Business owners have the ability to register for state trademark protection instead of, or in addition to, federal trademark registration. State registration protects an owner's intellectual property rights in his mark within the boundaries of the state. For a business owner with no plans to expand beyond the boundaries of one state, a state trademark prevents other businesses from using a similar logo or slogan.
Federal Trademark Unavailable
To qualify for federal trademark protection, a mark must be used in interstate commerce. The applicant must demonstrate either actual use of a mark in commerce nationwide, or intent to use the mark nationwide. For example, a sole proprietor operating a small used bookstore, with no plans to expand to other areas, would not be eligible for a federal trademark. In such a case, the shopkeeper’s only option to protect the intellectual property in his shop’s name or logo is to seek state trademark protection.
A state trademark owner does not have the right to use the “®” symbol, which signifies a registered federal trademark, but can use the “TM” symbol to notify the public of her claim to the trademark. All 50 states record state trademarks in a state trademark database, and these state trademarks appear in any trademark search. These records deter infringers or others with confusingly similar marks. A registered state trademark also prevents all similar, later-filed federal marks from being used within that state. Courts and other businesses are also more likely to accept a registered --rather than unregistered -- state trademark owner's first-use claim if there is a dispute.
Cost and Efficiency
State trademark applications are usually filed with the state’s Secretary of State. Most states do not have a stringent, months-long examination of applications as the United States Patent and Trademark Office does. The lighter review results in a shorter period of time between application and approval. State application fees are less than federal fees, and the application is simpler and more straightforward. In cases of infringement, owners of state trademarks have access to state courts. State court fees tend to be lower than federal court fees, and attorneys typically charge lower fees for state court litigation.
While federal trademark applications may be filed based on either usage of the mark or intent to use the mark, state trademark applications may only be based on actual use. A federal trademark is a better option for a business owner who intends to do business in several states or internationally. This ensures the mark is protected when the business expands. A state trademark owner risks another entity registering a federal mark similar to her own, which would prevent her from later registering her mark at the federal level.