An image is not simply a trademark, a design, a slogan or an easily remembered picture. It is a studiously crafted personality profile of an individual, institution, corporation, product or service. – Daniel J. Boorstin

With regard to the above quoted, we can safely say that before a right to a certain mark be conferred to the owner of such mark, registration shall be made validly in accordance with the provisions of the Intellectual Property Law.

A trademark is a word, symbol, or phrase, used to identify a particular manufacturer or seller’s products and distinguish them from the products of another. An example of this would be the trademark “Coca-Cola” distinguishes the brown-colored soda water of one particular manufacturer from the brown-colored soda of another such as Pepsi, RC, Pop Cola and the like. When such marks are used to identify services rather than products, they are called service marks, although they are generally treated just the same as trademarks.

Trademarks make it easier for consumers to quickly identify the source of a given good. Under some circumstances, trademark protection can extend beyond words, symbols, and phrases to include other aspects of a product, such as its color or its packaging. For example, the pink color of Owens-Corning fiberglass insulation or the unique shape of a Coca-Cola bottle might serve as identifying features. Such features fall generally under the term trade dress, and may be protected if consumers associate that feature with a particular manufacturer rather than the product in general. However, such features will not be protected if they confer any sort of functional or competitive advantage. So, for example, a manufacturer cannot lock up the use of a particular unique bottle shape if that shape confers some sort of functional advantage such when it is easier to stack or easier to grip.

In order to serve as a trademark, a mark must be distinctive, that is, it must be capable of identifying the source of a particular good. In determining whether a mark is distinctive, the courts group marks into four categories, based on the relationship between the mark and the underlying product: (1) arbitrary or fanciful, (2) suggestive, (3) descriptive, or (4) generic. Because the marks in each of these categories vary with respect to their distinctiveness, the requirements for, and degree of, legal protection afforded a particular trademark will depend upon which category it falls within.

Registration does confer a number of benefits to the registering party and gives the owner of a registered mark the exclusive right to prevent all third parties not having the owner’s consent from using in the course of trade identical or similar signs or container for goods or services which are identical or similar to those in respect of which the trademark is registered where such use would result in likelihood of confusion. Registration constitutes nationwide constructive notice to others that the trademark is owned by the party. Registration enables a party to bring an infringement suit against any person should the exclusive right of the registered owner have been impaired. Registration allows the registered owner to potentially recover damages from any person who infringes his rights, and the measure of the damages suffered shall be either the reasonable profit which the complaining party would have made, had the defendant not infringed his rights, or the profit which the defendant actually made out of the infringement, or in the event such measure of damages cannot be readily ascertained with reasonable certainty, then the court may award as damages a reasonable percentage based upon the amount of gross sales of the defendant or the value of the services in connection with which the mark or trade name was used in the infringement of the rights of the complaining party. A registered owner, upon proper showing, may also be granted injunction.

The exclusive right of the registered owner in a particular mark can be lost through non-use, abandonment, improper licensing or assignment, or genericity. However, non-use of a mark may be excused if caused by circumstances arising independently of the will of the trademark owner. Lack of funds shall not excuse non-use of a mark.

A trademark is abandoned when its use is discontinued with intent not to resume its use. Such intent can be inferred from the circumstances. The basic idea is that trademark law only protects marks that are being used, and parties are not entitled to warehouse potentially useful marks.

Trademark rights can also be lost through improper licensing or assignment. Where the use of a trademark is licensed without adequate quality control or supervision by the trademark owner, that trademark will be cancelled. Similarly, where the rights to a trademark are assigned to another party in gross, without the corresponding sale of any assets, the trademark will be cancelled. The rationale for these rules is that, under these situations, the trademark no longer serves its purpose of identifying the goods of a particular provider.

Trademark rights can also be lost through genericity. Sometimes, trademarks that are originally distinctive can become generic over time, thereby losing its trademark protection. A word will be considered generic when, in the minds of a substantial majority of the public, the word denotes a broad genus or type of product and not a specific source or manufacturer.

