Category: Trademarks

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Use Your Trademark Consistently or It Will Be Weak: WD-40 in the Crosshair

Most damaging to Sorensen’s argument regarding this factor is his inconsistent use of the crosshair [trade]mark. – Seventh Circuit Court of Appeals.

Sorensen_v_WD-40_CrosshairIn 1997, Jeffery Sorensen founded a company and began selling rust preventive products under the trademark THE INHIBITOR. Sorensen claimed trademark rights in THE INHIBITOR mark and common law trademark rights in the Sorensen Crosshair provided on some of his products, shown to the right.

In 2011, the WD-40 Company, began selling WD-40 Specialist Long-Term Corrosion Inhibitor for a similar purpose. The WD-40 product contained the same volatile corrosion inhibitor as Sorensen’s product.

Sorensen sued WD-40 for infringing THE INHIBITOR and crosshair trademarks in the case of Sorensen v. WD-40 Company, No. 14-3067 (7th Cir. June 11, 2015). But he lost on all counts.

While its not the only reason that Sorensen lost on his claim that WD-40’s crosshair infringed Sorensen’s crosshair, one factor in the defeat was the fact that Sorensen did not use the crosshair consistently across his products and marketing.

The consistent use of a trademark is very important to maintaining its strength. Trademark strength is one factor in determining whether there is a likelihood of confusion between two marks and therefore infringement. If you have a weak trademark you will have a harder time asserting infringement against similar marks.

In the WD-40 case, the court stated:

Inconsistent use makes a symbol less helpful to consumers as a source indicator, and therefore a weaker mark.

The court noted that Sorensen’s products, shown in the image below, provided evidence of inconsistent use of the crosshair. The court stated, “Sorensen’s crosshair has been used since 1997, but inconsistently–sometimes the crosshair has symbols in each quadrant, sometimes the quadrants are empty, and many times there is no crosshair at all, but rather a bull’s eye.”

Sorensen_v_WD-40_InhibitorProductLine

The court concluded that the inconsistent use of the crosshair mark weighed in favor of WD-40. This, together with other factors, ultimately led the court to find the WD-40 did not infringe Sorensen’s crosshair trademark.

To strengthen your trademark rights ensure consistency in all usage of your trademark. It is best to use the same capitalization, the same font, and the same color scheme for a given trademark for maximum consistency.

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Illinois State Trademark Registration Does Not Grant Rights Throughout the State

Steak_and_Brew_trademarkSteak & Brew, Inc.’s predecessor owned an Illinois trademark registration on STEAK & BREW and operated a restaurant under the STEAK & BREW mark in Peoria, Illinois up to the fall of 1971. In April of 1971, Beef & Brew Restaurant, Inc. opened a restaurant under the name BEEF & BREW in Rock Island, Illinois.

Steak & Brew sued Beef & Brew alleging Beef & Brew infringed its Illinois State trademark registration, but lost in the case of Steak & Brew Inc. v. Beef & Brew Restaurant, Inc., 370 Supp. 1030 (S.D.Ill. 1974).

Steak & Brew lost not because the word “Steak” is different from the word “Beef” in the respective marks. But it lost because of the counter-intuitive principle that an Illinois state trademark registration does not grant the registration owner exclusive rights to use the trademark throughout the entire state of Illinois. This is in contrast to a federal trademark registration, which does create a presumption of exclusive rights throughout the nation.

Illinois State Trademark Registration Worthless Against a Federal Registration

Previously I discussed the case of Burger King of Florida Inc. v. Hoots, 403 F. 2d 904 (7th Cir. 1968), which demonstrated that an Illinois state trademark registrations is subordinate to a federal trademark registration. In the Burger King case, the Hoots were the first to use its Burger King mark in Illinois, but Hoots’ Illinois state trademark registration was essentially worthless against the Burger King of Florida’s federal trademark, even where that federal registration was obtained after Hoot’s started using the Burger King mark in Illinois.

The court refused to accept the argument that the Hoots’ Illinois trademark registration entitled them to rights throughout the state when they were only using the mark in and around Mattoon, IL.

