DuetsBlog

Collaborations in Creativity & the Law

Trademark Enforcement in the Social Media Age

Posted in Branding, Infringement, Social Media, Trademark Bullying

Attorneys in general, and trademark attorneys in particular, have a reputation for heavy handedness. The traditional weapon of choice for these legal pugilist has been, and continues to be, ye olde cease and desist letter. A long, unnecessarily wordy letter sprinkled with “without authorization”‘s and “reserves all rights and remedies”‘s and other thinly veiled and not-so-thinly veiled threats of legal action. There are times when the traditional cease and desist letter is acceptable – Nay! – all but necessitated! But attorneys with an eye on their client’s business goals understand that there is no such thing as a one-size-fits-all enforcement communication. Indeed, the trademark tomes are jammed to the brim with tales of trademark owners whose actions have earned them the alleged label of a “trademark bully.”

But Bud Light’s recent dispute with a local Minneapolis brewery was just the opposite. Instead of creating a public relations nightmare, fanning the flames of “Big Beer” versus “Craft Beer,” Bud Light turned a trademark dispute into an advertising boon! The issue involved Bud Light’s newly adopted advertising tagline DILLY DILLY, which appeared in a Bud Light commercial earlier this year. Modist brewery chose to name its new Mosaic Double IPA “DILLY DILLY.” At the moment, the beer is still posted on the Modist Brewing website. The companies reached a friendly agreement and Bud Light even offered Modist two free tickets to the Super Bowl (which, coincidentally, will be in Minneapolis). And then, like a foam cherry on top, Bud Light hired an actor to visit the Modist taproom and “deliver” a cease and desist message from a scroll in medieval tongue. Modist plans to exhaust its current supply and then, if the beer is brewed again, use a different name. Even if the beer comes back as a new name, Modist will still have Ye Olde Scroll, which Modist has hung in its taproom.

In this instance, everyone seems to win. Bud Light received favorable press coverage throughout the country on the issue and put all other breweries on notice of its claimed rights in DILLY DILLY tagline. Modist received some great free publicity, two months ahead of the biggest sports party in the United States. I have to assume there will be more than just a handful of beer drinkers coming for Super Bowl festivities, wanting to go to the Dilly Dilly brewery and get a picture with Ye Olde Scroll.

Scrolls won’t be the next big thing in trademark enforcement. However, this is another example of how creative legal approaches can not only resolve a problem more efficiently, but end up creating other benefits for your business or clients. And with the number of breweries and beers expanding at an exponential rate the last few years, the industry will need to continue to find creative solutions to these problems. It’s great to see even the big players in the industry recognize this need.

Will the Small Hotel Knock the Gym Out of its Space?

Posted in Branding, Law Suits, Marketing

The Equinox Hotel Management, Inc. (“Equinox Hotels”) sued the Manhattan upscale gym giant, Equinox Holdings Inc. (“Equinox Gyms”), asking a federal judge in California to block the gym from expanding into hotels. Equinox Hotels do not want the upscale gym giant to take over the small company’s identity. Equinox Hotels fears that its brand recognition will quickly evaporate as consumers are bombarded with ads for the Equinox Gyms.

By way of background, Equinox Hotels is an independent San Francisco-based hospitality company that revitalizes hotel properties. It was founded in 1994. Equinox Hotels used its mark in connection with various hospitality services, including its hotel management and consulting services. The company portfolio of projects includes: (1) the Crowne Plaza Arlington; in Texas; (2) Jabal Omar Development Company Project in Saudi Arabia; (3) Walnut Creek Marriott & Athletic Club in Walnut Creek, California; (4) Hyatt Regency Sacramento in California; (5) The Davenport Hotel in Spokane, Washington; and (6) Laguna Cliffs Marriott Resort & Spa in Dana Point, California.

Equinox is a “fitness giant” that operates 94 EQUINOX branded luxury health clubs nationwide. Equinox Gyms abound especially in its hometown NYC. I recall my first trip to New York and seeing all of the signs with EQUINOX. I quickly learned that the New Yorkers escape from the hectic city into these upscale gyms.

The Equinox Gyms formulated plans to expand from the fitness industry into hospitality, including hotels. Two years ago, Equinox Gyms initially announced its hotel plans.

In its motion for an injunction, Equinox Hotels described its battle as a little David taking on a Goliath gym giant. The Equinox Gyms giant will soon be answering.

The hearing on the preliminary injunction will be held on January 16, 2018. Stay tuned.

