Updated: Apr 27, 2021
What it takes to get ® that beside your business name.
Here’s one rule you probably didn’t know about trademarks: the trademark office will only register marks that are being used “in commerce”. Sounds simple enough, right? Except that I’m not talking about our everyday understanding of the phrase “in commerce”; I’m talking about the legal definition. Curious to know whether your trademark is up to snuff? Read on.
The Law of the Land
Trademark law defines commerce as “all commerce which may lawfully be regulated by Congress.” This definition is not particularly helpful. I’m also pretty sure that my elementary school teacher taught that one should never include a word that one is trying to define in its own definition, but oh well. Thankfully, the Trademark Manual of Examining Procedure (TMEP) clarifies that “the types of commerce encompassed in this definition are interstate, territorial, and between the United States and a foreign country.”
So what is left out? Intrastate commerce; businesses that only operate in one state or only have one location. Reading this alone, one would think that a business with only one location in one state would not be eligible for federal trademark registration.
But the plot thickens.
Smoke and Mirrors
The TMEP goes on to say that “Intrastate use of a mark may qualify . . . if the intrastate use is of a type that would, taken in the aggregate, have a direct effect on interstate commerce.”
So what in the world are we supposed to do with that? Especially after Wickard v. Filburn when we found out that basically anything can be interstate commerce? (For those of you who are not law nerds, Wickard is a (in)famous Supreme Court case that held that Filburn wasn’t allowed to grow wheat on his own local farm, even though he was growing it for his own consumption and not selling it anywhere else, because it could still theoretically affect interstate commerce. This case was decided in the wake of the Great Depression, so there were definitely other factors at play, but the point still stands.) How can a single-location business know whether its goods and/or services have “a direct effect on interstate commerce”? Well, here are some examples that courts have allowed in the past:
A wine shop that only sold wine locally, but imported the wine from France. (In re Application of Silenus Wines, Inc.)
An automobile service with only one location that was situated beside an interstate highway and offered services to trucks on their way to other states. (In re Gastown).
A church whose only record of ever selling to someone from out-of-state was two hats sold for $38.34. (Christian Faith Fellowship Church v. Adidas AG).
With that track record, it seems like pretty much any business should count, except when it doesn’t. For example, in 2007 a construction company’s application to register its trademark was denied because the owner wasn’t unable to show that he’d ever done any work outside of Connecticut (that case was CottageCare v. Ranelli).
To avoid wasting time and money, a business owner who only sells locally can work with an attorney to determine whether their local business nevertheless can be considered to be affecting interstate commerce. What we can take away from past court cases is that no one factor is decisive. Instead, courts seem to take several different factors into consideration:
Whether branded inventory was imported or brought in from out-of-state.
Whether the clients or customers are from out-of-state.
The quantity and quality of advertising directed at an out-of-state audience.
The location of the business itself, particularly if the location is known to attract an out-of-state audience.
In some cases, one factor was enough to carry the day. In others, a combination of factors ultimately swayed the court. Working with your trademark attorney to make this judgment call before applying can help save time and money in the long run.
Thanks for reading the Bevel Law Blog! While this information is hopefully helpful to you, nothing in this blog is intended to be legal advice. Always consult a lawyer before making any legal decisions based on topics in this blog.
Ready to secure your trademarks so your business can be legally protected as you expand nationwide? Book a call today at bevellaw.com/call.