Legal

One thing copyrights and trademarks share is they happen automatically. As discussed in recent issues, a copyright is vested in the author immediately when the work is "fixed in a tangible medium." Trademarks automatically attach when used. A copyright cannot be enforced unless registered, but a trademark always can be enforced.

People often mistakenly think trademarks must be logos or designs. In fact, words alone suffice. For example, "Microsoft" and "Exxon" standing alone are immensely powerful marks. Designs—and even colors and sounds—also can be marks. By the way, since the distinction between a trademark and a service mark often is blurred, each simply is referred to by the word of art, "mark."

A trademark identifies the source of goods, like DVDs; a service mark identifies the source of services, like flying lessons. As with copyrights, wherein the circled "C" is the universally recognized symbol disclosing that the author is claiming ownership, trademarks have symbols, too. The circled "R" is limited to a federally registered mark (explained below), and it never can be used otherwise. You can be sued for unfair competition if you use the circled "R" on an unregistered mark. However, there are important, albeit unofficial, symbols you can use for unregistered marks: The superscript "TM" is for trademark, and (sm) is for service marks. There is no statute that designates either of the two as having special legal significance, but they have become an accepted method of staking claims to unregistered marks, much the same as the non-mandatory circled "C" for copyrights.

In the special environment of adult media, because there is no legal mandate with respect to the format of the ™ and (sm) signals (instead, you simply could say, "XYZ is a trademark of QRS Inc."), and because of the ill-defined line and overlap between a trademark and a service mark, it is good practice in this industry to use ™; (sm) sometimes has a secondary meaning you may wish to avoid. There is no real downside to using ™ for a pure service mark.

Unregistered trademarks are very enforceable. If you have been operating Icon Hamburgers restaurant for years, and a new joint with the same name opens up down the street, you can sue the new place for trademark infringement—technically unfair competition, because that is exactly what is happening; it is competing unfairly with you. But, if another Icon Hamburgers opens up in a small town thousands of miles away? Maybe not. The same probably is true if someone opens an Icon Car Wash in your town. That is why Delta Air Lines, Delta Dental, and Delta Faucets peacefully co-exist. Delta Dental doesn’t make faucets, and so on.

What about registration? The Lanham Act allows federal registration of marks at the U.S. Patent and Trademark Office; however, only marks used in interstate commerce (e.g., all websites) can be registered there. For purely local businesses, states also allow registration of marks.

Federal trademark registration differs from copyright registration in that copyright registration is automatic: Send in your Form PA; they stamp it and send it back. Trademark registration is considerably more elaborate. When you send in the application (electronically), it is assigned to an examining attorney. The examiner reviews it to determine whether it is a proper, unused mark. The first analysis is of the mark itself. For example, if you try and obtain a trademark for "Sexy DVDs," it probably will be rejected because all it does is describe what you do. Good trademarks, like Exxon, are meaningless—called "fanciful." Fanciful is good; descriptive is not. The second analysis concerns whether someone already is using the mark for a competing product. Trademarks must be unique: first come, first served.

Another distinction between copyrights and trademarks is that, once a copyright is established, it is good until it expires. A trademark is a use-it-or-lose-it proposition. With the exception of "intent to use" applications with the PTO (essentially, reserving a mark), a trademark is only good when used. Otherwise, it is deemed "abandoned"—even if registered.

Trademarks must be exclusive with the class of goods or services, must not be merely descriptive, and must be used or will be lost. One point worth elaboration is the descriptive-versus-fanciful distinction. Selection of a trademark is a huge task, and one often taken much too lightly when establishing new businesses. Frequently, a startup will select its name without a thorough search for prior use and/or without enough thought and wind up having to change it because it is considered too descriptive, someone else is using it, or it is just a turkey of a name.

Another problem is "dilution" of trademarks, which is the process of capitalizing on or tarnishing a famous trademark. So, just because Kleenex doesn’t make movies, you can’t use "Kleenex" as a trademark in connection with adult entertainment. Kleenex would claim that you are both tarnishing its reputation and capitalizing on its fame.

The aforementioned are reasons why you need an attorney to help you with trademark matters. Unlike copyright registration, which is a very straightforward process that can be learned from a lawyer the first time and routinely accomplished thereafter, the processes of selection and registration of trademarks is a minefield.

Finally worth mentioning is cybersquatting. When the World Wide Web was in relative infancy, it became popular to invest in domain names with famous trademarks. As the Internet became a more important (now indispensable) component of mainstream commerce, the owners of the famous marks were victims of stickups, wherein the cybersquatter would hold the desirable domain name hostage for ransom.

For example, the cybersquatter of Panavision.com simply had it attached to a site displaying photographs of the city of Pana, Ill. The owner of the Panavision mark sued the cybersquatter—successfully, but the only claims available at that time were dilution and violation of a California Businesses and Professions Code.

Congress responded with the Anticybersquatting Consumer Protection Act of 1999, adding 15 U.S.C. § 1125(d), which put into place remedies against cybersquatters. These include a provision allowing what is called an "in rem" action against the domain name. A federal court can order the transfer of the domain name to the trademark owner, even if the cybersquatter is in some far-flung country where he cannot be served with a lawsuit.

Protect your company’s banner.

Clyde DeWitt is a Los Angeles attorney whose practice has been focused on adult entertainment since 1980. He can be reached through AVN Online’s offices, or at clydedewitt@earthlink.net. Readers are considered a valuable source of court decisions, legal gossip, and information from around the country, all of which is received with interest. Books, pro and con, are encouraged to be submitted for review, but they will not be returned. This column does not constitute legal advice but, rather, serves to inform readers of legal news, developments in cases, and editorial comment about legal developments and trends. Readers who believe anything reported in this column might impact them should contact their personal attorneys.