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Bart Scott’s New Trademark?

Can a celebrity say a phrase on television and then register that phrase as their trademark?  That is exactly what Bart Scott of the New York Jet’s is trying to do.  On January 17, 2011 in a post-game interview Bart Scott said, “can’t wait” in reference to the upcoming playoffs tournament in Pittsburgh.  Now, Scott has hired an attorney and filed a registration application with the U.S. Patent and Trademark Office to obtain a trademark for this phrase.

HOW IT WORKS

The rules and procedures for registering a trademark are the same for everyone and every business.  The proposed mark has to represent a product or service of some type, it has to be used in commerce and it can’t be confusingly similar to another trademark.  In this case, Scott is attempting to register “can’t wait” under a 1(b) filing which means he isn’t claiming to be using the trademark right now but he’s promising that he has a bona fide intent to use the trademark at some future date.  The U.S. Patent and Trademark Office will not issue a trademark registration for Scott’s mark until he has begun to use it in commerce and has supplied their office with a specimen to prove how it is being used.  Of course, there will also be a time period in which the public can challenge his assertion of rights to this trademark by filing an opposition with the U.S. Patent and Trademark Office.

BART SCOTT’S GOODS

In this case, Mr. Scott has filed an application in which he claims a bona fide intent to use the mark “can’t wait!” on men’s, women’s and children’s clothing.  He isn’t claiming that he is using this mark in commerce right now only that he plans to do so.  He doesn’t actually have any rights to this potential trademark just yet.  He will have to produce a product, presumably a T-shirt that has “can’t wait!” splashed across the front before he will be able to convince the U.S. Patent and Trademark Office that he has rights to this mark.

ANSWER

The answer is “no” people, including celebrities, cannot claim trademark rights to words or phrases simply by virtue of vocalizing these in public (despite what pop culture might tell you).  The word or phrase has to be used in commerce on a product or service and it cannot be confusingly similar to another trademark.

What Makes A Business Legit?

I am often asked whether I think a business idea is “legit”?  My mental, unspoken response is always, “if you think it is or think it isn’t, you’re right.”  In other words, you as an entrepreneur are in control of whether your business is legit.  With that in mind, it doesn’t hurt to have a team of professionals performing technical work on your behalf to help your business achieve legitimacy.  Believe or not, you can’t shouldn’t do it all yourself.

Here are a few ideas for ensuring your business is legit:

• Choose a name that is unique enough to set you apart from your competition.
• Keep records and document the actions of your business.
• Pay your bills.
• Make business decisions guided by your conscience.
• Do business your way, not the way everyone else does it.
• Give back to your community.

Business and Intellectual Property

The trademark of a business is arguably one of its most valuable asset.  It’s the reason people buy your product time and time again. People are generally risk averse with their money and want to know beforehand what they are purchasing.  Protecting your business’ brand is a direct investment in the future profits of your business.

The process of protecting your brand involves several steps:

1. Trademark Search and Clearance – the first thing you want to know is whether another company is using a mark that is confusingly similar to your proposed mark/brand logo.  This can be done by searching the federal database at the USPTO as well as state databases and common law databases.  A search must include not only direct hits but similar phonetics, spellings or other impressions that a mark might have on consumers.  Once you’ve determined that no other marks are confusingly similar to your proposed mark you are ready to prepare an application.
2. Trademark Application – the application process is fairly straightforward except for two highly technical questions.  The first, is the class of goods/services that your mark represents.  The USPTO has a list of all of the classifications.  Selecting the correct classification will determine whether the mark gets approved by the examining attorney.  It will also be a major factor in the level of protection that the mark will receive once it is registered.  The second, is the description of the goods/services that your mark represents.  Again the USPTO provides a manual of “pre-approved” descriptions for various goods and services.  However, your particular mark may not fit neatly into one of these descriptions.  Drafting an adequate description will also determine whether the examining attorney approves the application and will set the level of protection the mark receives.
3. Trademark Prosecution – after an application has been filed it is assigned to an examining attorney.  This attorney will review and scrutinize the application to ensure that it complies with the federal trademark laws.  Often the examining attorney will have objections to the application.  These objections will be issued as “Office Actions.”  The applicant will need to respond to these actions in a timely manner or else the application will become abandoned and the mark will not be registered.  Some Office Actions are merely procedural in nature while others will involve substantive issues of trademark law.  Resolving these issues is critical to obtaining a registered mark.
4. Trademark Registration – once the application has been reviewed, prosecuted and published for opposition without issue, the examining attorney will approve the application for registration.  This entire process could up to one year to complete.  The benefits, however, could last the lifetime of the mark and provide substantial financial benefits to its owner.

