A trademark, or tradename, is extremely important to a businesses identity. Indeed, the hardwork, long hours, and sacrifice that go into building a business and create customer recognition are reflected in a company's tradename. This is known as goodwill. For this reason, insuring that you protect your tradename; and thereby, goodwill, from impostors, copycats, and scoundrels is extremely important.
One way to protect your trademark is to register your mark in the appropriate state or federal trademark office. Although it is a good idea to register your trademark, not having a registered trademark does not necessarily prevent you from enforcing your rights in it. This is because the right to trademark is created upon the earliest usage of the mark. For this reason, a senior user of a mark may enjoin, stop, or a junior user.
In Texas, to enforce rights in a trademark a holder of an mark needs to show: “(1) the name it seeks to protect is eligible for protection; (2) it is a senior user of the name; (3) there is a likelihood of confusion between its mark and that of the other user; (4) and because it seeks the equitable remedy of injunction, it must show the likelihood of confusion will cause irreparable injury for which there is no adequate legal remedy.” Zapata Corp. v. Zapata Trading Int'l, Inc., 841 S.W.2d 45, 47 (Tex. App. 1992).
To determine whether a word or phrase is protectable, it must be first determined which category the word or phrase falls into: 1) generic, 2) descriptive, 3) suggestive, or 4) arbitrary or fanciful.
Knowing the proper description of a mark helps determine under what circumstances it may be eligible for protection.
Generic terms are never eligible for trademark protection. Descriptive terms may only be protected after proof of secondary meaning, and suggestive, arbitrary or fanciful terms are all protectable without secondary meaning.
A generic term is one which identifies a genus or class of things or services, of which the particular term in question is merely a member. An example of a generic term is "dog". "Dog" may refer to any number of breeds like a golden retriever, dachshund, or rottweiler.
A descriptive term is one that identifies a characteristic or quality of the article or service. A descriptive term is often an adjective such as "speedy," "friendly," "green,", "menthol," or "reliable". A descriptive term can also be a geographical term, like "Illinois","American," and "southern" if they describe where the products or services are offered or manufactured.
A suggestive term is one which "suggests rather than describes, some particular characteristics of the goods or services to which it applies and requires the consumer to excercise the imagination in order to draw a conclusion as to the nature of goods and services." Zatarains, Inc. v. Oak Grove Smokehouse, Inc., 698 F.2d 786, 790 (5th Cir. 1983).
An example of a suggestive term is "Klondike" to describe an ice cream bar.
Finally, arbitrary and fanciful terms or phrases are those which are either coined words or words which are not suggestive of the product or service. Fanciful terms are most often coined terms such as "Xerox," or "Kodak." Zatarains, 698 F.2d at 791.
An "arbitrary" term refers to ordinary words which doe not suggest or describe the services involved. An example is "Ivory" when applied to soap.
Although a senior user of a mark may exclude a junior user, this right is not absolute. A senior user may not exclude others in areas where he does not currently do business nor is likely to do business in the future. Dawn Donut Co. v. Hart's Food Stores, Inc., 267 F.2d 358, 364-65 (2d Cir. 1959). He may not enjoin others from using the mark if the likelihood of confusion between his product and the of the infringer is minimal or non-existent, such as where the parties to the action use the mark in totally different markets, or for different products. Amstar Corp. v. Domino's Pizza, 615 F.2d 252 (5th Cir. 1980).