We Are Farmers…Dum Da Dum…

Posted in Advertising, Articles, Guest Bloggers, Keyword Ads, Look-For Ads, Marketing, Mixed Bag of Nuts, Television

–James Mahoney, Razor’s Edge Communications

Admit it, when you saw the headline, many of you finished the jingle featured in Farmers Insurance TV commercials.

Farmers has a great campaign going. Geico has a good campaign going. Both are entertaining. First, Farmers:

Their “Hall of Claims” series, developed by RPA, showcases weird situations that Farmers has paid claims on. RPA’s latest iteration on the “University of Farmers” campaign is terrific. It has a catchy jingle and a catchy tagline, “We know a thing or two because we’ve seen a thing or two.”

Right off the bat, every ad is unmistakably Farmers, from the opening shot of the set to the friendly, matter-of-fact delivery of spokesman J.K. Simmons. A consistent and long-term campaign, it always offers fresh interest.

Geico’s ads, developed by the Martin Agency, take a different tack. You don’t know whose ad it is until the payoff line hits partway through, like “Casual Friday at Buckingham Palace? Surprising. What’s not surprising? How much money [particular customer] saved by switching to Geico.”

The Farmers “Hall of Claims” ads are stronger than Geico’s “Surprising” series for a couple of reasons:

First, Geico’s creative doesn’t relate specifically to insurance the way that Farmers’ does. That doesn’t necessarily mean that it’s a weak campaign, but it does mean that they need to hammer harder and more often to establish the connection.

Second, there’s no immediately discernable Geico style since the scenarios are wildly different from one another. That raises the odds that, except for the more intriguing scenarios, someone will skip or otherwise tune them out with nary a thought of Geico. It’s also a factor that other companies are running campaigns that use the same “surprise” approach. That makes the competition for mindshare that much harder when there’s no obvious or intuitive link to the advertiser.

Our personal favorite Geico ad is Casual Friday at Buckingham Palace. As we fast-forward through commercial breaks, we’ll actually stop at that one to see it again. Funny stuff, well written and brilliantly acted.

Now compare that to any Farmers ad of the weird things they’ve insured. The difference is that one is entertainment sponsored by Geico, the other is indelible proof points, unforgettably Farmers, presented in an entertaining fashion.

That’s the difference between a great campaign and a good one. I like them both.

Beer Brand Battles: David Takes on City Hall (with Goliath on the sidelines)

Posted in Copyrights, Fair Use, Food, Infringement, Trademarks, USPTO

The City of Portland is known as a hub for craft beer, and its local government couldn’t be prouder. The Travel Portland website proudly proclaims that Portland is “home to more breweries than any other city on earth.” Yet the city’s relationship with the local craft beer scene is not so bubbly at the moment, as trademark dispute between the city and local Old Town Brewing has gone public.

The dispute revolves around Old Town Brewing’s logo and a large lighted sign owned by the city, both shown below.

 

This isn’t the first time the city hasn’t gotten into a dispute with a brewery over the sign. The city previously objected to Pabst’s use of a logo derived from the sign back in 2015.  Our 2015 article contains a good back story as to the city’s purchase of the sign as well as the city’s claimed trademark rights in the sign (and for our regular readers, the investigation into Portland’s unicorn burial ground is ongoing). However, for our purposes, a TLDR history will suffice. The sign is known as the “White Stag” sign and was built in 1940. The text has changed numerous times along with the ownership. The City of Portland purchased the sign in 2010 and has since begun licensing reproductions of the sign to third-parties.

Most recently, Portland sought to license production of the sign to AB InBev, the parent company to Budweiser and a whole host of other big and small names in the alcohol business. Jeff Alworth at the Beervana Blog has a great write up regarding the dispute that is worth a read. As you might expect, the small, local craft brewery is not pleased with Portland’s attempt to permit a direct competitor to use a similar logo. The fact that the competitor is Budweiser certainly can’t help.

Luckily for Old Town, they recognized the benefits of obtaining a registration for their design logo at the U.S. Trademark Office. Even better, the registration is now more than 5 years old and can no longer be challenged on a number of grounds, like confusion with a senior user’s mark.

The City of Portland also recognized the importance of registrations and applied to register the image of the sign for a wide variety of goods and services, including alcoholic products. The Trademark Office has refused registration based on a likelihood of confusion with Old Town’s prior registration.

