Why a Trademark Clearance Search Comes Before Everything Else
A trademark clearance search answers one question before a business commits money to a brand name. Can you use the proposed mark and register it without running into problems? A trademark search should be commissioned before registering a domain, designing a logo, printing business cards, building a website or filing a trademark application. Every dollar spent on branding before a clearance search is a dollar the business may have to write off if a trademark search later reveals a problem.
I've seen businesses spend five figures on brand development and marketing materials only to receive a cease and desist letter months after launch. A clearance search that would have caught the problem costs a small fraction of what rebranding cost. It's the cheapest insurance available in trademark law.
What a Clearance Search Involves
Checking the USPTO's trademark search system at tmsearch.uspto.gov is the first step which can identify obvious problems, but that doesn't constitute a full clearance search. The USPTO's system is a free database that lets anyone look up registered marks and pending applications. Typing your proposed mark into the search system and seeing no exact match can provide a false sense of security.
A comprehensive clearance search examines federal registrations on the principal and supplemental registers, pending applications, abandoned applications owned by businesses that may still have common law rights in those marks, state trademark registrations across all 50 states, business name registrations, domain name registrations, and common law uses found through Internet searches, industry directories, and social media. A full trademark search also accounts for phonetic equivalents ("Kleen" vs. "Clean"), foreign-language equivalents, transliterations, design mark similarities, and marks owned in classes for related goods and services that might create a likelihood of confusion even if they're not identical to the proposed mark.
The reason for this breadth is that trademark rights in the United States arise from use, not registration. A company that has been using a mark in commerce for 10 years without ever filing a federal application still has common law rights in the geographic area where it's been operating. Those rights won't appear in the USPTO's search system, and the examining attorney won't find them during examination, because the PTO searches only federal registrations and pending applications. But a common law user of a mark that is similar to the one you own can file an opposition at the TTAB during the 30-day "publication period" after an application for a mark is approved, seek cancellation of a mark that has been registered, send a cease and desist letter, or sue for infringement in federal court under Lanham Act § 43(a). A federal registration that survives examination can still be challenged or rendered unenforceable in the common law user's territory.
The Likelihood of Confusion Standard
A clearance search evaluates whether any existing mark is likely to cause consumer confusion with the proposed mark, a question that reaches well beyond identical marks. The USPTO and federal courts use a multi-factor test (the DuPont factors in the TTAB, and the Digits of Confusion test in the Fifth Circuit) that considers the similarity of the marks in sight, sound, and meaning, the relatedness of the goods and services, the similarity of the trade channels, the sophistication of the buyers, and several other factors.
Two marks don't have to be identical to create a likelihood of confusion. STARBLAZE and STARBLAZER for the same category of goods would likely confuse consumers even though the spelling and length differ, because they share a strong distinctive element and the overall commercial impression is nearly identical. Conversely, marks that share only a descriptive or common prefix while differing in their dominant distinctive elements (SWIFTPAY and SWIFTLEDGER for financial software, for example) might survive the likelihood of confusion analysis because "swift" is descriptive of speed and the components "pay" and "ledger" may be different enough to distinguish the marks in the minds of consumers. Similarly, a word mark and a design mark that incorporates the same or similar wording can be confusingly similar, because the examining attorney evaluates marks across sight, sound, and meaning regardless of whether one is stylized and the other is standard text. The analysis requires judgment calls that depend on the strength of the shared elements, the distinctiveness of the differing elements, and the relatedness of the goods, which is why a clearance search is a legal analysis, not simply a database lookup.
The relatedness of goods and services is particularly important. A mark that's registered for software might block an application for consulting services in the same industry, even though "software" and "consulting" are different categories of services. The question is whether consumers encountering both marks would assume the same company is behind them.
Reading the Search Results
A clearance search report can run 50 to 100 pages or more, depending on how common the proposed mark's elements are. A search report is intended to list every potentially conflicting mark the search identified, organized by similarity and risk level. Reading the report requires evaluating each potential conflict against the likelihood of confusion factors and making a judgment about the level of risk each one presents.
Not every hit in a clearance search is a deal breaker. A descriptive mark registered on the supplemental register for unrelated goods presents a different risk profile than an identical mark registered on the principal register for the same goods in the same trade channels. The attorney's job is to evaluate each conflict and give the client a realistic assessment of the risk and prepare a clearance opinion.
Some clearance opinions identify no significant conflicts and recommend proceeding with the filing. Others identify moderate risks and explain what they mean in practical terms, so the client can make an informed business decision about whether to accept the risk. Others identify blocking marks that make registration unlikely and recommend choosing a different mark before investing further in the brand.
What Happens Without a Search
Skipping the clearance search tends to play out in a predictable pattern. A business launches, builds recognition in the mark, and eventually comes to the attention of the senior user, who then sends a cease and desist letter demanding that the junior user stop using the mark, surrender the domain name, and destroy all marketing materials bearing the mark.
At this point, the junior user has three options, and none of them is good. Fighting the claim through litigation can cost five to six figures in legal fees and costs and takes years to resolve, with the outcome depending on facts that were potentially knowable before launch. Sometimes (though not often), a senior user will permit a junior user to continue using the junior user's mark under certain conditions through what's called a trademark coexistence agreement, but that usually requires giving something up (geographic limitations, product restrictions or making royalty payments to the senior user). In that scenario, the senior user holds all the bargaining power because they own prior rights in the mark at issue. Rebranding can mean losing all the money the business invested in the original mark and starting over.
A clearance search is designed to mitigate those risks but, even then, a lawyer cannot guarantee that a particular mark will be approved by the USPTO for registration, or that a third party will not assert rights against the mark owner. If a search identifies an obvious blocking mark, the business can choose a different mark when the rebranding cost is minimal. If the search results identify manageable risks, the business makes an informed decision about whether to proceed. Either way, the business launches with eyes open instead of hoping for the best.
When to Search
The clearance search should happen after the business has narrowed its mark choices to two or three finalists but before it commits to any of them. Searching multiple candidates at once is more efficient than searching one, falling in love with it, and then learning it's blocked.
Businesses that expand into new product categories or geographic markets should conduct supplemental clearance searches for the existing mark in the new context. A mark that passed clearance for restaurant services in Texas may face conflicts when used for packaged food products nationwide. The scope of the search should match the scope of the planned use.
Related practice area: Trademarks
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