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A Legal Primer to Help Develop Explicit Brands Previously Off Limits

A Legal Primer to Help Develop Explicit Brands Previously Off Limits
Lawrence G. Walters

The recent U.S. Supreme Court decision involving The Slants rock band, which invalidated restrictions on registration of “disparaging” trademarks, has generated renewed interest in protecting adult industry brand names.

Offensive or explicit brand names that were previously off limits, may now be allowed to proceed to registration, given the reasoning in the recent case.

Some adult companies approach the business with a ‘live and let live’ philosophy, which serves them well in many circumstances. However, in the realm of trademark infringement, this is not a viable approach.

A company’s brand name will ultimately become its most valuable asset, so every effort should be made to protect that brand from infringement and dilution.

The following is a legal primer to assist adult business owners in developing a comprehensive brand name protection strategy.

Select a protectable brand

Trademark law can be counterintuitive in some ways. Often when choosing a brand name, adult business owners will consider names that are descriptive of their business model.

However, such names are generally ineligible for federal trademark protection, since the U.S. Patent and Trademark Office (USPTO) will typically refuse to register trademarks that are merely descriptive of the company’s goods or services.

Therefore, brands like “Live Webcams” or “Hot Transsexuals” may be refused registration based on the fact that those brands simply describe the kinds of services provided by the applicant.

Instead of choosing a descriptive brand, adult business owners should consider names that are arbitrary (having no association with the goods and services) or at most, only suggestive of the company’s offerings.

In addition, any entrepreneur should carefully search all other uses of any prospective brand name to ensure that no other company holds superior rights to the desired brand. This typically involves a full trademark search undertaken in consultation with legal counsel.

Carefully prepare trademark applications

Once a brand name is chosen, it is time to lock in all available rights to the name. Depending on the type of business being conducted, and its geographic scope, the owner will want to consider filing one or more state and/or federal trademark applications.

The benefits of obtaining a formal registration cannot be overstated. While companies can obtain certain “common law” trademark rights by simple use of a brand name, only owners of registered trademark rights are entitled to the presumption that the brand name belongs to the company, in connection with specific goods and services.

Proving the existence of common law trademark rights in any legal proceeding can be time consuming, expensive and possibly unsuccessful. Once a trademark is registered for a period of time, the registration can become “incontestable” to third parties.

Companies that offer goods or services online will typically qualify for trademark protection at the federal level. The application is submitted to the USPTO, and the process takes about six months, assuming that neither the USPTO nor any third party opposes the application. While the USPTO trademark application process may appear relatively simple, based on review of the online filing forms, submission of a federal trademark application requires significant planning and legal strategy.

Our firm often sees applications filed directly by a client, or through some legal form service, which are hopelessly defective. Some of these defects can be difficult to fix, and may require abandonment of the application.

Notably, the statements made in a USPTO application are made under the penalties of perjury, so every effort must be taken to ensure the statements are 100 percent accurate and capable of proof if necessary.

Identifying the dates of first use and the description of goods and services must be undertaken with careful attention to detail, to ensure the maximum level of legal protection when and if the mark is registered.

Another application detail that can result in registration problems is the selection of a proper specimen, demonstrating actual use of the identified goods and services in commerce by the applicant.

The USPTO requires that the specimen shows the use of the exact mark in connection with the goods and services described in the application. Trademark owners must also consider whether to seek protection in a single class of service, or in multiple classes.

Finally, applicants should evaluate whether multiple separate applications should be filed to cover things like logos or slogans which may be associated with the primary brand name. With proper planning, applicants can significantly reduce the chances of receiving a registration refusal or “office action” by the USPTO, which requires increased time and expense to oppose.

Monitor for infringements

With appropriate strategic planning, an adult business owner should be able to obtain a registered trademark at the state and/or federal levels. Once that trademark registration has been secured, the next step is to make sure that third parties do not infringe on these protected rights. Often, a trademark holder will first notice an infringement when a similar (or identical) brand starts to get some traction in search engine results associated with the registered mark.

Certainly, at that point, appropriate action needs to be taken by the trademark owner. However, there are ways to detect infringing use of registered brand names long before they start appearing on the first page of your Google results.

One option is to monitor the Official Trademark Gazette published by the USPTO. This publication will reveal any attempt by third parties to seek registration of a confusingly similar brand name.

While the USPTO examining attorneys will deny registration of an infringing name, reasonable minds can differ as to what constitutes infringement or confusion. Therefore, many trademark owners employ an attorney or agent to regularly monitor the Official Gazette in order to provide the registrant with an opportunity to fight a pending trademark application that may infringe on established rights.

Another method of detecting ongoing trademark infringement is through a private monitoring service that reviews third party use of the registered mark in commerce. Such services often use artificial intelligence or web crawling tools that constantly seek out potential infringing uses of the brand name.

Once an infringement is identified, the trademark holder can pursue one or more of the various remedies available to stop the legal violation, and potentially obtain compensation for past infringement.

Actively looking for potential infringement is strongly recommended for all trademark holders. For one thing, the value of your trademark is significantly reduced if widespread infringement is permitted to occur.

Confusion also results in the marketplace, as customers cannot identify legitimate sources of the goods and services from illegitimate ones.

Finally, trademark holders can lose their valuable intellectual property rights by tolerance of widespread infringement. Under the legal theory of abandonment, registrants who fail to take action against infringers can be deemed to have waived or abandoned their rights at some point. Therefore, careful monitoring of the marketplace and USPTO records for possible infringement is essential.

Pursue infringers

Identification and targeting of trademark infringers requires strategic planning. A variety of options are available to the trademark holder, and every situation is unique. Some targets may warrant a cease and desist letter, where the primary goal is to stop future infringement.

Other infringers require legal action in court without prior notice, such as where dissipation or transfer of assets is a concern. In other cases, a domain name arbitration complaint may be the appropriate remedy, where the primary goal is acquisition of an infringing domain name.

Various state and federal laws provide trademark holders with remedies, such as the Lanham Act, or the Anti-Cybersquatting Consumer Protection Act. In some cases (i.e.: cybersquatting), the courts will award “statutory damages” to the trademark holder, without the need to prove actual losses. In other cases, the court might award damages, court costs, attorneys’ fees, and injunctive relief.

The goal is to stop future infringement, and make the trademark owner whole for all losses incurred. Any target of trademark litigation must be thoughtfully chosen, keeping in mind the target’s location and financial ability to satisfy a judgment.

Occasionally, litigation is warranted even if the defendant is judgment-proof. Taking formal action against infringers sends a strong message to other potential infringers: “Hands off our brand name!” Trademark holders who are known for enforcing their rights are taken more seriously, and often experience fewer infringement issues.

Some adult companies approach the business with a “live and let live” philosophy, which serves them well in many circumstances. However, in the realm of trademark infringement, this is not a viable approach. Failure to seek out and pursue infringers can result in a devastating loss of valuable legal rights.

Conclusion

All efforts undertaken by an adult business owner to deliver quality products and services contribute to the goodwill and reputation associated with the company’s brand name. That brand name therefore embodies the company’s unique persona and commercial essence. Any effort by a third party to impersonate a brand can cause significant damage to the brand’s reputation and confusion in the marketplace.

Often, infringement is driven by a desire to easily profit from your hard work in establishing a quality business reputation. By taking action to protect a company’s brand name, and pursue infringers, adult business owners can preserve and enhance their valuable intellectual property assets.

Lawrence G. Walters, Esq., heads up Walters Law Group and has represented website operators for more than 25 years. Nothing contained in the foregoing article is intended as legal advice. Please consult individual legal counsel with any questions or concerns.

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