We have all had that million-dollar idea in our head. We then brush it aside until we see the plan executed by someone else. We are then left asking ourselves, “Why didn’t I act on it sooner?”. This typical story that may be fantastical to most is the unfortunate reality of those who have an idea for a trademark only to find out they have just missed the boat. When it comes to trademarks, someone has the priority, or first rights, to use the mark. Resolving who has that priority is essential in determining who owns the trademark and whether another party is infringing on that trademark.
There are several factors that go into determining who has the priority to use the trademark. The first of these factors is public use. In order to merit the priority rights to a trademark, the mark must be used in connection with the public distribution of goods or services. Some examples of acceptable public use include: soliciting and accepting orders, presale announcement of new products, and sending prototypes to a potential licensee. Simply telling your friend or neighbor about your idea or even writing it down will not suffice to establish priority to the trademark.
The second factor that determines priority is the continuous commercial use of the trademark. It isn’t enough for the trademark use to be public, rather the trademark owner must show that the trademark is being used in actual business or commercial sales. If it doesn’t appear that there is a continuous commercial use of the trademark, the owner can be subject to a claim that they are “warehousing” the mark. The term warehousing refers to a situation in which the owner of a trademark makes token sales periodically in order to retain the rights to their trademark, even though they have no true intent to commercialize the trademark.
While generally speaking the use of the trademark establishes priority, another party’s “intent-to-use” application may take priority over the actual use. Applicant’s for trademark registration can file based on the intent to use the trademark, rather than actually using the trademark. This application does not become officially registered until a statement of use specifying the first actual use of the trademark is accepted by the U.S. Patent and Trademark Office. See 15 U.S. Code § 1051. Once the actual use is proven, the date of the intent-to-use application becomes the date of first use. For example, if someone files an intent-to-use application on March 1st, and then has their first actual use on June 1st and has their statement of use approved, then their date of first use becomes March 1st. If another party tries to adopt the mark after the intent-to-use date, then the first party will still be given priority.
It is for these reasons that it is important not to waste time when registering a trademark. If you have a trademark that you would like to register, you should consult an intellectual property attorney to expedite the process and ensure that you don’t miss out on establishing priority to the trademark.
Source: Yadegar, Minoofar & Soleymani LLP