If a party owns the rights to a particular trademark, that party can sue subsequent parties for trademark infringement. The standard is likelihood of confusion. To be more specific, the use of a trademark in connection with the sale of a good constitutes infringement if it is likely to cause consumer confusion as to the source of those goods or as to the sponsorship or approval of such goods. In deciding whether consumers are likely to be confused, the courts will typically look to a number of factors, including: (1) the strength of the mark; (2) the proximity of the goods; (3) the similarity of the marks; (4) evidence of actual confusion; (5) the similarity of marketing channels used; (6) the degree of caution exercised by the typical purchaser; (7) the defendant’s intent.

The use of a mark may be an infringement on the trademark owner’s rights if it is likely to create confusion in consumers. Consumers can be confused by similar, as opposed to identical, marks; use of an identical mark is not required for a use to be trademark infringement. But sometimes even using the exact same mark does not create confusion, such as when the two marks are used in different contexts, such as Apple Computer and Apple Records.

Using a very similar mark on the same product may also give rise to a claim of infringement, if the marks are close enough in sound, appearance, or meaning so as to cause confusion. On the other end of the spectrum, using the same term on a completely unrelated product will not likely give rise to an infringement claim. Thus, Apple Computer and Apple Records can peacefully co-exist, since consumers are not likely to think that the computers are being made by the record company, or vice versa.

The owner of a trademark right owns the exclusive right to use the registered trademark for the designated goods or services listed in the application for trademark registration for ten (10) years of duration from the date of registration. However, a certificate of registration may be renewed for periods of ten (10) years at its expiration upon payment of the prescribed fee and upon filing of a request. Thus, the use of the registered trademark by another party is deemed to infringe the trademark rights.

Similarity of trademark or goods/services becomes an issue, in many cases, in determining the existence of trademark infringement because the use of a registered trademark or a trademark that is similar to the registered trademark for goods/services that are similar to the registered marks on goods/services is also deemed to constitute trademark infringement.

Determination of the similarity of goods/services is made in consideration of an actual transaction and based on whether confusion arises over the source of the goods and services or not when the goods/services bear the mark in question.

Furthermore, similarity between trademarks is determined based on comprehensive consideration of whether or not there is confusion over the source of goods and services on the basis of the level of attention that traders and general purchasers pay when they purchase goods, bearing in mind the actual transactions, and the similarity in the way a trademark looks or its appearance, the way it is read or its sound, and its general impression or the concept.

For brand-centric enterprises, trademark protection is of utmost importance. If a competitor knowingly or otherwise starts using a trademark that interferes with your exclusive trademark rights, this can have significant negative effects for your business. Even if you ultimately prevail in a trademark infringement lawsuit, you likely will have spent substantial sums of money to do so, and potentially lost business and even lifetime customers along the way.

With these concerns in mind, it should be clear that the best way to combat infringement and mitigate its costs is to spot the issues early.

Imparted with the knowledge regarding trademarks, what are rights conferred and remedies available to the registered owner, what constitutes infringement, maybe a question in our mind will be made such as if using counterfeit goods constitute trademark infringement? On some people’s point of view, generally, consumers’ acts of purchasing infringing goods are not considered to constitute trademark infringement. However, some limits shall be given by laws and regulations to those that intend to manufacture and sell infringing goods to damage a trademark holder’s legitimate rights and interests. Infringement refers to “manufacturing and selling” goods or services of a registered trademark without authorization, but does not include consumers’ acts of purchasing and using infringing goods or services. If laws entirely indulge consumers’ infringements, it is not entirely effective in protecting a trademark holder’s legitimate rights and interests.

A trademark is a mark used to identify and distinguish the source of the same or similar goods or service of one party from those of others. However, a major objection to the Trademark Law is that using a trademark identical with a registered trademark on the same kind of goods as the registered trademark without authorization is prohibited, because such acts would confuse consumers, decrease the recognition gained by the mark, and thereby lower the brand value of the registered trademark. In general, as for infringing goods, after consumers purchase them, the confusion caused by the infringing goods to consumers is gone. The reason behind such a general rule is that, except in limited circumstances, infringing goods purchased by a customer cannot expand the scope of such infringing goods to other customers. Taking into account the considerations above, the Trademark Law and judicial practice show that purchasing and using infringing goods by consumers is harmless.

