Coca-Cola®. Starbucks®. Apple®. Your favorite brands all have trademarks — and as you seek to start your own business, you might be wondering whether you need that little R in a circle, too. Like many questions in business, the answer to this one is, “it depends.” But don’t let that cryptic answer discourage you. We’ll clear things up in a Jiffy®.
What is a trademark?
First things first: as defined by the U.S. Trademark and Patent Office, a trademark is “a word, phrase, symbol or design, or a combination of words, phrases, symbols or designs, that identifies and distinguishes the source of the goods of one party from those of others.” The primary reason trademarks were created was to prevent confusion in the marketplace that can arise if two similar companies use the same intellectual property.
Should I trademark my name?
There are some instances when trademarking your LLC name could be beneficial, and others where it might not be necessary. If any of the following three scenarios apply to your business, you should consider applying for a trademark.
1. Does your business name share your own name?
In certain professions, your name is your brand. For example, if you are an actor, a fashion designer, a consultant or an attorney, your name may be synonymous with your business. Or, your name may simply be part of your business name, as is often the case with car dealerships and doctors’ offices. In these situations, you may wish to protect your name by applying for a trademark.
However, it is worth nothing that even if your name is not trademarked, you may still have legal rights its use, simply due to the fact that it is your name. Actor Morgan Freeman and Designer Donna Karan have both successfully sued “cybersquatters” who purchased domain names misusing their own names.
2. Do you plan to do business in more than one state?
When you apply for an LLC with your state, the Secretary of State Office will check to make sure no one else is currently using the same name in a competing business. If your name is approved, you alone will have legal rights to use the name in your state, in conjunction with an LLC or corporation. However, this protection only applies to corporations and LLCs (not DBAs or Sole Proprietorships), and it does not apply to the rest of the U.S. So, for example, if you’re opening a restaurant in Texas, and you don’t plan to do business outside the state, you don’t need a trademark. However, if you later expand to Arkansas, you may be unpleasantly surprised to discover that another business is already using the same name, meaning you can’t use it in that state. Applying for a trademark at the beginning can avoid issues like this if you plan to grow your business in the future.
3. Does your company design or manufacture products for sale?
If you’re selling products, chances are good that you’re doing business outside of your state alone. After all, the Internet makes it easy to buy and sell almost anything from almost anywhere. For this reason, it’s a good idea to get your product name trademarked. This not only protects your product name; it also ensures you don’t accidentally infringe on someone else’s trademarked product name.
What protections are already afforded to me, without trademarking my name?
You may be wondering what common law trademark rights you already have. The answer may be, “More than you think.” When a U.S. company is the first to use a name within a product category or geographic market, common law trademark rights automatically apply. So, if you’ve searched your intended product name and find that no one else is using it, you may begin selling products under that name now, and even claim ownership of the trademark, without formally registering it. Simply start using the ™ symbol after the brand name, to protect your trademark. Later, if you decide to apply for a formal trademark, you can use the ® symbol instead — but only after your application has been approved by the U.S. Trademark and Patent Office.
How much does it cost?
It’s only $325 to apply for a trademark application directly with the U.S. Patent and Trademark Office. If you require assistance, you may wish to use an online legal service, which will cost a bit more. Or, you could work with an attorney, which will cost a little more — but it could prevent errors and increase the likelihood of getting your trademark approved.
It’s not necessary to trademark your LLC name if you’re not planning to do business outside your state, and/or you’re not concerned about others misusing your name. However, if your own name is part of your business name, you’re planning to do business in other states, or you’re selling a product manufactured by your company, it may be a good idea to register a trademark. Whatever you decide, we hope this article has been helpful, and we wish you the best of luck in your business ventures.