The situation is a twist on the more common David versus Goliath of Big Beer versus Craft Beer, and not simply because the City of Portland is involved. In fact, the city is claiming that David, aka, Old Town Brewing, is the bad guy. The City is arguing that “it is Old Town Brewing that is trying to prevent the City from using its own logo.”

The city isn’t entirely off base. It’s true that the City isn’t telling Old Town to stop using the logo. But the City’s argument makes a lot of assumptions that may not hold water (or other beverages, for that matter).

The city seems to assume that because the City bought the sign, they own the right to use the component images of that sign for any and all purposes. That’s wrong. For a lot of reasons. Owning a sign doesn’t create trademark rights, use does. And if Old Town began using a portion of that sign as a trademark before any other third-party, then Old Town is the senior user. Also, even if the City owns some trademark rights, the law is clear that a trademark does not provide a right in gross. Trademark rights are defined by the goods or services sold under the mark, with protection against goods and services that are sufficiently related to owner’s goods or services.

Also, the City’s white hat isn’t so white. I’m not even sure it’s a hat. Old Town isn’t the bad guy here. The brewery isn’t telling the City not to use the logo derived from the sign design.  I’m not a politician or a mayor, but I can’t think of any reason why a city needs to be able to use its logo to sell beer. If Minneapolis were doing this, I’d kindly ask that they fix the potholes or finish construction on the bridges over 35W first.

At the moment, it seems that public opinion seems to be in Old Town’s favor, at least based on the limited (and biased) sampling of Old Town’s Facebook Page.  From the legal standpoint, it seems that Old Town has an upper hand, but from all public statements it seems that Portland is committed to moving forward with its own applications and a license. But is a deal with Budweiser important enough to risk the bad press and the alienation of the craft beer industry? The City has until March 15 to appeal the Trademark Office’s last Office Action. By then, we’ll at least know whether Portland wants to continue the fight. In the meantime, I’ll be looking to see how far Old Town distributes its products. Their SHANGHAI’D IPA sounds delicious, not to mention, it has an excellent name.

 

John Deere: These Colors Don’t Run

Posted in Branding, Dilution, Law Suits, Look-For Ads, Mixed Bag of Nuts, Non-Traditional Trademarks

Growing up with a farm in the family, I learned early on that Nothing Runs Like Deere®.  As people tend to do, we named all of the tractors –  after Masters of the Universe characters, of course.  There was a front-loader type tractor of a brand I don’t recall named Skelator, another old tractor named Cringer, and a John Deere that we called He-Man.

John Deere, like other iconic brands, holds an elevated status among farmers and inspires a certain tribal loyalty – the kind that reminds me of Seth Godin’s quote about Harley Davidson: “Nobody gets a Suzuki tattoo.”  Well, people get John Deere tattoos:

John Deere Tattoo John Deere Tattoo John Deere Tattoo John Deere Tattoo

A couple things you’ll notice is that these tattoos prominently feature actual tractors, not just the famous John Deere deer logo, and they are in color: John Deere’s iconic green and yellow.

It should be no surprise that these are colors John Deere values and protects.  Colors can function as trademarks, just like brand names or logos, but only if they acquire distinctiveness.  Color, planted as seeds on products, packaging, in logos, and in “look-for” advertising, grows into a trademark over time as the public begins to associate the color with a source of products or services and recognize it as a mark . Once that association is made, the color becomes part of the story of the brand, and the brand owners have significant power through it.

Last month, John Deere showed just how much power it has in its color marks when it won a hard-fought court battle against FIMCO, maker of these sadly named, “Ag Spray Equipment” agricultural sprayers (the name is not surprisingly not registered as a trademark):

Ag Spray Equipment

Here is one being pulled by a John Deere tractor.  Confusing?  Would you assume the tractor and the equipment come from the same source?  What about a defense that farmers want their equipment to match the color of their tractor, because it is aesthetically pleasing?  Is it fair to give John Deere a monopoly right on a color combination?

Ag Spray Equipment and John Deere

Perhaps even more importantly than the immediate legal victory, in the 107-page decision the district court also called John Deere’s green and yellow color combination “famous,” a meaningful label for trademarks from which John Deere may potentially harvest even greater long-term value.  Under the Lanham Act, the owners of famous marks can enjoin subsequent users of similar marks that are likely to dilute distinctiveness of the famous mark “regardless  … of actual or likely confusion, of competition, or of actual economic injury.”  Powerful stuff indeed.

So, hey, John Deere, if you ever need a new slogan, how about “These Colors Don’t Run?”