The Illinois state registration will not insulate against claims of infringement made by the owner of a federal registration nor will it block third parties from moving into the state using your mark in areas of the state where you are not operating/selling.

Geographic Scope of Illinois State Registration: Area of Use, Not Entire State

In the Steak & Brew case, the Illinois trademark registration owner operated in Peoria, Illinois and the defendant operated its restaurant 100 miles away in Rock Island, Illinois. The Steak & Brew court stated, “[The Plaintiff’s] registration of the ‘Steak & Brew’ mark simply does not bar the innocent adoption and use by the defendants of a somewhat similar name embracing the word ‘Brew’ in the Quad-Cities area where plaintiff’s mark has never been used.”

Therefore, the court stated that the Illinois trademark registration does not grant rights in geographic areas where you are not using the mark. This is counter-intuitive. One would think that an Illinois trademark registration would give the owner rights throughout the entire state, but it does not.

No Geographic Scope Beyond Common Law Rights

At common law, a business obtains rights in the trademark simply by being the first to use the trademark in the business to identify goods or services in a particular geographic area. An Illinois state trademark registration only gives you the geographic scope of trademark protection that you would already obtain under the common law by simply using the trademark without registration.

The trademark act effective in the Steak & Brew case is different from the current act in Illinois, but the result is the same. The current Illinois Trademark Registration and Protection Act (Illinois Trademark Act) provides a protection of common law rights: “Nothing in this Act shall adversely affect the rights or the enforcement of rights in marks acquired in good faith at any time at common law.” 765 ILCS 1036/80.

The “at any time” language must mean rights acquired under the common law either before or after an Illinois registration is granted.

Therefore, under the common law, the defendant Beef & Brew Restaurant would begin to build up rights in the BEEF & BREW mark simply by operating its restaurant under that name in Rock Island. As the plaintiff only operated far away in Peoria, its rights would not extend to Rock Island under the common law. This is true even though the plaintiff obtained its Illinois registration before the defendant began operating in Rock Island.

The plaintiff’s Illinois state trademark registration could not be used to stop others in remote geographic areas within the state from using the same or similar mark for the same or similar services.

Benefits of Illinois State Trademark Registration

The Illinois Trademark Act provides for an award of treble monetary damages in the case of willful trademark infringement, which is not available to unregistered marks under the federal Lanham Act. 765 ILCS 1036/70. However, it is often difficult to prove willfulness in a trademark infringement suit. And if litigation under the Illinois Trademark Act is similar to that under the Lanham Act, the statistical likelihood of obtaining an award of money damages at trial is low.

Federal Registration Generally Preferred

An Illinois state trademark registration is inexpensive but provides few benefits. The state registration does not grant exclusivity within Illinois. And the state registration is subordinate to federal trademark registrations. Therefore if you’re interested in broad protection of your trademark you should consider filing a federal trademark application if your circumstances allow.

 

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Lapse of Trademark Registration is Not Abandonment of All Trademark Rights

CrashDummiesYou search the trademark database at the USPTO and find that your competitor’s trademark registration was canceled because the competitor did not file renewal documents and fees. You jump at the chance to grab their trademark by filing your own trademark application on their mark. Did you succeed in grabbing up rights in their trademark? Not necessarily.

Common law trademark rights can be obtained by use of the trademark in business/commerce alone without a federal registration. Therefore lapse of a trademark registration does not automatically result in a loss of all trademark rights.

This principle is demonstrated in the case of Crash Dummy Movie, LLC v. Mattel, Inc., 601 F.3d 1387 (Fed. Cir. 2010).

Crash Dummies Fight

Mattel owned a trademark registration on CRASH DUMMIES for toys. Mattel acquired rights in the CRASH DUMMIES trademark when it acquired Tyco in 1997. In December of 2000, the USPTO cancelled Mattel’s registration on CRASH DUMMIES because Mattel did not file the required trademark renewal documents and fees.

On March 31, 2003, The Crash Dummy Movie, LLC (“CDM”) filed an intent-to-use trademark application on CRASH DUMMIES for games and playthings.

