Companies give branded clothing items to their employees to wear during the performance of their job. Make the branded clothing stylish enough and the employee may just wear it out socially as well. Brand extensions are helpful to increasing the conceptual strength of the mark, so being able to extend a brand to clothing or anything else can be a positive thing. Unfortunately, giving branded clothing to employees will likely not extend your brand to clothing because it likely does not qualify as transport in actual trade.
Trademark rights are based on use of the mark in commerce, and for use to be sufficient to establish trademark rights it must: (1) be a bona fide use in the ordinary course of trade; and (2) not be merely for the purpose of reserving rights in a mark. The use must a genuine commercial use as opposed to use solely for the purpose of establishing trademark rights. Accordingly, whether use is genuine is based on what is a typical commercial use within the relevant industry.
Commercial use does not mean that a sale must occur. A mark is used in commerce in connection with goods when the goods are sold or transported in commerce. For a sale or transport to qualify as use in commerce it must be: (1) in actual trade; and (2) lawful. And in the case of transport as the basis, the use must also be: (a) of a finished product; and (b) open and public to actual consumers of the goods.
Transport of a good in actual trade means the good must benefit and have independent value to others, and cannot be an item that is transported incidentally in connection with other primary goods and services. Goods that are incidental to other primary goods and services: (1) are useful only in connection with a primary good or service; (2) are inextricably tied to a primary good or service; and (3) lack independent value.
Branded clothing given to employees is connected to the primary purpose of the business. It is incidental to the primary purpose of the business. Generally, the branded clothing is useful only in the performance of the employee’s job. And, generally, it lacks independent value. Branded clothing given to employees functions more like advertising or promotional material, which is insufficient to establish trademark rights for goods.