Businesses often make the mistake of assuming that once they acquire a federally registered trademark, they are protected. But having a federally registered trademark does not automatically protect the mark. The use of a trademark has to be “policed” – that is, the trademark owner is obligated to locate and investigate unauthorized uses of the mark. By not doing so, the owner risks losing the mark altogether.
Trademark law places the burden of policing a mark on the owner. While a trademark owner need not pursue every infringing use of its trademark, the owner must pursue infringers to the extent necessary to ensure that the mark does not lose its distinctiveness and does not become diluted by widespread use. From a business standpoint, widespread use of the same or similar marks adversely affects the perception of consumers. When consumers lose the sense that certain goods or services connected with a mark all come from the same source, the mark can become generic or be considered to have been abandoned.
It is important to police a mark to avoid losing the protection given under the law. “If a ‘trademark’ symbol is used as a generic name of a product or service, it ceases to function to identify a single source of that generic thing . . . . Sometimes a mark becomes abandoned to generic usage as a result of the trademark owner’s failure to police the mark, so that widespread usage by competitors leads to a generic usage among the relevant public, who see many sellers using the same word or designator.” Thomas McCarthy, McCarthy On Trademarks And Unfair Competition § 17:8 (2007).
Even an incontestable mark may be lost: “Indeed, an incontestable mark may be deemed abandoned when the registrant licenses the mark and fails to police the license. See Warner Bros. Inc. v. Gay Toys, Inc., 724 F.2d 327, 334 (2d Cir.1983).” A defendant bears a “high burden of proof” to show abandonment through failure to police. Warner Bros., Inc. v. Gay Toys, Inc., 724 F.2d 327, 334 (2d Cir.1983). The law is clear that “a trademark owner’s failure to pursue potential infringers does not in and of itself establish that the mark has lost its significance as an indicator of origin.” Exxon Corp. v. Oxxford Clothes, Inc., 109 F.3d 1070, 1080 (5th Cir.1997) (citations omitted). Where, however, a party can show that widespread use of similar designs has resulted in a “loss of trade significance,” the defense of abandonment is made out. See id.
The importance of policing a mark cannot be overstressed. It makes no business sense to go to the time and trouble of developing a brand and having it registered, only to have it lost when others use the same mark without consequences.