Believe it or not, the answer is yes.
Although the United States is a first use in commerce jurisdiction, filing early does give you some benefits.
Say, for example, a company uses a trademark in commerce in Ohio for twenty years, but never filed an application to obtain a federal registration.
In the meantime, a competitor in California begins using that same trademark for the same or similar goods and services and files an application for federal registration. If the California user gets a registration prior to the Ohio user, even though the Ohio user was first, the federal registration may freeze the Ohio user’s rights of any future expansion beyond its current territory.
The Ohio user may consider initiating a concurrent use proceeding before the Trademark Trial and Appeal Board where it could argue priority and hash out a geographical territory. It’s possible that both companies would obtain a trademark registration limited to their particular region.
Cases vary on how large that territory will be. It could include a large territory of multiple states, a single state, or a 20 mile radius, for example.
Depending on how big the Ohio user’s market is, it could potentially sue the California user for infringement of the Ohio user’s unregistered mark. However, mere existence on the Internet is not yet recognized as creating a national territory, so the Ohio user would need to establish that it actually had a market in California.
There are also ways the companies can amicably agree to coexist. In situations that do not become adversarial, a trademark attorney can draft and negotiate a consent agreement. A consent agreement can also help overcome a likelihood of confusion office action if all sides—including both users and the USPTO—can agree.
The moral of the story here is to file for federal protection as early as possible. Although failing to do so doesn’t strip you of all options, protection can become more time-consuming and expensive than if you had just filed early.
Please note that the information contained in this article is intended for general informational purposes only and not as specific legal advice. The facts of your situation may differ from this general information. It is not intended to and does not in any way establish an attorney-client relationship.
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