P.S. On second thought, for a tractor, “not running” might be the wrong message ;)

Supreme Court Justices’ Questions in Oil States Suggest Inter Partes Review Will Be Upheld as Constitutional

Posted in Articles, Civil Procedure, Infringement, Law Suits, Patents, USPTO

On Monday, November 27, 2017, the U.S. Supreme Court heard argument in Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, No. 16-712. The case presents a direct challenge to the U.S. Patent and Trademark Office’s (“USPTO’s”) “inter partes review” (“IPR”) process, under which third parties can petition the USPTO’s Patent Trial and Appeal Board (the “PTAB”) to cancel one or more claims of an already-issued patent.

Photo Credit: Fox

ScotusBlog recently offered a brief introduction to Oil States’s “remarkably pedestrian” backstory:

Petitioner Oil States sued respondent Greene’s Energy, contending that Greene’s Energy was infringing a patent that Oil States holds on technology useful for preserving wellhead equipment in the oil and gas industry. Predictably, Greene’s responded by seeking inter partes review, hoping that the PTO would invalidate the Oil States patent. When the PTO concluded that the patent in fact was invalid, Oil States raised the stakes, arguing that Congress violated Article III and the Seventh Amendment when it authorized an administrative agency to invalidate the patent without affording Oil States an opportunity for a jury trial.

If the Supreme Court decides that IPR is unconstitutional, the holding will have major consequences. As an initial matter, many would-be litigants have chosen to pursue IPR petitions instead of patent defenses or claims in court because the IPR process is faster and more cost-effective than federal litigation. For example, a typical medium-sized patent dispute costs around $3M to litigate in federal court, but IPR proceedings are one-tenth the cost. The average time to trial is around 2 years, 3 months, whereas IPR proceedings take just over half as long to conclude. In addition to offering advantages to litigants, IPR proceedings have played a significant role in lightening the federal patent docket, addressing more than 1,000 patent cases with dispositive effect. Usually, patent cases are stayed pending an IPR proceeding. Thus, the IPR process in many cases eliminated the need for protracted federal litigation.  

As Oil States neared oral argument, several commentators offered their take on how the case might turn out. But the Justices’ questions at oral argument provide better hints at whether affirmance or reversal will result:

Right out of the gate, Chief Justice Roberts asked the petitioner, Oil States, to explain its distinction between the USPTO’s post-grant procedures that are “examinational” in nature, versus those which are adjudicative. The distinction relates to the federal government’s separation of powers between its three branches, with the judiciary serving the role of adjudicating disputes–as provided by Article III, which vests the “judicial power” in the federal courts. Getting to the heart of the matter, Justice Sotomayor asked, “What is so fundamentally Article III that changes [the IPR] process into an Article III violation?” Suggesting an answer to her own question, the Justice stated, “Both [IPR processes and other post-grant processes] are just informing the PTO of the nature of its error and giving it an opportunity to correct its error.” Justice Ginsburg later chimed in: “[IPR] is geared to be an error correction mechanism and not a substitute for litigation.” Justice Breyer appeared to agree, stating, “I thought it’s the most common thing in the world that agencies decide all kinds of matters through adjudicatory-type procedures often involving private parties. So what’s so special about this one…?” Justice Kagan remarked, “it seems a little bit odd to say, sure, the government can reexamine this…but there’s some line that falls short of what” is constitutional.

Justice Gorsuch suggested that the distinctions between permissible examination and impermissible adjudication could be avoided by focusing on whether there is a private or public right involved, the idea being that public rights (e.g., licenses) need not be adjudicated by an Article III court. Justice Kennedy asked, “[C]ould Congress say…we will grant you a patent on the condition that you agree to this procedure; otherwise, we don’t give you the patent?” Justice Alito later asked a similar question. Justice Kennedy followed up, “Could Congress say that we are reducing the life of all patents by 10 years?” When counsel for Oil States answered yes, he responded, “Well, then that–doesn’t that show that the patent owner has limited expectations as to the scope and the validity of the property right that he holds?” Justice Gorsuch begged to differ, however, stating “we have a number of cases that have arguably addressed this issue…in which this Court said the only authority competent to set a patent aside or to annul it or to correct it for any reason whatever is vested in the courts of the United States.” But Justice Sotomayor, seemingly rejecting that argument, stated that at least one of the cases cited by Justice Gorsuch (McCormick v. Aultman) did not involve determinations of constitutional law, nor did it involve statutory analysis of post-grant procedures because none were applicable or available at the time that case was decided.

