UK startups and scale-ups considering US expansion often ask us about using and protecting their brand in the States
Certain questions arise consistently, so for easy reference we’ve prepared the FAQ below. Of course, check with your US advisors to confirm the right approach for your business.
1. US Trademarks: What’s the bottom line?
Before launching in the US you should strongly consider:
- conducting a clearance search to determine whether anyone else already has applied for, registered, or is using a mark in the US that could block your company’s use of its mark, and
- filing a US trademark application if the clearance search results are favorable.
2. Do I need to bother?
It depends on how important your brand is to your US business plans and your company’s tolerance for potential US litigation risk.
If you’ve built or hope to build US brand recognition – such that it would create a hardship to have to rebrand if you can’t use your mark in the US – you’ll want to ensure you’ve properly addressed US trademark matters.
US trademark applications are optional, but they can provide a strategic advantage — particularly if you don’t intend to launch in the US for a considerable period of time but still want to lock up rights to a name.
Also, failure to properly confirm in advance that you can use a brand increases the risk your company may unknowingly infringe a third party’s trademark rights, and litigation and litigation threats tend to be more common in the US than in the UK.
3. Does my UK or European Community trademark registration cover the US?
No. Trademarks are generally country-specific; e.g. a UK registration provides protection only in the UK.
However, UK or European trademark filings sometimes can be helpful for establishing rights through subsequent trademark filings in the US, particularly if the subsequent US filings come shortly afterwards.
4. I searched the US Patent and Trademark Office (USPTO) online database and there seem to be no filings for my company’s mark – are we good to go?
Not necessarily. Here are two reasons why not:
- Unregistered marks. A search of the USPTO database won’t identify unregistered marks that nonetheless may pose a problem. A US trademark registration offers useful benefits, but a company can develop protectable rights in a mark simply by using it in the US. That company potentially can block later users of identical or similar marks even without a trademark registration if there is a “likelihood of confusion” (more on this concept below).
- Similar marks. An online search of the USPTO database also won’t necessarily identify marks that aren’t identical to yours but are sufficiently similar to potentially block you. For example, searching the USPTO database won’t turn up a registration for soda in the US under the KOKA KOLA brand. However, a large Atlanta-based company likely would want to have a word with anyone executing on that plan.
5. I searched the USPTO online database and lots of companies have filed for my company’s mark – am I out of luck?
Not necessarily (again!).
Multiple companies can own rights in the same mark in the US if the various uses do not create a “likelihood of confusion” among the relevant customers. For example, the companies behind DELTA airlines, DELTA petrol, and DELTA faucets are all unrelated. However, whether a “likelihood of confusion” exists is not always a straightforward question; US courts consider many different factors when evaluating “likelihood of confusion” in US trademark disputes.
6. Do I have to have a US company to apply for a US trademark registration?
No. In fact, for tax reasons, it’s often more desirable for a non-US company to own a US trademark registration.
7. Does my company need to be doing business in the US to apply for a US trademark registration?
No, although eventually, your company needs to use the mark in the US (or be a US company using the mark cross-border) to register the mark.
8. Does using my mark on my company’s website count as using a brand in the US?
Potentially yes, if your company’s services are being provided to US customers or users, and your company is using the mark on its website to identify the source of the services. If your company makes physical goods, typically the mark must be shown on the goods or product packaging. Use of the mark solely as a domain name is insufficient to establish trademark rights.
9. Do I need a trademark lawyer?
Although technically any individual can file a US trademark application, clearing a trademark for use in the US and obtaining a US trademark registration are nuanced processes. Working with a US trademark lawyer will virtually always save you money and time; be sure to get a quote in advance, of course.
10. Realistically, what are the risks?
The practical risks of not properly addressing US trademarks include:
- US trademark disputes. A common worst-case scenario is that someone already has US rights in your company’s mark and you start trading anyway. Trademark claims are more common in the US than the UK; the US is more litigious generally and you’ll have to bear your own costs in litigation (which creates pressure to settle on potentially unfavorable terms). You don’t want to find yourself on the wrong end of an expensive and time-consuming US trademark claim if you could have readily avoided it with an understanding of the complete picture. This isn’t a theoretical risk – in our experience, trademark claims are the second-most common type of dispute initially encountered by non-US startups in the States (anecdotally, employment claims are the most common).
- Inability to use your brand in the US. The landscape may be clear now, but without using your brand in the States or filing a US trademark application, there’s little stopping someone else from obtaining US rights in your brand before you do.
- Wasting time and money. You spend time and money filing your own trademark application and the USPTO rejects it for avoidable reasons.
Post produced in partnership with Daniel Glazer, Aaron Hendelman, and John Slafsky at Wilson Sonsini Goodrich & Rosati.
Dan can be reached at firstname.lastname@example.org, Aaron at email@example.com, and John at firstname.lastname@example.org. This post does not constitute legal advice and should not be relied upon for business or legal decisions.