Understanding Common Law, State, and Federal Trademarks

There are three basic ways to protect your trademark rights in the US: via common law, state registration, and federal registration.

Common Law Trademarks

A “common law” trademark is a mark established only by use in commerce in a specific geographic area. No formal registration process or fees are required to protect a trademark under common law.

Just as with other forms of trademark protection, common law can protect business names, logos, and phrases.

To obtain a common-law trademark, all you need to do is to use the mark in connection with your business or product.

For example, if you use the mark “Bob’s Bitcoin Laundromat” for your business in Boise, you can prevent others from using the same or a similar name for other businesses in Boise.

However, a common-law trademark only applies locally, and won’t prevent others from using the “Bob’s Bitcoin Laundromat” mark in Boston or Boca Raton.

State Law Trademarks

Registering your trademark in your state may make sense when you only plan to do business in your own state and not elsewhere in the US.

State law trademark registration has several advantages over federal registration, but also several disadvantages.

According to the US Patent and Trademark Office (USPTO), it takes about 8.3 months on average for the Office to take its first action on a federal trademark registration. It will likely take several more months until a federal trademark is finally granted.

In contrast, a state trademark can be granted within a few days.

Also, trademarks related to non-hemp cannabis can’t be registered with the USPTO, because registration is only allowed for marks related to legal products and cannabis is still illegal at the federal level. However, such marks can be registered in states in which cannabis products are legal.

A state-law trademark may also be a fallback option if the USPTO refuses to register a federal trademark.

The main disadvantage of a state-law trademark is that it only protects the mark in the state where it’s registered. This may be fine for a brick-and-mortar business such as a laundromat, but it won’t provide much protection for a company doing business on the internet or that plans to open branches in other states.

Federal Trademarks

Federal trademark registration is recommended for any business that is using, or plans to use, its marks in interstate commerce. This includes any company providing goods or services via the internet, where orders can come from anywhere in the US and perhaps internationally as well.

(However, note that a US trademark will only protect a mark within the US. For international trademark protection, the owner must register the mark in each country or region in which it is to be protected, which can be a costly and difficult process.)

Before seeking a federal trademark, it’s a good idea to do a thorough search not only of the federal trademark register but of state registers, and to do a Google search to determine whether the mark is already being used by someone else as a common-law trademark.