Trademark Basics: 1

Gregory A. Piccionelli
Many adult entertainment entrepreneurs are unaware of the value and importance of creating and protecting trademarks and service marks to identify the products and services that they sell. Trademarks are a form of intellectual property that provide a trademark owner with a limited monopoly in the use of names, designs, logos, phrases and sounds associated with goods sold in commerce. Service marks provide the same type of protection for services.

For the purposes of this article, I will use the term "trademark" generically to refer to both service marks and trademarks.

The primary purpose of a trademark is to identify the source of related goods and services and to distinguish them from others in the marketplace.

Consequently, the owner of a valid trademark can prevent another person from using that trademark or a confusingly similar mark to identify similar goods or services. Because of this, it is important to determine whether you can rightfully use a desired name, design, logo, phrase, etc., in association with goods or services prior to committing resources to the production of a product, its packaging or advertising using a mark that belongs to someone else.

This is usually accomplished by an appropriate trademark search that is evaluated by a competent trademark attorney.

Some common examples of trademark use by the adult industry are trademarked brand names such as Digital Playground®, lines of product comprising a series such as Virtual Sex®, contract star names such as Jesse Jane®, website names like Cybererotica®, affiliate program names like Max Cash® and gentlemen's club names such as Spearmint Rhino®.

You do not have to register a name, a logo or a design to obtain rights to use a trademark. If no one else is using the same or a confusingly similar mark, and you are the first to do so in association with particular goods or services in commerce, and the mark is capable of operating as the identifier of the source of the goods or services it is associated with (e.g., the word is not a generic term like "Car" or "Vehicle" to identify automobiles), then you can generally commence acquiring "common law" trademark rights in that name or logo by simply using the mark in association with the goods or services sold.

Alternatively, if you have not commenced using the name, logo, etc., you can file an "intent to use" trademark application prior to the commencement of use of the mark.

The intent to use application enables you to establish a priority filing date and rights in the trademark if it is approved by the U.S. Patent and Trademark Office, provided that you begin using your mark and you file an acceptable "Statement of Use" within three years of the USPTO's issuance of a "Notice of Allowance."

It is important to note that unlike copyright, which exists without any further effort on your part after a work's creation, a trademark requires "actual use" or a filing of an application alleging a bona fide intent to use the mark in commerce. Another important distinction from copyrights is the fact that copyrights have a limited duration (currently for the life of the author plus 100 years), whereas trademark rights can theoretically be perpetual.

This is actually one of the major asset- and wealth-building benefits of trademarks, because as long as a mark is in use, it can remain valid. The trademark for the famous British insurer Lloyd's of London, for instance, has been in use for several hundred years, and the American company Coca-Cola registered its first trademark on Jan. 31, 1893. Each mark is worth billions of dollars.

One risk that trademark owners encounter, however, is that their mark can become a generic term, that is, it loses its ability to be a source identifier. This typically occurs because consumers begin to use the mark in reference to all products or services originally identified by that mark, and the trademark owner fails to properly enforce the owner's trademark rights with respect to the mark. For example, the words "escalator," "trampoline," "kerosene," and "nylon" were all once valid and enforceable trademarks. However, because the companies that owned those marks did not properly protect them, they lost their protected status. Currently, the Google® mark may be at risk as consumers frequently use the mark as a reference to the act of conducting an Internet search and is fast becoming a part of the English language.

Another important issue to keep in mind is ownership of your trademark. If you hire someone to create a logo for you, for example, it is important to have a "work for hire" and "assignment of rights" contract that makes it clear that you are purchasing all rights and interests in the design.

It may be useful to consult with an attorney before hiring someone to make sure that neither they nor any other party will have any rights to your logo.

In part two, we'll look at the benefits of trademarks and how to register them.

Gregory A. Piccionelli, Esq. is a senior member of Piccionelli & Sarno, one of the world's most experienced law firms specializing in Internet and adult entertainment matters. He can be reached at (310) 553-3375.

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