Bell's Brewery in Kalamazoo is in a trademark dispute with a small brewer in North Carolina over the use of the word "Innovation". I'm not writing this to pick sides in that argument, but to use it to show how both using the trademark process can avoid expensive fights like this.
First, what are the costs of something like this? The money costs can be big. Legal fees for commercial lawsuits run into the tens of thousands of dollars. And if the plaintiff in the case wins, they can recover their own lost profits, or the defendant's profits. Just deciding on this amount takes a lot of time, expense, and is very unpredictable.
As a business owner, you do not want to have unpredictable liabilities.
Loss of Identity
For the losing side, you're going to have to deal with customers having lost a recognizable connection to your business. Even if it's just a slogan, there can be costs and confusion. For a small business, the cost of changing a name can be enough to put company out of business. It may seem unfair, especially if the company suing you never did business locally, but if they registered the name, and you didn't, your chances of winning are small. Even a similar sounding name can be a problem. Just look online for all the "Yard Doctors" sued by "Lawn Doctor". Most don't exist anymore, even if they changed their name.
The other cost that is harder to judge is to your business' reputation. If you're seen as taking advantage of the small local guy, you might get branded as a corporate bully. For some businesses that might not be a problem, but if you're trying to be the earthy, crunchy micro-brewer, you don't want your name being publicized by your attorneys. Let the marketing people promote your image. Lawyers are terrible at presenting a friendly, feel-good image.
Bell's has had to defend its action in this case, because of the backlash on social media.
There are three simple things you can do to avoid these problems. Research first, register it before you use it, and finally, use it as often as possible.
Before you pick a name, do some research. But remember, just because you don't find it with google doesn't mean you're good to go. A trademark attorney will look at US, state, and international trademark registrations, state business name databases, and other resources that you might not know about or have access to.
Plus, just because a name or phrase is taken, doesn't mean you can't use it. Depending on how it's being used, and how you want to use it, you might be okay as long as there's no likely confusion.
In this case, Bell's has been using the "innovation in brewing" slogan for quite a long time before Innovation Brewery started. I would imagine that it would have been possible to find that phrase before they started.
Authoritative recognition. That's what you get if you've registered with the U.S. Patent and Trademark Office.
- Any one looking for a name will, or should, start at uspto.gov. No one can argue that they didn't know about it, if you had it registered.
- You get nationwide protection, even if you're not (yet) using it outside of your home town.
- You have proof that you own that trademark as of the registration date. No one can argue that they weren't at fault for using the same name after that date.
- It's easy to protect yourself if you can just point to the registration number. This usually makes it possible to avoid lawsuits with one quick letter.
- The ability to get international protection. These days, if your business has any presence online, you're automatically dealing with an international market. Especially if you're selling goods overseas, you need this to protect your name, and stop counterfeiters.
- And many more good reasons that are too boring and technical to go into...
If Bell's had actually registered its "Bottling innovation since 1985" slogan at some point since 1985, this whole kerfuffle could have been avoided.
Find the perfect name or slogan, and registering it with the US government doesn't help you at all if you don't actually use it widely. One of the requirements of USPTO registration is to provide proof that you are using it, and are still using it after 5 years.
Even if you have it registered, if you can't show that the public associates the word or phrase or logo with your business, you're going to have a hard time arguing that you're being hurt by someone else's use.
Even if you forgot to register it, if you've used it widely and people think of you when they hear that phrase or see that logo, you can still win in a dispute.
Those Bell's bumper stickers are pretty common here in Michigan. I don't know if people in North Carolina would have seen them.
Based on what I've seen, I couldn't predict whether Bell's would win in a lawsuit. But I can predict that if it comes to a lawsuit, it will be very expensive for everyone.
Help is available
That's why you need to think about this stuff first. An attorney can help in many ways when you're starting your business. Picking a name you can protect, getting your company legally registered with the state and federal government, hiring employees, signing leases, preparing contracts and service agreements; these are all areas where a little legal help at the beginning can avoid a lot of legal expense later on.