All businesses that are developing a brand to represent their goods/services should consider obtaining and maintaining a registered trademark.  To exemplify this statement consider Coca-Cola.  Management at Coca-Cola have stated that even if the company lost all of its manufacturing plants, buildings, vehicles and other hard assets, it would be able to rebuild itself simply by relying on the brand.  Nike is another excellent example.  As one of the most recognizable brands, Nike is more a marketing company than a sports equipment and clothing company.  The brand is so strong that Nike can license the use of its mark to clothing manufacturers and reap enormous profits without ever opening another factory.  Businesses run on IP.  Protecting that IP is critical to long term marketability as well as competitive advantage.

Trademark Infringement – In Brief

From the United State Patent & Trademark Office (USPTO) online glossary, a trademark is “words, names, symbols, sounds, or colors that distinguish goods and services from those manufactured or sold by others and to indicate the source of the goods. Trademarks, unlike patents, can be renewed forever as long as they are being used in commerce.”  Under the Trademark Act, you can file an application to register your trademark with the USPTO if you are currently using your trademark in “commerce” or if you have a genuine intent to use your trademark in “commerce.”  There are several benefits to registering your trademark one of which is the heightened protection from infringement that your trademark receives once it is registered.  To really understand why this is significant you need to understand the term “infringement” in the trademark context.

Infringement generally means violating a right or privilege.  So in the trademark context infringement refers to violating another’s trademark rights.  If you need a refresher on trademark rights read this post.  Infringement can occur in two ways: Simple infringement and Technical Infringement.

SIMPLE TRADEMARK INFRINGEMENT

Someone uses your trademark without your authorization.  That’s it!  They have infringed upon your exclusive right to use your trademark.

TECHNICAL TRADEMARK INFRINGEMENT

Someone uses a confusingly similar name, word, symbol, sound or color (or any combination) in connection with the same or related goods or services in a way that is likely to confuse, deceive or cause consumers to make a mistake about the source of the goods or services.  This is often referred to as the “likelihood of confusion” infringement.  Since this is a little more technical here are some factors that the courts consider when determining whether a “likelihood of confusion” has actually occurred.

DUPONT FACTORS FOR LIKELIHOOD OF CONFUSION

1. The similarity or dissimilarity of the marks in their entireties as to appearance, sound, connotation and commercial impression.
2. The similarity or dissimilarity and nature of the goods or services as described in an application or registration or in connection with which a prior mark is in use.
3. The similarity or dissimilarity of established, likely-to-continue trade channels.
4. The conditions under which and buyers to whom sales are made, i. e. “impulse” vs. careful, sophisticated purchasing.
5. The fame of the prior mark (sales, advertising, length of use).
6. The number and nature of similar marks in use on similar goods.
7. The nature and extent of any actual confusion.
8. The length of time during and conditions under which there has been concurrent use without evidence of actual confusion.
9. The variety of goods on which a mark is or is not used (house mark, “family” mark, product mark).
10. The market interface between applicant and the owner of a prior mark.
11. The extent to which applicant has a right to exclude others from use of its mark on its goods.
12. The extent of potential confusion, i. e., whether de minimis or substantial.
13. Any other established fact probative of the effect of use.

Not all of these factors are always considered nor are they given equal weight.  However, it does give the holder of a mark some sense of what the law regards as infringement.

Raising Money: The Private Placement Memorandum

Millions of dollars are raised every year by highly motivated small business entrepreneurs.  Most of that money doesn’t come from the bank.  Banks are very conservative and risk averse when it comes to lending money to small businesses.  Bank wants to see your business generating money before they will make a loan.  As we all know, it takes money to make money.  Many small business entrepreneurs turn to family, friends, savings accounts, retirement accounts or private angel investors for funding.  Whenever you raise money from friends, family or other private investors you need to be give them a document called a private placement memorandum.  A private placement memorandum, commonly called a PPM, is a disclosure document given to investors. Usually when a company wants to raise money they will offer to sell a piece of the company to private investors rather than to the public at-large. Investing in a company always involves a certain element of risk. Investment risks, business objectives, management and capital structure are commonly disclosed in a PPM. For entrepreneurs, the PPM is a critical piece of documentation because it provides a safety back-drop against potential claims by investors. By way of simplistic illustration, imagine you started a lemonade stand and your neighbor gave you $100,000 in exchange for 50% of the profits (notice this isn’t a loan). After years of buying lemons and making lemonade you still haven’t been able to sell any lemonade. Your neighbor might get anxious and ask for his money back. Unfortunately, the money has all been spent on lemons. Now what do you do? Hopefully, you gave your neighbor a PPM so he was aware of the risks. It is a simple fact that businesses fail. When businesses fail, investors usually lose money. On the flip side, when businesses succeed investors usually reap enormous windfalls.

BORING (but important) LEGAL STUFF ABOUT FEDERAL SECURITIES REGULATIONS

When you sell a piece of your company typically you sell shares of stock in your corporation.  This intangible is also referred to as equity in a company.  It basically means you are an owner of the company.  This intangible ownership interest is called a security.  When you offer to sell securities to family, friends or investors it is called a securities offering.  The offering is subject to regulation under the Securities Act of 1933, which are designed to prevent fraud by requiring complex and extensive disclosure and registration of offerings. Complying with the registration requirements of the Act can be time consuming and quite expensive. However, there are exemptions to the registration requirements for some private offerings. Rules 504, 505, and 506 of Regulation D allow for an exemption from registration if certain conditions are met. In addition to federal laws, state laws also regulate the sale of securities by companies. These laws are typically referred to as “Blue Sky” laws. Compliance with these laws in your offering is a necessary part of raising capital for your company. The private placement memorandum gives a company the chance to make some of the same disclosures that are required in a public offering.

