In this ‘Intellectual Property Application Series,’ I’ll be discussing common law service marks and the proper way to use the service mark symbol inorder to maintain the legal rights provided under common law. I’ll explain what a service mark is, what a common law service mark involves, and what to know about proper usage of the service mark symbol to maintain a common law service mark. This and more will help explain why common law service marks are an important tool, which protects both businesses and consumers.
A service mark is a type of intellectual property that uniquely distinguishes and identifies the source of a service. Like trademarks, service marks assert one’s right to use a specific word, phrase, logo/symbol, design, or a combination thereof, in the market. Importantly, service marks and trademarks also convey an indication of the uniform quality expected of the services it identifies. This is also known as the “good will” of the service mark. In general, service marks are secured by a company to advertise and distinguish their services from those offered by other companies.
The word “trademark” is generally used as an umbrella term to include both trademarks and service marks. More specifically, service marks protect those marks that indicate the source of a service, rather than the source of a good. The protections provided, under either a service mark or trademark, vary slightly. Common Law rights extend to both trademarks and service marks.
The word “trademark” is also generally used as an umbrella term to include both commonly protected and formally protected trademarks/service marks. The protections provided by a service mark, and the obligations to maintain those protections, vary based on the type of service mark rights governing the mark. Formally protecting a service mark would involve filing an application to register the mark federally and/or filing an application to register the mark in individual U.S. states.
Federal Service Mark Registration:
To obtain federal registration, an official Application for Federal Registration of a Service Mark is filed with the United States Patent and Trademark Office (USPTO). An application for federal registration undergoes the most rigorous of prosecution procedures. The federal service mark prosecution process involves a review of the federal service mark application, to confirm adherence to the government filing requirements. Also during the prosecution process, the mark itself is examined to confirm it qualifies for federal protection, in accordance with strict government rules. Once the examination process is completed and the application is accepted, a formal Federal Certificate of Registration is issued and the mark is considered protected under federal trademark/service mark laws.
Only marks in current use in interstate commerce can be granted federal registration and protection. If a mark is not currently being used to market products/services, but there is a true intention to do so, the USPTO does provide the option of filing an intent-to-use based application. This option allows for an earlier application filing date and potential priority over competing marks, which could be crucial in a legal conflict over the service mark.
State Service Mark Registration:
To obtain registration in a specific state, an official Application for Registration of a Trademark or Service Mark must be submitted to the relevant Secretary of State’s Office. To qualify for state registration and protection, the mark must be in current use in commerce. Unlike federal registrations, no option is provided for filing an application with only an intention to use the mark.
The service mark prosecution procedures for state service mark registration are not as rigorous as those for a federal service mark application. Even so, the application must meet the filing requirements of the Secretary of State’s Office and strict filing procedures must be followed. These requirements and procedures vary based on the Secretary of State’s Office in question. The service mark itself must meet the statutory requirements for registrations, governed by the Secretary of State’s Office with which registration is sought. Once the state service mark prosecution process is completed and the application is accepted, a formal State Certificate of Registration is issued by the relevant State’s Office. Once officially registered, the mark is considered protected under state trademark/service mark laws.
Common Law Service Mark:
Marks used by a company in commerce, but not registered federally or with a state, are protected under common law rights and are referred to as common law trademarks or common law service marks. A common law service mark distinguishes and identifies the source of a service, just as registered service marks do. One important difference is, common law service marks and state registered service marks are governed by state laws, while federally registered service marks are governed by federal laws. All service marks assert one’s right to use a specific word, phrase, logo/symbol, design or a combination thereof in commerce.
According to the Lanham Act, which governs trademark/service mark law in the U.S., from the moment a mark is used by a business in commerce, it is automatically protected as a common law mark. Specifically, the first individual to use a mark in commerce, in connection with marketing and exchanging services for legal tender, is awarded the common law service mark rights to the mark, as used.
This is different from some international service mark rules, e.g. China, which bases rights to a service mark on a first-to-file, rather than first-to-use basis. Common Law rights do not extend to any country in which trademark/service mark laws are based on a first to file ruling. The use of a mark internationally can also not be used to claim prior use of a mark in the U.S. For international service marks seeking registration in the U.S., the date of first use in another country cannot be claimed. The day the international mark is first used in U.S. commerce is considered the true date of first use.
