Trademarks are a common type of intellectual property, used by virtually every business. Trademarks are those names or symbols that identify a company as the source of a product or service. Originally, trademarks were literally the marks tradesmen imprinted on their goods to indicate who made them.

Before adopting a trademark, you should invest in a trademark search to identify potentially competing claims to the mark. Rights in trademarks are generally based on priority of use. The few hundred dollars you spend on a search will be worth every cent if the expenditure saves you from having to change a name or a mark down the road.

TYPES OF TRADEMARKS
Trademarks are generally characterized as being "fanciful," "arbitrary," "suggestive," "descriptive," or "generic." The inexperienced person may opt for a descriptive trademark -- although from the perspective of adopting a strong, protectable trademark, a mark that is fanciful, arbitrary or suggestive is better. Two hundred words from now and you'll never make that mistake again.

• Marks that are "fanciful," "arbitrary," or "suggestive," become trademarks immediately upon proper use in commerce; "descriptive" terms can acquire trademark significance with time and usually the investment of some money; "generic" terms are never protectable as trademarks.

• A "fanciful" term is one that has no recognized meaning when chosen, such as EXXON®. An "arbitrary" term is one that has a meaning totally unrelated to the goods or services with which it is used -- as in Apple computers. A "suggestive" term is one that suggests a characteristic of a product or service without actually describing it such as Coppertone® sun tan lotion. Fanciful, arbitrary and suggestive terms are what are known as "inherently distinctive" terms and are the best candidates for trademarks from a legal point of view because they usually need no extra time or extra help to become protectable.

• A "descriptive" term is one that describes the purpose, size, class, quality or some other characteristic of the goods or services on which they are used (Tender Vittles for cat food; Bufferin for buffered aspirin). Generally, descriptive terms cannot function as trademarks immediately upon use. A descriptive term can become a trademark over time if it develops what is called "secondary meaning." A generic term (Management Services) can never become a trademark. Improper use or a failure to police use of a trademark could cause it to become generic.

• Trademarks should not be descriptive of the goods or services to which they apply and they should be as remote as possible from other trademarks used in the industry. "Hassenpferrer's Apple Pie" is much stronger than "Yummy Apple Pie."

Learn more about trademarks in the Trademark FAQs