When Should a Bank Think about Trademarks?

Trademark protection can benefit any company that provides a product or service.  This includes banks of any size, as they provide various services from mortgage lending to on-line consumer account access.  The question becomes, at what point in the process should a bank think about trademark protection?  The answer is “early and often.”

What is a Trademark?

At its most basic level, a trademark is a “source identifier” for a particular good or service.  It can be a product name, a logo, or something else that identifies that particular good or service that you are selling.  When people hear or see that mark, they instantly think of your company and the particular product or service provided.  For a bank, this could be whatever catchy name you have for your mortgage program, the name of your on-line customer portal, or anything similar.

What marks are protected?

In order for a mark to be protected, it must be “distinctive.”  In other words, it has to do more than simply describe your product.  The more off-the-wall or unrelated your product name is, the stronger the trademark protection for that mark.

For example, if you have an on-line customer account access website that you call “Customer Account Portal” you likely may not have trademark protection, or the protection could be fairly weak.  All that phrase is doing is describing what your product is.  However, if you called your on-line customer account access website something like “The Phoenix” then you will likely have really strong trademark protection since that name has little or no inherent relation to your product or service. 

When to Register a Trademark?

Trademarks can be protected from infringement whether they are officially registered with the Patent and Trademark. Office or not.  That is because the protection comes from the first and continuous use of the mark in connection with goods or services.  It is the use of the mark that provides the claim for protection.  A company is even allowed to put the small “TM” logo by the name of their product without the product being registered, to indicate to others that you are claiming trademark protection in that particular mark.  The trademark can be officially registered at any point, even after it has been used for a while.  Only after it is registered can the symbol “®” be used by the name.

The fact that protection is in place without registration allows banks to roll out a new product or service without taking the time or expense to register the trademark with the patent and trademark office.  It allows the bank time to start marketing its product or service while still weighing the benefits of registration of the trademark.

Benefits of Waiting to Register:

If a particular mark is not excessively distinct, for example if it appears to describe the product in some way, and there is concern over whether it could be registered as a trademark the use of the mark pre-registration can help to establish the validity of the mark.  The use and marketing of the mark can help develop “secondary meaning.”  In other words, your customers start to come to associate your particular mark with your particular company, product, or service and start thinking of it as a trademark.  After such strong association is achieved, the trademark can potentially be registered despite its descriptive nature.

For example, if a bank calls their on-line mortgage calculator “The Payment Estimator,” it may be difficult to get a trademark, since it is simply describing what the mortgage calculator does.  However, if that term is used and marketed for a while and customers start associating the term “The Payment Estimator” with a particular bank, you would then have a stronger case to request registration from the Patent and Trademark Office.

Benefits of Registration:

Even though registration is not required to protect your trademark, it is still important to evaluate early on whether registration is beneficial.  If a mark is registered prior to the infringement by another company, there are additional remedies available, such as seeking attorney fees from the infringing party or an enhanced damages calculation.  Federal registration can also provide a greater geographic scope of protection, as opposed to just being protected in the areas where you have used the mark.

Conclusion:

When contemplating trademarks, it is important for a bank to consider early when or if they should register their trademarks.  It is important to weigh such considerations as how likely someone may be to infringe on the trademark and how likely the bank thinks it will be in successfully showing that the mark is distinct enough for registration.  If the mark is less distinctive, then it may be better to wait on registration while trying to build up the customers’ recognition of it as a trademark.  However, if it seems likely that another bank will want to copy or infringe on the trademark, it could be beneficial to register it early and thereby gain access to the increased remedies.

If you have questions about when or how to register your trademarks, call the experienced attorneys at Goosmann Law Firm, PLC, in our Omaha, Sioux City, or Sioux Falls offices.