Trademark Rights: Federal Vs Common Law — Who Wins?

Common law trademark rights and federally registered trademarks are two different ways of protecting a brand. Common law trademark rights arise naturally from the use of a mark in commerce, while federally registered trademarks are protected across the entire United States. One of the main challenges with common law trademarks is enforcement, as there is no public record of the mark or its use. Despite these challenges, common law trademark rights can still provide valuable protection, especially for businesses operating within a localized area. In some cases, a common law mark may even prevail over a federal registration if it has an earlier, proven first-use date.

Common law trademark rights are limited to the geographic area where the mark is actively used and recognised by consumers

One of the main challenges with common law trademarks is enforcement. Since there is no public record of the mark or its use, proving ownership and the extent of the mark’s recognition can be difficult. This often requires substantial evidence, such as sales records, advertising materials, and customer testimonials, to demonstrate that the mark has established a presence in the market. Despite these challenges, common law trademark rights can still provide valuable protection, especially for businesses operating within a localized area.

Federal registration creates a legal presumption that the mark is valid and owned by the registrant. It also provides crucial defensive benefits, establishing a legal presumption of ownership and exclusive rights across the entire United States. After five years of continuous use, a federally registered trademark can become incontestable, making it extremely difficult to challenge.

However, there are some cases in which a common law mark may prevail over a federal registration. This typically occurs because the common law trademark has an earlier, proven first-use date that can combat the federal trademark’s rights in a certain region. Common law trademarks can also hinder a federal application if a proper clearance search was not performed prior to the application’s submission.

Federal registration creates a legal presumption that the mark is valid and owned by the registrant

A plaintiff who is the owner of a federally registered trademark also has additional remedies available to them compared to a plaintiff who owns only common law trademark rights. These remedies may include monetary damages such as disgorgement of the infringer’s profits, statutory damages, and punitive damages.

Common law trademark rights, on the other hand, are limited to the geographic area where the mark is actively used and recognized by consumers. One of the main challenges with common law trademarks is enforcement. Since there is no public record of the mark or its use, proving ownership and the extent of the mark’s recognition can be difficult. This often requires substantial evidence, such as sales records, advertising materials, and customer testimonials, to demonstrate that the mark has established a presence in the market.

Despite these challenges, common law trademark rights can still provide valuable protection, especially for businesses operating within a localized area. It is important to note that common law trademark rights arise naturally from the actual use of a mark in commerce, rather than through a formal registration process.

Common law trademark rights provide limited regional protections to one's business

Common law trademark rights arise naturally from the actual use of a mark in commerce, rather than through a formal registration process. While common law rights offer a degree of protection, registering a trademark with the USPTO provides significant advantages. A federally registered trademark is protected across the entire United States and creates a legal presumption that the mark is valid and owned by the registrant. After five years of continuous use, a federally registered trademark can become incontestable, making it extremely difficult to challenge.

However, there are some cases in which a common law mark may prevail over a federal registration. This typically occurs because the common law trademark has an earlier, proven first-use date that can combat the federal trademark’s rights in a certain region. Common law trademarks can also hinder a federal application if a proper clearance search was not performed prior to the application’s submission to the USPTO. It is crucial to conduct thorough clearance searches to avoid conflicts with existing common law marks, as these marks can pose significant challenges in enforcement and may prevail over federal trademarks due to prior usage.

If a formal lawsuit is initiated, federal registration provides the trademark owner with a jurisdictional hook to litigate its trademark and related claims in federal court rather than state court. A federal court offers procedural and other advantages to a trademark owner party plaintiff that are not available in state court. A plaintiff who is the owner of a federally registered trademark also has additional remedies available to it compared to a plaintiff who owns only common law trademark rights. These remedies may include monetary damages such as disgorgement of the infringer’s profits, statutory damages, and punitive damages.

Common law trademarks can also hinder a federal application if a proper clearance search was not performed prior to the application

It is crucial to conduct thorough clearance searches to avoid conflicts with existing common law marks, as these marks can pose significant challenges in enforcement and may prevail over federal trademarks due to prior usage. This is especially important if you are looking for a way to protect your brand and patent worldwide.

A proper clearance search should include deep interest searches, industry-specific directory searches, business filing searches, social media searches, and even a domain search. This is because, in some cases, a common law mark may prevail over a federal registration if it has an earlier, proven first-use date that can combat the federal trademark's rights in a certain region.

While common law rights offer a degree of protection, registering a trademark with the USPTO provides significant advantages. A federally registered trademark is protected across the entire United States, and federal registration creates a legal presumption that the mark is valid and owned by the registrant.

Common law trademark rights arise naturally from the actual use of a mark in commerce, rather than through a formal registration process

Common law trademark rights are limited to the geographic area where the mark is actively used and recognised by consumers. One of the main challenges with common law trademarks is enforcement. Since there is no public record of the mark or its use, proving ownership and the extent of the mark's recognition can be difficult. This often requires substantial evidence, such as sales records, advertising materials, and customer testimonials, to demonstrate that the mark has established a presence in the market.

Despite these challenges, common law trademark rights can still provide valuable protection, especially for businesses operating within a localized area. In some cases, a common law mark may even prevail over a federal registration if it has an earlier, proven first-use date.

However, registering a trademark with the USPTO provides significant advantages. A federally registered trademark is protected across the entire United States and creates a legal presumption that the mark is valid and owned by the registrant. After five years of continuous use, a federally registered trademark can become incontestable, making it extremely difficult to challenge.

Frequently asked questions