Registering Trademark Can Save You Later On
Buoyed by the popularity of their trendy hair salon in the Chicago suburb of Hinsdale, Raymond Koubek and Salvatore Segretto created a line of shampoos, conditioners and gels under the Zazu salon brand.
They registered “Zazu” with the Illinois trademark office in 1980 and began selling the products to clients on a limited basis in 1985. In 1986, Koubek and Segretto were astonished to see national magazine ads for a line of temporary hair color products called Zazu, placed by L’Oreal, a major Paris-based cosmetics company.
“We were as careful as a small business owner could be and went through the trouble of protecting ourselves,” said Koubek, who told L’Oreal to stop using his trademark.
L’Oreal officials told him it was too late to stop distribution of what turned out to be a short-lived product.
The angry entrepreneurs sued L’Oreal, and in September, 1988, a federal judge in Chicago awarded Zazu’s founders $2.1 million in damages. They are still waiting for the money but feel vindicated because the judge agreed that L’Oreal flagrantly violated Zazu’s trademark registration.
John D. Sullivan, corporate counsel for Cosmair Inc., which licenses the L’Oreal line, said the decision was “extraordinarily unusual” and added that he is still awaiting the judge’s final ruling in the case.
Many small-business owners who think filing for a trademark is too expensive or time-consuming will be surprised to learn that it usually costs less than $1,000 and can save you endless grief.
“The money you spend in the beginning to protect your name is going to pay itself back 100 times,” said James Warren, head of the intellectual property group at the San Francisco law firm Pillsbury, Madison & Sutro.
Warren, who has been hired to protect the “New Kids on the Block” rock group name, among other big and small company trademarks, said that even the tiniest company can benefit from trademark protection.
Your company may be small now, but if your products or services take off, you don’t want imitators to threaten your success. On the other hand, if you use a name that belongs to someone else, you can be put out of business immediately if they find out.
It is possible to conduct a trademark search on your own, but hiring a competent trademark attorney is not as expensive as you might think.
Once you’ve chosen a name you like, the first step is to see if anyone else is using it or anything that sounds or looks like it. This kind of first-level search is usually done by paralegals and costs $50 to $100. If nothing turns up, the next step is to complete a national search of databases, telephone books, trade magazines and other published sources. The second phase can cost $250 or more, depending on the complexity and comprehensiveness of the search.
Names are not the only thing you can register as a trademark. Logos and graphic designs can also be protected, Warren said.
If the name you choose is available, the next step is to file an application with the U.S. Patent and Trademark Office. The government charges a $175 application fee for each class of goods or service your product falls into. To qualify for a federal trademark registration, your products must be sold in more than one state.
After your application arrives at the Patent Office, it is turned over to an attorney who determines whether there is anything “confusingly similar” between your trademark and others. If your trademark application clears this hurdle, notice of your intent to register the mark is published four times in a weekly publication called the “Official Gazette”--so others can be alerted.
If no one files a notice of opposition, the registration certificate is usually issued by the Patent Office within four to six months.
West Hollywood entrepreneur Ken Girouard learned the hard way how vigilantly giant corporations monitor their trademarks. Fruit of the Loom recently filed suit against Girouard and his company, Two Left Feet, over the “Fruit Flops” name that Girouard uses on his firm’s hand-decorated rubber beach sandals. Girouard, a former Madison Avenue ad executive, never attempted to get a trademark. He contends, however, that the big apparel maker does not have a monopoly on the word “fruit” and has hired an attorney to defend him in Los Angeles federal court.
Although big corporations have entire legal departments devoted to protecting trademarks, small-business owners usually must rely on vendors and customers to tell them if another firm is infringing on their product name.
“The companies that have spent millions and billions of dollars creating, protecting and promoting their trademarks are very vigilant,” said Michael Finn, spokesman for the United States Trademark Assn. in New York City.
Finn said there are about 650,000 active, federally registered trademarks, plus thousands of others registered with states. In our computerized society, he said, anyone who tries to get away with using someone else’s name will eventually get caught.
Through the years, Finn said, many product names have lost their protected status because they were commonly used by the press and the public. Corn flakes, nylon, escalator, dry ice, kerosene and raisin bran are among products that have been victims of “genericide,” or generic use, according to Finn.
He said his association, which has about 2,200 members, offers several publications to help business owners deal with trademark issues.
“A Trademark is Not a Patent or Copyright,” “Protecting Your Trademarks Abroad,” “Trademark Checklist,” “The Guide to Proper Trademark Use” and “Trademarks . . . A Winning Combination” are among the publications available for a modest fee. To obtain a publication and price list, send a self-addressed stamped envelope to: U.S. Trademark Assn., 6 East 45 St., New York, N.Y. 10017.
Series to Focus on Trading With Japanese
A five-week lecture series on doing business with Japan begins Oct. 1 in downtown Los Angeles. The series is sponsored by the Foreign Trade Assn. of Southern California, Japan External Trade Organization and Honda International Trading Corp. Featured speakers include Robin Rose, president of Robin Rose Ice Cream; Yasuyoshi Shimada, president of Shimada International Associates, and George Marshall, vice president of Mitsui O. S. K. Lines America Inc.
The meetings run 6-8 p.m. at JETRO’s office, 725 S. Figueroa St., Suite 1890. The $100 registration fee may be sent to the Foreign Trade Assn., 900 Wilshire Blvd., Suite 1434, Los Angeles 90017. For information, call (213) 627-0634.
