Cute Designs And Catchy Phrases: The Risks And Rewards Of Clever Branding And Creative Merchandising

By Michele M. Glessner, Alston & Bird and Sarah Parker, Turner Broadcasting Systems

Consumers are bombarded with brands, designs and advertising every day. With the rise of the online marketplace, products are more readily available to consumers, and competitors can more easily access a retailer's or manufacturer's products and advertising materials for "inspiration" for their own products. At the same time, even an innocent infringement of a third party's intellectual property is more likely to be noticed, and more consumers are likely to purchase the infringing product, potentially increasing damages liability. Now more than ever, retailers and manufacturers need to take active steps to take stock of their intellectual property and determine what steps they need to take to protect that property from misuse while reducing their own risk of infringement.

Brand creation and protection

A trademark is a word, symbol or phrase that is used to identify a particular manufacturer's or seller's products or services and distinguish them from another's. McDonald's, the Apple logo, Just Do It—these are all examples of marks that consumers immediately recognize as identifying the source of particular goods or services.

In the United States, trademark rights can be based on either a federal or state registration of a mark or on use of the mark in commerce without registration. Although federal registration carries with it several important benefits, it is not necessary to own a federal (or state) registration of a mark to enforce those rights. Nevertheless, a federal registration is a good idea for house brands, umbrella brands and main product lines because it gives third parties nationwide notice of your rights in that mark. Federal registration can also make available certain additional monetary remedies in a suit for trademark infringement.

In order for a brand to develop strength and value, its use should be exclusive to the brand owner. So before adopting a new brand or mark, you should conduct what is called a "clearance search" to determine if any third parties own a confusingly similar mark for similar goods or services. Conducting a clearance search will help ensure (1) that you are not infringing the trademark rights of someone else, and (2) that your selected brand is exclusive to you and can serve as a potentially strong brand for your goods or services.

How different should your selected trademark be from someone else's to avoid an...