NannyPay Or NaniPay – What’s the Difference and Why Should We Care?


A recent article in the legal press described a trademark battle between two small companies:

“A trademark battle has erupted between the maker of NannyPay and the maker of NaniPay, two companies that offer solutions for the problem of how to pay a nanny and comply with the law.  Company 1, the user of NaniPay, sent a cease-and-desist letter to Company 2, the user of NannyPay, saying that it must stop using the term NannyPay for its software or face a lawsuit from Company 1. But instead of ceasing its use, Company 2 decided to win the race to court. It filed suit seeking a declaratory judgment that its NannyPay trademark does not infringe on Company 1’s NaniPay mark.”  Cyberlaw Archives.

Company 1 thought it could bully the little software company into giving up its registered trademark but Company 2’s rapid response paid off; and the case settled in the software company’s favor. The legal battle was unavoidable. Both Company 2 and Company 1 understood that the similarity between the two trademarks could confuse their customers, which would ultimately affect each company’s profitability. Both took steps to protect these valuable assets. Company 2 registered its trademark with the United States Patent and Trademark Office (“USPTO”) long before the lawsuit; and while Company 1 had neglected to do so (a costly mistake), it retained a law firm to demand Company 2 to cease and desist using the mark “NannyPay.”

Clearly, trademarks and service marks are worth protecting and may be among your business’ most valuable assets. How do you identify a trade or service mark? Easy – they are the names, images, or phrases that identify your product or service and make customers think of you when they hear or see the mark. When you think of a trademark you may immediately think of “Coca-Cola®”, “Kodak®”, or “Windows®” but your mark does not have to be famous to be valuable. Think of the consequences of someone stealing your trade or service mark and marketing it as their own – ouch! As I have tried to convey, lawsuits are made of that stuff. Also, imagine the consequences of using a trade or service mark that someone else owns – even more fodder for lawsuits. If you have a trade or service mark, determine whether anybody else is using it. If not, register it with the USPTO. Registration is important because it serves as evidence that you owned your mark first and provides statutory damages should you sue for infringement. Remember, however, if you go to the trouble and expense of registering your trademark, you must monitor it. Search the Internet regularly, and check your trade journals, newspapers and other publications and make sure no one is infringing it. Also, don’t put your registered trademark away for a rainy day. A trademark must be used in commerce and failure to use it can be deemed abandonment.

Here are ten reasons why you want to register your trademark. They have been widely published but worth repeating:

1. TRADEMARK SEARCH. Before registering your mark, your attorney will make sure a thorough trademark search is performed to determine whether anybody else may be using the same or similar mark.

2. PRINTING COSTS. If you don’t register and you find out later that another company already has the same or a very similar name, you will have to redo all of your business cards, stationery, advertising, and signs.

3. LOST CUSTOMERS. If you have to change your business name because you later find out that someone else is already using it, you could confuse and lose your customers.

4. EXCLUSIVE USE. Registering your mark gives you the exclusive right to use it within the relevant geographic area. 5. OPTION TO EXPAND. You could lose the right to expand outside the original business area if you do not register your trademark.

6. PRESUMPTION OF OWNERSHIP. Anyone else who uses your registered mark will be presumed to be a willful infringer, and you could be entitled to monetary damages as a result of the infringement.

7. STATE LAW PROTECTION. Some states’ laws provide additional protection in an infringement action if the mark is registered with the state.

8. FEDERAL PROTECTION. Federal registration serves as constructive notice to the rest of the country that you are the owner of the mark, even if you do not yet do business nationally.

9. LIABILITY TO REGISTERED OWNER. If you do not register and there happens to be a registered owner of the same or a substantially similar mark, that owner will have an indefinite period of time to find you and sue you for infringement.

10. MONEY, MONEY, AND MORE MONEY. If you have infringed on someone else’s name or mark, you may be ordered to rename your company immediately; give up all profits earned by the use of the unregistered mark; and pay other damages, including punitive damages, fines, and attorneys’ fees.

Think about these points as they relate to your business.


Source by Adam G. Garson, Esquire

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