What Does a Trademark Protect?

A trademark protects the goodwill a company or brand has built surrounding themselves as a source of goods or services by establishing intellectual property rights in any word, phrase, and/or design that serves to identify the source of the product or service in the eyes of consumers. Holding the rights in a trademark prevents others from using the mark in relation to those applicable goods or services. This allows the company or brand to avoid any lost sales, unfair competition, and dilution or smearing of its good name.

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A trademark is any word, phrase, and/or design that serves to identify the source of the product or service in the eyes of consumers. Although, they can also be a sensory mark such as a color, sound, or even a scent, that—due to its distinctive use—becomes a symbol of a company, product, or service.

These phrases, designs, and more, become powerful tools for brands as they seek to establish themselves as a reputable source and distinguish themselves from others providing similar goods or services. Accordingly, protecting these source identifiers through trademarks is invaluable to a brand.

Brand Goodwill

As consumers, we grow to rely on the authority of trademarks that identify specific brands. Thus, brands work hard to establish their trademarks in the marketplace and build the appropriate goodwill needed to operate. But there are those who leech off the work of these brands and use their established trademarks to confuse consumers into thinking there is some affiliation with the established brand. This allows the infringers to capitalize on the established brand’s hard-earned goodwill.

By allowing recovery for willful infringement, the Lanham Act protects trademark owners’ established goodwill against these brand thieves by allowing for injunctive relief as well as monetary damages. Specifically, included in the calculation of actual damages is loss of a brand’s goodwill (determined by comparing the value of goodwill before and after the infringement).

Lost Sales and Licenses

Trademark infringement damages include disgorgement of the infringer’s profits, actual damages, and reasonable royalties, among other things. In the Lanham Act allowing for these monetary recoveries, trademarks also protect against the loss of profits due to stolen sales and any revenues lost from potential royalty payments.

A brand seeking to protect the hard-earned goodwill associated with its products or services should ascertain qualified counsel to assist in the protection of its intellectual property rights through proper trademark enforcement and maintenance.

For more information on trademarks and intellectual property in general, see our trademark services and intellectual property practice pages.

Klemchuk PLLC is a leading IP law firm based in Dallas, Texas, focusing on litigation, anti-counterfeiting, trademarks, patents, and business law. Our experienced attorneys assist clients in safeguarding innovation and expanding market share through strategic investments in intellectual property.

This article is provided for informational purposes only and does not constitute legal advice. For guidance on specific legal matters under federal, state, or local laws, please consult with our IP Lawyers.

What does a Trademark Protect? Answering IP Law FAQs