Protecting Your Brand Name from Trademark Pirates

File early. This doesn’t just apply to US trademark applications, which are handled on a first-come, first-served basis. File early in other countries, too. Otherwise, you might have your trademark hijacked.

The US is a “first to use” jurisdiction. This means that whoever first uses a trademark in US commerce has priority, regardless of whether the mark is registered with the U.S. Patent and Trademark Office.

Most other countries are “first to file” jurisdictions. This means that whoever files a trademark application first has priority, regardless of whether the mark is being used by someone else.

China is the most notorious “first to file” jurisdiction. It is not unusual for Chinese applicants to monitor new US trademark application filings and file corresponding Chinese applications. Then, when the unsuspecting US applicant enters the Chinese market, they are met with a demand for payment.

Even famous brands aren’t immune to these tactics. In 2006, Chinese businessman Zhan Baosheng registered the TESLA trademark in English and Chinese before Tesla entered the Chinese market. When Tesla began operations in China, Zhan sued the company for trademark infringement, seeking to halt its sales and demanding compensation. In 2014, Tesla announced that it had “completely and amicably” resolved the dispute with Zhan, leading to the cancellation of the contested trademarks and the transfer of related domain names to Tesla.

So if you anticipate China being an important market for your business, file a Chinese trademark application as early as possible. Otherwise, you might be the target of an extortion attempt.