VOL. CXCVIII - NO.1 - INDEX 47 OCTOBER 5, 2009 ESTABLISHED 1878

INTELLECTUAL Federal law spells out those advantag- State Trade Name Registration Is es in detail. As discussed below, New Jersey’s Act is less specific about the advantages of registration, Insufficient To Clear a Trademark and it remains to be seen how courts will interpret those protections.

By David M. Kohane A trademark is a designation New Jersey’s Registration Scheme any practitioners are aware used to distinguish a company’s goods of federal laws for the pro- from another’s goods and identify tection and registration of those goods as originating from a par- New Jersey’s system for reg- Mtrademarks. Federal trademark protec- ticular source. A serves istering marks is generally modeled on tion, however, extends only to marks the same function for a company’s the federal scheme. It provides for reg- used in interstate commerce. Although services. Mark refers to both trade- istration of marks — not trade names the constitution’s interstate commerce marks and service marks. A mark can — by which a company’s goods or clause is broadly interpreted, it does be a word, name, symbol, or device, services “may be distinguished” from not extend to purely intrastate com- or any combination thereof. N.J.S.A. those of others. N.J.S.A. 56:3-13.2. merce or, therefore, to used 56:13.1a. A trade name, in contrast, This “distinctiveness” requirement is only within New Jersey’s borders. identifies the itself. common to statutory and common law New Jersey law partially fills trademark protection schemes and re- this gap. Trademarks and business The Nature of Trademark Protection fers to whether the term operates as names enjoy protection under this an identifier of source rather than as a state’s common law. In addition, the Protection of trademarks and statement of the nature of the product New Jersey Trademark Act, N.J.S.A. trade names is part of unfair competi- or service (e.g., one can claim trade- 56:3-13a et seq, offers certain protec- tion law. The law protects against the mark protection for using “apple” on tions similar to federal law for compa- use of marks likely to cause confusion computers but not on apples). nies doing business only in this state. with a prior user’s mark. The imitation Like the federal system, New This article reviews those state law of a name, mark, product appearance Jersey will refuse registration even to protections. It also explains why New that enjoys the goodwill of the pur- a distinctive mark under certain cir- Jersey’s state and county procedures chasing public can constitute unfair cumstances. Most important, regis- for reserving and registering business competition. Red Devil Tools v. Tip tration is to be refused if the mark is names are insufficient to “clear” a Top Brush Co., 50 N.J. 563 (1967). “likely, when used on or in connection trademark. Marks do not get trademarked with the goods or services of the ap- by some governmental process. A busi- plicant, to cause confusion or mistake ness becomes the owner of a mark by or to deceive” with a mark previously Trademarks, Service Marks and Trade using the mark in commerce to identify registered in New Jersey or a mark or Names its goods or services. The federal and trade name already in use in the state. Kohane is a member of Cole, state governments do, however, regis- N.J.S.A. 56:3-13.2(f). Schotz, Meisel, Forman & Leonard in ter marks. Registration is permissive, New Jersey’s registration pro- Hackensack. but it affords substantial advantages. cedures in many ways resemble their

