Does a state registered trademark supersede a federally registered trademark?

Does a state registered trademark supersede a federally registered trademark?

A trademark is something that a producer of a product uses to distinguish its products from the competition.  Traditionally a trademark is thought of as a word, phrase or symbol, however just about anything that functions as a source identifier can be eligible for trademark protection.  In the United States trademark law gives the first person to use a trademark to brand goods priority over subsequent users of a trademark.  This means that the senior user of a trademark can exclude subsequent users of a trademark from using the trademark in a way that is likely to consumes consumers. When a trademark is used, by someone other than the senior user, in a way that is likely to confuse consumers into thinking that the senior produced the product, that can be considered trademark infringement.

Trademark law in the United States is composed of federal statutes, state laws and common law principles.  The main federal trademark statute is the Lanham Act, was most recently amended in 1996.  Federal law provides the most extensive source of trademark protection although state law trademark actions are still available.  This complex frame work of different laws can sometimes create conflicts.  Generally, both state and federal law follow the principle that the first user of a trademark has priority over later trademark users.  Registration of a trademark is a way to strengths the rights associated with a trademark but is not required to being using a trademark or gain a claim to a trademark.  The United States Patent and Trademark Office maintains a federal register of trademarks and many states maintain their own trademark register.  However, registration of a trademark does not guarantee the registrant immunity from liability for trademark infringement.

The United States Patent and Trademark Office performs a search during its trademark registration process, and rejects applications that are confusing similar to trademarks which are already registered.  Many states do not perform such a search, trademark applications are accepted without any scrutiny.  A trademark user that has registered their trademark with a state and believes that givens them an unfettered right to use the mark would be mistaken.  The senior user of a trademark has priority over junior users.

The Pennsylvania State University v. Parshall, 4:19-cv-01299 (M.D.PA 2019) is a case that touches on the conflict between trademarks registered with a state and the federal trademark register.  The plaintiff in this case is a world renowned University that sells many different products to promote itself.  The plaintiff uses the trademarks PENN STATE and NITTANY LIONS on its products and licenses the trademarks to other producers.  The plaintiff has been using the trademarks since 1908 and 1984 respectively.  The plaintiff’s marks are federally registered.

The defendant in this case is the owner of a brewery.  Defendant advertises itself as an intellectual property holding
company consisting of a portfolio of sports trademarks, registrations and service marks for sports teams throughout the United States.  Two of the trademarks the defendant claims to own are PENN STATE NITTANY BREWING, PENN STATE NITTANY BEER.  The defendant claims ownership of the marks by virtue of a trademark registration with the Pennsylvania Secretary of States.  The defendant claims to have been using the trademarks since 2016 in the state trademark application.

The plaintiff filed suit against the defendant for trademark infringement.  In its complaint the plaintiff alleges that the defendant’s business model revolves around getting famous trademarks registrations at the state level and then claiming ownership of those trademarks.  The plaintiff seeks the cancellation of all the defendant’s state trademark registrations and damages for willful trademark infringement.  While the defendant has not answered the complaint yet, it is difficult to see a winning legal argument to the plaintiff’s complaint.  The lesson to be learned from this case is registration of a trademark is not a golden ticket.

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