Neglecting trademark enforcement can cost entrepreneurs anywhere between $120,000 to $750,000 and a great loss in market share. But we are here to save your megabucks!
Protecting your brand identity puts the foundation of your business’s success. And overlooking it may have serious consequences, including a damaged market reputation and loss of customer’s trust and loyalty.
With that said, let’s explore the importance of trademark enforcement, the consequences of failure to do so, and some effective strategies for this purpose.
What is Trademark Enforcement?
Trademark enforcement means actively protecting and defending your brand’s identity against unauthorized use and infringement by third parties. It could be anything; your logo, slogan, tagline, or even a patented invention.
When a business owner registers a trademark with appropriate authorities, he gets exclusive rights over it. In case, anyone else tries to use it in the market, the owner can take legal action against the infringing party.
Consequences of Non-Enforcement: Implications and Risks of Failures
The major consequences of failure to enforce a trademark are mentioned below:
1. Market Confusion
Imagine a crowded marketplace where two stores are selling goods under a similar logo. The customers may think that both services are coming from the same place, which can create confusion about the brand.
2. Loss of Market Share
Considering the same example, let’s assume 25 out of 75 of your potential customers start purchasing from the counterfeit store. It means you’d lose one-third of your consumers. Or you can say one-third of your business revenue.
3. Damaged Brand Reputation
If someone steals your trademark and you are unaware of it, your potential customers will keep on shopping, thinking it’s you. They may receive subpar service and leave bad reviews. One bad review can tarnish your brand reputation instantly, which may have long-term negative effects.
To save yourself from a damaged brand reputation, you must protect your intellectual property and follow trademark enforcement strategies.
What is Trademark Enforcement?
Trademark enforcement means actively protecting and defending your brand’s identity against unauthorized use and infringement by third parties. It could be anything; your logo, slogan, tagline, or even a patented invention.
When a business owner registers a trademark with appropriate authorities, he gets exclusive rights over it. In case, anyone else tries to use it in the market, the owner can take legal action against the infringing party.
Consequences of Non-Enforcement: Implications and Risks of Failures
The major consequences of failure to enforce a trademark are mentioned below:
1. Market Confusion
Imagine a crowded marketplace where two stores are selling goods under a similar logo. The customers may think that both services are coming from the same place, which can create confusion about the brand.
2. Loss of Market Share
Considering the same example, let’s assume 25 out of 75 of your potential customers start purchasing from the counterfeit store. It means you’d lose one-third of your consumers. Or you can say one-third of your business revenue.
3. Damaged Brand Reputation
If someone steals your trademark and you are unaware of it, your potential customers will keep on shopping, thinking it’s you. They may receive subpar service and leave bad reviews. One bad review can tarnish your brand reputation instantly, which may have long-term negative effects.
To save yourself from a damaged brand reputation, you must protect your intellectual property and follow trademark enforcement strategies.
How to Enforce a Trademark?
Trademark enforcement is important and so is knowing how to enforce a trademark. If you don’t focus on trademark enforcing, you will lose your potential customers, market share, brand identity, and much more to the infringing party.
The path to successful trademark enforcement goes through various steps. First of all, search thoroughly for all similar brands and detect infringement. It can be done using USPTO’s Trademark Electronic Search System (TESS).
After successful detection, the next step involves sending a cease and desist letter. You may write it yourself using a letterhead or hire an attorney on your behalf. But before that, make sure your trademark is registered with relevant authorities.
You can file a lawsuit if the infringing party does not stop using your trademark. But filing a lawsuit can cost you between $400,000 to more than 2 million. If your lawsuit is successful, the court will order the infringing party to cover your financial loss and give you the money they got using your products.
If you don’t have enough money to file a lawsuit, you may hire a trademark attorney.
Legal Basis of Trademark Enforcement
The legal basis of trademark enforcement lies in intellectual property law, specifically through trademark registration. Trademarks are protected to prevent confusion among consumers and to safeguard the reputation and value associated with a brand.
Owners can enforce their rights by taking legal action against unauthorized use, ensuring their exclusive rights are upheld.
Top Strategies for Enforcing Trademarks
Below mentioned are some easy and effective strategies for trademark enforcement:
Monitoring for Potential Trademark Infringement
To monitor your trademark, you should regularly check trademark office filings to see if someone has a similar trademark. You can do it by yourself or set up internet alerts for it.
For instance, you may run up a search on USPTO’s Trademark Electronic System; or hire a specialized team for watchful monitoring. You can also use watching services, such as Clarivate or The Trademark Company.
Registration
A trademark can be registered using online USPTO application forms. They are available for both national and international filers and also offer a Standard and a Plus service (costs more).
Negotiation
Negotiation refers to a one-on-one settlement between both parties. It involves settlement, open dialogue, documentation, highlighting the risk factors, and offering solutions to resolve matters peacefully.
Cease and Desist Letters
A cease and desist letter is sent to warn the infringing party to stop engaging in illegal activity. It is issued by the court and must have the recipient’s physical address, proof enforcing trademark rights, and details of infringement (such as a screenshot showing products under your trademark).
It is a relatively less costly alternative to litigation and is issued by the court. With the issuance of this letter, the infringing party gets the time of 10 to 15 days to take action.
Mediation and Arbitration
One of the safest trademark enforcement strategies includes mediation and arbitration, as both are forms of alternative dispute resolution. It involves consulting neutral mediators. They listen to both parties, help them come to a joint consensus, and give a final verdict to resolve the dispute.
Online Enforcement
Online trademark enforcement strategies include regular monitoring on social platforms like Facebook, Instagram, Twitter, etc. These platforms have their own privacy policies against infringing cases. Some of them inform the recipient and warn them to take it down. While others take it down as soon as they verify the case.
Domain Name Dispute
Like logos and taglines, domain names are also considered intellectual property. As the name suggests, this dispute arises from similar domain names. The Internet Corporation for Assigned Names and Numbers (ICANN) started the Uniform Domain-Name Dispute-Resolution Policy (UDRP) for these disputes.
For this, you must find a third-party resolution provider as per your budget. Send a complaint with proof to ICANN and wait for them to enforce trademark rights.
Protecting your Trademark Internationally
International trademark enforcement requires you to file an application in WIPO, the World Intellectual Property Organization. Mention the names of countries you want it to be valid in and protect your distinctiveness on all levels.
Litigation
Litigation is the legal pathway to trademark enforcement and is used when all the above methods fail to sort the matter out. It works by filing a lawsuit against the infringing party in the court.
After you spot possible infringement, start gathering evidence. You must document every single detail and keep a record of communication with the infringing party. These things will decide whether the decision will be in your favor.
Summing up
In conclusion, trademark enforcement is crucial for safeguarding a brand’s identity and reputation. Neglecting trademarks can result in market confusion, lost market share, and damaged reputation.
By employing effective trademark enforcement strategies such as monitoring, registration, negotiation, cease and desist letters, and legal action, businesses can preserve their distinctiveness, market position, and customer trust.
By proactively defending their trademarks, businesses ensure long-term success and protection in the marketplace.