Another questionable act regarding trademark infringement would be the use or wearing of different brand in a sports event or other events which may be attended by numerous people contrary to that of brand sponsoring such event. Was that simple act amount to trademark infringement? I disagree if that would constitute such. Every person has the right to freedom and of expression. Freedom to choose what he is going to say, to write, to wear as long as it does not violate the rights of another person, such cannot be restricted. A person has the right to express himself in any way possible subject to the rights of other persons. No one will think that our dresses, shirts or anything that we would like to bring in an event would constitute trademark infringement with regard to the sponsor brand of such particular event. That’s why the law also provide for defenses available to persons other than the registered owner to freely wore or used a brand without limitations having regard to those existing registered marks. Under the Intellectual Property Law, registration of a mark shall not confer on the registered owner the right to preclude third persons from using bona fide their names, addresses, pseudonyms, a geographical name, or exact indications concerning the kind, quality, quantity, destination, value, place of origin, or time of production or of supply, of their goods or services provided that such use is confined to the purposes of mere identification or information and cannot mislead the public as to the source of goods or services. Furthermore, an unauthorized use of a mark does not constitute trademark infringement if first of all, there is a fairly well-recognized carve-out to infringement, called “nominative fair use.” This concept borrows from copyright’s “fair use” exception, which allows certain uses to be made of copyrighted work without permission or payment do not harm the market for the original work, or some combination of both. Basically, when you can’t say what you need to say without using some portion of the copyrighted work, you can use as much as you absolutely need to say it. In the trademark context, nominative fair use is more or less the same. If you are using someone else’s trademark to make a point, to comment on the other company’s offerings or to comment on the mark itself, or to state something true about your own business that you can’t say without using that trademark, you may qualify for nominative fair use. A good example of this is an authorized Lexus dealer who included the word “Lexus” in its domain names, buy-a-lexus.com and buyorleaselexus.com. Lexus sued for trademark infringement and was shot down on nominative fair use grounds: the dealer was simply stating something true about its business—that it legally sold and leased Lexus automobiles.

There’s another way that your use of another’s trademark might not be infringing if your use of the trademark is “functional.” How can a trademark use be functional? Well, it’s something like fair use, if you are using the mark to do something other than to inform the public about the source of goods or services, then your use of the trademark may be functional. A recent case provides an expansive view of this. In Fleischer Studios, Inc. v. A.V.E.L.A., Inc., plaintiff Fleischer Studios claimed ownership of copyrights and trademarks in the character Betty Boop. Defendant A.V.E.L.A. had sold licenses to other parties to use Betty Boop, based on vintage posters featuring that character. A.V.E.L.A. licensees then placed Betty Boop’s image on dolls, T-shirts and handbags. The court, in a somewhat surprising ruling, decided that these placements were not trademark infringement, since they were not likely to deceive consumers about the origin of the products, but were, rather, functional uses of the character. Fleischer court stated that one function of well-known characters, placed on clothing, jewelry and the like, can function to tell the public that the owner of these items identifies him or herself with that character, or even that he or she likes that character. A previous case, quoted in Fleischer, calls this “allowing the wearer to publicly express her allegiance” to the subject of the trademark. In that case, the subject was a young woman’s organization. In this case, the subject matter is Betty Boop. One can see how Fleischer Studios, then, is something of a surprising extension: it’s pretty understandable to say that expressing one’s affiliation with or allegiance to a civic organization is a “functional” use of a trademark.

References:

Intellectual Property Law
http://www.google.com
http://cber.law.harvard.edu/
Dawn Donut Co., Inc. v. Hart’s Food Stores, Inc., 267 F.2d 358 (2d Cir. 1959)
Kellogg Co. v. National Biscuit Co., 305 U.S. 111 (1938)
Major League Baseball Properties, Inc. v. Sed Non Olet Denarius, Ltd.
New Kids on the Block v. News America Publishing, Inc., 971 F.2d 302 (9th Cir. 1992)
Polaroid Corp. v. Polarad Elect. Corp.
Qualitex Co. v. Jacobson Products Co., Inc., 115 S. Ct. 1300 (1995)

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