Reprinted with permission from the OCTOBER 5, 2009 edition of New Jersey Law Journal. © 2009 ALM Media , LLC. All rights reserved. Further duplication without permission is prohibited. 2 NEW JERSEY LAW JOURNAL, OCTOBER 5, 2009 198 N.J.L.J.47 federal counterparts, including dis- litigation. For small without ute prohibits use of a “famous” mark claimer of unregistrable components of an interstate nexus, New Jersey regis- that “causes dilution of the distinctive the mark and opportunities to contest or tration can be a relatively inexpensive quality of the owner’s mark.” N.J.S.A. appeal (to the Office of Administrative way to enhance a mark’s value. 56:3-13.20. The protection is somewhat Law) refusals. State registrations may narrower than current federal protec- be cancelled on application of a third New Jersey Statutory Trademark Remedies tions. New Jersey’s statute prohibits party. N.J.S.A. 56:3-13.3-13.b. dilution of the distinctive quality of There are, however, some dif- The New Jersey Trademark Act a mark (“blurring”); federal law pro- ferences between the state and federal includes remedies for infringement of tects against blurring but also protects schemes. State registration is filed on both registered and common-law marks against “tarnishment” of a famous mark paper; federal registrations are usually similar to those afforded by federal law. through use of the defendant’s mark on accomplished on-line. New Jersey has The owner of a mark may bring a civil goods or services of lesser quality. Un- no “Official Gazette” to publish pend- action, for example, against persons like federal law, furthermore, New Jer- ing applications for opposition and no who use any “reproduction, counterfeit, sey’s statute requires actual dilution, not “Supplemental Register” for descriptive copy or colorable imitation” of a mark just a likelihood of dilution. 15 U.S.C. marks that may acquire distinctiveness. in a way “likely to cause confusion or § 1125(c). State registrations must be renewed ev- mistake or to deceive as to the source ery five years. N.J.S.A. 56:3-13.5. A of origin of the goods or services.” Registering a Trade Name Does Not “Clear” It federal presumption of abandonment N.J.S.A. 56:3-13.16.a. for Trademark Purposes through nonuse now arises after three Remedies can include injunc- years, 15 U.S.C. § 1127; New Jersey tive relief, destruction of goods or A common misconception is presumes abandonment after two years. materials bearing infringing marks, that registration or reservation of a trade N.J.S.A. 56:3-13.1a. disgorgement of profits and damages. name protects against a charge of trade- A certificate of registration is Treble damages and attorneys’ fees are mark infringement. The willingness of admissible to prove the registration in available, in the court’s discretion, if the county clerk (for sole proprietor- New Jersey’s courts. N.J.S.A. 56:3- the infringement was knowing, in bad ships and general partnerships) or the 13.4. Unlike the federal statute, howev- faith or “egregious.” N.J.S.A. 56:3-13- state (for corporations, limited liability er, New Jersey’s statute says little about .16.d. Under specified circumstances, companies and limited partnerships) to what legal rights registration establish- the court may order ex parte seizures register or reserve a name does not give es. Where federal registration grants and injunctive relief of goods bearing the registrant the trademark or ensure federal registrants nationwide priority in counterfeit marks. The statute autho- that a business’s name will not infringe the use of the mark (15 U.S.C. § 1057), rizes the attorney general to intervene another business’s mark or trade name. the New Jersey Trademark Act makes if the infringement poses a threat to Although the statutes provide no explicit statement whether state reg- the public health, safety or welfare. that a corporation, limited liability com- istration grants statewide priority. Fed- N.J.S.A. 56:3-13.16.c. pany or limited partnership may only eral registration affords a presumption New Jersey also has an “un- register its actual name if it will “distin- of validity, ownership and exclusive fair competition” statute that protects guish it” from another company’s name, rights, 15 U.S.C. § 1057(b), 1115(a); marks, business names and a business’s for example, a company can register an New Jersey’s Trademark Act does not goodwill. N.J.S.A. 56:4-1 prohibits alternate name regardless of whether the spell out that equivalent presumptions the appropriation of another’s “name, name will “distinguish it” from another arise from state registration. The act , trade-mark, reputation or good company’s name. N.J.S.A. 14A:1-2.1, leaves these issues to the courts, but it will….” The statute authorizes injunc- 42:2A:6.1, 42:2B-4.b. The divided does provide some guidance. It states tive relief and damages; the court may state/county system for registering and it is intended to “provide a system of award treble damages in its discretion. reserving trade names does not provide state trademark registration and protec- N.J.S.A. 56:4-2. for cross-checking of state and county tion substantially consistent with the Federal law often relies on mul- records. The trade name registration/ federal system of trademark registra- tifactor tests to determine when marks reservation process also does not check tion and protection” and instructs that are confusingly similar and therefore for registrations and uses of marks and federal law is “persuasive authority” in infringing. New Jersey’s test is substan- names outside New Jersey or for unreg- interpreting New Jersey’s act. N.J.S.A. tially the same. Buying for the Home, istered uses of marks with common-law 56:3-13a. LLC v. Humble Abode, LLC, 459 F. protection. Generally speaking, there- Regardless of how these is- Supp.2d 310 (D.N.J. 2006); American fore, a trademark search is needed to sues are decided, New Jersey registra- Home Mortgage Corporation v. Ameri- “clear” a name or mark for trademark tion can deter infringers and establish can Home Mortgage Corporation, 357 purposes — preferably before a com- a mark owner’s dedication to protect- N.J. 273 (App. Div. 2003). pany invests time, money and effort to ing its mark, helping avoid disputes and Finally, New Jersey’s stat- develop goodwill in the mark.■