Turning to the respondent, Greene’s Energy, Justice Breyer fired off the first question, asking whether it was a “problem” that a company could invest $40B in developing a patent and could have it for 10 years before an IPR proceeding cancelled the patent. He asked, “Is there something in the Constitution that protects a person after a long period of time and much reliance from a reexamination at a time where much of the evidence will have disappeared,” suggesting a due process-flavored argument. Chief Justice Roberts followed up, asking whether Greene’s Energy’s position is that “If you want the sweet of having a patent, you’ve got to take the bitter that the government might reevaluate it at some subsequent point.” Finding agreement, he said, “Well, haven’t our cases rejected that…proposition? I’m thinking of the public employment cases, the welfare benefits cases. We’ve said you…cannot put someone in that position.”

The discussion shifted to whether the availability for subsequent judicial review of the PTAB’s IPR decisions bears on IPR’s constitutionality. Justice Sotomayor remarked, “That..was what troubled me deeply about you telling Justice Kagan that, without judicial review, that this would be adequate. I mean, for me, this–what saves this, even a patent invalidity finding, [is that it] can be appealed to a court….[H]ow can you argue that the…PTO…has unfettered discretion to take away that which it’s granted?”

Justice Gorsuch again brought up the public-private rights distinction, noting that “there’s an abundance of law going back 400 years. Justice Story says it. I mean, you know, this is not a new idea, that once [a patent is] granted, it’s a private right belonging to the inventor.”

Finally, the Court turned its attention to the Government’s argument. Justices Gorsuch and Roberts asked about the “bitter with the sweet” argument. The Government responded that employment and welfare decisions are often made by executive officials and must always comport with due process, but need not be adjudicated by courts in the first instance.

Justices Breyer and Roberts then steered the conversation toward factors that might help distinguish private rights from public rights. Justice Breyer expressed the view that the large investment underlying a patent might justify a due process or takings clause argument, but the Government responded that there is no as-applied challenge in this case.

The Government also brought up the adjudication versus examination point, arguing that IPR is distinct from typical judicial functions, which involve determining liability between private litigants and assessing monetary damages. For example, an infringement action involves determining liability for use of a patented idea and the reasonable royalty damages that should be paid for that use. IPRs, on the other hand, merely address patentability and do not involve liability or damages. The Government also noted that the executive frequently employs adjudicative proceedings to take appropriate executive action. IPR is no different.

In the end, as always, divining the eventual decision from the Justices’ questioning is more art than science–no puns intended. Justices Sotomayor, Ginsburg, Breyer, and Kagan all appear to endorse the view that IPR proceedings do not violate separation of powers. Justices Kennedy and Alito also seem to fall in the same camp. On the other hand, Justices Breyer, Roberts, and Sotomayor’s questions suggest that these Justices think there may be serious due process concerns. Only Justices Gorsuch, Breyer, and Roberts were interested in the public rights versus private rights distinction, but two of those Justices expressed doubts about the distinction’s defining features. If I had to call it, I would guess that the Court will find that IPRs, as currently structured, do not violate separation of powers or due process and are therefore constitutional. Stay tuned for updates on this important case.

Will the Velveeta Brand Melt into Laughter?

Posted in Advertising, Articles, Branding, Dilution, False Advertising, Famous Marks, FDA Approval, Food, Loss of Rights, Marketing, Taste, Trademarks, TTAB

What do you think of when you hear the word Velveeta? Me too, childhood — complete with piping hot Campbell’s tomato soup — and perfectly melted grilled cheese sandwiches. Later in life, at least for me, came liquid gold and RO*TEL queso dip, usually on weekend game days. And, my daughter might add to the Velveeta memory mix, perfectly smooth shells and cheese.

Velveeta can conjure up some less than innocent and charitable thoughts too. Eventual trips to the doctor. Perhaps cardiac stents. And, even probing medical questions like, is that yellow loaf or brick really cheese? Turns out, it’s technically not real cheese, rather the box even calls it “Pasteurized Prepared Cheese Product.” What does that even mean?

Yet, Kraft apparently has felt no shame, remorse, or even second thoughts in continuing to maintain the original 1923 Velveeta trademark registration for “cheese,” despite an FDA warning letter some fifteen years ago that apparently led to the more accurate “Pasteurized Prepared Cheese Product” appellation.

As a trademark type though, and putting aside the interesting trademark abandonment question of whether Kraft actually uses the Velveeta mark in connection with the recited goods, “cheese” — the notion of a coined trademark comes to mind with Velveeta too. The kind of trademark that is invented, or let’s say, made up, or produced for the exact purpose of functioning as a trademark indication of source.

