What Corporate Attorneys Should Do About Trademarks Before Forming a Corporation

StartupA client arrives at your law office and wants to start a company and form a corporation or LLC. Your client had a company name in mind. You search the Secretary of State records for other companies with the same or similar name and find nothing. You also search the state trademark database and find nothing. You prepare an engagement agreement for the work of forming the corporation. Is your client in the clear to use the name? Not necessarily.

The formation of almost every company implicates trademark law. Every new company needs a name. That name will often be used with the relevant group of purchasers or suppliers. Therefore, in addition to counseling on whether the chosen name is protectable as a strong trademark, an attorney’s process forming a corporation, LLC, or other entity should include a trademark search or an informed waiver by the client of the trademark search. Below I explain the reasons why a search or waiver is necessary and provide an example client waiver.

Searching Secretary of State Corporate Records is Insufficient

Searching the corporate, LLC, and DBA records of the relevant secretary of state is not enough. Trademark rights, e.g. the right to use a name or other indicia to identify a source of goods or services, is controlled by federal law under the Lanham Act. As federal law trumps state law, approval of the name of the new corporation by the Secretary of State cannot be used to defend against claims of trademark infringement. The decision of the secretary of state does not authorize your client to use a name, if that name would infringe a third party’s prior trademark rights.

Obtaining a State Trademark is Insufficient

Moreover, an Illinois state trademark registration provide few benefits because they are subordinate to federal and common law trademark rights. Burger King of Florida Inc. v. Hoots, 403 F.2d 904 (7th Cir. 1968) demonstrated that an Illinois state trademark registrations is subordinate to a federal trademark registration. Steak & Brew Inc. v. Beef & Brew Restaurant, Inc., 370 Supp. 1030 (S.D.Ill. 1974) demonstrated that an Illinois state trademark registration does not grant the owner rights throughout the state. Therefore obtaining a Illinois state trademark will not insulate your client from claims of trademark infringement.

Searching USPTO Trademark Database is Insufficient

Still further, searching the trademark database at the U.S. Patent and Trademark Office is not sufficient to fully clear a name for use. This is true because in the United States trademark rights can be obtained by use alone. A registration is not necessary for a person or entity to obtain trademark rights. Therefore, searching the U.S. Patent and Trademark Office (USPTO) trademark database is not sufficient to determine whether your use of a mark is clear. Someone could have gained superior rights in the mark by use without registering.

U.S. common law provides rights based on use alone because trademarks are designed to prevent consumer confusion. Therefore, in one example, the law grants rights to trademark users where the relevant purchasing public has come to recognize a particular trademark as representing a source of particular goods/services, even if that trademark is not registered. This rule protects consumers, but increases the search burden on companies because searching the USPTO database may not find all relevant uses of a mark.

Receiving a Federal Registration is Insufficient

Further, even if the USPTO grants a trademark registration on the mark, that is no guarantee that your client can use your mark. This is true because, as stated above in the U.S. trademark rights can be generated based on use alone without any registration. The USPTO will only check the USPTO database and will not check state databases, the Internet, or common law usages to see if someone else has previously used the same or similar mark for the same or similar goods / services as your client plans.

If a prior user has superior rights, in some circumstances, the prior user can seek to have your client’s trademark registration canceled along with demanding your client stop using the mark. For example, 15 USC 1052(d) provides that a mark may not be registered if it “so resembles a … mark or trade name previously used in the United States by another and not abandoned, as to be likely, when used on or in connection with the goods or services of the applicant, to cause confusion, or to cause mistake, or to deceive….” See TBMP 309.03(c).  Therefore, if a third party was first to use the same or similar mark on the same or similar goods, that third party might be able to oppose your client’s trademark application or seek to cancel your client’s trademark registration.

In other circumstances, the prior user might have trademark rights in the geographic area that they were operating in before your client registered. Such rights might prevent your client from expanding to market and sell in that area. The way to know that your client is clear to use the mark throughout the U.S. is to have a comprehensive trademark search performed. Therefore, you cannot rely on the USPTO’s approval of the mark as clearance.

Comprehensive Searching

The comprehensive search should include direct hits (identical wording/characters) as well as marks that are similar or might lead to consumer confusion. This search frequently includes searching for homonyms, synonyms, phonetic equivalents, alternative spellings, anagrams, marks with similar components, and marks that start or end the same, or that have any other similarity.

