More on Infringement

Suppose that you begin using a trademark in connection with your new business, but you fail to clear the mark first. As a result, another business who owns a federal trademark registration for similar goods or services sends you a letter and demands that you cease-and-desist in your use of the same or similar trademark. What are your options?

The first option is to stop using the mark as demanded. Under federal trademark law, you may be liable for significant damages if you continue to use the mark in violation of the registered trademark owner’s rights. The trademark owner only needs to show, essentially, that he has a valid trademark and he hasn’t given you permission to use it. It’s a bit more complicated than that, but you should know that intent is not an element of trademark infringement. That means that your lack of intent to infringe the mark is irrelevant to the issue of whether or not you infringed or not. Intent only makes a difference in awarding more damages to the trademark owner. If you willfully infringe another’s trademark, then the trademark owner may be entitled to a larger damage award.

Another option is to contact the current trademark owner and ask permission to use the mark concurrently with the trademark owner. The current owner may require you to pay for a license to use the mark, but, if your business and the current owner’s business are geographically far apart, you may be able to persuade the trademark owner to concurrent use of the mark.

A third option includes filing a declaratory action in federal court. As noted in my previous post, a declaratory action does not come without risks. First, you can only file a declaratory action if the trademark owner threatens litigation and even then the court can decline to hear the matter. The advantage, though, is that you get to litigate in your home venue, which reduces your litigation costs.

What option you choose depends on your particular situation. If you receive a cease-and-desist letter, you should contact your attorney who can help you make the right business decision.