a matter of law that the settlement and license agreements were valid contracts between the parties and that Kustom breached those contracts by purchasing, owning, registering or operating internet domain names that contained the term “koozie,” and by using the term “koozie” or “KOOZIE” to describe and sell products on those internet sites. The Court also found that the mere use of the claimed mark after the failed attempt to terminate the license agreement did not constitute trademark infringement and grant summary judgment to Kustom.

Practical Lesson: Think twice before you commence litigation. It can be timely (almost 2 1/2 years here) and expensive. However, trademark owners have a legal obligation to police and enforce their trademark rights, often putting owners between a rock (losing their trademark) and a hard place (expensive litigation).

No: 1:09-cv-1378-JMS-WGH (December 21, 2011)
U.S. District Court, Southern District of Indiana
Before: Magnus-Stinson

2011 was quite a year. We witnessed intellectual property trump civil liberties time and time again. I’ll continue to archive the most important stories from each week, although I’m no longer certain it’s best for my mental health. Onward and upward (hopefully).

Copyrights Are No Longer About Copies (Part 1): William Patry

Creativity Springs From Careful Copying (Part 2): William Patry

Statement by the President on H.R. 1540 (the “National Defense Authorization Act for Fiscal Year 2012)

Artists: Can You Be Sued for Including a Real Person in Your Painting?

SOPA is the end of us, say bloggers

Company sues former employee over right to Twitter followers

Scottie Pippie Files Suit Claiming Websites Falsely Labeled Him as Bankrupt; Is Blog Tag Defamatory?

Google+ Censoring Borderline Offensive Profile Images; Author Images in Search Results To Blame?

Dear Internet: It’s No Longer OK to Not Know How Congress Works

USPTO gets a new website

In the eyes of the law, are we all public figures on Facebook?

Don’t Break the Internet

“The intellectual property situation is bad and getting worse. To be a programmer, it requires that you understand as much law as you do technology.” – Eric Allman

Coach continues the litigation trail against Kristy’s Trends of Greenfield, Indiana.

Court Case Number: 1:11-cv-01695-TWP-DML
File Date: Thursday, December 22, 2011
Plaintiff: Coach, Inc., Coach Services, Inc.
Plaintiff Counsel: Alejandro Valle of Gonzalez Saggio & Harlan, LLP
Defendant: Kristy A. Davidson
Cause: Copyright Infringement, Trademark Counterfeiting, Trademark Infringement, Trade Dress Infringement, False Designation of Orgin, False Advertising, Trademark Dilution, Common Law Trademark Infringement, Unfair Competition, Forgery
Court: Southern District of Indiana
Judge: Judge Tanya Walton Pratt
Referred To: Magistrate Judge Debra McVicker Lynch

The business side? Same as before.