Mattel filed an opposition against the CDM’s trademark application based on Mattel’s common law rights in the mark CRASH DUMMIES. CDM claimed that Mattel abandoned its trademark rights in the mark.

Registration Lapse is not Abandonment

The Court stated, “Although Mattel later allowed its trademark registrations to lapse, cancellation of a trademark registration does not necessarily translate into abandonment of common law trademark rights.”

As explained in prior abandonment posts here and here, a trademark is abandoned if (1) its use in commerce has been discontinued (2) with no intent to resume use. The Lanham Act provides “[n]onuse for 3 consecutive years shall be prima facie evidence of abandonment….” 15 U.S.C. § 1127. This means that after three years of nonuse there is a presumption that the mark has been abandoned.  But, the trademark owner can rebut that presumption by presenting evidence that during the three years the owner formulated an intent to resume use of the trademark in commerce.

Presumption of Abandonment and Rebuttal Evidence

Abandonment depends on trademark use and owner intent and not on registration alone. In the Crash Dummy Movie case, the presumption of abandonment attached because Mattel did not use the CRASH DUMMIES mark for more than three years beginning in December 1995 and ending in December 2003 (8 years) when Mattel made a shipment of CRASH DUMMIES toys.

But Mattel was able to rebut the presumption of abandonment and maintain its ownership of the mark by presenting evidence that Mattel intended to resume use of the mark during the first three years of non-use. That evidence included: (1) Mattel’s discussion with KB Toys in 1998 about them being the exclusive retailer of CRASH DUMMIES toys, (2) Mattel recorded trademark assignment in 1998 transferring ownership of the CRASH DUMMIES mark from Tyco to Mattel, and (3) research and development activities by Mattel from 2000 to 2003 regarding CRASH DUMMIES toys.

Looking at the Trademark Database is Not Enough

The Crash Dummy Movie case demonstrates that the failure to renew a trademark registration does not automatically result in abandonment of all the owner’s trademark rights. The trademark owner may still have common law trademark rights based on their ongoing use or intent to resume use of the mark.

Therefore, simply looking at the status of a registration in the USPTO trademark database will not tell you conclusively whether a trademark owner has abandoned all rights in the trademark. You will need to perform due diligence to gain reasonable assurance that the trademark owner has (1) stopped using the mark in business/commerce and (2) does not intend to resume use.

Determining the trademark owner’s intent is often not easy. So grabbing up an apparently dead trademark of another will likely carry some risk that the trademark owner has not abandoned all of its trademark rights.

8 Years of Non-Use Not Too Long

The risk that the owner has not abandoned all rights may reduce as the period of non-use grows over time. However, Mattel did not use its CRASH DUMMIES mark for 8 years from 1995 to 2003 and still retained its trademark rights based on its activities showing intent to resume use as explained above.

Risks If Trademark Rights Not Abandoned

If the original trademark owner has not abandoned all of its trademark rights, the owner might be able to sue you for trademark infringement based on your use of the mark and/or may oppose your registration of the mark as Mattel successfully did in the Crash Dummy Movie case.

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Reviving Dead Brands of Others: Trademark Windfalls

DURAFLAMEKingsford-Clorox owned the trademark Duraflame for artificial firelogs. Kingsford-Clorox decided to get out of the firelog business and wanted to write off the goodwill associated with the Duraflame mark for accounting purposes. So it published a notice in the Wall Street Journal announcing the abandonment of the Duraflame trademark effective on the date of publication.

Two companies scrabbled to grab the Duraflame trademark, which resulted in the case of California Cedar Products Co. v. Pine Mountain Corp., 724 F.2d 827 (9th Cir.  1984). California Cedar won rights in the Duraflame mark because it was the first to use the Duraflame trademark after the mark was abandoned.

WindFall of Goodwill in Picking Up an Abandoned Trademark

When one company abandons a trademark, any other person or entity can grab the abandoned trademark through use or by filing an intent to use trademark application. The new person or entity picking up the trademark will receive a windfall of goodwill associated with that trademark.

Assuming the trademark is associated with a favorable reputation, the new trademark owner will gain that goodwill for essentially no cost, other than the cost of using the mark to make a sale or render service.