A comprehensive search may look in federal and state trademark databases, online databases, trade directories, product catalogs, internet domain names, and the like. The goal is to find an actual use of the proposed mark, or a similar mark, whether or not it is officially registered. Third party search services may be able to provide such raw comprehensive search results. Then the search results will need to be analyzed to determine whether any of the search results present a risk.

 Client Acknowledgement / Waiver

Many times a client may decide to forgo the comprehensive trademark searching due to the expense. If the client decides to skip searching, the lawyer should include a written acknowledgement of the risks and the client’s decision in the lawyer’s engagement agreement or in a separate writing. One sample acknowledgement could be:

This engagement does not include undertaking any trademark searching. This engagement does not include advising whether or not the use of the above listed Mark/corporate name would infringe another’s trademark rights. The (1) approval of a trademark application by the U.S. Patent and Trademark Office or (2) acceptance of the articles of incorporation by the Secretary of State does not guarantee you can use the Mark/corporate name and does not guarantee that the use of the above listed Mark/corporate name will not infringe another’s trademark rights.  Only a comprehensive trademark search can reveal information sufficient to provide advice regarding whether the Mark/corporate name is clear to use. Comprehensive searching and related analysis is not included within the scope of this engagement.

Name changes are disruptive and can be expensive. The client should know what risks they are taking when skipping a comprehensive search. Including a written explanation of the risks in the client engagement letter can avoid problems between you and your client down the road if valid claims of infringement are made by a third party.

Photo credit to flickr user dierken under this creative commons license.

Invention, Design, & Branding Lessons from Apple’s Lead Designer Jony Ive

JonyIveThe GeniusBehindApplesGreatestProducts

“In a company that was born to innovate, the risk is in not innovating. . .The real risk is to think it is safe to play it safe,” said Jony Ive, the lead industrial designer for Apple.

Jony Ive is the subject of Leander Kehney’s book Jony Ive: The Genius Behind Apple’s Greatest Products . Steve Jobs, deservedly,  gets a lot of attention and credit for the success of Apple products. However, Jony Ive is the man behind many of the decisions about and features of Apple’s products.  The book is not an authorized biography. Yet, it provides insights into the product innovation process and product development process at Apple. It also demonstrates how product design alone can indicate a brand to customers.

Design Alone Can Carry Branding without a Logo or a Name
The face of the iPhone and IPad has an infinity pool look devoid of any product or company name or logo. The brand is carried by the design itself:

iPhone 4 with the black “infinity pool” face common to all iPhones

The front face bore neither the company logo nor the name of the product. “We also knew from our experience with iPod,” [Chris] Stringer [of Apple] explained, “if you make a startlingly beautiful and original design, you don’t need to. It stands for itself. It becomes a cultural icon.”

Apple sought design patents to protect the look of the iPhone which proved effective when Apple sued Samsung alleging Samsung’s phones were copied from Apple designs and infringed Apple’s design patents, among others.

Apart from patents, the idea that the shape of a product can indicate a source of the product is recognized in trademark law as trade dress protection. Apple was also successful proving that some of Samsung’s phones infringed Apple’s trade dress rights in the design of the iPhone. The iPhone and iPad are products that demonstrate the look of a product through its design can do the work of conveying the brand to the customers.

Innovation is a Series of Steps, Not one Giant Leap
Richard Powell of the design firm Seymourpowell is quoted on the process of invention in the book:

“Innovation…is rarely about a big idea; more usually it’s about a series of small ideas brought together in a new and better way. Jony’s fanatical drive for excellence is, I think, most evident in the stuff beyond the obvious; the stuff you perhaps don’t notice that much, but which makes a difference to how you interact with the product, how you feel about it.”

Design Should Make Technology Approachable
Apple is famous for making products that are easy to use. The handle and the transparency of the iMac case (click here for a photo of the IMac case) is discussed as an example:

The transparency added a sense of accessibility, but in order to give the iMac an even more approachable feel, the designers added a handle on top. For Jony, the handle on the iMac was not really for carrying it around, but to build a bond with the consumer by encouraging them to touch it. It was an important but almost intangible innovation that would change the way people interact with computers.

