Establishing Commercial Use of a New Trademark

By definition, trademarks are creatures of commerce. State and federal laws protect trademarks because they serve an important purpose in the marketplace, helping consumers know the source of the goods or services they purchase. This is true whether the product in question circulates among the general public or is only of interest to a narrow group of specialists. Federal trademark applications can be based either on actual use of the mark in commerce or on an intent to use the proposed mark in commerce, but to receive formal registration the applicant must prove that the mark has actually been used in commerce on or in connection with the goods or services included in the application. There are a number of ways a trademark owner can establish commercial use.

The definitions associated with “use in commerce”

Like so many trademark concepts, use in commerce may sound straightforward but in practice can work in un intuitive ways. Section 45 of the Trademark Act, 15 U.S.C. §1127, defines use in commerce as “the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark.” At the outset we can see that the law is written to prevent someone from going through the motions to establish rights in a trademark when there is no intention of really using it as a mark. If bona fide use of the mark isn’t established, the putative owner of the mark could face a strong argument that the mark is invalid.

Section 45 goes on to explain when a mark meets the standards of use in commerce. The applicable standard depends on whether the mark relates to physical goods or services. A mark is used in commerce on goods if:

• (A) it is placed in any manner on the goods or their containers or the displays associated therewith or on the tags or labels affixed thereto, or if the nature of the goods makes such placement impracticable, then on documents associated with the goods or their sale, and
• (B) the goods are sold or transported in commerce.

For services, a mark qualifies as used in commerce “when it is used or displayed in the sale or advertising of services and the services are rendered in commerce, or the services are rendered in more than one State or in the United States and a foreign country and the person rendering the services is engaged in commerce in connection with the services.”

Establishing use in commerce can be a multifaceted process

Based on the definitions provided in Section 45 the use in commerce requirement is simpler for some businesses than it is for others. A business that sells consumer goods can meet the standard by simply following the letter of the rule. But many businesses don’t have products that lend themselves to straightforward labeling or packaging. A software company, for example, may sell products that are entirely embedded in other companies’ products. Whether a business has filed an intent-to-use application with the USPTO or simply wants to establish a mark that it might register later on, establishing use in commerce can be accomplished by following a few straightforward principles:

• Use the mark on anything related to the associated products or services. As a rule of thumb, it’s a good practice to put the new mark on as many different materials as possible. Trade show signs, newsletters, business cards, and websites might all be good places to put a proposed mark. There are two key points to be made about this broad use suggestion. First, the use needs to be in connection with the products or services that the business intends to be represented by the mark. If the USPTO application claims that the mark will be used in connection with e-commerce software, its use in connection with fashion accessories won’t be helpful. Second, the mark needs to be placed on materials that the business can prove were seen by people outside the business within whom the business has some type of commercial relationship. That might be potential customers, or it might be potential sources of financing. This requirement is one reason why simply putting a mark on a website may be insufficient to establish use.
• Be consistent. A mark needs to be adopted and clearly defined from the start. Having a dozen variations of a mark in use at the same time may mean that none of them is being used with sufficient regularity to meet requirements. Alternatively, it may force the company to deal with the expense of protecting several similar but distinct marks rather than one. Establishing a trademark use policy is a good way to provide clear guidance to employees about when and how to use a mark.

Use the mark as a mark. Critically, the mark needs to be plainly used on materials as a mark and not as a mere description or in a way that doesn’t clearly indicate a connection with the particular goods or services that the business wishes to cover. The kind of effort that will be required depends in part on where the mark falls in the spectrum of distinctiveness. At one end of this spectrum are generic terms, which by definition can’t become trademarks. For example, “apple pie” can’t become a trademark for a baker. Descriptive marks are common terms that can develop distinctiveness through regular use in commerce: an example might be a baker’s efforts to establish rights over “scrumptious apple pie.” Generally speaking, a lot more effort needs to be put into establishing trademark rights over a descriptive term than one that is at the other end of the spectrum, in the realm of the arbitrary or fanciful. “Apple” is arbitrary with respect to computers. “Xerox” is a fanciful term with no meaning outside of its role as a mark. In each case, use in commerce in connection with goods or services is required to establish trademark rights.