Key Takeaways

  • A common law trademark arises automatically from actual use of a mark in commerce, even without federal registration.
  • Rights are limited to the geographic area of use and possible expansion, unlike federal marks that apply nationwide.
  • Benefits include cost savings, immediate protection, and prevention of local competitors from using similar marks.
  • Limitations include weaker enforceability, difficulty proving ownership, and lack of nationwide priority.
  • Protection requires continuous use, active enforcement, and evidence of consumer association with the mark.
  • Federal registration strengthens rights with nationwide protection, statutory damages, and access to federal courts.
  • Searching for existing marks should include federal, state, and common law sources like business directories and domain names.

What Is a Common Law Trademark?

A common law trademark is a type of infringement protection for intellectual property wherein the property is used in commerce before it's federally registered. The U.S. common law trademark starts when you use the mark in commerce for the first time within a geographic area. It endures with continual, deliberate use and is shown by the superscript symbol "TM."

Business names, taglines, product names, logos, design elements, and sounds used to identify companies are all covered by a common law trademark. U.S. trademark law differs from international trademark laws because it's based on common law, rather than first-to-file law.

Benefits of Common Law Trademarks

Common law trademarks stop competing businesses in your area from using identical or similar marks that could confuse customers. You can sue any local competitor for damages if they start using your mark. If your case is successful, the other business will also have to stop using your mark. 

Since you're the only one using the mark, there's no confusion among consumers. Customers won't accidentally visit a competitor store believing it's linked to yours.  

Limitations of Common Law Trademarks

Common law trademark rights are limited to the geographic area the intellectual property is used in and any areas where it could reasonably expand. If a hair salon trades under the name Curlz in California, the common law trademark rights for this name are only valid in California.

So long as the owners didn't know about the Californian Curlz, a salon in Maryland could also trade under the name Curlz without infringing the trademark. However, if the Maryland Curlz began franchising outlets around the country, the common law trademark would prevent it opening a new salon close to the one in California.

Risks of Relying Solely on a Common Law Trademark

While common law trademark rights provide immediate and low-cost protection, relying on them alone carries risks. Proving ownership in court can be difficult without a registration record, and litigation may require extensive evidence of use, advertising, and consumer recognition. Additionally, businesses that later register a similar mark federally may gain stronger rights outside your local market. In industries where expansion is common, depending solely on common law rights could leave your brand vulnerable to disputes and costly rebranding.

Protecting Your Common Law Trademark

You can promote your common law trademark by using the symbol ™. Place the symbol next to your trademarked material to inform your competitors of its trademark status. This symbol could be enough to make copycats think twice.

It's your responsibility to enforce your common law trademark rights. If you don't, you could lose your right to protection. For example, if you don't oppose the registered trademark application of a patent that infringes on your common law trademark within five years, your common law trademark could be revoked.

If a competitor business starts using your mark, you should send a cease-and-desist letter. If this fails, speak to a trademark lawyer about filing an infringement lawsuit. Common law trademarks are built into your state's code and are enforceable by its courts. You will need to prove you deserve exclusive use of the mark. You'll do this in the same way someone with a registered trademark proves use:

  • By showing a history of using the mark
  • By providing evidence that suggest consumers associate the mark with your business, rather than its products

Usually common law trademark claims use similar doctrines and case law to the Lanham Act. State and federal courts often rely on the trademark precedents established in previous common law trademark cases to make their rulings.

Evidence Needed to Enforce a Common Law Trademark

To enforce your common law trademark, you must be able to show evidence of consistent commercial use. Common forms of proof include:

  • Sales records and receipts demonstrating regular business activity under the mark.
  • Advertising materials such as flyers, digital campaigns, or media mentions.
  • Customer testimonials or surveys linking the mark directly to your business.
  • Dated product packaging or labels showing the mark in commerce.
    Courts give significant weight to evidence that consumers associate the mark with your goods or services. Without such proof, defending a common law trademark claim can be challenging.

How a Common Law Trademark Compares With a Federal Registered Trademark

Common law trademarks aren't governed by statute as federal registered trademarks are. Instead, they were created under a system of rights governed by state law. You don't need federal registration to have common law trademark rights or start using the trademark symbol.