“Back then, people weren’t comfortable with technology,” Jony explained. “If you’re scared of something, then you won’t touch it. I could see my mum being scared to touch it. So I thought, if there’s this handle on it, it makes a relationship possible. It’s approachable. It’s intuitive. It gives you permission to touch. It gives a sense of its deference to you.”

Design Interest from Early Age Cultivated by his Father
Jony had an interest in design from a young age.

As a young boy, Jony exhibited a curiosity about the workings of things. He became fascinated by how objects were put together, carefully dismantling radios and cassette recorders, intrigued with how they were assembled, how the pieces fit. Though he tried to put the equipment back together again, he didn’t always succeed.

“I remember always being interested in made objects,” he [Jony] recalled in a 2003 interview conducted at London’s Design Museum. “As a kid, I remember taking apart whatever I could get my hands on. Later, this developed into more of an interest in how they were made, how they worked, their form and material.”

Jony’s father, Mike Ive, worked as a silversmith and a teacher. Mike eventually was put in charge of monitoring the quality of teaching at schools in his district, focusing on design and technology. In doing so Mike moved design technology from a marginal subject to something that occupied seven to 10 percent of a student’s school time. Mike’s design emphasis was not limited to school but also was passed on to his son:

Mike Ive encouraged his son’s interest, constantly engaging the youngster in conversations about design. Although Jony didn’t always see the larger context implied by his playthings (“The fact they had been designed was not obvious or even interesting to me initially,” he told the London crowd in 2003), his father nurtured an engagement with design throughout Jony’s childhood.

He was constantly talking to Jonathan about design. If they were walking down the street together, Mike might point out different types of street lamps in various locations and ask Jonathan why he thought they were different: how the light would fall and what weather conditions might affect the choice of their designs. They were constantly keeping up a conversation about the built environment and what made-objects were all around them . . . and how they could be made better.

Jony Ive: The Genius Behind Apple’s Greatest Products is a worth while read with interesting insights into Apple’s product development and design processes and philosophy. Particularly interesting was Apple’s intentional reliance on trade dress rights in the look of the product–without any logo or name on the face of the iPhone and iPad–to convey its brand.

Words or a Logo or Both in a Trademark Application?

LogoWordCombinedTrademarkApplicationIf your trademark includes words, letters, or numbers, before filing a federal trademark application you need to determine whether you will include any logo or stylistic element(s) as a part of your claimed trademark in the application. This is true because the U.S. Patent & Trademark Office asks you to specify whether or not you are claiming with your mark any font, style, size, color, or graphics. Marks without a claim of any of those style elements are known as standard character marks. Marks with any of those claims are known as special form (styled and/or design) marks.

If your mark is a combination of words or characters with a logo or design elements, it can be, but it is not always the best approach to claim the logo and design elements in your trademark application. Below are issues to consider when deciding whether to pursue a trademark registration on a standard character mark or a special form mark.

Types of Trademarks
First a review of the types of trademarks is helpful to the discussion that follows about how to claim your trademark in a trademark application.

Standard Character
A standard character mark is one where the mark has word(s), letter(s), and/or number(s) with no design element and no claim to any particular font, style, size, or color. The character(s) of the mark must appear in the Trademark Office’s standard character set. The characters or word(s) of the mark are provided in standard text without any style, font, or graphics. For example, U.S. Trademark Reg. No. 1,452,359, is for the mark “STARBUCKS” as a standard character mark.

Special Form
Special form marks cover marks presented in a variety of ways and make a claim to the stylistic elements included with the mark. Below are a few examples.

IBMLogo1Mark with a Particular Font or Stylized Text
This type of mark does not have a logo outside of the styling/font of the text of the mark. IBM’s U.S. Trademark Registration No. 1205090 is an example where the mark “IBM” is represented in the now widely recognized horizontally striped style.

NikeSwooshLogo Mark Alone
This type of mark has no standard characters in it. Nike’s U.S. Trademark Reg. No. 1,232,243 is an example of the Nike “swoosh” logo mark that has been registered alone without any standard characters.

Logo with Adjacent Text
NikeSwooshWordsThis type of mark has standard characters adjacent to the logo. Nike’s U.S. Trademark Reg. No. 1,325,938 is an example where the word “NIKE” is combined in the registration and adjacent to the swoosh logo. However, the combined adjacent elements must present a unitary commercial impression, which this mark does.

