June 22, 2025
How Trademarks Build
Better CPG Businesses
Intellectual property (IP) refers to the legal rights granted to individuals or businesses for their creations, inventions, and unique ideas.
By Drew Smith
In a crowded and competitive marketplace, most CPG businesses now appreciate the importance of delivering a consistent and integrated brand message to their customers. However, in a rush to get products to market, many new businesses fail to confirm that their chosen business (or product) name is available or take the necessary steps to secure trademark rights to protect their investment.
This "run before walk" mentality can have serious long-term consequences. The Central Oregon business community is filled with cautionary tales of those who neglected to take proactive steps to secure their brand, only to face litigation or a name change after going to market.
Indeed, Atlas Cider (now Avid Cider), Justy's (now Lifty's), and Wildfire Brewing (now 10 Barrel Brewing) all faced legal challenges stemming from a failure to conduct conflict searching or secure trademark rights at an early date. When combined with advanced conflict or clearance searching, federal trademark protection offers a practical and cost-effective way for CPG businesses to safeguard their brand, leverage customer goodwill, and venture into new markets. The following presents a user-friendly overview of the substantial advantages of obtaining federal trademark protection with the United States Patent and Trademark Office (USPTO), with the aim of instilling a sense of security and confidence in your brand's future.
Strong Trademarks Protect and Grow Businesses
First, what is a trademark? By definition, a trademark is any word, name, symbol, or device that identifies the source of one's goods or services and distinguishes it from others. While a trademark (referred to as a “service mark” when used with services) typically combines words and/or logos, the definition is expansive, including colors, scents, sounds, motions, and package design. Simply put, a trademark conveys to customers the source of your goods and distinguishes them from others in the marketplace.
Although trademarks come in various forms, not all are created equal; strong marks have a greater scope of protection than weak ones. The strength attributable to a trademark is best visualized as a sliding scale, with strong marks being fanciful (KODAK for film), arbitrary (APPLE for computers), and suggestive (COPPERTONE for sunblock) on one side and descriptive (BEND BREWING CO.) and generic marks (APPLE for apples) on the other.
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Many local businesses are eager to incorporate "Bend" into their brand to associate themselves
with the beautiful place we call home - Bend Sauce, Bend Cider, Bend Health Guide, Bend
Breakfast Burrito... the list goes on. While well-intentioned, geographic terms should be avoided
because they describe where the goods/services originate and, therefore, are inherently
descriptive and weak trademarks. Descriptive brands are not eligible for federal trademark
protection unless the owner can demonstrate substantially continuous and exclusive use for five
years or more. Likewise, an owner of a descriptive brand will be entitled to a smaller scope of
protection, thereby making it more difficult to enforce their rights against another competing
business with a confusingly similar name.
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In short, CPG businesses should adopt a strong trademark at the outset, avoiding geographic indications or descriptive terms, to distinguish themselves from the competition and ensure that their business/products are entitled to protection against confusingly similar marks in the marketplace.
How to Acquire Trademark Rights
There are two routes by which a business can obtain trademark rights in the United States. First,
they can acquire "common law rights" simply by using a mark with goods in the marketplace.
These rights are automatic and arise from using the mark, but they are limited to the specific
geographic areas where the products have been sold or shipped.
Consequently, a Bend-based business relying on common law rights may not enforce its
trademark against subsequent users outside of Central Oregon and may be prohibited from
expanding into new markets if a similar mark is already being used.
The second and far more pre is to file rademark application with the United States Patent and Trademark Office (USPTO). A non-exhaustive list of the benefitsthat federal registration provides includes:
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Nationwide Rights
A federal registration grants a trademark holder the presumptive right to use and enforce its mark anywhere in the United States for the designated goods and/or services as of theapplication's filing date. This means you can prevent others from using a similar mark in anystate, not just where you're currently doing business.
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Constructive Notice
Federal registrations are publically available on the USPTO website, provide constructive
notice of ownership in a mark, and alert potential infringers of the liability associated with
using the same or similar mark.
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Federal Jurisdiction
A federal trademark owner can enforce its rights in federal court where judges are often more familiar with trademark matters and, if successful, may recover (1) any damages sustained, the infringer's profits, and (3) the costs of the action, with treble damages available for willful infringement.