Some other examples of coined marks include Exxon, Rolex, and Google. Some call those types of marks the gold standard since they are the strongest trademarks along the Spectrum of Distinctiveness. They are often singular in meaning, and ripe for dilution protection.

So, imagine my surprise seeing a “room” dedicated to Velveeta, as I walked 6th Street with one of my sons, this past weekend, in Austin, Texas, inspiring me to capture the image shown above to further document and discuss it: The Velveeta Room.

My surprise was especially fine-tuned since the apparently-non-eponymously named room did not appear — at least, on the surface — to be promoting liquid gold, yellow bricks, golden loafs, queso, or even shells and cheese, much less the almost century old Velveeta “cheese” brand or distinctive box.

Mind you, there was a day when Kraft appeared to give a serving of some serious trademark enforcement attention to the likely famous Velveeta trademark, even when the target showed up selling comedy as opposed to calories.

Back in the day, circa 1993, Kraft opposed registration of Blue Velveeta for “entertainment services in the nature of comedy and musical acts.” It appears the improv act melted away in the mid-90s — not sure whether it was voluntary or not.

The Velveeta Room apparently began around the same time as Blue Velveeta, circa 1988. Perhaps either of their fans can help explain their branding, because I’m at a loss. Did the improv group or does the comedy lounge specialize in cheesy humor? Pasteurized jokes? Fake laughter and chuckles? Or perhaps, unhealthy routines and the need for medical attention?

The irony has not escaped me that the Velveeta product was invented to solve the problem of “broken cheese” and the Velveeta brand and trademark was invented or coined to identify, distinguish, and indicate the source of an engineered — or to some, fake cheese product.

It remains to be seen whether the Velveeta trademark registration is itself “broken,” whether the brand simply melts away over the next century, whether its meaning will further evolve and blend into a smoothly-delivered butt of jokes, or whether Kraft will laugh all the way to the bank.

Happy Thankfulness and Gratitude!

Posted in Articles, Food, Marketing, Trademarks

Instead of saying the traditional Happy Thanksgiving exclamation this year, I thought I’d reframe it this way: Happy Thankfulness and Gratitude!

Thankfulness is a state of mind. It is a choice, a repeated fork in the road for each of us. Gratitude is a decision we can make and live, every minute of the day, every day of the year, even during moments of tension, confusion, and fear.

Turns out choosing to live with a spirit of gratitude and thankfulness is closely linked to the happiness most seek and many long for in their life.

With that, and recognizing how it is impossible for me to list all those who consistently remind me of my choice of thankfulness and gratitude, here are just a few highlights:

Please know that if you’re reading this now, whatever you’re thinking at the moment, I’m ever so thankful for you too, Happy Thankfulness and Gratitude!

As you experience Thanksgiving Day today, what reminders exist for you to choose a spirit of thankfulness and gratitude? And, what about tomorrow? The day after tomorrow?

Tasting Notes: When Alcohol Goods and Services Descriptions Matter

Posted in Food

On December 11, I will be presenting a CLE on Brewery and Distillery Law, discussing trademark issues affecting breweries and distilleries.  One of the topics that I’ll spend some time on during that presentation – and one that we’ve covered a lot here – is how the Trademark Office considers beer to be sufficiently related to wine and other spirits when evaluating a pending application for a likelihood of confusion with a registered mark.  The same has, in a few cases, been said about these alcohol products being related to restaurant services or bar services.

In today’s episode involving this issue, Heritage Distilling Company in Washington filed a trademark application in 2016 for a standard character mark BSB for “distilled spirits”.  The Trademark Office refused registration of this mark, however, based on a prior registration by Black Shirt Brewing Company for the following mark for “brewpub services; taproom services; taproom services featuring beer brewed on premises.”

Trademark image

Meanwhile, Heritage Distilling Company filed for the logo below and that went through the office with ease.  Not even an Office Action.  It was filed on April 28, 2017 and registered on October 3, 2017.

Trademark image

Heritage Distilling Company appealed the Examining Attorney’s rejection of its standard character mark for BSB claiming, in part that brewpubs and taprooms are not generally known for distilled spirits.  Although finding the marks to be similar, the Board agreed that the claimed services of the registration were not sufficiently related to support a likelihood of confusion.  “To establish likelihood of confusion a party must show something more than that similar or even identical marks are used for food products and restaurant services.”  In re Coors Brewing Co., 343 F.3d 1340 (Fed. Cir. 2003).  The Board further noted that “the definitions of taproom and brewpub refer to beer and food, not spirits. ”  Based on the evidence of record, the Board determined that the Examining Attorney had not satisfied the “something more” requirement here and found that the goods and services were not similar or related.  Only because the record failed to show these goods were related, the Board reversed the refusal.

