There are three types of legal protections available for trademarks:
- Common law protection
- State protection
- Federal protection
The common law is the law created by judges’ decisions, solidified over the centuries and it is based upon general principles of justice. This law governs trademarks that are put into use, but not registered. If you are using a name, you gain a set of rights just by using it.
These principles protect your business from those who take unfair commercial benefits from others’ brands, but, common law protections are relatively weak. In general, these weaknesses center around the fact that damages recoverable are entirely dependent on the extent of use – a mark that you may be using, and that might be very important to your business, may not receive a lot of protections if it is in use to a limited extent and/or in use in a limited geographic area.
Contrasting with patents and copyrights, which are exclusively controlled by the federal government, trademarks may be registered with each state. State trademark laws have been passed by all of the states in the U.S., but again, the protections are limited. The state registration is simpler and less expensive, but your brand is protected just in one state. If your business is a local one you might consider state registration, but you must carefully consider the possibility of later expansion. For example, it is possible that a restaurant will never expand beyond state lines, but many local restaurants have grown into franchised multi-state giants over the years. The cost savings in having a state trademark over a federally registered one is so little that it rarely makes sense to register a state mark. One should never consider a state trademark without a full consultation with an expert in trademark law.
Federal trademark law provides a system for registering and protecting your trademarks with the United States Patent and Trademark Office. This system is based on the Lanham Act and other federal laws related to trademarks and intellectual property. For any business acting across state lines, it offers by far the best combination of rights and remedies for infringement.