You don't have to register your trademark through the United States Patent and Trademark Office (USPTO), but it's a good idea to do so because it comes with stronger rights concerning:

  • Location. Registered trademarks protect the mark across the United States, not just within the local area as common law trademarks do.
  • Listing. All registered trademarks are listed on the USPTO database. This makes it easy for competing businesses to learn about your mark and avoid using it.
  • Symbol. Businesses show they have a registered trademark using the ® symbol, rather than the ™ symbol used for common law trademarks.
  • Legal action. Registered trademark holders can file lawsuits in a federal court to apply their trademark rights. In these cases, registered trademark holders have the right to:
    • Recover profits
    • Sue for statutory damages
    • Get the infringing business to pay their legal fees, which is much harder for common law trademark holders
    • Receive triple damages for willful infringement

In addition, businesses holding a registered trademark in the U.S. find it easier to get a foreign trademark and stop foreign businesses from selling their goods in the U.S.

While registering a federal trademark has many advantages, it does not give holders priority over common law trademark holders. In a well-documented case, the national fast food chain Burger King could not open a Burger King outlet within 20 miles of Matoon, Illinois, because a small burger restaurant called Burger King already had a common law trademark there. 

State Trademark Registrations as a Middle Ground

In addition to federal registration, many states allow businesses to register trademarks at the state level. State registration offers benefits beyond common law rights, such as:

  • A public record of your claim to the mark within that state.
  • Statewide priority, even in areas where you have not yet expanded.
  • An added layer of protection in state courts.
    However, state registration does not provide nationwide rights or the ability to enforce your trademark in federal court. For businesses that operate mainly within one state, it can serve as a useful compromise between relying solely on a common law trademark and seeking federal protection.

Searching For Trademarks

Before using a piece of intellectual property, U.S. law states you must ensure it doesn't already have a federal, state, or common law trademark.

  • Search for federal trademarks. Visit the USPTO website to find all registered U.S. trademarks.
  • Search for state trademarks. Visit state trademark websites to find trademarks registered within the state. Before using a common law trademark, you only need to check the official trademark website in your state. However, you'll need to check all state records before registering for a federal trademark.
  • Search for common law trademarks. Since people don't register their common law marks, they won't appear in trademark databases. Business directories, phone directories, and online searching could help you learn whether your intended mark is already protected under a common law trademark. Finding domain names similar to your intended mark could signal that a website holder already has the common law trademark.

While you can do your own search, a U.S. trademark lawyer is likely to do a more thorough job. Once you're sure you can use a mark under a common law trademark or register the trademark, act quickly. Search results can quickly lose relevance. If you haven't started using the trademark or filed for its registration after two to three months, you must repeat the searches.

Best Practices for Trademark Clearance

A thorough search is critical before adopting a new mark. Relying only on the USPTO database can miss unregistered but legally protected marks. To strengthen your clearance search:

  • Review social media platforms for active businesses using similar names or logos.
  • Check domain name registrations to identify potential conflicts.
  • Search local business licenses and trade directories in your area.
  • Use professional search firms or attorneys for comprehensive clearance reports.
    These steps reduce the risk of adopting a mark already protected by common law rights, which could force you into disputes or costly rebranding later.

Frequently Asked Questions

1. What is the main difference between a common law trademark and a registered trademark?

A common law trademark protects your mark based on use in commerce, while a registered trademark provides nationwide rights, public listing, and stronger enforcement tools.

2. Can I use the ™ symbol without registering my mark?

Yes. The ™ symbol indicates you are claiming common law rights, even without registration. Only federally registered trademarks can use the ® symbol.

3. Do common law trademarks expire?

They do not expire as long as you continue using the mark in commerce. However, abandonment or three years of non-use may cause you to lose rights.

4. Is federal registration necessary if I already have common law rights?

Not required, but highly recommended. Registration expands your rights nationwide, deters infringement, and provides stronger remedies in court.

5. Can common law trademark rights extend across state lines?

Generally, no. Rights are limited to your current market and areas of natural expansion. To secure protection beyond your local area, federal registration is needed.

If you need help with common law trademarks, you can post your question or concern on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.