California Cedar acquired a windfall of goodwill associated with the Duraflame brand simply by being the first to use the mark after it was abandoned.

Problems in Reviving Abandoned Marks: You Don’t Know Its Abandoned

Why not go around grabbing up abandoned brands? You can, but the difficulty is knowing for certain that trademark is abandoned.

A trademark is abandoned if (1) its use in commerce has been discontinued (2) with no intent to resume use. The Lanham act provides “[n]onuse for 3 consecutive years shall be prima facie evidence of abandonment….” 15 U.S.C. § 1127. This means that after three years of nonuse there is a presumption that the mark has been abandoned.  But, the trademark owner can rebut that presumption by presenting evidence that during the three years the owner formulated an intent to resume use of the trademark in commerce.

Determining whether the the trademark owner has an intent to resume using the mark is difficult. This is why it is possible, but often risky, to attempt to resurrect a trademark mark that appears to no longer be in use.

California Cedar Products Co. represents the easy case is where the trademark owner publicly announces the abandonment of the mark. However, this rarely happens.

It is more common for a company or entity to stop taking action publicly, e.g. stop selling in retail, stop updating a website, stop attending tradeshows, etc. These things may indicate that the company has stopped using the mark. But you can’t be sure. These things do not tell you (1) whether the company has in fact stopped selling, maybe the company is still using the mark to serve at least one customer, or (2) whether the the owner has an intent to resume using the mark if the owner has actually stopped using the mark.

Out of Business

Even when a company goes out of business or looks like it is out of business this is no guarantee that its trademarks are abandoned.

If the trademark owner goes out of business, it is possible that the trademark owner could transfer its assets, including the trademark, to another company. That receiving company would then have rights in the mark as long as the gap in trademark use is not too long.

Abandonment uncertainty is illustrated by the case of Specht v. Google, 758 F.Supp.2d 570 (N.D. Ill. 2010), aff’d, 747 F.3d 929 (7th Cir. 2014). As discussed in my prior post, Specht and his companies ADC and ADI abandoned the trademark rights in ANDRIOD DATA after ADI/ADC stopped using the Android Data mark in 2002 when ADI lost all of its customers and essentially went out of business. Google then picked up rights in ANDRIOD when it launched its mobile operating system in 2007.

Google’s rollout of ANDROID in 2007 was somewhat risky because at the time ADI owned a federal registration over the mark ANDROID DATA, and ADI/ADC maintained a website at androiddata.com. The website did not offer any price information about the Android Data software and was mostly purposeless. These uses were not enough to keep ADC/ADI’s trademark rights alive.

While Google was ultimately successful, Google did not know for sure that Specht and his companies had abandoned the ANDRIOD DATA trademark until Google obtained internal documents and information from Specht during the lawsuit.

Bankruptcy

If the trademark owner goes into bankruptcy, the trademark and associated goodwill can be sold off to satisfy debts of the owner. The entity receiving the trademark as a result of bankruptcy will then have rights in the mark as long as the gap in use of the mark was not too long.

Conclusion

You can gain a windfall of trademark goodwill by adopting an abandoned trademark. The problem is that it is usually difficult to determine whether the trademark is actually abandoned. A long passage of time may give an increased assurance of abandonment.

However, to be sure the mark is abandoned, it is best to have an express statement of abandonment, as happened with the Duraflame trademark. Yet, this rarely happens.

If an express statement of abandonment is not provided, then extensive due diligence is necessary to gain reasonable assurance of abandonment. As the abandonment standard considers the trademark owner’s intent to resume use of a trademark, reviving another’s trademark will likely carry some risk that abandonment has not occurred unless an express statement of abandonment is available.

While picking up an abandoned mark can provide a windfall to the new trademark owner, the uncertainty of abandonment is a risk that may offset some of the windfall benefit.

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Use it or lose it: Android Trademark Abandonment and Revival

ANDRIODIn 1998, Erich Specht formed Android Data Corporation (ADC) and began selling e-commerce software under the trademark Android Data. ADC later transferred its assets, including the trademark, to Andriod’s Dungeon Inc. (ADI), which was owned by Specht. In 2009, Specht and ADI filed a trademark infringement lawsuit against Google based on Google’s use of the Android mark to refer to its mobile operating system. But Specht and ADI lost.

