Q&A Trademarks

What Is Use in Commerce?

Use in commerce in U.S. trademark law boils down to two distinct requirements: (a) bona fide use in (b) federally-regulated commerce. Both must be satisfied to have federal rights in a trademark (or service mark).

Bona Fide Use

The first requirement pertains to what sort of use makes a mark eligible for federal trademark protection. The U.S. Patent & Trademark Office (USPTO) scrutinizes evidence of use by requiring “specimens”. U.S. trademark laws—which were amended in 1988 to be stricter about this point—say there must be “use in commerce”, which is a term given a special legal meaning.

“Use in commerce” means the “bona fide [that is, good faith] use of a mark in the ordinary course of trade and not made merely to reserve a right in a mark.” The way this applies to marks on goods versus services varies somewhat. And what is considered the “ordinary course of trade” will vary by industry. But the main point is that federal trademark rights require a connection to actual real-world use. Token uses, sham uses, or purely internal uses are not bona fide uses. So what sorts of uses are sufficient?

Use in commerce on goods occurs when two conditions are met. First, a mark must be placed on the goods or their containers, or on attached tags or labels, or displays associated with the goods. If the nature of the goods makes those kinds of placements impracticable, then use of the mark on documents associated with the goods or their sale qualify. Second, use in commerce on goods requires that the goods (bearing the mark) be sold or transported in “commerce”.

Use in commerce for services occurs when a mark is used or displayed in the sale or advertising of services and the services are rendered in “commerce”, or the services are rendered in more than one state or in the United States and a foreign country.

Note that these definitions for the first requirement are explicitly tied to the second requirement about federally-regulated “commerce”. But otherwise this first requirement can be summarized by saying that you have to actually be using a given mark directly in connection with meaningful commercial offerings of goods or services.

Federally-Regulated Commerce

The second requirement ensures that trademark rights fall with a type of commerce that can be federally regulated. In other words, federal trademark law is limited to certain types of commerce that the federal government is able to regulate as opposed to individual states (find out about the historical background of that requirement here). So in federal trademark law, “commerce” means only commerce that is interstate, territorial (in or with a U.S. territory), or between the United States and a foreign country or tribe. Activities that occur only within a single state on a localized basis often don’t meet that requirement.

Offering services via the Internet is considered use in “commerce”, because the Internet utilizes interstate communications networks. Services such as restaurant and hotel services are considered to be rendered in “commerce”—though courts have been inconsistent on this point historically. Also, intrastate use of a mark may qualify if of a type that would, taken in the aggregate, have a direct effect on interstate commerce. But goods or services offered only locally, entirely within one state, without a significant effect on interstate commerce, would not qualify for federal trademark protection.

Foreign trademark applicants can obtain a U.S. registration without first establishing use. This gives foreign trademark applicants more leeway than domestic U.S. applicants. This is partly because of international treaties the U.S. federal government has signed. But it is also because the federal government has special authority over foreign commerce. However, even foreign registrants must eventually establish use in commerce in or with the U.S. to maintain a federal registration.

The USPTO does not scrutinize the type of commerce when examining trademark applications. Instead, the USPTO presumes that use of a mark is of a type that is federally regulated unless there happens to be evidence to the contrary. It is the responsibility of the applicant and the applicant’s attorney to determine whether an assertion of use in commerce is supported by the relevant facts. So a failure of a use to be in federally-regulated “commerce” generally only comes up if a registration or application is later challenged on those grounds by someone in an opposition, cancellation, or court proceeding.

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Austen Zuege is an attorney at law and registered U.S. patent attorney in Minneapolis whose practice encompasses patents, trademarks, copyrights, domain name cybersquatting, IP agreements and licensing, freedom-to-operate studies, client counseling, and IP litigation. If you have patent, trademark, or other IP issues, he can help.