Legal Ease Articles

Trademarks In The Trade: Trademark issues in the Design Business

By Jean S. Perwin

A design firm created a catchy Christmas champagne campaign for a major beverages client. The client loved it. The tag line was to go on coasters, swizzle sticks, straws and all kinds of point of sale and packaging, billboards and possibly television. As everything was about to go to the printer, the firm discovered that their cute tag line was the federally registered trademark of an organic juice company in another state. Panic ensued. Whose responsibility was it to make sure this didn't happen? Was it the client's-they had signed off on it and always had their lawyers check the copy. Was it the design firm's? The firm didn't want to give a client something that could end the client up in a lawsuit. And they certainly wanted to keep the client happy. The campaign was saved when the owner of the trademark agreed to license the mark to the client for the period of the campaign. But the design firm was so freaked out by the unmitigated disaster that could have resulted it they had had to change the campaign at the last minute or if their client had been sued for trademark infringement, that they changed their contracts and instituted a new policy of checking trademarks before making any proposals to clients.

In the internet era where "branding" has taken on a whole new dimension, trademarks have become serious business. Design firms are involved in trademarks in two distinct ways. They are often involved in corporate identity work creating logos or marketing materials that serve as trademarks for their clients. And they often have their own trademarks with which to market and promote the firm's services. Both have the potential to affect the firm's bottom line. So, here are some basic legal guidelines to keep your firm and your clients our of trademark trouble.

What are trademarks?

People often confuse trademarks with copyrights and patents. But each fulfills a completely different legal function and is protected under very different federal statutes. A trademark identifies goods or services. A copyright protects creative work. A patent protects an original invention. The law defines a trademark as a mark that assists consumers in obtaining goods or services from a consistent source, of a consistent quality which they have come to expect and to prevent confusion, mistake and deception. The right to exclusive use of a trademark begins when a mark is used. Once you begin to use a trademark, you automatically possess the right to prevent others from using it. That right can also be protected by federal and state registration.

Trademarks most commonly consist of names and logos. But they can also consist of a type of container or architectural features ( the Coke bottle or McDonalds arches) distinctive markings on shoes or clothing (the Nike swoosh), distinctive ornamentations or colors (yellow cabs, pink insulation) numbers or letter, three dimensional objects, slogans or fragrances.

Client's trademarks

What are the trademark issues which come up when creating design work for a client? There are two-will the work you're creating for them be able to function as a trademark and be registrable and protectible as a trademark? And will the work infringe someone else's trademark?

In corporate identity work, where you know that the designs you are creating will have to function as a trademark, the issue is clear. You have to make sure that what you are proposing to a client is non infringing and be legally protectible. Once the client has approved a logo, it's a good idea to have a trademark search done before the client has invested a lot of money in recreating the logo on a lot of products. If you want to provide this service to the client, you can arrange to have the search done yourself. If you want the client to take care of running the search, make it clear in your agreement with them that the responsibility of "clearing" the mark is theirs and that you and your firm are not liable for any potential nfringement.

A trademark search is not a search on the internet. Putting a name into Google and seeing what comes up is not a valid trademark search. Do not rely on this as a basis for clearance of a trademark or logo. A trademark search is not a search on the US Patent and Trademark website list of registered marks. While this type of search can be useful, and we'll get back to it, it does not provide enough information to determine whether a mark is available. A trademark search can be done by a professional search firm such as Thompson and Thompson (see box) or by a trademark lawyer. It includes a search of many databases to determine whether someone is currently using your selected mark or something too similar.

But before a full trademark search is run, there are many "knockout" searched that you can run yourself, that cost nothing and can pickup problems well before it's time for a full fledge trademark search. A Google search is one. If it's clear from what you find on the internet that someone else is already using the mark, name, slogan, tag line etc that you have in mind, you can stop and go in another direction. A PTO search is another. At www.uspto.gov you can run searches in the trademark office database to see if anyone has registered your mark or something similar. The searches are free and If something shows up, you can "knock it out" before you go any further with it. It can save a lot of time to find out early which potential marks have problems before you even present anything to the client.

Design Firm trademarks

Branding the firm with a trademark or registering the name of a firm as a trademark has become increasing popular with design firms. If using the firm name or a slogan or branding a specific type of service you provide is part of your firm's marketing strategy or plans, here are some things to keep in mind as you make the decisions about how to do it.

Before you do anything, run a search. You might be the only XYZ firm in town, but if there are XYZ firms in other states or cities you may not be able to register your name as a trademark. If it looks like there may be problems, you want to know before you've spent a lot of money on a marketing campaign with your name as its centerpiece. Also make sure that your domain name matches your trademark.

If the search comes up clear, consider registering your trademark-either with your state or, if you're thinking of expanding operations or if you do a lot of work online, federally. Although you don't have to register your trademark to have rights in it, the benefits or registration are significant-especially on line. Registration establishes your ownership of the mark and your right to its exclusive use. It also entitles you to use the ® symbol. Only federally registered marks can use the ® symbol.

But registration is a long process and not an inexpensive one and is only worth doing if you are sure the firm will be around long enough to get the benefits of it.