One of the most important reasons law firms run trademark clearance searches is to better understand the risk of the client trademark infringing on the rights of another trademark owner. Once a trademark is brought forth to the market, and is similar or slightly similar to another trademark that was in the market first, that creates confusion amongst consumers and can establish trademark infringement.

The Lanham Act of 1946 established what is known as "common law" trademark rights. Common law trademark rights are acquired automatically as soon as a business begins using a name or logo in commerce and are enforceable. The first to use the trademark in commerce, regardless if they have a registered trademark at the USPTO or not, has priority rights over the trademark. To demonstrate priority at common law, the trademark statute requires that the mark be used in the United States and not abandoned.

In TWO PESOS, INC. v. TACO CABANA, INC. the Supreme Court has held that “common ground that § 43(a) protects qualifying unregistered trademarks and that the general principles qualifying a mark for registration under § 2 of the Lanham Act are for the most part applicable in determining whether an unregistered mark is entitled to protection under § 43(a)."

Trademark owners can take legal action against a third party if they believe their trademark is being infringed upon. This is one of the main reason why law firms run trademark clearance searches.