The Real Estate Business And Trademark Law

Co-Author: Amy E. Allison, Esq.

Question: I am starting my own real estate company and will invest much of my time and money promoting my company. I have hired a graphic artist to design a logo. How can I avoid using someone else’s name? How can I protect against someone taking advantage of the goodwill I will build around my logo? I have registered my domain name “XYZ.com.” The Colorado Secretary of State has already approved my corporate name as “XYZ Realty, Inc.” Do these steps assure me trademark protection?

Answer:   This article seeks to explain some of the most basic concepts of trademark law. Both real estate and trademarks are property. Some of the basic notions of trademark law are analogous to concepts in real estate law. Since most of the readers of this article are knowledgeable about real estate law, we will explain some notions of trademark law by analogizing to real estate law.

Someone may acquire “common law” rights to a trademark within a limited geographic area by actual use of the mark in connection with a particular good or service. Establishing common law trademark rights is somewhat analogous to acquiring title to real property through adverse possession. Unlike adverse possession, which requires the open, notorious, and hostile taking of a property for a continuous period of eighteen years, common law trademark rights may be established based merely upon a bona fide actual use of the mark in connection with a particular good or service.

Most entrepreneurs seek to establish a distinctive trademark to separate the entrepreneur from the crowd. If an entrepreneur is aware of her local market, it is unlikely that the entrepreneur who is acting in good faith will choose a mark which is deceptively similar to an existing trademark. Where brokers run into common law trademark problems is when the broker seeks to expand the business into other geographic areas. The broker may find a competitor in a different geographic region using the broker’s mark or a similar mark. The competitor might have established prior common law rights in that geographic area. The purpose of searching is to reduce the risk that someone else is using the mark in which you are about to invest time and money in order to build goodwill.

Preliminary trademark searching can be done through on-line data bases which search federal and state trademark registers (which are somewhat analogous to clerk and recorder’s offices) and domain names.

Though the Colorado Secretary of State allows you to incorporate as “XYZ Real Estate,” this affords you almost no trademark protection. For example, had someone else been operating as “XYZ Real Estate,” without incorporating, the Secretary of State’s records would not reflect the name of the company. Yet, the owner of “XYZ Real Estate” may have established common law trademark rights in the geographic area in which you seek to practice. Registering with the Secretary of State is a fact which helps a proprietor establish their own common law rights, but it is no substitute for the protection afforded by registering your trademark.

If your desired trademark passes preliminary screening, you may be ready for a more comprehensive search. These searches are conducted by companies who specialize in trademark searches. These companies are somewhat analogous to title companies. They are critical for a federal trademark registration, but are of less importance for an entrepreneur seeking to establish a Colorado real estate company.

Registration

A state trademark is one that is used within the confines of the state and optionally registered on the state’s trademark list. A federal trademark is one that is used across state, territorial or international borders, or that affects commerce across such borders. The term “federal trademark” is also generally taken to mean that the trademark has been federally registered, as opposed to a common law trademark.

If you are only going to use your mark in Colorado, you will only need to register your mark in Colorado. In fact, federal registration will not be permitted due to the fact that your mark does not affect trade “across state, territorial or international borders.” If you do in fact use your mark in interstate or international commerce, you should consider registering your mark with the United States Patent and Trademark Office in order to adequately protect your mark.

State Registration. All states maintain separate trademark registers. The main function of these is to provide notice to would-be later users that the mark is already in use. Unlike federal trademark registration, placement of a mark on most state registers confers few benefits other than an indication of when trademark rights in the mark were first claimed by the registrant. In Colorado, trademark registration is done through the Secretary of State’s office. Please note that simply registering your business with the Secretary of State does not equal trademark registration. A separate form is used and a separate register is kept. Assuming there are no trademarks previously registered, registration is effective within two to three weeks of filing unless expedited filing is requested.

Federal Registration. A real estate entrepreneur may register a trademark which is already in use, or register a trademark that the entrepreneur intends to use in the future. Registration begins with the filing of the application along with the appropriate filing fee based on the type of application and a specimen of the mark. The typical time it takes to get a trademark registered is between twelve and eighteen months, assuming no objections to the application are filed and that the Patent and Trademark Office approves the mark. However, any trademark search conducted after the filing of an application will disclose that the application is pending, and would-be users of the mark are thereby put on notice that the applicant is already claiming ownership.

The registration of a domain name does not assure trademark protection. For example, you might be able to successfully register the domain name “XYZ Real Estate.com.,” only to find out that your competitor is operating under the name “XYZ.com” and that that competitor has a prior common law or registered trademark “XYZ Real Estate.”

Amy E. Allison is no longer with Frascona, Joiner, Goodman and Greenstein, P.C.

Jon Goodman is a shareholder with Frascona, Joiner, Goodman and Greenstein, P.C., a Colorado law firm. His practice areas include Real Estate,Brokerage Law, Contracts, Land Use, Leasing, Real Estate Title, Association Law, Business Law, and Finance. Contact Jon Goodman.

Disclaimer — Content is general information only. Information is not provided as advice for a specific matter, nor does its publication create an attorney-client relationship. Laws vary from one state to another. For legal advice on a specific matter, consult an attorney.

JONATHAN A. GOODMAN