How to Name Your Business
Stop. Don’t spend anymore time and money developing business name ideas or even building your existing company until you have deeply considered whether your brand is trademarkable.
Naming your business is a real challenge. Even if you think you struck gold with a catchy name and an available .com, your work has only just begun.
The sad reality is that many business names are simply not protectable under trademark law. If a business name is not protectable, any competitor could conceivably set up shop under the same brand. Imagine how confused your customers would be if another company with a nearly identical name as yours opened for business down the street. It’s a potential disaster that could and should be avoided.
A basic tenet of branding is the importance of crafting a name that sets you apart. Ideally, this is a unique identity that instantly gives your customers a feeling about your brand and clearly identifies your business as the source of certain goods or services. No matter where you are in the branding process, it’s important to ask: how protectable is your brand name?
What’s in a Brand Name?
Above all else, the best brand name strategy is to craft something so unique that you can own exclusively in your market. The most effective way to assert exclusive rights to a business name is to have your name registered as a trademark with the US Patent and Trademark Office (“USPTO”).
Applying for trademark registration can be complex and many applicants fall victim to the same common errors over and over again. See my post on Common Trademark Application Mistakes for more information before filing to protect your mark. In this post, I’ll focus on one core concept central to both branding and trademark law: coining non-generic marks.
First, we need to understand a bit about how trademark applications are evaluated. A critical piece of the trademark examiner’s analysis of your application is where your applied-for mark falls on the following continuum:
Generic — Descriptive — Suggestive — Arbitrary — Fanciful
(shown left to right from weakest to strongest)
Understanding how to use this important spectrum to create a brand will put you lightyears ahead of many entrepreneurs and marketing professionals.
If any word in the English language could be trademarked, we would quickly lose our ability to effectively communicate in the marketplace. It is imperative that generic terms remain free for all to use. Purely generic terms cannot be registered on the Principal Register or on the Supplemental Register. In essence, they cannot function as an identifying of the source of a good or service.
For example, let’s take a hypothetical general contractor named Gregg. If Gregg was marketing his contracting services, the use of the term GENERAL CONTRACTOR would almost certainly be denied by the USPTO because the relevant purchasing public understands this term as a common name for the class of services offered, not a source of the services. Obviously, other general contractors need to be able to use this term to describe their businesses and granting Gregg a monopoly on those words in the marketplace would not serve the public’s best interests. If you market your business as “FINE ARTIST” or “WEDDING PHOTOGRAPHER” it is highly unlikely you could ever obtain any trademark rights in that name. That said, whether an asserted mark is generic, under the Trademark Act, is a factual determination made by the Trademark Trial and Appeal Board (TTAB) pursuant to the Lanham Trade-Mark Act, § 23(c), 15 U.S.C.A. § 1091(c). The guidelines in this article are just that: guidelines. The ultimate determination of whether your mark is generic is in the hands of the trademark examiner and the TTAB.
Creative entrepreneurs who market and sell their work online should also be aware of how this issue applies to domain names. The TTAB has thwarted the registration of numerous web domains seeking trademark protection under this provision. For example, HOTELS.COM was found to be generic for “providing information for others about temporary lodging; [and] travel agency services, namely, making reservations and bookings for temporary lodging for others by means of telephone and the global computer network” and, thus, rendered unregistrable. In re Hotels.com, L.P., 573 F.3d 1300 (Fed. Cir. 2009). Similarly, MATTRESS.COM was found to be generic for “online retail store services in the field of mattresses, beds, and bedding,” the TTAB held each of the constituent words (“mattress” and “.com”) to be generic. The TTAB then considered the mark as a whole to determine if the combination added any new meaning, ultimately finding that it did not. This was in part due to widespread use the term “mattress.com” by other online mattress retailers who provide substantially the same services as the MATTRESS.COM. In re 1800Mattress.com IP, LLC, 586 F.3d 1359 (Fed. Cir. 2009).
Generic marks are the least likely to receive any trademark protection and should be avoided.
If a mark uses terms that literally describe a quality or characteristic of the good or service, these will likely be nonregistrable unless the mark obtains secondary meaning. To be descriptive, the mark does not need to describe all the goods and services identified, as long as it describes one significant function, attribute, or property. Deceptively misdescriptive marks are similarly nonregistrable.
An example of a merely descriptive mark used by our hypothetical contractor, Gregg, could be BEST HOME BUILDERS. This mark simply adds adjectives to an otherwise generic mark (builders). These adjectives describe the quality and characteristics of the contractor’s service. While better than a purely generic mark, this would probably not be trademarkable without secondary meaning and could, thus, be used by Gregg’s competitors.
Other examples of descriptive marks include: COASTER-CARDS descriptive of a coaster that can be mailed (In re Bright-Crest, Ltd., 204 USPQ 591 (TTAB 1979)); APPLE PIE descriptive of potpourri (In re Gyulay, 820 F.2d 1216 (Fed. Cir. 1987)); and BED & BREAKFAST REGISTRY descriptive of reservation services for bed and breakfast lodging (In re Bed & Breakfast Registry, 791 F.2d 157 (Fed. Cir. 1986)).