So what if Black Shirt Brewing Company had instead filed for their mark on “bar services”?  It’s possible that the Board may not have reversed the refusal because there would have been a more clear association between a distilled spirits and bar services.

Taking that a step further, what if Black Shirt Brewing Company had filed for the mark on “beer”?  That would have likely made a refusal of BSB in standard characters over BSB on beer more difficult for the Trademark Office to reverse.  The “something more” standard would not apply when comparing goods to goods – beer to distilled spirits – as it does when comparing food products and restaurant services.  The brewery never filed for its house mark for beer, yet a few months after these applications were filed, they filed for some of its beer names for “beer”.   Here’s the specimen from one of those filings in 2014.  Would you have filed for BSB for beer?

https://tsdrsec.uspto.gov/ts/cd/casedoc/sn86372733/SPE20140823081858/1/webcontent?scale=1

When Names become Brand Names

Posted in Advertising, Branding, Contracts, Fair Use, Fashion, Goodwill, Infringement, Law Suits, Marketing, Mixed Bag of Nuts, Squirrelly Thoughts, Trademarks

And whatever the man called a living creature, that was its name.

Genesis 2:19

Naming things is a fundamentally personal, human act that sometimes – in a profession all about brand names – we take for granted. It’s easy to forget when we are clearing, registering, and protecting names, that at a basic level we are engaging with an essential part of human existence not so far removed from the story of Adam’s naming of living creatures in Genesis. True, Adam may not have had to concern himself with trademarks and intellectual property rights, but we trademark lawyers do.

Lately, I’ve been thinking a lot about this act of naming and names – not brand names, but specifically, baby names. My wife and I are expecting a baby on December 1, and among many of the things to do, naming the baby is perhaps the most important. So while my wife and I work on that, I thought I’d use the opportunity to take a closer look at a case that reminds us of how a personal name can become something else – a brand name – and what happens next.

Ten years ago, while I was in law school taking my first trademark law course, the famous fashion designer Joseph Abboud was learning about trademark law the hard way: in court. The lawsuit (about suits) against Joseph Abboud claimed that his marketing and promotional activities as Joseph Abboud for a new clothing line called “jaz” infringed trademark rights to the name – you guessed it – “Joseph Abboud.” So how did it come to pass that the real person named Joseph Abboud was being sued for using his own name?

Well, it turns out that in his rise to the top of the fashion industry through the 1980s and 1990s, Joseph Abboud registered his personal name and variations as trademarks in connection with his clothing. Then, in 2000, Joseph Abboud sold his company JA Apparel and its trademarks, including the trademarks “Abboud” and “Joseph Abboud,” for approximately $65 million. As part of the transaction, Joseph Abboud transferred all of his rights to the following:

[T]he names, trademarks, trade names, service marks, logos, insignias and designations [of Joseph Aboud]. . . . and [a]ll rights to use and apply for the registration of new trade names, trademarks, service marks, logos, insignias and designations containing the words “Joseph Abboud,” “designed by Joseph Abboud,” “by Joseph Abboud,” “JOE” or “JA,” or anything similar to or derivative thereof, either alone or in conjunction with other words or symbols . . . for any and all products and services. . . .

In addition, the designer Joseph Abboud further agreed not to compete with the JA Apparel for a period of time.

But wouldn’t you know, the designer Joseph Abboud couldn’t sit idle and, despite his agreement, he began to engage certain third parties in preparation for the launch of a new line called “jaz” and began promoting it as Joseph Abboud, the fashion designer. When JA Apparel found out, it sued to stop Joseph Abboud on the grounds that it had acquired the exclusive rights to use the name Joseph Abboud, not just the trademarks. In other words, while perhaps “jaz” didn’t infringe the trademarks, Joseph Abboud’s use of his own name to promote it did, and furthermore it breached the contract. In a page right out of Mad Men, the attorneys for JA Apparel even published a full-page ad announcing that “The Finest Trademark Attorneys in the World Wear Joseph Abboud®.”

