When it comes time to choose a name for the new product or service you are launching, it is important to know that not all trademarks are created equal. In addition to the marketing considerations of choosing a brand name, there are also important legal considerations to keep in mind.
Let's consider the example of opening a gas station. If a company opens 50 new gas stations and names each of them, "The Gas Station," no trademark rights will or can be established that would prevent others from calling their gas stations the same name. Very simply, "gas station" has become the generic term for the place gasoline is purchased.
Perhaps not as obvious, a descriptive name, while eventually protectable, is a weak trademark. A company may choose to call its new gas stations "Gas 'n Go." The marketing people like the name because it is easy to remember and it immediately conveys both the service and a quality about the service to the consumer. It may seem like the perfect trademark, yet there are legal implications to be considered when choosing a descriptive trademark. Both the United States Patent & Trademark Office and the courts agree that descriptive trademarks are not entitled to protection until the owner establishes secondary meaning and that the level of protection is dependent on how descriptive the trademark is. Secondary meaning is established when a substantial percentage of consumers recognize the brand. This is most often proven through consumer surveys. Secondary meaning has traditionally been presumed to be established after five years of use, although the length of time needed varies depending on how descriptive the trademark is and how heavily the owner markets it.
To avoid having to wait for protection or to prove secondary meaning, a good choice for a product or service name is a suggestive trademark. Mobil is a suggestive trademark for a gas station. The name suggests something about the service, but does not actually describe it. These trademarks typically satisfy both the marketing people and the lawyers. They are entitled to immediate trademark protection.
Trademark categories which receive the highest level of legal protection can be challenging for marketing people to accept. Arbitrary and fanciful trademarks can be expensive to market due to the lack of information regarding the product or service. An arbitrary trademark is an existing word or words that bear no relationship to the product or service. "Shell" is an arbitrary trademark for gas stations. While the word "shell" is a common English word, it does not give the consumer a description or even suggestion as to the type or product or service. Fanciful trademarks enjoy the same level of protection and perhaps a bit more. Fanciful trademarks are made up words. Exxon is a Fanciful trademark.
The levels of protection are important if it becomes necessary to determine whether use by two different entities of the same or similar trademark is trademark infringement. Beginning with the strongest trademarks, it would be hard to argue that the average consumer wouldn't think that two gas stations, both called Exxon, have common ownership or affiliation. Because Exxon is such a strong trademark, consumers would likely think there was an affiliation between a gas station called Exxon and an auto parts store called Exxon. At the opposite end of the spectrum, consumers are likely to think there is no affiliation between two gas stations based solely on the common use of the words "gas station." Similarly, if a consumer sees a Gas 'n Go in New York and later sees a Gas'n Go in Arizona, she might wonder if there is an affiliation but is just as likely to think it is a coincidence.
The next time you launch a new product or service, keep these legal guidelines in mind along with the marketing considerations to help avoid trademark disputes later.