According to U.S. trademark laws, a business has common law rights to a unique name as soon as it’s used in commerce. However, common law rights are limited to your geographic area, and provide limited help in court should you try to challenge another business for using the same name. These are some of the main reasons why businesses apply for federal trademark protection in the first place.
A standard trademark - officially called actual use trademark – requires that your product or service is market ready and that you’re already using the mark in commerce. But what if your business isn’t ready for prime time yet? In this case, the U.S. Patent and Trademark Office (USPTO) will let you file an intent to use trademark application.
The intent to use trademark basically reserves a trademark until you’re ready to use it. The main benefit is that it sets your filing date as the constructive date for establishing nationwide priority. If you file an intent to use application on October 1, but haven’t launched your product yet and another company comes in and files an actual use trademark application on November 1, you will have superior rights to the name even though the other company went to market first.
Here’s the one important detail: For the intent to use application to be valid, you will need to put your mark in use, and file a statement of use application with the USPTO. The USPTO gives you six months to go to market after filing your intent to use the application. If you’re not ready by then, you can file a six-month extension - and have up to five extensions total. But if you fail to file an extension on time, or aren’t ready after your five extensions are up, then the USPTO will consider your application to be abandoned.
To appreciate the importance of applying for an intent to use trademark early in the process, here’s a story cited in the National Law Review.
A Minnesota business filed an intent to use trademark application on December 10, 2011 for the mark, BLAST BLOW DRY BAR. However, a Texas business had already filed an actual use trademark application on December 8, 2011; the application from the Minnesota business was rejected. Had it filed its intent to use application just three days earlier, it would have received priority.
The takeaway? It’s entirely possible that someone else will come up with the same idea as you for an entity name, and with trademarks, the early bird gets the worm.