StarbucksLogoLogo Mark with Embedded Text
This type of mark has standard characters embedded in the logo. Starbucks U.S. Trademark Reg. No. 1,815,937 is an example of a registration where the text “STARBUCKS COFFEE” is embedded in the Starbucks logo.

Color as an element of the Mark
MobileColorClaimThis type of mark claims color as an element of the mark. Exxon Mobil’s U.S. Trademark Reg. No. 3,787,476 is an example of a registration where color is claimed as a feature of the “MOBIL” mark. In that registration, the letters M B I L are claimed in blue and O is claimed in red.

Strong Protection
Companies with a lot of resources to dedicate to trademark and brand protection often file several trademark applications on their marks for the same goods/services. For example, Nike owns (1) U.S. Trademark Reg. No. 0,978,952 on the standard characters “NIKE” for athletic shoes, (2) U.S. Trademark Reg. No. 1,232,243 on the “swoosh” logo alone for athletic shoes (shown above), and (3) U.S. Trademark Reg. No. 1,325,938 on combination of the word NIKE with the “swoosh” logo for athletic shoes (shown above). Similarly, Starbucks owns (1) U.S. Trademark Reg. No. 1,452,359 on the standard characters “Starbucks” for coffee, (2) U.S. Trademark Reg. No. 1,815,937 on the Starbucks logo having the words “Starbucks Coffee” for coffee (shown above).

Many times the broadest protection is achieved by filing multiple trademark applications covering the same goods/services. For example, broad protection may be achieved by (a) filing one application covering the standard characters, (b) filing an application on the logo combined with the words, and (c) sometimes filing on the logo alone without the word if the logo is used in that manner (e.g. Nike’s swoosh logo).

Why So Many Trademark Registrations?
Standard character marks protect just the standard characters of the mark and not any logo, graphical, or stylistic elements. Therefore Nike’s standard character trademark registration does not cover its swoosh logo. On the other hand, special form marks can be interpreted to be limited, to some extent, by their logo, graphical or stylistic elements. Therefore, while the words/characters of a special form mark will generally be given greater weight when comparing to other marks for infringement or conflict, it is possible that in some circumstances were a third party doesn’t use the exact same wording as your mark and does not have the same logo/style elements, then the third party may have a better chance of avoiding your claims of infringement based on a special form mark alone. So covering your mark in multiple registrations can give you broader protection against infringers.

Another, possibly more likely, problem with proceeding only with a special form trademark is that if you decide later to change your logo or the stylistic elements in the special form mark, then you might have to file a new trademark application on the changed version depending on the extent of the changes. Further, you might not be able to renew the trademark registration of the old version because it is no longer in use. Trademark law rewards longevity of use and registration. Therefore a mark that has been registered for a long time will have a better chance of being considered strong and will be harder for others to challenge its validity. So, if you have to drop registrations because of logo changes you will not receive the benefits of maintaining a trademark registration for long periods of time. Standard character marks don’t have this problem because they cover the words within the mark as presented with any logo or stylistic arrangement.

Economizing: Money for Only One Application
If you have a mark with a logo or design elements and you only have the funds to file one trademark application, below is some general information to consider. If you don’t have a logo or graphical representation of the mark, then it is easy, and a standard character mark should be selected in the application process. When choosing to economize by filing one application, there’s always a risk that a situation could arise with a third party where it would have been better to have filed multiple applications or a different type of application than they one that was filed. But that risk is a part of the balance being struck when choosing to reduce costs by pursuing one application.

Distinctive Mark: Standard Character
If the words or characters of your mark are very distinctive (e.g. fanciful, arbitrary or even suggestive), then it’s generally best to pursue a standard character trademark first. This is true because protection of a standard character mark covers the characters and words of the mark presented in any font style, arrangement, or graphical representation with an additional logo or without. Therefore standard character marks have the broadest protection because they are not limited to any particular color, style or graphic. However, a standard character mark will not protect the design or logo elements used by others that do not include the same or similar words/characters.

