Business Formation

Federal Trademark Registration

What is a Registered Trademark?

The importance of the registered trademark is lost on many business owners. This is because the majority does not understand what a trademark stands for or has a very vague idea of the meaning of it. A trademark is a symbol, word, or words representing a company or product legally registered or established by use. A trademark embodies the business’ goodwill and reputation. The more reputation grows, the more valuable the brand represented by a trademark, will be. Similar to property rights, a trademark can be bought, sold, licensed or used as a security interest to secure a loan. Furthermore, a trademark never expires for as long as it is used for commerce in the United States.

In the United States, multiple layers of legislation protect a registered trademark. Primarily, trademarks are protected under the Lanham Trademark Act. The US Patent and Trademark Office is a federal agency that enforces Lanham Act and regulates the registration process. The registered trademark symbol (®) provides notice that the preceding word or symbol is a trademark or service mark that has been registered with a national trademark office.

At the state level, a trademark is protected by common law principles of unfair competition. Common law protection is limited in scope and only extends to the territory where the mark is used.

Why Register a Trademark?

The main benefit of registering a trademark on the federal level is the enforcement of the trademark rights granted by the Lanham Act. Statutory causes of action that could be brought by the owner of a trademark include: infringement (unauthorized use), counterfeiting (use of a substantially undistinguishable mark from the registered mark), trademark dilution (use of name that is likely to reduce public’s perception of a famous mark which signifies something unique), false advertising (false designation of origin, for example), passing off (false representation with intent to induce to believe that the goods or services are those or another).

It is important to understand that even without a registration the trademark is somewhat protected. State trademark registration is an alternative option available for business owners. Though state registration generally grants rights no greater than one could obtain under common law, the process is quick, easy and it does have certain benefits. It secures the mark’s placement in trademark reports and provides a notification to the third parties. If the business is at an early stage and there are no plans to go nationwide, the protection granted by the state is enough for a purely local business.

Federal registration allows the owner to have indisputable evidence of validity and ownership rights of the mark. Furthermore, under federal registration, a trademark falls under federal court subject matter jurisdiction over infringement and other trademark claims without showing diversity or minimum amount in controversy. Statutory remedies available for federal trademark infringement claims include treble damages and recovery of attorney’s fees. In addition, federal trademark provides grounds for registering the mark in foreign countries.

It is important to note that even if it may seem your business meets all the requirements for trademark, the registration of a mark is not guaranteed. Officers of the USPTO consider all federal trademark applications. It usually takes up to a year to finalize the process.

When to File a Trademark Registration

Trademark registration is important for business owners who are serious about their business and their brand. Every step you take to grow your business is an investment in your brand and you should secure it. To gain maximum legal protection, we recommend filing a trademark application soon after you start doing business. The trademark process takes more than 6 months so it’s best to get started early.  

What Should be Included in the Trademark?

Any type of device used to identify the source or origin of a product or service can be registered as a trademark. It could be words, phrases, symbols, designs. Some trademark could also include, under certain circumstances, sounds, smells, colors and shapes. The main benefit of having it registered, is that it provides an exclusive right to the registered owner to use the trademark in connection with products and services covered by the mark. This helps to distinguish the origin and quality of the goods or services that may originate from different sources.

Requirements for Federal Trademark Registration

Initial requirements for the federal trademark protection include usage in the stream of commerce and distinctiveness. Furthermore, it shouldn’t include any deceptive terms or immoral language, and there shouldn’t be any similarities or confusion with other registered marks.

While the process of filing a trademark application may seem to be quite easy at the first, it can be a tedious process. The most tedious part of the process is the so called “trademark clearance”. An applicant has to conduct a very thorough search (Federal Trademark Register search, state trademark registers, various public sources) and proceed with a very detailed analysis to eliminate possible conflicts and issues with the application. An applicant or an attorney assisting with the application needs to evaluate if the proposed mark qualifies for trademark protection and federal registration. Conducting trademark clearance on initial stages helps to avoid or reduce investment in a trademark that is already unavailable.