ADC lost because it stopped using the Android Data mark in 2002 when it lost all of its customers and essentially went out of business.

Trademark Rights Tied to Use

Trademark rights exist in conjunction with the use of the mark in the sale of goods or services in business/commerce. When the owner stops using the trademark through sales or licensing for a period of time, the owner can loose its rights in the trademark. This is called abandonment. And this is what happened to Specht and ADI in the case of Specht v. Google, 758 F.Supp.2d 570 (N.D. Ill. 2010), aff’d, 747 F.3d 929 (7th Cir. 2014).

After abandonment, anyone can grab the trademark through use or by filing an intent to use trademark application. Google grabbed the Android mark in 2007 when it launched its operating system.

Trademark Abandonment

The Lanham act provides “[n]onuse for 3 consecutive years shall be prima facie evidence of abandonment….” 15 U.S.C. § 1127. This means that after three years of nonuse there is a presumption that the mark has been abandoned.  But, the trademark owner can rebut that presumption by presenting evidence that during the three years the owner formulated an intent to resume use of the trademark in commerce. Therefore it is often difficult to determine, from public ally available information, whether

Maintaining an Email Addresses & A Ghost Website is Not Enough

In the Specht case, Specht and ADI argued the use of email addresses containing @androiddata.com and the maintenance of a website at androiddata.com after 2002 was sufficient use of the mark to avoid abandonment. The trial court disagreed. The court found that the use of an email address to identify an Internet host computer does not constitute a bona fide use of the trademark in commerce.

Regarding the website, the court noted that the Plaintiffs did not claim  site offered any price information about the Android Data software, information about how a visitor to the website could license the software, or detailed information and pricing on ADI’s services. Further, ADI did not license or sell the Android Data software. The court concluded that Specht and ADI could not preserve its trademark by “posting the mark on a functional yet mostly purposeless website.”

ADI lost rights in the ANDRIOD DATA mark because it stopped using it without a demonstrated intent to resume use of the mark. Google was able to acquire rights in the ANDRIOD mark because ADI abandoned it through non-use.

Use It or Risk Loss

If you want to maintain ownership over a trademark it is best to continue using it in the sale of goods or services. If you stop using the mark too long, you can loose your trademark rights in the mark.

 

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My Use is Fair: Responding to Trademark Cease and Desist

FairUseFarzad and Lias Tabris were auto brokers. They operated websites at buy-a-lexus.com and buyorleaselexus.com connecting buyers with dealers selling Lexus vehicles.

Toyota, which owns the Lexus brand, sued the Tabris’ for trademark infringement, but lost.

Toyota lost because the Trabris’ use was a “fair use” in the case of Toyota Motor Sales, USA, Inc. v. Tabari, 610 F. 3d 1171 (9th Cir. 2010)

When Trabris’ used the Lexus trademark they were referring to actual Lexus vehicles. If they didn’t use the term “Lexus,” how could they let customers know the type of vehicles that they broker?

Nominative Fair Use Defense

A defendant may succeed with a nominative fair use defense if: (1) the product is not readily identifiable without using the trademark, (2) the defendant used no more of the mark than was necessary, and (3) the use did not falsely suggest the defendant was sponsored or endorsed by the trademark owner.

As just explained on the first factor, the Trabris’ could not let customers know the type of vehicles that they broker without using the Lexus mark.

Regarding the second factor, at the time of trial the Trabris’ did not use the Lexus logo, font, or distinctive styling on the websites. Therefore, when they used the plan text “lexus” in the domain name and on the website they were using no more of the mark than was necessary.

Third, the contextual use of Lexus in the domain name did not make a false suggestion of endorsement. The court stated:

Because the official Lexus site is almost certain to be found at lexus.com (as, in fact, it is), it’s far less likely to be found at other sites containing the word Lexus.

