State and Federal Trademarks - What's the Difference?

Today's post from guest Ipper Andrew Flusche.  Andrew is a practicing attorney who helps his clients with their real-life IP problems.  In this post, Andrew addresses one of the most common questions he receives from clients, "what's the difference between state and federal trademarks?"

One issue that complicates trademark law is the fact that the United States has two different levels of trademark protection: federal and state. This makes trademark protection a little confusing for business owners. Here are some key issues to understand when evaluating the two different types of trademarks. Hopefully this will demystify the distinction.

Federalism

We have two levels of trademark protection because the United States has two main levels of government. Each state has its own laws and local sphere of activity that it regulates. Then the federal government regulates international and interstate affairs. (That's over-simplified, but it works for our purposes here.)

Trademarks are no different that other areas of the law. Federal and state governments both have their hands in them.

Protection

The main substantive difference between a federal and state trademark is the geographic sphere of protection.

A state trademark only protects your brand within the state of registration. A federal trademark protects your brand across the entire country.

Importantly, remember that trademarks protect mainly against future users of the registered mark. If you register a state trademark, then a competitor registers the same mark on the federal level, you wouldn't be able to later register the mark federally.

Cost and difficulty

Another difference between these two types of marks is the cost and difficulty of obtaining registrations. You generally own a trademark by using it in commerce. But to obtain the benefits of a registration, you have to jump over some hurdles.

Many states make trademark registration extremely easy and cheap. For example, a Virginia trademark application is simple to fill out and only costs $30 to file.

On the other hand, the federal registration process costs at least $275 in filing fees (sometimes several multiples of $275). Also, the application isn't easy for the layperson to figure out, and there are many technical legal requirements to meet.

Which to use?

But what does all this mean, especially for small business owners? Which trademark do you register?

I counsel clients to focus on their target markets. If you just operate on a local level within your state, a state trademark will probably be all you need.

However, many businesses have broader markets with the use of the internet. If you serve customers outside your state, you really should think about a federal trademark.

At the very least, all these complexities mean that you should consult a trademark attorney to discuss protecting your brand. You don't want to obtain the wrong type of trademark registration.

Andrew Flusche is a Virginia attorney who practices in the areas of intellectual property, estate planning, and reckless driving defense. He can be reached via his website at http://www.andrewflusche.com