A recent study which analyzed 25 years of USPTO data shows that applicants who used an attorney to file their trademark applications were 50% more likely to get their marks approved than those who applied without legal representation.

How does your company protect its trade secrets? Are you putting the effort in to have policies and procedures in place prior to disclosing trade secrets to employees, contractors, vendors, clients and business partners? Don’t wait until after someone infringes on your trademark to seek legal advice. Our firm can help you achieve trademark registration by ensuring all the requirements are met for filing.

If not, contact us today for a no-obligation assessment of your overall legal needs and risk management program. Call us at (832) 305-5529 or email us at info@filippovlaw.com to schedule an appointment.

This blog is intended as an information source for existing and future clients of FILIPPOV LAW GROUP, PLLC and should not be construed as legal advice. Readers should not act upon the information contained in this blog without professional counsel. The materials presented in our blog, “tweets” and legal articles may not reflect the most current legal developments, verdicts, or settlements. These materials may be changed, improved, or updated without notice. FILIPPOV LAW GROUP, PLLC. is not responsible for any errors or omissions in the content of this site or for damages arising from the use or performance of this site under any circumstances. © Copyright 2017 FILIPPOV LAW GROUP, PLLC

Selecting a Business Structure

Selecting a business structure is an exciting but often challenging undertaking. One of the most important decisions you will make is choosing the type of business you will open. The business structure you choose will have legal and tax implications.  Generally, businesses are created and operated in one of the following forms:

• Sole proprietorship: The most common and the simplest form of business is the sole proprietorship. In a sole proprietorship, a single individual engages in a business activity without the necessity of formal organization.
•  General partnership: A general partnership is created when two or more persons associate to carry on a business for profit. A partnership generally operates in accordance with a partnership agreement, but there is no requirement for state-filing or that the agreement be in writing.
• Corporation: A corporation is a legal entity with the characteristics of limited liability, centralization of management, perpetual duration, and ease of transferability of ownership interests. The owners of a corporation are called “shareholders.” The persons who manage the business and affairs of a corporation are called “directors.” However, state corporate law allows shareholders to enter into shareholders’ agreements to eliminate the directors and provide for shareholder management. Choosing the best management structure for your corporation is a decision you make with the advice of an attorney.
• Limited Liability Company: The limited liability company (LLC) is not a partnership or a corporation but rather is a distinct type of entity that has the powers of both a corporation and a partnership. Unlike the partnership, where the key element is the individual, the essence of the limited liability company is the entity, necessitating more formal requirements for its creation.
• Limited Partnership: A Texas limited partnership is a partnership formed by two or more persons and having one or more general partners and one or more limited partners. The limited partnership operates in accordance with a partnership agreement, written or oral, between the partners as to the affairs of the limited partnership and the conduct of its business.
• Limited Liability Partnership: In order to limit the liability of its general partners, a general or limited partnership may opt to register as a limited liability partnership. The Secretary of State provides a form for registration as a limited liability partnership.

All Texas business entities are created by filing a certificate of formation with the Texas Secretary of State. The Secretary of  State requires a payment of fees for each filed certificate of formation. The Texas Secretary of State Business Formation Fee Schedule follows below.

For questions about business entity formation process in Texas, contact business law attorney at Filippov Law Group, PLLC by calling (832) 305-5529.

 Texas Secretary of State Business Formation Fee Schedule:

The decision regarding business structure should be made after a consultation with an attorney and a tax adviser because it involves the consideration of issues regarding tax, liability, management, continuity, transferability of ownership interests, and formality of operation. The Business Attorneys at Filippov Law Group, PPLC will help you learn about the different types of business structures and find the one best suited for your business. Call us at (832) 305-5529 or email our managing member directly at info@filippovlaw.com to schedule an appointment.