On the other hand, a number of sites make nominative use of trademarks in their domains but are not sponsored or endorsed by the trademark holder…

Consumers who use the internet for shopping are generally quite sophisticated about such matters and won’t be fooled into thinking that the prestigious German car manufacturer sells boots at mercedesboots.com, or homes at mercedeshomes.com, or that comcastsucks.org is sponsored or endorsed by the TV cable company just because the string of letters making up its trademark appears in the domain.

The court further dismissed the argument that consumers would be confused before encountering the Tabris’ disclaimer used on the site, which provided “We are not an authorized Lexus dealer or affiliated in any way with Lexus. We are an Independent Auto Broker.” The court stated:

But nothing about the Tabaris’ domains would give rise to such confusion; the Tabaris did not run their business at lexus.com, and their domain names did not contain words like “authorized” or “official.” … Reasonable consumers would arrive at the Tabaris’ site agnostic as to what they would find. Once there, they would immediately see the disclaimer and would promptly be disabused of any notion that the Tabaris’ website is sponsored by Toyota.

Therefore the court noted that when a customer arrives at a website with a trademark plus additional terms (except for words that imply a sponsorship or endorsement) in the domain name, the customer will be agnostic as to whether the website is authorized by the trademark holder or not. The customer will consider the content of the website to determine whether it is authorized by the trademark holder or not.

Responding to a Cease and Desist Letter

If you are using a mark to refer to the genuine product carrying the mark, then you might be able to assert the nominative fair use defense.

You will have a better chance of succeeding with a nominative fair use defense if you (1) do not use the trademark holder’s logo, distinctive style, or font when using the trademark, and (2) do not use any words such as “authorized,” “official,” or similar words that could indicate a sponsorship or endorsement by the trademark owner.

The court stated that a defendant is not required to use a disclaimer in order to win with a fair use defense. But, a disclaimer will strengthen the defense.

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Sophisticated Purchasers and Expensive Services: Responding to Trademark Cease and Desist

ChannelsOfTradeIn my last post, I discussed the case of EDS versus EDS. In that case, one company that used the EDS mark opposed another company’s registration of the mark EDS. Identical trademarks. Sales to the same customers. But no conflict.

One reason for the result was that goods/services provided by the respective companies were sold in different channels of trade to different purchasers.

Another reason–the focus of this post–is that the customers that purchased the goods/services of each company were sophisticated purchasers.

First, a quick recap of parties and their products/services. Electronic Design & Sales, Inc. (“Electronic Design”) filed an application to register the mark E.D.S. for power supplies or battery chargers.Electronic Data System Corp. (“Electronic Data”) opposed Electronic Design’s trademark application for E.D.S in Electronic Design & Sales, Inc. v. Electronic Data Systems Corp., 954 F.2d 713 (Fed. Cir. 1992). Electronic Data used the mark EDS for the sale of computer programming and installation services. Both companies sold to some of the same customers.

Sophisticated Purchasers and Expensive Services

The chance of conflict (i.e. “a likelihood of confusion”) between two trademarks is reduced where the goods/services are expensive and purchased after careful consideration. Sophisticated consumers may be expected to exercise greater care in making purchasing decisions.

When a purchaser exercises greater care in making purchasing decisions it is more likely the purchaser will notice differences between the respective marks, the respective goods/services, and the respective sources of those goods/services. Therefore it is less likely the purchaser will be confused to believe that the goods/services of one company originate from the other company.

In this case, Electronic Data’s computer services are “expensive and are purchased only by experienced corporate officials after significant study and contractual negotiation.” When a customer is making an expensive purchase after a contractual negotiation, it is very likely the customer will know the service provider negotiating the contract. Therefore, the purchaser is less likely to be confused as to the source of those services.

Likewise, evidence showed that the evaluation process used in selecting Electronic Design’s battery and power products by customers required significant knowledge and scrutiny.

In this case conflict was avoided, in part, because the parties’ goods/services were usually purchased after careful consideration by persons who were highly knowledgeable about the goods or services and their source.

Responding to a Trademark Cease and Desist Letter

When both parties’ customers are sophisticated purchasers the chance of confusion as to the source of the parties’ goods/services is reduced. Therefore the chance of a conflict between the marks is reduced. Further, when the goods/services are expensive, customers are more likely to take greater care in making purchasing decisions.