The process of obtaining common law rights to a mark is relatively simple, in that it does not require the formal prosecution of a service mark application or official substantiation. As such, the rights conveyed and the protections offered to a common law service mark are limited, compared to those provided by a federally registered service mark. Specifically, common law rights are limited in the scope of protection provided under the state laws, which govern them. In addition, use of common law service marks are limited and can be geographically restricted from expanding into other markets. Due to the unofficial nature and limitations, enforcing common law service mark rights may also prove difficult.
Federal registration of a service mark provides the broadest rights and the greatest protections available to service marks. However, a common law service mark claim may be more suitable in certain situations. If a mark is only used in a small geographic area and is not being used in interstate commerce, a service mark only qualifies for common law rights.
Common Law Service Mark Symbol:
Simply using a service mark in commerce allows a mark protection under common law rights. Proper use of the service mark symbol gives constructive notice to the public that the mark is in use and is protected by that use. This notice asserts the service mark rights and discourages others from infringing the mark. If alleged infringement is found, the owner of a service mark has the right to bring suit in the relevant state court.
Once common law service mark rights are claimed, those rights must be maintained through proper use of the service mark. To maintain the rights provided by a common law service mark, the service mark owner must continue to use the same service mark in connection with the services initially associated with the mark. Overtime, consumers will hopefully begin to associate a company’s service mark with that individual company and as the source of their particular marketed services. The goodwill of a service mark can be established and grow as consumer recognition, and their association of the brand with trusted services, solidifies.
To help with consumer association of a company’s service mark as the source of that company’s marketed services, the standard “SM” symbol is appropriate to use, when displaying a common law service mark. Proper use of the SM symbol signifies to the public that the common law mark is in use. The use of the SM symbol does not confer legal rights, as common law rights do not provide an assumption of ownership. This is because common law service marks are not held to a standard involving a formal prosecution or registration process. Without enduring these formal processes, a service mark cannot be verified as representing a unique and distinctive mark, which has not previously been used in the marketing of services.
A common law service mark must be displayed and used in accordance with the rules governing all trademarks/service marks. Common law service marks are not permitted use of the registration symbol (®), which indicates federal registration. It is a violation of federal law to use the (®) federal registration symbol, if a federal service mark Certificate of Registration has not been issued for the mark. If the owner of a common law service mark attempts to federally register their mark, the premature use of the official registration symbol can be grounds for refusing to register the service mark.
Proper use of a service mark preserves the rights provided under the Lanham Act and the opportunity to file suit in state courts. Common law service mark rights come with responsibilities and obligations for the service mark owner, in order to maintain those rights. If the service mark is not properly monitored and protected by an owner, the rights to the mark can be put at risk or lost completely.
Common Law Service Mark – An Important IP Tool:
Common law service marks are important in their ability to protect businesses and consumers alike. They provide a business with legal backing to protect their identity, reputation, and the goodwill associated with a company and its service marks. While the strongest protection for a service mark is provided through federal registration, common law rights still provide a service mark owner important, but limited state rights.
The rules that govern service marks enable businesses to compete efficiently and fairly. Government trademark/service mark rules establish a standardized system for businesses competing in the market. Government guidelines for addressing service mark disputes are also integral to the success of the service mark system.
In addition, the laws governing service marks help protect consumers from deceit by counterfeit or by fraudulent companies. Service marks do this by signifying the goodwill and identity of a company. Consumers depend on service marks conveying the goodwill of a company, as this establishes an expected level of quality and/or trust. The proper use of the service mark symbol (SM) is the best way to communicate to consumers that a legitimate service mark is in use. If businesses could not prove and protect their reputation via service marks, it could be the consumer that pays the greatest price.
Don’t leave a matter as important as your intellectual property to chance. Willing help in the form of an experienced legal team is here and is just a call away. Thrive IP® patent attorneys are located in Charleston, SC; Greenville, SC; and Knoxville, TN; Alexandria, VA and Smithfield, VA. Please contact us if you have an interest in filing a service mark application or other intellectual property services.