DISCLOSE, DISCLOSE, DISCLOSE

Sales people everywhere live and die by the phrase “under sell and over deliver.”  The same concept applies when you are raising money.  Appropriate disclosures in a PPM are a way of “under selling” your business and setting the right expectation with investors.  Equally important is providing investors with the right type of information.  Most PPMs will have the following sections:

• Summary of the Investment
• Risk Factors
• Use of Proceeds
• Capitalization
• Business Plan
• Management
• Description of the Securities
• Terms of the Offering
• Legal and Tax Matters

Mark My Words (and Logos).

Can you actually register that fantastic name, logo or slogan that represents a valuable product or service as a trademark and prevent other companies from using that same name, logo or slogan?

Is your mark qualified for federal registration or will the US Patent and Trademark Office (USPTO) deny your application?

Whether a mark is qualified for federal registration depends upon the following factors:

1. The USPTO must consider your mark to be distinctive.
2. The mark cannot legally conflict with another mark.
3. The mark has to be in actual use.
4. The mark’s use must be subject to Congressional regulation.
5. The mark cannot be scandalous, immoral or deceptive.

If you want to find out more about these five factors, please fill out our contact form and we will email you a pamphlet that explains in more detail the qualifications for obtaining a federally registered trademark.

Do I Own the Copyright?

Whenever an author or creator fixes his/her original work of authorship in any tangible medium of expression a copyright is born. An original work of authorship includes literary works, lyrics, musical compositions, plays, choreographic works, art and graphics, movies, scripts, sound recordings and architectural works. A copyright protects these works by allowing the owner of a copyright the exclusive rights to reproduce, distribute, create derivative works, perform, display and transmit the work. So the question is do you own the copyright?

Copyright Ownership

Initially, the copyright is owned by the author or authors of the work.  Authors of a joint work become joint owners of the work.  For employees who create original works for their employers the author is considered the employer under the copyright laws.  Any work made for hire (or a work created for your employer) vests copyright ownership in the employer (unless otherwise agreed).  In other words, you may have created the work but if you did so as part of your employment then your employer is considered the author of the work for purposes of copyright law.  However, it is possible to have a written agreement with your employers that allows you to be the owner/author of all works you create.   It is important to note that individuals who contribute ideas, procedures, systems, concepts, processes, discoveries or methods of operation do not become owners of the underlying work.  For example, if you and a friend discuss a plot for a new screenplay and only you write it down, you are most likely the sole owner of the copyright.  Your friend may have contributed ideas but the copyright came into existence when it was fixed in a tangible medium of expression.  In other words, if you write it, you own the copyright.  If you are unsure about whether you own the copyright to a work you have authored please contact a copyright attorney and obtain an opinion letter stating that you are the owner of the copyright.

Define Trademark.

The legal definition of a trademark is a word, phrase, graphic, logo or other representation used to distinguish a product or service from others in the market.  An example of a trademark is the apple icon that represents the iPod, iPhone, Mac and other products of Apple, Inc.

Do Copyright Laws Affect Me?

The Federal Copyright Act of 1976 is the federal law that provides authors, artists, creators and programmers with the property rights to exclusive use and control over their creations.  Copyright laws affect anyone who writes, draws, programs, films, photographs, composes or otherwise creates literary, musical, dramatic, artistic or creative works in a tangible medium of expression.  In addition, copyright laws also affect those who like to imitate, steal or otherwise misappropriate creative works that are not their own.  There are severe civil and criminal penalties for infringing a copyright.  With the ubiquitous use of the internet, and blogs in particular, almost everyone is affected by copyright laws.

Fair Use

Material that is protected by a copyright may still be used under the Fair Use exception to the copyright rights.  In order to promote the free flow of information authors are able to copy material from protected works for specific purposes.  A few of these purposes are education, news, research and criticism.  It is always a good idea to check with a qualified copyright lawyer before attempting make use of copyright protected material.

Public Domain

Materials that are not protected by copyright fall within the realm of Public Domain.  Anything published before 1923 is in the public domain.  You may use this material for your own purposes without legal consequence.  However, you should be aware that some material in the public domain may have been altered in a creative way thereby creating a new copyright which cannot be infringed.  Again it is always wise to check with a qualified copyright attorney if you have any questions.

Copyright, Copyright Where For Art Thou Copyright?

The legal definition of copyright is a right of control over the use of an original work of authorship.  A copyright secures to its owner the property rights of the work.  These property rights include the right to reproduce, display, distribute, perform, and/or adapt the work.