Weak Marks: Combine with Logo or Stylistic Elements
If the words or characters of your mark are weak or descriptive then it is generally best to pursue a trademark application that claims the combination of the words and a logo, but only if the words and logo will be used together in your business. This is effective when the logo includes the words of the mark (e.g. Starbucks Logo). However it also can be effective if the logo and words are adjacent one another (e.g. “Nike”combined with the Swoosh). Either way, the distinctiveness of the logo should protect the trademark from being considered merely descriptive by the Trademark Office.

Important Logo
If the characters or words of your trademark are distinctive but your logo is very important to you, you might decide to pursue a special form mark including the logo and the words given the importance of your logo (e.g. “Nike” combined with the Swoosh mark and Starbuck’s logo mark). However, if the logo is changed in the future you may have trademark renewal problems as explained above.

Font Only
If the stylistic features of your mark only include a particular font style or color arrangement (e.g. IBM and Mobile), then as long as you’re mark is sufficiently distinctive you will probably get the most bang for your buck by pursuing a standard character mark.

Seek Multiple Application(s) Later
As your business develops, you may decide to dedicate more resources to trademark registration. If you do, you can add trademark registrations at that time to broaden the scope of protection.

The broadest protection may be obtained by filing separate federal trademark applications on the words lone, the logo, and the logo combined with the words. However, when starting out, you might decide to economize by filing only one trademark application. Whether that application should be a standard character mark or a special form mark is circumstance dependent. Many times an application on the standard character mark make sense as long as the mark is sufficiently distinctive. If it is not distinctive then an application on a special form mark having the logo and the words may be the best option. Above are some points to consider in the decision process.

Eric Waltmire Presenting on IP for Dupage’s REV3 Innovation Center

Rev3On March 11, 2014 at 6:30pm, REV3 Innovation Center of Dupage is hosting me for a presentation on Strategies for Protecting Intellectual Property: Innovation and Branding. Intellectual property plays a role in adding value to most businesses, whether through invention, branding, or the use of other creative works.

My presentation will help business owners, entrepreneurs, and inventors understand how patents and trademarks can be used to protect innovation and business branding. It will provide strategies for protecting intellectual property rights under various scenarios and funding circumstances. Sign up here to attend.

Particularly the presentation will cover the following.

Patents and Invention Protection:

  • What is patentable
  • Patent Searching
  • The U.S. Patent Application Process
  • When to maintain secrecy and when to publicize
  • Seeking Foreign Patent Protection
  • When not to seek a patent
  • When and how to rely on trade secret protection

Trademarks and Brand Protection:

  • Value of trademarks
  • Types of marks
  • Strategies for choosing legally strong marks
  • Proper trademark use
  • Strategies for relying on branding in the absence of patent protection

In addition, the presentation will discuss steps that are needed to obtain and maintain ownership over the intellectual property created by your company, its employees, and its contractors.

REV 3 Innovation Center
REV3 Innovation Center is an incubator and future co-working space in DuPage County. REV3 is focused on helping people and companies manufacture products, software, and technology to drive the third industrial revolution. One aim of REV3 is to provide facilities to allow companies to prototype, build, and assemble small and moderate scale product volumes.

If you are interested in getting involved with REV3, please contact me.

The presentation will be held at the Illinois Institute of Technology (IIT) – Rice Campus at 201 E. Loop Rd., Wheaton, IL 60189.

Please sign up to attend here: http://rev3dupage.com/events/?ee=12.

Seventh Circuit Questions Usefulness of Trademark Surveys

CrackerBarrelThe Cracker Barrel Old Country Store (CBOCS) is a well known chain of restaurants. Kraft is a well-known manufacturer of food products sold in grocery stores, including a variety of packaged cheeses. Some of the packaged cheeses are sold under the trademark “Cracker Barrel.” Kraft sued CBOCS when it discovered that CBOCS planned to sell food products, such as packaged hams, in grocery stores under its logo, “Cracker Barrel Old Country Store.” Kraft Foods v. Cracker Barrel Old Country Store, No. 13-2559 (7th Cir. 2013).

Kraft objected only to the sale of products under the mark “Cracker Barrel Old Country Store” in grocery stores. It did not object to the sale of such products in the CBOCS restaurants or online. The district court granted a preliminary injunction prohibiting CBOCS from selling food products under the Cracker Barrel Old Country Store mark in grocery stores. The Seventh Circuit Appeals court agreed and upheld the injunction.