After a bench trial, the district court agreed with these finest trademark attorneys in the world and concluded that the agreement made by Joseph Abboud transferred not just certain trademarks to JA Apparel, but also the right to use his own personal name for commercial purposes, including in the phrases “a new composition by designer Joseph Abboud” or “by the award-winning designer Joseph Abboud.” Nevertheless, although providing “sweeping injunctive relief” was necessary to ensure that JA Apparel received the full benefit of its bargain, the court determined Joseph Abboud could make media appearances as himself or as a fashion expert, but not to promote clothing in competition with JA Apparel.

On appeal, the Court of Appeals for the Second Circuit found the word “name” as used in the agreement ambiguous and vacated the decision of the district court, remanding returning it for a full refund. Additionally, the court of appeals held that if the contract was not breached, then the district court would need to determine whether Joseph Abboud’s use of his own name constituted trademark infringement by examining specific proposed advertisements. For example, one advertisement featured the “jaz” mark prominently with an image of Joseph Abboud and the disclaimer “Designer Joseph Abboud is no Longer Associated or Affiliated with JA Apparel Corp., the owner of the Trademark ‘Joseph Abboud’TM.” Such advertisements presented the “jaz” mark and Joseph Abboud’s name in ways which might not be infringing or could reasonably be fair use.

On remand, the district court examined additional extrinsic evidence and discovered that the word “names” appeared only in the final draft of the agreement and that nothing in the discussions between the parties explained the reason for its inclusion. Instead, the word “names” was part “laundry list of words” under the “more general penumbra of ‘trademarks’” – essentially a substitute for “brand names” not “personal names.”   Reversing its prior conclusion, the court concluded that Joseph Abboud had not sold his personal name. Unfortunately, for Josheph Abboud, the inquiry did not end there.

The problem, the court explained, was that while Joseph Abboud may not have sold all rights to commercially use his personal name to JA Apparel, Joseph Abboud did register his name as a trademark and he did sell that trademark to JA Apparel. And in such circumstances, Joseph Abboud would be permitted to use his name to advertise his affiliation with other businesses, so long as such use was not in an “overly intrusive manner:”

This is a case in which an individual elected to use his name for many years as a trademark, building up substantial goodwill; he then sold the same, but intends to continue to commercially exploit his name by designing clothes in competition with the purchaser of the trademark. This case therefore presents an inherently difficult scenario, because Abboud’s use of his name in the sale of clothing will inevitably lead to consumer confusion.

The court’s solution was to allow the following ad and similar ads, with the addition of a conspicuous disclaimer making clear that Joseph Abboud, the designer, was no longer affiliated with Joseph Abboud, the apparel brand:

The court was even stronger in its approval of the following possible ad, proposed by JA Apparel, noting that the placement, size, and useage of Abboud’s name, together with the disclaimer (unreadable in the image below), arguably would remove the likelihood of any confusion:

The court was not so enthusiastic about the following ad, which it called “utterly confusing” because Joseph Abboud’s personal name would be used in a virtually identical way as the Joseph Abboud trademark, suggesting “jaz” is merely a sub-line of clothing:


The review of the ads above helped the court craft the following permanent injunction against Joseph Abboud, showing just what happens when a name becomes a brand name:

Abboud may not use his name in any manner on “jaz” clothes, labels, hang-tags, or product packaging.

Should Abboud choose to use his name in promotional and advertising materials, he must do so in a way that is not inconsistent with this Court’s fair use analysis.

Abboud’s name must be used descriptively, in the context of a complete sentence or descriptive phrase, and must be no larger or more distinct than the surrounding words in that sentence or phrase.

Abboud is to prominently display his trademark “jaz” (or any other trademark) elsewhere in the advertisement, both to alert consumers that “jaz” is the source—in the trademark sense—of the new clothing line, and to minimize any resulting confusion.

Finally, should Abboud use his name as proposed in [the ads] or anything similar, he must include a disclaimer of any affiliation with JA Apparel and products sold under the Joseph Abboud trademarks. The disclaimer must be displayed in a font that is no smaller than the accompanying text in which Abboud uses his name.

The lesson for all of us is that a personal name, when it becomes a brand name, becomes something that can be bought and sold just like any other trademark. And after that sale, while some personal uses of a name will be fair use, any use of the name as a brand name will likely result in confusion (if the goods are the same or related).  Sometimes the use of a personal name is inevitable, but business owners and celebrities should take care when they decide to use their personal name as the brand name for their business, especially if they are not exactly ready to retire from what made them famous and successful when they sell their business.  Otherwise, they may find themselves with a name that’s become something they can’t use.