Trademark Infringement: 8 Ways to Protect Your Business
Many of you probably read yesterday's headline, "Obama Campaign Sues Washington Promotions & Printing for Trademark Infringement." To recap, a promotional products distributor is being sued by Obama for America for unauthorized use of the Obama "Rising Sun" logo.
Washington Promotions & Printing has not yet responded to the filing, and they may have a perfectly sound defense. Regardless of the outcome of the lawsuit, it got me thinking about trademark use in the promotional products industry. Trademarks are something we use in this industry every day, as nearly any logo a client wants printed is, or can become, a registered trademark.
Trademark infringement is also one of the most costly mistakes a company can make; not only can the trademark holder sue for the infringer's profits or any lost revenue, under certain circumstances, someone infringing on a trademark could pay up to $1,000,000 per trademark in damages.
Yesterday I spoke with Lisa A. Lori, Esq., a partner in the litigation department at law firm Klehr, Harrison, Harvey & Branzburg LLP, and an expert on trademark law. Here are her eight tips for protecting yourself when working with trademarks.
1) Do not use trademarks or the names or likenesses of others without written permission from those sources.
2) Anything that sounds too good to be true probably is. As a general rule, if any price seems exceptionally low for no good reason, the products are likely to be counterfeit (or knockoffs). You may be deemed to have knowledge that the product you are acquiring is a counterfeit (i.e., you should have known that the product was a counterfeit even if you did not have actual knowledge).
3) Do your due diligence. Make sure your sources are credible and reputable and make sure all third-party trademark use in the promotional products has been authorized in writing from the trademark owner.
4) Do not use trademarks that too closely resemble the mark of another.
5) Maintain good records. Make sure you maintain files containing written authorizations for use of others' trademarks. Keep these files until long after the statutes of limitations for potential claims have expired. Statutes of limitations for certain actions vary per state. You should consult with your lawyer to determine how long you should maintain records.
6) Develop and implement policies for your company against intellectual property infringement. The policies should include, among other things, provisions prohibiting use of others' trademarks without written authorization.
7) Obtain indemnification agreements from your sources. If you have a contract with your suppliers, include a provision in the contract that provides for your indemnification if claims are asserted by third parties for intellectual property infringement. Remember, the indemnification is only as good as the source providing indemnification.
8) Have a good commercial liability insurance policy in place that provides coverage for advertising injuries. Not all insurance policies provide coverage for trademark infringement claims. However, it is worth speaking with your insurance.
Lisa A. Lori is a partner in the litigation department at law firm Klehr, Harrison, Harvey & Branzburg LLP. She represents national and international businesses in a full range of complex commercial litigation matters, including copyright and trademark disputes, real estate disputes and general business torts. Ms. Lori also counsels clients on a variety of matters, including advertising, marketing, branding and regulatory (including Food and Drug Administration (FDA) and Federal Trade Commission (FTC)) compliance.