The 7th Circuit strongly questioned the usefulness of surveys in trademark lawsuits. Generally in a trademark dispute the question is whether there is a likelihood that the consumer would be confused to believe that the product/service of the junior user originates from the same source as the senior user’s product/service. One piece of evidence that a party may put forth is a survey of relevant consumers for showing whether confusion is likely.

Expensive Surveys
The problem with survey’s, aside from the issues identified by the Court, is that they can be expensive. An expert must be hired. The expert must plan a survey relevant to the case. The survey must be conducted. Then the expert must prepare a report with conclusions from the survey. Then the other party has the right to depose and otherwise attack the survey and its conclusions. All of the expert cost associated with surveys can total from $20,000 to over six figures depending on the case.

The Opportunity to Forgo Surveying
The court’s negative view of the value of surveys, as explained below, is helpful for litigants with limited budgets. If a litigant can dispense with the need to conduct surveys, the litigant can reduce costs substantially. Yet, forgoing evidence that could be supportive of the party’s position is always a risk. However, a party may decide to forgo a survey, particularly in the 7th Circuit in view of this Kraft Foods case.

General Problems with Surveys
The court started off with an overview of the problems with relying on surveys in trademark cases. The court stated that “Consumer surveys conducted by party-hired expert witness are prone to bias.” Citing several academic articles, the court continued, “There is such a wide choice of survey designs, none foolproof, involving such issues as sample selection and size, presentation of the allegedly confusing products to the consumers involved in the survey, and phrasing of questions in a way that is intended to elicit the surveyor’s desired response— confusion or lack thereof—from the survey respondents.”

Further referring to the academic articles, the court stated, “Among the problems identified by the academic literature are the following: when a consumers is a survey respondent, this changes the normal environment in which he or she encounters, compares, and reacts to trademarks; a survey that produces results contrary to the interest of the party that sponsored the survey may be suppressed and thus never become a part of the trial record; and the expert witnesses who conduct surveys in aid of litigation are likely to be biased in favor of the party that hired and is paying them, usually generously.”

The court concluded that generally, “All too often experts abandon objectivity and become advocates for the side that hired them.” This makes logical sense. A party will not hire an expert to give them a conclusion that damages the party’s position.

Professional Expert Witnesses
Turing the the survey in the Kraft Foods case, the court noted that Kraft’s Expert, Mr. Poret, appeared to be “a professional expert witness.” The court said that it would not hold this against him. However noting that Poret appears to be a professional expert witness implies a negative connotation. This appears especially evident when read in context with the court’s citation to academic literature to support the proposition that too often become advocates for the side that hired them.

Kraft Survey Problems
The Poret survey was conducted online via email. Poret emailed photos of CBOCS sliced spiral hams to 300 american consumer of whole-ham products and then asked in the email whether the company that makes ham also makes other products, and if so what products. About a quarter of the respondents said the company makes cheese. However the court was not convinced by this result noting that consumers could have guessed that the company makes other products because many companies have multiple product lines. Then the consumer could have guessed that the company made cheese.

Next, Poret showed “a control group of 100 respondents essentially the same ham, but made by Smithfield—and none of these respondents said that Smithfield also makes cheese.” The court noted that “Poret inferred that the name ‘Cracker Barrel’ on the ham shown to the 300 respondents had triggered their recollection of Cracker Barrel cheese, rather than the word ‘ham’ being the trigger.” The court found that the relevance of this conclusion was obscure. The court stated, “Kraft’s concern is not that people will think that Cracker Barrel cheeses are made by CBOCS but that they will think that CBOCS ham is made by Kraft, in which event if they have a bad experience with the ham they’ll blame Kraft.”

Validity of Online Surveys Questioned
Also the court question the validity of online surveys when drawing conclusions about products purchased in person in a store. The court said, “it’s very difficult to compare people’s reactions to photographs shown to them online by a survey company to their reactions to products they are looking at in a grocery store and trying to decide whether to buy.” The court continued, “The contexts are radically different, and the stakes much higher when actual shopping decisions have to be made (because that means parting with money), which may influence responses.” Online surveys are less expensive than in-person in-store surveys. However, this opinion counsels away from using online surveys when the products at issue are purchased in-person in a retail location.

