5 Ways Your Trademark Issue Can Result In Litigation

When other parties use a trademark without the owner’s permission, known as infringement, this may lead to legal action. In this scenario, trademark owners may decide to pursue litigation to obtain compensation for any damages suffered due to the infringement; this type of legal action can arise in numerous ways. Explore five examples in which a trademark issue can lead to a legal claim, and find out how Sullivan & Carter, LLP can assist those seeking to bring or fight against legal proceedings arising as a result of a trademark issue; call (929) 724-7529 today to speak to our legal team.

What Is Litigation?

The United States Courts define litigation as a legal action or proceeding, namely a lawsuit, with the participants in this process (those bringing and defending against these claims) referred to as litigants. Additionally, it means the practice, process, or act of resolving a legal dispute in court.

What Do We Mean by a Trademark Issue?

Trademark legal issues typically relate to infringement, which can take place due to numerous reasons, such as similar product names, advertising strategies, and goods and services. A trademark infringement refers to utilizing a trademark in an unauthorized manner or using the mark in association with specific products and services in such a way that may cause deception, mistakes, or confusion surrounding a good or service’s source. In addition, using a mark in a manner that diminishes the trademark’s reputation or value is another trademark infringement type.

What Is a Lawsuit for Trademark Infringement?

A trademark infringement lawsuit is a type of legal claim brought against a party for infringing someone else’s trademark. If successful, the court may issue an order preventing the infringing party from utilizing the mark. Additionally, the trademark owner could receive monetary relief from the infringing party to compensate them for their damages.

What Are the Damages for Trademarks?

Trademark infringement can have significant legal and financial repercussions for the infringing party. In addition to damages, fines, and paying the legal fees of the trademark owner, those who infringe trademarks could potentially face criminal charges. If someone infringes another party’s trademark, the court may order the infringing party to pay the following damages to the trademark owner to compensate them for any damage caused to their goodwill, business, and reputation:

• Actual damages experienced by the owner of the trademark, such as lost revenue and profits
• Profits generated by the trademark infringing party due to their use of the mark
• Reasonable royalties the trademark owner could have earned from licensing usage of the mark to the infringing party
• The owner of the mark’s costs for preventing the trademark infringing activity and repairing any reputational damage
• Punitive damages, designed to punish the trademark infringing party for their actions

What Are the Actions for Trademark Infringement?

Various situations can result in trademark owners pursuing legal action for trademark infringement. Below is a discussion of five example scenarios.

Unfair Competition

One common type of trademark infringement is unfair competition, which occurs when a party uses a trademark that is either identical or similar to another brand’s. To bring these claims, the owner of the mark has to demonstrate they own the rights to the trademark and show that the use of the same or similar mark by the other party is likely to confuse customers.

Learn additional ways where a trademark issue can result in litigation, and find out how a seasoned Chicago intellectual property lawyer may help the parties fighting and launching these claims. Contact Sullivan & Carter, LLP today to explore the available legal options.

Trademark Dilution

Trademark dilution takes place when an infringing party commercially uses a well-established and distinctive trademark to make a profit while weakening the trademark’s uniqueness. To bring these claims, the owner of the mark has to prove that consumers widely recognize their trademark, that the other party commercially used the mark after it became well-known, and that this use likely led to dilution.

False Advertising

False advertising legal claims arise when a trademark owner falsely advertises something associated with their mark, potentially leading to competitors losing customers due to these false statements. Bringing these claims requires evidence of misleading or false advertisements that deceived, or may have deceived, customers. The party bringing the claim also has to demonstrate that the misrepresentation affects interstate commerce, that they suffered, or likely suffered, damages due to these advertisements, and that the deception significantly impacted customer’s buying decisions.

Domain Name Infringement

When a party trafficks, registers, or dishonestly uses a domain name that is either similar or identical to an existing trademark, this could constitute cybersquatting and give rise to legal action. Importantly, the infringer has to do this in such a manner as to profit from their actions. For example, they could use the domain name to sell counterfeit or inferior goods to customers who may have otherwise bought them from the owner of the trademark.

Trade Dress

Trade dress refers to a certain type of trademark that applies to certain elements of a product, such as its design, labeling, packaging, color, or flavor. These components can act as trademarks provided they are non-functional and distinctive. If an infringing party uses these product features in their own goods, it could confuse a brand’s customers, enabling the trademark owner to launch a legal claim.

Why Pursue Trademark Infringement Lawsuits?

Trademark infringement damages a company’s brand by creating confusion among customers, compromising brand recognition, and eroding brand loyalty and trust when consumers obtain similar but inferior products. If an infringing party sells copycat goods or services that are of lower quality than that of the trademark owner, this can cause consumers to associate these items with the owner of the mark, leading to complaints, negative reviews, and a loss of trade to competitors. Trademark infringers can also benefit from the brand’s reputation and take their potential customers, leading to lost revenue.

When a brand experiences an infringement of a trademark, it typically focuses significant resources on resolving this issue, which can strain the company’s other relationships. Trademark infringement also gradually destroys a brand’s identity and damages its reputation, since the business does not appear to manage its intellectual property effectively, which can be challenging to restore.

Ways of Enforcing Trademark Rights

According to the United States Patent and Trademark Office (USPTO), owners of registered trademarks are responsible for fighting for their IP rights. They can achieve this in the following ways:

• Monitor for possible infringement by completing internet, social media, and mobile application searches, establishing search engine alerts, searching the USPTO’s trademark database, and utilizing trademark monitoring services.
• Oppose similar trademarks published in the USPTO’s Official Gazette or seek to cancel the registration of an infringing trademark.
• Register the trademark with Customs and Border Protection (CBP); they can assist with detaining, seizing, forfeiting, and destroying counterfeit goods and the materials used to produce them.
• Send cease and desist letters to the allegedly infringing party warning them that if they continue their actions, they can expect the trademark owner to initiate legal proceedings against them.
• Consider bringing legal claims against supposedly infringing parties who do not respond to cease and desist letters or whose actions have caused substantial damage to the brand.

Contact a Chicago Intellectual Property Lawyer To Find Out More

Trademark litigation can be a costly and time-consuming process, necessitating strong cases for parties looking to fight infringement claims or enforce their own IP rights. Consider contacting the experienced Chicago intellectual property lawyers at Sullivan & Carter, LLP to seek assistance for any trademark issue that may arise. Call our legal team today at (929) 724-7529 to arrange a consultation.