Given the favorable environment in China and in some other foreign countries, many U.S.-based companies elect to have products manufactured abroad for eventual sale in the United States. If, however, the products are branded with a trademark during the manufacturing process, the U.S.-based company may wish to take additional steps to ensure they are not inadvertently infringing trademark rights in the foreign country.
For example, if a trademark applied during the manufacturing process is seen to function as an identifier of the source of the goods in the chain of production, then the application of the trademark during manufacture might be viewed as actual use of the trademark in the foreign country. This situation has occurred in China, for instance. If use of the trademark during manufacturing is seen as actual use of the trademark, and if there is a previous registration in that country for a similar trademark, then the U.S.-based company may find themselves inadvertently infringing the foreign trademark.
For this reason, it may be important to clear and perhaps register trademarks in foreign countries if the trademarks will be applied to products during manufacture overseas.
Of course, the strategy will depend on the particular facts and circumstances of the situation. So, if you are manufacturing overseas and having the factory apply your trademark to your product, one of our experienced trademark attorneys can help you navigate the complexities.