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Transferable Property
A federal registration is a business asset that may be bought, sold, licensed, used as collateral, and shown to investors. Likewise, a prospective purchaser will want to verify the brand is secure and not subject to any collateral risk, thereby driving the valuation of your business upon exit.
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Incontestability Status
A federal trademark becomes "incontestable" upon reaching its fifth registration anniversary,
conclusively establishing ownership in the name of the trademark holder. Consequently, anentity with prior common law rights will be barred from challenging an incontestable federalregistration based on its prior marketplace usage, and its business expansion will be geographically frozen as of the date the incontestable registration was filed.
How to Protect CPG Brands Before Entering the Market
Trademark applications with the USPTO come in two forms. The first is a trademark application
filed by a business that has operated for months, if not years, before the application's filing date.
In this scenario, a business (think 900 Wall restaurant) would file a federal trademark application
based upon "actual use" and claim the date that it first commenced business (i.e., the date
associated with its common law trademark rights).
The second type is trademark applications filed under an "intent-to-use" filing basis (ITU). This is
ideal for a business that has confirmed that its preferred business/product name is free of conflicts
but has yet to go to market. If you're in this situation, you may want to consider filing an ITU
application. ITU applications are examined by the USPTO in the same manner as those filed
under actual use, with the only exception being that an ITU will be approved but will not mature
into an enforceable federal trademark until the applicant has commenced the sale of the
goods/services in question.
ITUs provide a constructive use priority date when the ITU application is filed with the USPTO and
allow a business upward of four years to launch its product. For example, if you were to file an
ITU trademark application today and wait to launch your CPG product for four years (or until
spring 2029), your nationwide trademark rights upon registration would post-date four years back
to today, the filing date of the underlying application. ITUs are also beneficial because the USPTO
examines applications based on the date they are filed, thereby giving an ITU applicant a leg up on
competition and mitigating the risk that a competitor will adopt or file an application for a
confusingly similar name before the CPG product goes to market.
The benefits conferred by ITU applications have real consequences in the marketplace. By way of
example, Atlas Cider opened its doors on May 1, 2013, and waited almost three years before it
filed an actual use trademark application for ATLAS CIDER CO. on February 17, 2016. The
USPTO refused Atlas Cider's application because a Washington D.C. brewery filed an ITU
application for ATLAS on June 4, 2012.
The reason? The brewery acquired nationwide priority rights to ATLAS as of the ITU filing date
(June 4, 2012) that predated Atlas Cider's common law, use-based rights to ATLAS CIDER CО.
(March 2013). In short, the brewery secured enforceable trademark rights because it filed an early
ITU application with the USPTO and not because it was first to market.
On June 1, 2018, Atlas Cider celebrated its fifth anniversary not by owning an incontestable
federal trademark, but by changing its name to Avid Cider.
The lessons of the Atlas Cider case study should not be overlooked. First, file an ITU application
early in the business planning stage and as soon as the name has been cleared for conflicts.
Second, trademarks do not need to be identical in appearance (ATLAS CIDER CO. vs. ATLAS) or
cover identical goods (cider vs. beer) for there to be a likelihood of confusion under USPTO and
federal case precedent. Finally, searching the USPTO register for conflicts, even for actual use
applications, is essential to properly assess the risk presented by a prior-filed ITU application or
registration. Failing to do so may have the unintended consequence of alerting the other party to
your trademark application when the USPTO issues a refusal upon examination, potentially
leading to the time and expense of litigation.
Take Home Considerations
Achieving success as a CPG brand depends on many factors, some of which are in your control
and others left to chance. Investing in early brand protection, including clearance of a preferred
business/product name for conflicts and the early filing of an ITU application before launch,
mitigates risk and offers an effective means to capitalize on consumer goodwill. Securing federal
trademark protection should be leveraged by any new or existing CPG business looking to expand
into new markets, whether across the street or across the country.
This article and its contents are for informational purposes only and do not constitute legal
or professional advice.
Drew Smith is the principal at Resonate IP, an intellectual property firm in Bend, Oregon that
specializes in all aspects of trademark representation, including brand counseling, clearance,
prosecution, and enforcement.