Side-by-Side Statististical Sales Data Also Questioned
The court proposed using statistical sales data as an alternative to a survey. But then concluded that such statistical sales data would likely lack reliability necessary to support a basis to refuse “granting preliminary injunctions in trademark cases.” The proposed statistical data process would involve analyzing the actual sales of the two products at issue in the real world. “…in some of [the stores] Kraft Cracker Barrel cheese would have been displayed side by side with CBOCS hams plus similar meat products sold at comparable prices, while in other stores the cheese and hams would have been displayed in different areas of the store, and still other grocery stores would have carried CBOCS hams but not Kraft Cracker Barrel cheese.” The court stated that by examining the greater sales, if any, that “CBOCS hams obtained by proximity to the Kraft Cracker Barrel label, an expert witness might be able to estimate the extent of consumer confusion.” The greater boost in sales in those CBOCS hams in proximity to the Kraft Cracker Barrel cheese, the greater likely association of the CBOCS hams with the marker of the Cracker Barrel cheese. Still the court discounted this method in this scenario, stating, “nor have we such confidence in the reliability of such a study that we would think it an adequate basis for refusing to grant preliminary injunctions in trademark cases.”

Expert Testimony on Buying Habits And Consumer Psychology Suggested
There was one type of evidence that court would consider. The court noted that testimony of “experts on retail food products about the buying habits and psychology of consumers of inexpensive food products” would be illuminating in trademark cases. The court cited an academic article providing that “neither courts nor commentators have made any serious attempt to develop a framework for understanding the conditions that may affect the attention that can be expected to be given to a particular purchase.”

The courts criticism of trademark surveys is a benefit to litigants on a limited budget. While forgoing potentially favorable survey evidence is a risk, the opinion in this case provides authority for calling into question the other party’s survey conclusions.

Protecting Unpatentable Inventions

Not every invention is patentable. Yet, inventors and companies may decide to proceed to market with an unpatentable products or services. This article will explore other intellectual property protection options that exist beyond patents.

Build a Brand
In many cases customers purchase a product or service because it is provided under a recognized brand name. This may be true regardless of whether the product or services is patented. Therefore you may decide to choose a strong trademark for the product or service. Then you can market that trademark so that customers associate that trademark with the type of product or service you are selling. The goal is to build a brand so that consumers will seek out that brand when purchasing your goods or services. In this way customers will choose your brand of product, even if there are competitors selling the same or similar products/services.

The brand can be built around a product/service name or around a company name or both. If the names used in your branding are unique (they should be), then you can seek to obtain a federal trademark registration which will provide additional benefits. The trademark rights built around your product or service will not prevent competitors from copying the product or service. Yet it will prevent them from using your trademark or a similar mark. The strategy of building a brand is designed to draw customers to your brand regardless of the competition.

It may be possible to protect your invention under copyright law. However, copyright protects the expression of an idea but not the idea itself. Therefore if you write software creating a new type of application, copyright protection will protect you from direct copying of the software. But it cannot prevent others from copying the idea and writing their own implementation of that idea. The copyright protection extends somewhat beyond identical copying, but the point is that copyright provides narrow protection of the expression of an idea as compared to patents.

Trade Secret
When an invention cannot be patented, it might be protectable as a trade secret. Not all inventions are capable of being protected as a trade secret. A trade secret may generally be understood as something that has economic value, is not generally known, and is subject to efforts to maintain it as a secret. Therefore, if the invention is embodied in a product that is distributed to the purchasing public and whom can reverse engineer or discover the invention by inspecting the product, then it is unlikely that the invention can be protected by a trade secret. However, if the invention is capable of being maintained in secrecy, then trade secret protection might be relied on.

It is possible to draft a contract that requires the party receiving the invention to keep it confidential and not disclose it to others (similar to an NDA). This is more likely to occur with business to business transactions where the sale involves significant money or resources to execute or implement. The other party would need to agree to such a confidentiality term.

This does not work with consumer goods because the product often needs to be marketed broadly and publicly where the invention details may be disclosed.

There are a number of alternative approaches to protection when your invention is not patentable. While each alternative is not a complete substitute, the options above may provide some protection when proceeding with a product or service in the absence of a patent, depending on the circumstance.