When your goods and the plaintiff’s goods are expensive and/or purchased by sophisticated customers, you have a better chance of defending against claims of trademark infringement.

See other posts in this How to Respond to a Trademark Cease and Desist series:

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Different Channels of Trade: Responding to Trademark Cease and Desist

ChannelsOfTradeEDS versus EDS. One company that used the EDS mark opposed another company’s registration of the mark EDS. Identical trademarks. Sales to the same customers. But no conflict. How?

One reason the marks were not found in conflict was that the goods/services provided by the respective companies were sold in different channels of trade to different purchasers.

Here’s the story.

Electronic Design & Sales, Inc. (“Electronic Design”) filed an application to register the mark E.D.S. for power supplies or battery chargers.

Electronic Data System Corp. (“Electronic Data”) opposed Electronic Design’s trademark application for E.D.S in Electronic Design & Sales, Inc. v. Electronic Data Systems Corp., 954 F.2d 713 (Fed. Cir. 1992). Electronic Data used the mark EDS for the sale of computer programming and installation services. But, both companies sold to some of the same large companies.

Different Channels of Trade and Purchasers

If a conflict (a.k.a. “a likelihood of confusion”) between marks exists, it must be based on the confusion of some “relevant person;” i.e., a customer or purchaser.

Both companies sold to General Motors and Sears. But simply selling to the same large companies was not enough. Individual departments in larger companies may be independent in their purchasing activities.

The court stated: “There is no evidence here, for example, that those computer specialists in the administrative departments at General Motors responsible for purchasing computer services are also responsible for purchasing battery chargers for the auto parts and services departments.”

The overlap in medical sales was even more of a stretch. Electronic Data supplied data processing services for medical insurers.  Electronic Design sold batteries and power supplies to makers of medical equipment such as bedside alert systems and crib monitors.

The court noted that Electronic Data “offers no reason to infer, for example, that Blue Cross officials responsible for purchasing its computer services might decide to discontinue purchasing from opposer because of confusion by a secretary in a physician’s office who mistakenly attributes the malfunction [of Electronic Design devises] to [Electronic Data], even though the secretary will process patients’ claims to Blue Cross.”

The medical secretary is not the “relevant person” for trademark conflict purposes. It is not always enough to look at common corporate customers as a whole, you must look at the purchaser within the corporation to identify an overlap.

For commercially sold items, users of the Electronic Design devices would only be “relevant persons” if those users could influence future purchases. And evidence of that was lacking in this case.

As a result the court found  that “although the two parties conduct business not only in the same fields but also with some of the same companies, the mere purchase of the goods and services of both parties by the same institution does not, by itself, establish similarity of trade channels or overlap of customers.”

Responding to Trademark Cease and Desist Letter

When considering whether marks are in conflict, you should consider the channels of trade in which the products/services are marketed and sold.

If the channels of trade are sufficiently different and the the relevant persons (e.g. purchasers) are not likely to encounter the plaintiff’s mark and your mark , then the marks might not be found in conflict.

Sales to the same large corporations alone is not enough. The relevant overlap is whether the same purchasers (or possibly users that can influence purchasers) will encounter both the plaintiff’s mark  and your mark.

Therefore, marketing and sales in different places to different groups of purchasers can be one factor in your favor in defending against claims of trademark infringement.

Another factor supporting no conflict conclusion in this case was that the purchasers of both companies goods were sophisticated. I will cover this topic in a future post.

See other posts in this How to Respond to a Trademark Cease and Desist series:

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Trademark is Geographically Descriptive: Responding to Trademark Cease and Desist

PrimarilyGeographicallyDescriptiveTrademark_YosemiteBeerSpirits of New Merced (“Spirits”) applied to register the trademark YOSEMITE BEER for the sale of beer. But the US Patent and Trademark Office (USPTO) refused to register the mark.

The USPTO refused to register the mark because it was primarily geographically descriptive in In re Spirits of New Merced, LLC, 85 USPQ2d 1614 (TTAB 2007).

