Goodwill

Goodwill refers to the intangible value provided by a business' products or services. The value of goodwill arises almost exclusively from the reputation of the products and services in the eyes of the public. A positive goodwill will lead consumers to continue to use those products and services and to recommend those products and services to others.

Goodwill is one of the primary elements of value protected by a trademark. Without the protection afforded through the appropriate trademark registration, other entities could sell similar if not identical products or services to capitalize on the goodwill in the marketplace. In addition, if the similar products or services are of an inferior quality to the original, they could actually undermine the goodwill of the original product or service, thus robbing the owner of the financial value or rewards associated with the goodwill established by the owner.

Likewise, when another individual or entity infringes on a trademark, the concern is typically that the infringement could undermine the goodwill of the trademark holder, either by using that goodwill for financial gain or by reducing the amount of goodwill associated with the product or service in the marketplace.