Part of building a successful business is developing a recognizable brand. Whether you run a large corporation in a major city or a mom-and-pop shop in a small town, success often hinges on the ability of consumers to easily identify a business with great products and services. This is one reason that trademark law is important. Businesses often protect their names or logos by registering them as trademarks; this protects other businesses from using the same name for their products or services, and piggy-backing off of the positive brand you have built.
Trademarks, however, can sometimes result in problems for businesses that mean no harm. A restaurateur in North Jersey recently learned this the hard way when he opened a restaurant in Wyckoff and named it Serafina, after his mother. A couple of months after opening, he heard from the owners of Serafina Restaurant Group in Manhattan that he was infringing on their trademark.
When this restaurant owner selected the name Serafina, he reportedly thought that he did due diligence. His accountant told him that "Serafina Restaurant LLC" was available in New Jersey, but he later found that there was actually a federal trademark on "Serafina" owned by the Manhattan company.
He ended up deciding to change the name of his restaurant to La Sera, and this cost him thousands of dollars not including the lost business; when restaurants change their names and signage, people often assume the restaurant changed hands and this results in a loss of customers.
While being forced to change a business's name or logo is an expensive hassle, one can understand why trademark holders protect their trademarks. It is generally not good for one's business to have another company, in the same industry, using the same name.
In order to avoid being hit with a trademark infringement claim, business owners can check national trademarks on usptov.gov as well as work with a business planning attorney to ensure they are in the clear. When it comes to branding and trademarks, putting the effort and time into planning during the beginning can prevent costly battles later.
Source: NorthJersey.com, "Trademark battles put tension on the menu," Bill Ervolino, March 31, 2013
- Our law firm in Montclair, New Jersey, provides legal representation to businesses both in business formation and planning as well as business litigation.