Once you start conducting business, you are going to start running into the topic of intellectual property and trademarks. Understanding the role of a trademark will help you grasp why they are important.

A trademark is a unique form of intellectual property. Most intellectual property is created to protect the person or business creating it. A patent, for example, is designed to protect the inventor from having other parties use it without consent. Copyright works much the same way. A person who writes a hit song should receive compensation from it and copyright is designed to protect the person in this regard.

A trademark is unique because it performs two purposes. The first is similar to patents and copyrights. A trademark is a way for a person or business to protect a logo, etc., from the misuse by others. In truth, this is pretty much the underlying idea of most intellectual property. The only time a protected intellectual property right can be legally infringed upon is if the infringer pays a royalty or licensing fee for the right to use it.

Trademarks, however, also serve a secondary purpose. This purpose has its basis in something called public policy. Throughout the law, you will find guidelines that are set forth as a matter of public policy. These guidelines essentially are designed to help the general pool of consumers in some way.

With trademarks, there is a strong public policy supporting their establishment. The policy has to do with consumer confusion and the quality of products or services. When a consumer sees a trademark, they associate a company and level of quality with that mark. For instance, a person associates a certain cola drink with the "Coca Cola" trademark.

When a trademark is allegedly infringed upon, the court will evaluate the issue of whether the alleged infringement is such that it is likely to confuse consumers. If it is, then a ruling of infringement is more like. For instance, assume Reebok started selling a sneaker that had a swoosh similar to Nike. The swoosh, however, was vertical instead of horizontal. Nike would certainly file suit for trademark infringement claiming that the Reebok swoosh created confusion among consumers. It would also win!

When considering whether to trademark your logo, etc., you need to evaluate how it helps consumers identify with your product or service. The more distinct your mark, the better chance you have of both being approved for a trademark and then defending it against competitors.