If your business currently operates under a descriptive trademark, you are probably wondering what “secondary meaning” is and how to obtain it. Essentially, secondary meaning can be acquired if a merely descriptive mark is continuously and exclusively used to identify the source of goods or services for at least five years in commerce. Secondary meaning is generally difficult and expensive to acquire. Building the public association with your brand necessary to achieve secondary meaning typically requires substantial advertising and a high volume of sales continuously for many years.
Even with the possibility of earning rights by way of secondary meaning, merely descriptive marks are fair less than optimal.
Another important point to note about our hypothetical mark BEST HOME BUILDERS is that including descriptors such as “Best” or “#1″ do not carry much weight in the trademark world. These are nothing more than puffery and typically do not make a mark more likely to receive protection.
As with generic terms, merely descriptive marks are less likely to receive exclusive trademark rights and should be avoided in branding for most industries unless your business has the financial resources and sales volume to get over the hurdle of secondary meaning.
Marks in this part of the continuum indirectly suggest a characteristic of the good or service offered but require imagination or thought to reach a conclusion about the nature of the goods or services. To revisit our hypothetical, if Gregg used the service mark CAVEMAN CONSTRUCTION, this could arguably be suggestive in a few ways. CAVEMAN could describe the tools or methods of construction used and the notion of a cave in the context of a caveman connotes a home.
Other examples include SPEEDI BAKE in connection with frozen dough. This trademark suggests the desired characteristic that dough will quickly and easily bake into bread (In re George Weston Ltd., 228 USPQ 57 (TTAB 1985)). The mark DRI-FOOT was found to be suggestive of antiperspirant for feet (In re Pennwalt Corp., 173 USPQ 317 (TTAB 1972)). See also In re Vienna Sausage Mfg. Co., 156 USPQ 155, 156 (TTAB 1967) (FRANKWURST held not merely descriptive for wieners, the TTAB held that, although “frank” may be synonymous with “wiener,” and “wurst” is synonymous with “sausage,” the combination of the terms is incongruous and, thus, results in a mark that is no more than suggestive of the nature of the goods).
Suggestive marks, like fanciful and arbitrary marks, are registrable on the Principal Register without proof of secondary meaning and are often are granted registration by the USPTO. These are an excellent choice for many businesses because consumers can easily grasp a sense of what the products or services are from the mark and the brand is generally protectable by way of trademark registration.
Arbitrary marks use words with common meanings in a way that has no connection to the goods or services offered — i.e., they do not suggest or describe a significant quality or characteristic of the goods or services. Arbitrary marks are “a known word used in an unexpected or uncommon way.” Nautilus Grp., Inc. v. Icon Health & Fitness, Inc., 372 F.3d 1330, 1340 (Fed. Cir. 2004).
A well-known example of an arbitrary mark is APPLE. APPLE is a word with a common meaning that has no relation to the computer industry and is, thus, arbitrary in usage. By contrast, an apple orchard wishing to sell their fruit under the brand APPLE, would be generic. Other examples include: VEUVE in connection with champagne and OLD CROW for whiskey.
Using an arbitrary mark to identify your business is an excellent approach. Arbitrary marks are generally highly distinctive from your competitors and relatively easy to protect. However, one challenge associated with arbitrary marks is building consumer awareness around your brand. Being that the public will not instantly understand what your goods and services are from your arbitrary brand name, some amount of advertising may be necessary to bridge the gap.
The strongest type of trademark is a fanciful mark. These marks are invented words with no prior common meaning or are completely out of common usage for the sole purpose of functioning as a trademark or service mark. A few well known examples include PEPSI, ACURA, POLAROID, CLOROX and EXXON. The challenges presented with fanciful marks are usually even greater than those of arbitrary marks. Being that the consuming public has never heard these words before, they will likely not understand what your brand represents without a significant advertising campaign.
If your budget is large enough, a fanciful mark may be a great choice. They are highly distinctive and typically easy to obtain protect under trademark law.
Where Does Your Brand Fall on the Continuum?
Is your business name protectable? Please let me know in the comments. Haven’t named your business yet? Use this information to guide your choice for a business name that can last.
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Trademark is a complex area of the law that is commonly misunderstood and vastly underutilized by many entrepreneurs. For more information, I encourage you to read my other articles:
- Avoid These Common Trademark Application Mistakes
- Supercharge Your SEO with Trademarks
- Trademark Registration – Is Your Brand At Risk?
*Ian Gibson, Esq. is an attorney licensed to practice in the state of California. This article is for informational purposes only and is not intended to constitute legal advice. Visiting iangibson.com does not create an attorney-client relationship. This material may be considered advertising under applicable state laws. Copyright 2013 Ian Gibson.