First and foremost, I would like to thank the LegalZoom trademark service for this article. I swear, the only good thing about LegalZoom is its uncanny ability to continually provide me with fodder to write about. Just when I think I have nothing interesting to talk about, LegalZoom swoops in to save the day!
I occasionally work as an independent contractor to another trademark attorney here in St. Louis and frequently assist her clients with a variety of intellectual property matters. She was hired by a client to respond to a trademark office action he received from the United States Patent and Trademark Office (USPTO) that requested some additional information and clarifications regarding his trademark and the products with which his mark is used. I later learned that this client had used the LegalZoom trademark service (which is a do-it-yourself trademark service and not a law firm) to prepare and file his trademark application. Of course, when he received this office action in his inbox, he had no idea what it was or how to properly respond to it.
The LegalZoom Trademark Service Fails Again
Trademark Ownership – Why Does It Matter?
This is probably a good time to give you some essential background information about trademark ownership and how it relates to trademark registration. The very first question on the trademark application asks for the “owner” of the mark. The owner of a mark may be an individual but, in many cases, the owner is a corporation or limited liability company (LLC) which has been legally organized under the laws of a particular state or country. For instance, the trademark COCA-COLA is owned by The Coca-Cola Company, which is a Delaware corporation. Not surprisingly, only the owner of a trademark may apply to register the mark with the USPTO. If the person or entity applying to register the mark isn’t the owner of the mark on the date the application is filed, the application is void and any resulting registration is void. Unfortunately, when an application is filed in the name of the wrong party, the mistake cannot be cured by simply amending the application or assigning it to the proper party. And, even worse, the filing fee submitted with the trademark application won’t be refunded.
When I’m hired by a client to prepare and file a trademark application, I usually ask whether he/she has already formed a corporation or LLC under which they are currently doing business or intend to do business. When the answer is yes, I then inquire as to the legal name of the entity and the state or country in which the entity is incorporated so that I’m able to properly identify the owner of the trademark on the application form. Having learned the hard way early in my career, I now always check the online corporate records (which are maintained by each of the 50 states and most countries) to make sure that the information provided by the client is accurate and complete. You would be astonished by the number of people who either don’t know the exact legal name of their corporate entity, or who thought they had formed a corporate entity but never completed all the steps or paid all of the necessary government fees.
Uh-Oh! The Owner Doesn’t Exist!
Now let’s return to the story. As I routinely do when a client comes to us with an already-filed application, I reviewed the application in its entirety and noted that it was filed in the name of an Illinois corporation. I then pulled up the Illinois Secretary of State’s website to make sure that the name of the corporation listed on the trademark application matched the legal name of the corporation in the Illinois corporate records. It did. Only problem was that the corporation was formed two weeks after the client had filed his trademark application using the LegalZoom trademark service. In other words, the corporation wasn’t even in existence on the filing date of the trademark application and, therefore, it could not logically have been the owner of the trademark. Clearly, this application was void the very second LegalZoom filed it with the USPTO.
The LegalZoom Trademark Service Doesn’t Verify Information
When I called the client to deliver the bad news, he admitted that he told LegalZoom that the corporation was the owner of the trademark. He thought he could put the trademark application in the name of the corporation since he would be forming it pretty much momentarily. Now, did LegalZoom do what any responsible and experienced attorney would have done and check the corporate records before filing the application? No. Even more to the point, did LegalZoom attempt to verify any of the information provided to it by the client in order to ensure that the application would be prepared with truthful and accurate information so that the client’s interests would be protected? Again, the answer is no. LegalZoom doesn’t think, ask questions, or make inquiries. The sole function of LegalZoom is to prepare documents in a machine-like fashion with whatever information is given to it. The LegalZoom trademark service is like a computer program; if you plug garbage in, it will spit garbage out. On the other hand, trademark attorneys know which questions to ask and which investigations to undertake in order to get the job done right the first time so that their clients’ interests are not prejudiced.
The Trademark Office Doesn’t Verify Information
Finally, some of you may be wondering why the USPTO didn’t reject the client’s application on the basis that it was filed in the name of the wrong party. Well, that’s because the USPTO doesn’t independently investigate whether the person or entity named as the owner of the mark is correct or, in this case, even exists. Unless there’s something else about the application that raises a red flag regarding ownership of the mark, the USPTO won’t question ownership. And what’s really scary is that, had I not caught this error and just responded to the office action, the client’s void trademark application would have matured into an equally void trademark registration. He would have been operating his business as if he had all the benefits and protections of a United States trademark registration when, in fact, he would have had none. This could have been disastrous for him had he ever wanted to franchise under the trademark or found himself either a plaintiff or defendant in a trademark infringement suit.
Using the LegalZoom Trademark Service is Risky
In conclusion, unless you care about me so much that you want to ensure that I have something to write about week in and week out, please stay away from the LegalZoom trademark service and encourage your friends, family, and colleagues to do the same.
I’m experienced US trademark attorney Morris Turek. As you can see, the LegalZoom trademark service poses unacceptable risks to trademark owners that fortunately can be avoided by working with a knowledgeable, trusted, and skilled trademark attorney with your unique interests in mind. If you would like to chat about your specific trademark matter, I encourage you to contact me directly at (314) 749-4059, through email at firstname.lastname@example.org, or by using my contact form (below). I look forward to the opportunity to work with you.
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