A trademark is considered primarily geographically descriptive when (1) the mark’s primary significance is a generally known geographic location; (2) the goods or services originate in the place identified in the mark, and (3) that the relevant public would be likely to make a goods/place association, that is, would be likely to believe that the goods originate in the place named in the mark. TMEP 1210.

Spirits made and sold beer in its brewpub in Merced, California, which is about 80 miles from Yosemite National Park.

A nickname for a geographic location is equivalent to official name for purposes of determining registrability of the geographic term. It did not matter that Yosemite was not a city name or  county name.

The Trademark Board found that Yosemite is a well recognized and frequently used shorthand reference for Yosemite National Park and the Yosemite region in general. Therefore, the purchasing public would be likely to believe that the beer originates in the place (Yosemite) named in the mark.

The addition of “beer” to “Yosemite” did not save the application because “beer” was weak as being a descriptive or generic term.

Responding to a Trademark Cease and Desist Letter

When evaluating the strength of the Plaintiff’s trademark, you should consider whether it is primarily geographically descriptive. That is, is the mark primarily descriptive of a geographic location?

If so, the plaintiff’s trademark may be weak and the protection afforded to it may be weak or non-existent. If the plaintiff can’t protect its mark because its primarily geographically descriptive, then the plaintiff might not be able to stop your trademark use.

The Exceptions

However, if over time customers begin to recognize a geographically descriptive mark as a source of goods/services, that mark can gain trademark protection (through acquired distinctiveness or secondary meaning). TMEP 1210.07(b).

Therefore, if the plaintiff’s mark has been long used for its goods/services and/or has otherwise become recognized in the marketplace, making claims that the mark is weak as primarily geographically descriptive may not be an effective defense.

Picking a Strong Trademark

If you are at the point of picking a trademark for your business, product, or service, you want to select a strong mark that is not primarily geographically descriptive.

See other posts in this How to Respond to a Trademark Cease and Desist series:

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Trademarks Have Different Meanings: Responding to a Trademark Cease and Desist

“‘PLAYERS’ for shoes implies a fit, style, color and durability adapted to outdoor activities. ‘PLAYERS’ for men’s underwear implies something else, primarily indoors in nature.” – Trademark Trial and Appeals Board.

PlayersTrademarkBritish Bulldog Ltd. applied to register the trademark PLAYERS on the goods of men’s underwear. The trademark examiner  refused to register the mark claiming that it conflicted with a previously registered mark PLAYERS for the goods of shoes.

But the appeals board overturned the refusal and found that there was no likelihood of confusion between the marks in the case of In re British Bulldog, Ltd., 224 U.S.P.Q. 854 (TTAB 1980).

How could identical marks not be in conflict when used on items that a person wears, e.g. underwear and shoes?

Was it because the goods of underwear are so different from shoes that consumers would not expect a source of underwear to also be a source of shoes?

No. The Trademark Trial and Appeals Board noted several previous cases where a conflict was found when the same or similar marks were used by different parties in connection with shoes and with items of clothing.

The one of the  reasons the Board found no conflict was that the marks had different meanings in the context of the respective goods. On that point the Board said:

“PLAYERS” for shoes implies a fit, style, color and durability adapted to outdoor activities.

“PLAYERS” for men’s underwear implies something else, primarily indoors in nature.

Nicely put.

The Board described this a “close case.” Yet, the differing meanings played an important roll in the result.

But, in other cases a conflict was found where there was a lack of meaning-contextual difference. For example, a conflict was found between two users of INGENUE, one for shoes and the other for women’s undergarments. General Shoe Corp. v. Hollywood-Maxwell Co., 47 C.C.P.A. 933 (CCPA 1960).

Responding to a Trademark Cease and Desist

Therefore, when considering the similarities of the marks in response to a trademark cease and desist letter, you should consider whether the marks have distinctly different meanings in relation to the goods/services that they are used on.

Different meanings will not always save you from a conflict as noted by the fact that the Board called the Players case a close case,  but it is one area worth investigating that could be successful.

See other posts in this How to Respond to a Trademark Cease and Desist series: