Pattishall IP Blog

June 8, 2017

PICK THE RIGHT TRADEMARK AND YOU WON’T HAVE TO SUE PEOPLE

Filed under: Trademark (General) — Tags: , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 9:29 am

By Janet Marvel

A case filed recently is an object lesson in the best way to pick a trademark.  The Color Run, LLC sued My School Color Run, LLC for using COLOR RUN for organizing 5K races where people pay to be covered with dyed cornstarch.

If I were the defendant, I would argue that COLOR RUN describes races where participants end up covered in different colors, and the mark, as descriptive, is not legally protected.

If I were the plaintiff, I would argue that COLOR only suggests the nature of the race, i.e., you have to think about it to determine what the race is about, and suggestive marks are legally protected.  I would also argue that I have set up COLOR RUN races for such a long time, they are well-known and my trademark rights are very strong.

If The Color Run tolerates unauthorized use of its mark, it might lose its rights.  That is true of every trademark owner.  But enforcement burdens can be eased by picking a mark in the first place that is easier to protect.  Had The Color Run picked a made-up word for its races, the mark would be easier and less expensive to protect.  On the other hand, no one would have any idea of the nature of the race just by hearing the name.

There is a trick to picking a good mark.  Trademarks are divided into four categories of protection.  The first category includes made-up and arbitrary terms.  Made-up terms, like GOOGLE for web searching services, and arbitrary terms (dictionary words used to designate something other than their standard meaning), like APPLE computers, are easiest to protect.  After all, why would anyone need to use a made-up or arbitrary word to describe what their product is, or what it does?

Made-up and arbitrary marks work well in the tech sector, where people are accustomed to them.  But in some more sober business environments, (say, industrial equipment) these terms might seem over-the-top.

Many marketers prefer the category comprising “descriptive marks.”  Descriptive marks, not surprisingly, describe some characteristics of products.  They can become trademarks if they are used for a long time and become well-known, but they don’t start out as trademarks.  You will have to prove they are distinctive to win your case (there are exceptions, but that’s a post for another day).  Examples of descriptive marks include HOLIDAY INN and BANK OF AMERICA.

Generic terms can never be trademarks.  No pencil manufacturer can stop a competitor from calling its products “pencils.”  “Pencil” is the generic name of the type of thing.

The holy grail for trademark owners may be the “suggestive” mark.  Suggestive marks evoke a characteristic of a product, but they don’t describe it.  They aren’t too weird for markets where consumers want marks that evoke trust (e.g. manufacturing supplies).  They aren’t too boring for the tech market.  Examples include CHICKEN OF THE SEA for tuna, PLAYBOY for men’s magazines, GLASS DOCTOR window repair, and EXTEND YOUR BEAUTY for eyelash extensions.

Unfortunately, the distinction between terms that merely describe a product (descriptive marks) and terms that suggest a product characteristic (suggestive marks) is murky.  A trademark lawyer can help you determine where your mark likely fits.

The bottom line:  If you can pick a mark that is coined or arbitrary, then go for it.  Fewer people will copy it; and if they do, they probably intend to infringe.  That makes your case much easier.  If you can’t pick a coined or arbitrary mark, go for one that is suggestive.  You won’t have to prove that the mark has become distinctive in the marketplace to protect it (although in litigation you may do it anyway, just to be on the safe side).  Suggestive marks are more distinctive than descriptive ones, so there is less justification for copying.  You are likely to face fewer infringers, and you have a better chance of winning disputes.

These materials have been prepared by Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP for general informational purposes only.
They are not legal advice. They are not intended to create, and their receipt by you does not create, an attorney-client relationship.

March 17, 2017

Game Over for EMPORIUM ARCADE BAR service mark: “Merely Descriptive”

Filed under: TM Registration, Trademark (General), TTAB — Tags: , , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 9:31 am

 

 

 

 

By Jacquelyn R. Prom

On March 8, 2017, the Federal Circuit ruled[1] that the phrase ‘Emporium Arcade Bar’ is merely descriptive of arcade and bar services.

Emporium Arcade Bar is a popular Chicago bar offering a variety of old-school arcade games, pinball machines, draft beers, and cocktails. This crowd-pleasing spot opened its first location in 2012 in Wicker Park. In 2014, it opened a second location in Logan Square.

In 2014, Emporium also applied to register     as a service mark.[2] The Examining Attorney refused registration on the ground that the phrase is merely descriptive of Emporium’s arcade and bar services. Emporium tried to overcome the refusal by disclaiming the exclusive right to use ‘arcade bar’ apart from the mark as a whole. The Examining Attorney, however, required the additional disclaimer of ’emporium’ before the trademark could register. Emporium refused. It argued a disclaimer for ’emporium’ was unnecessary because the term does not immediately convey knowledge of its arcade and bar services. The Examining Attorney disagreed and issued a final refusal. Emporium appealed to the Trademark Trial and Appeal Board.

The TTAB affirmed the refusal,[3] finding ’emporium’ to be merely descriptive of arcade and bar services. Emporium again appealed, this time to the Federal Circuit.

The Federal Circuit affirmed the TTAB’s decision, ruling that the composite mark could not be registered without a disclaimer of all the wording due to each term’s descriptive nature. In reaching this conclusion, the court relied on dictionary definitions of emporium, arcade, and bar, as well as third-party trademark registrations that disclaimed ’emporium’ for restaurant, catering, and bar services.[4] The Federal Circuit also rejected Emporium’s argument that ‘Emporium Arcade Bar’ is a unitary mark. For these reasons, the court held ‘Emporium Arcade Bar’ was merely descriptive.

So for now it is game over for ‘Emporium Arcade Bar’ unless it is willing to disclaim all the wording in the composite mark, including emporium.

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[1] In re: Ddmb, Inc., Appellant, No. 2016-2037, 2017 WL 915102 (Fed. Cir. Mar. 8, 2017)

[2] Ser. No. 86/312,296

[3] In re Ddmb Inc., 86312296, 2016 WL 552609 (Jan. 29, 2016)

[4] E.g., Reg. No. 2216510 for the mark THE FLYING SAUCER DRAUGHT EMPORIUM, registered with a disclaimer of DRAUGHT EMPORIUM for “restaurant and bar services”; Reg. No. 3304948 for the mark MCDADE’S EMPORIUM, registered on the Supplemental Register with a disclaimer of EMPORIUM for “restaurant and bar services”; Reg. No. 2741163 for the mark THE FOOD EMPORIUM, registered under Section 2(f) with a claim of acquired distinctiveness and with a disclaimer of EMPORIUM for “retail grocery store and delicatessen services” and “catering and take-out delicatessen services”; and Reg. No. 2352358 for the mark GARDEN EMPORIUM, registered with a disclaimer of EMPORIUM for “catering services and restaurant services.”

 

These materials have been prepared by Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP for general informational purposes only.
They are not legal advice. They are not intended to create, and their receipt by you does not create, an attorney-client relationship.

March 2, 2017

The Marshall Tucker Band is still “Searchin’ for a Rainbow”[1] – and a trademark infringement that works

Filed under: TM Registration, Trademark (General) — Tags: , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 12:24 pm

Paul BorovayBy Paul A. Borovay

On March 1, 2017, a South Carolina federal judge dismissed The Marshall Tucker Band’s complaint against its publishing company alleging trademark infringement and dilution.[2]

The judge based her decision on the band’s failure to allege the publisher used the band’s trademarks in commerce.  The band relied entirely on the publisher’s trademark registrations, [3] as well as its statements to support its trademark applications that its marks were “now in use in . . . commerce.”

To establish trademark infringement under 15 U.S.C. § 1125(a) of the Lanham Act, a plaintiff must prove five elements, including that the defendant uses the mark “in commerce.”[4]  Section 15 U.S.C. § 1127 defines the term “use in commerce” to mean “the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark.”

Stating that a mark is “now in use in . . . commerce” while prosecuting a trademark application is not the same thing as “using” a mark “in commerce.”  Judge Lewis cited Kusek v. Family Circle, Inc., 894 F. Supp. 522, 532 (D. Mass. 1995) for this notable proposition: “a federal registration [of a trademark] gives the owner of a mark legal rights and benefits, [but] its mere registration does not create the mark nor amount to ‘use’ of the mark [, and, therefore,] trademark registration per se cannot be considered as a use in commerce.”

While it has certainly been a “Long Hard Ride”[5] for The Marshall Tucker Band, the decision shows that a plaintiff cannot rely solely on defendants’ statements while prosecuting a trademark application to meet the Lanham Act’s “use in commerce” requirement.

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[1] “Searchin’ for a Rainbow” is the fourth studio album by The Marshall Tucker Band.
[2] Marshall Tucker Band Inc, The et al v. M T Industries Inc et al, No. 7:16-cv-00420 (D.S.C. March 1, 2017)
[3] See United States Trademark Reg. Nos. 4616427 and 4616428.
[4] 15 U.S.C. § 1125(a) requires the plaintiff to prove the following five elements: (1) that it possesses a mark; (2) that the defendant used the mark; (3) that the defendant’s use of the mark occurred in commerce; (4) that the defendant used the mark in connection with the sale, offering for sale, distribution, or advertising of goods or services; and (5) that the defendant used the mark in a manner likely to confuse consumers.
[5] “Long Hard Ride” is the fifth studio album by The Marshall Tucker Band.

 

These materials have been prepared by Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP for general informational purposes only.
They are not legal advice. They are not intended to create, and their receipt by you does not create, an attorney-client relationship.

July 7, 2015

Amazon.com Sued for Bait and Switch

Filed under: Internet, Litigation, Trademark (General) — Tags: , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 2:52 pm

baa_hiresBy: Brett A. August

In an important case for all companies whose products are sold on Amazon.com, the Ninth Circuit Court of Appeals overturned a district ruling yesterday that Amazon could not be sued for trademark infringement when it presented the goods of one watch maker in response to a search for another brand of watches.  In Multi Time Machine Inc. v. Amazon.com Inc., Case No. 13-55575, the Ninth Circuit (in a 2-1 decision) ruled that Amazon’s practices could confuse consumers into believing the watches displayed in the search results are put out by a company related to the manufacturer of the searched-for watches.

This is an important result for all vendors of branded goods who believe they are losing business to competitors due to Amazon’s failure to tell users of its website that the goods for which the customer is searching are not available on Amazon.com. The court noted that Amazon’s competitors – such as Buy.com and Overstock.com –  inform customers when the goods in their search terms are not sold on those websites.

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Brett August is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals. The firm advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Brett’s practice focuses on domestic and international trademark, copyright, unfair competition, and Internet counseling and litigation.

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January 22, 2015

Supreme Court Finds Tacking to Be an Issue of Fact

Filed under: Trademark (General) — Tags: , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 9:17 am

Jason Koransky F HRby Jason Koransky, Associate

The doctrine of “tacking” deals with priority in trademark law. A trademark owner “tacks on” its period of using an earlier version of its mark to the time it has been using the current version of the mark. For tacking to be accepted by the court or the T.T.A.B., however, the respective versions of the marks must be “legal equivalents,” creating “the same, continuing commercial impression.” In a rare opportunity to decide a substantive issue of trademark law, on January 21 the Supreme Court in a unanimous opinion held that tacking is an issue to be decided by a jury. See Hana Financial, Inc. v. Hana Bank, 574 U.S. __ (2015). In affirming the Ninth Circuit’s decision that tacking is an issue of fact, the Court settled a circuit split, with the Federal Circuit and Sixth Circuit having held tacking to be an issue of law.

In this case, the petitioner Hana Financial began using its HANA FINANCIAL mark in commerce in 1995, and in 1996 obtained a federal registration of a logo that included the HANA FINANCIAL mark for financial services. Meanwhile, in 1994, the respondent Hana Bank started to advertise financial services under the name Hana Overseas Korean Club in the United States, targeting Korean expatriates. These advertisements included the name “Hana Bank” in Korean. In 2000, Hana Bank changed its name to Hana World Center, and in 2002 it started operating a bank in the U.S. called Hana Bank.

In 2007, Hana Financial sued Hana Bank for infringing its HANA FINANCIAL mark, and in response Hana Bank claimed priority based on tacking. The case went to trial, at which the jury was given a tacking instruction. The jury found that Hana Bank did not infringe the HANA FINANCIAL mark, and the district court denied Hana Financial’s motion for judgment as a matter of law.

In its brief and straightforward opinion, the Court wrote that tacking was properly in the jury’s hands as an issue of fact because “the tacking inquiry operates from the perspective of an ordinary purchaser or consumer.” It emphasized that it has “long recognized . . . that, when the relevant question is how an ordinary person or community would make an assessment, the jury is generally the decisionmaker that ought to provide the fact-intensive answer.”

The Court acknowledged that courts could decide a tacking issue in a bench trial or on summary judgment or judgment as a matter of law when the facts warrant such a determination. But when the parties request a jury trial, and summary judgment or JMOL is not warranted, tacking must be decided by the jury.

The Court rejected the four arguments Hana Financial made for why tacking is an issue of law. First, even though the “legal equivalents” test in tacking involves the application of a legal standard, the court found no reason why the jury could not properly apply that standard, essentially stating in dicta that the jury could consider this mixed question of law and fact. Next, it rejected Hana Financial’s argument that tacking questions must be decided by comparing the marks at issue to the marks in other tacking cases. Third, it found that juries deciding tacking would not make the trademark system “unpredictable.” Finally, it found that courts have not historically decided the issue of tacking as a matter of law, and that Hana Financial’s cited cases in which the court ruled on tacking included bench trials and summary judgments.

On its facts, Hana holds only that tacking an issue of fact for the jury. But the analysis seems to apply to other issues in trademark law as well, such as likelihood of confusion – even though the opinion does not address these other issues. If Hana is extended to such other issues, it could make it more difficult to obtain summary judgment in trademark litigation.

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Jason Koransky is an associate with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois. Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, trade secret and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues. Jason’s practice focuses on trademark, trade dress, copyright and false advertising litigation, domestic and international trademark prosecution and counseling, and privacy issues. He is co-author of the book Band Law for Bands, published by the Chicago-based Lawyers for the Creative Arts.

 

 

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May 20, 2014

Can California Chrome THREE-PEAT? Its Owners Sure Hope So

Filed under: Advertising, TM Registration — Tags: , , , , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 3:28 pm

Paul Borovay F LRBy Paul A. Borovay, Associate

California Chrome, the horse that won both the Kentucky Derby and the Preakness Stakes over the last three weeks, has the opportunity to be the first Triple Crown winner in 36 years if it wins the Belmont Stakes on June 7. While California Chrome flirts with history next month, its owners are securing its rights in the horse’s name to capitalize on its (potential) legacy.[1]

As ESPN.com reported this morning,[2] Steven and Carolyn Coburn and Perry and Denise Martin, who make up the horse’s ownership entity of Dumb Ass Partners, filed for the trademark CALIFORNIA CHROME, Ser. No. 86/281,678, for “[a]thletic apparel, namely, shirts, pants, jackets, footwear, hats and caps, athletic uniforms.” According to the article, California Chrome’s owners hope to cash in on licensing deals that are likely dependent on California Chrome winning at the Belmont Stakes.

California Chrome’s owners will not be the only ones this spring hoping to cash in on an outcome dependent trademark. Pat Riley, the owner of the trademark THREEPEAT, Reg. No. 4,051,757, hopes to capitalize on the mark once again if the Miami Heat manage to repeat as NBA champions for a third straight year. [3] Riley first applied for the THREE-PEAT mark in 1988, Reg. No. 1,552,980, when his Los Angeles Lakers were on the cusp of winning three consecutive NBA championships only to be swept by the Detroit Pistons in the championship series.

While he was unable to exploit the mark in the 1980s, Riley has monetized it several times since then. For example, Riley reported earned over $300,000 in licensing revenue when the Chicago Bulls won three consecutive championships (twice) in the 1990s.[4]   Meanwhile, the New York Yankees and Los Angeles Lakers have also won three consecutive championships each, adding even more licensing revenue to Riley’s coffers.

Interestingly, Riley’s first registration for THREE-PEAT, the ’980 Registration discussed above, was cancelled in 2008 because he failed to file an acceptable declaration under Section 8 of the Trademark Act. Additionally, an individual filed a petition to cancel the ’980 Registration in 2001, arguing that the mark did not serve as a trademark and had become generic.[5] Holding that the petitioner failed to show that the mark did not function as a trademark or that the mark was generic, the Trademark Trial and Appeal Board (“TTAB”) noted that a type of athletic accomplishment in itself (i.e., winning three consecutive championships) did not necessarily indicate that the term “conveys any meaning, let alone a generic meaning, about [Riley’s] goods.” Pet. Cancel, p. 9. Additionally, the TTAB stated that the placement of Riley’s THREE-PEAT mark on t-shirts was consistent with how trademarks are generally used as a source identifier. Id. Last, the TTAB said that as long as Riley controls the nature and quality of his licensees’ goods, “the mark does not have to indicate a single physical source of the goods, but may also indicate a single, i.e., consistent, source of quality, regardless of the actual physical source or producer of the goods.” Id at 10.

While Riley’s most recent THREEPEAT mark, Reg. No. 4,051.757, was filed in 2010 under Section 2(f), there remains the question whether the mark has now become generic for the feat of winning three consecutive championships. While the petition to cancel the mark was unsuccessful in 2001, a mark can become generic over time. With more teams winning consecutive championships, and with more individuals invariably using the mark in a descriptive or generic manner for winning three consecutive championships, time will tell whether someone will contest the marks validity in the future and what will be the ultimate result.

With that said, Riley’s ability to monetize a mark that only has value when a series of exceptional events occurs in the future proves that patience really can pay off. While it may look like California Chrome’s owners’ gaze is affixed on the finish line on June 7, their foresight to file a trademark application last week demonstrates that their vision for both California Chrome and CALIFORNIA CHROME really starts when the race is over.

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Paul A. Borovay is an associate with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.   Paul’s practice focuses on litigation in trademark, media, online gaming and entertainment, advertising, as well as trademark prosecution and counseling.

 

[1] ESPN.com reports that the horse was bred for $10,500 and has now won $3.45 million on the track. See http://espn.go.com/horse-racing/triplecrown2014/story/_/id/10957336/california-chrome-owners-file-trademark-horse-name

[2] Id.

[3] As reported on this blog only July 25, 2012, there is some debate as to whether Riley or ex-Los Angeles Lake Byron Scott coined the term THREE-PEAT. Nevertheless, Riley owns the rights to the mark. See https://blog.pattishall.com/2012/07/25/who-owns-a-trademark-jeremy-lin-wins-linsanity-as-anthony-davis-fights-for-his-unibrow/

[4] http://espn.go.com/nba/story/_/id/9360787/miami-heat-owner-pat-riley-had-foresight-patent-three-peat-not-three-heat-espn-magazine

[5] Christopher Wade, Pet. Cancel No. 21,869, 2001 WL 1028372 (Trademark Tr. & App. Bd. Sept. 6, 2001).

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May 6, 2014

Doing Your Due Diligence Before Picking A Name

Filed under: Due Diligence, TM Registration — Tags: , , , , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 3:04 pm

Paul Borovay F LRBy Paul A. Borovay, Associate

Entrepreneur Magazine recently published an article about things to consider before naming your business.[1] It is a good (and short) read for anyone considering starting a company, or even for those individuals who have a company and are thinking about rebranding it under a new name or concept.

To start, consider what makes a company name so important: it must be unique, easy to spell, and nowadays, ideally, play nice with Google’s, Yahoo’s, and Bing’s be-all and end-all algorithms, among other necessaries. As the Entrepreneur article points out, several names, like Apple, Snapple, Oreo and Virgin, are fun to say and easy to spell – and they stick in consumers’ minds.

But the article fails to mention one important aspect about the “picking a name process:” entrepreneurs must do their due diligence before investing time and money in a name.[2] There is nothing worse than getting excited about the perfect name only to be sued for infringing someone else’s trademark after launch.

There are several ways to avoid this scenario. A good start is to check the United States Patent and Trademark Office (USPTO) website to see whether someone else is already using your name. The USPTO provides for both word and design mark searches. Next, conduct your own internet search. If you get several results with a name that is similar to your proposed name but covers different goods or services, you might be okay. Trademark attorneys focus on these types of risk analyses.

One of the most popular services trademark attorneys offer are clearance opinions. First, the attorney will conduct a clearance search for your proposed mark. A clearance search may be obtained from a professional search vendor and reviewed by the attorney. The professional search vendors offer the broadest coverage, including reviewing federal and state trademark registrations, business names across the country (or world if you would consider selling your goods or services abroad), similar internet and domain name references, and variations and colorable imitations of your proposed name revealed through their own proprietary databases.[3] These searches are far more comprehensive than anything you or I could do on our own. They are not cheap, but they really show just how unique and protectable your name might be. Following the search, a trademark attorney will provide you an opinion assessing whether the mark is available for use, as well as your likelihood of getting a state or federal registration.

If you plan to operate your business internationally, securing the advice of a trademark attorney is definitely the way to go, as different countries have very different trademark systems. If you don’t secure trademark rights in the countries where you want to do business, someone else might easily register your name there, and there might not be anything you could do about it.

Once you do secure your perfect company name, you should consider retaining a watch service. As the name suggests, a watch service watches federal and state trademark registrars for similar trademark applications. Getting an early start to protecting the brand you have spent so much time and money developing is imperative and will help keep the scope of your rights in your name as broad as possible.

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Paul A. Borovay is an associate with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.   Paul’s practice focuses on litigation in trademark, media, online gaming and entertainment, advertising, as well as trademark prosecution and counseling.

 

[1] As a complete disclosure, neither I nor this law firm has any connection to Entrepreneur Magazine – though I do own a subscription.

[2] An Entrepreneur Magazine article published on April 8, 2011, titled How Can I Find Out Whether a Business Name Is Already Taken? did discuss the importance of trademark searches.

[3] For example, would you think to search for the term “Fit You” if you were conducting your own trademark clearance search for your proposed new company name “U Fit”? Maybe, but maybe not. See You Fit, Inc. v. Pleasanton Fitness, LLC, 8:12-CV-1917-T-27EAJ, 2013 WL 521784 (M.D. Fla. Feb. 11, 2013).

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January 17, 2014

CrossFit Cybersquatter Gets Dealt Multiple Blows

Filed under: Cybersquatting, Domain Name, TM Registration — Tags: , , , , , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 2:52 pm

Paul Borovay F LRBy Paul A. Borovay, Associate

In CrossFit, Inc. v. Results Plus Personal Training Inc, the panel held that an unsubstantiated “consent to transfer” will not avoid an adverse ruling.  National Arbitration Claim Number: FA1305001498576 (June 28, 2013).  The domain names at issue were <crossfitagawam.com>, <crossfitansonia.com>, <crossfitbeaconfalls.com>, and many other “crossfit”-derivative .com domain names referring to different cities across the United States.

CrossFit, Inc. provided workout and gym products and services.  Its revenue mainly came from licensing its registered CROSSFIT marks and programs to affiliate gyms around the country.  Typically the affiliate would register a “crossfit” domain name that included a geographic designator, e.g., crossfitboston.com.  The Respondent, Results Plus Personal Training Inc., was a competitor of Crossfit.  It registered 113 domain names, most of which “do nothing but add the name of a famous or popular city [to] the CrossFit mark.”  Most were used for parked web pages, often with advertising hyperlinks for Respondent and other competitors.  The panel found that Respondent registered that large amount of domain names “to resell them exclusively to Complainant and its affiliates.”  It was a “bad faith endeavor to confuse Internet users into believing Complainant or its CrossFit mark is at the source of the content, all so Respondent can advance its goals to generate revenue.”

Results Plus argued that GoDaddy.com led it to believe that it could legally register and use these domain names in the manner that it did.  Although CrossFit had filed a federal court action seeking $9 million in damages, the Panel determined that it retained authority to proceed to decision.  To avoid an adverse ruling, Results Plus offered to transfer the domain names to Crossfit on the condition that Crossfit pay Results Plus $1,300, which Results Plus argued was “far less” than it had spent maintaining the 113 domain names.

The Panel observed that an effective consent to transfer does not ordinarily arise when the transfer is subject to the condition precedent of a markholder’s payment of fees. The Panel found that Complainant has not implicitly consented in its Complaint to the transfer of the disputed domain names without a decision on the merits by the Panel.  The Panel observed that this “consent-to-transfer” approach was one way cybersquatters tried to avoid adverse holdings, but it normally was ineffective, especially when the alleged “consent” required the transfer of money to the respondent.  The Panel ultimately found that Results Plus did not have any legitimate interest in the disputed domain names and had acted in bad faith, and ordered the domain names transferred to Cross Fit.

This case highlights that trademark owners can bring an action to transfer  multiple infringing domain names from a single cybersquatter under the Uniform Domain-Name Dispute Resolution Policy (commonly referred to as “UDRP”).  The UDRP sets forth the grounds on which arbitrators base their decisions, but there are several different dispute resolution forums from which to choose, all with their own local rules, procedures and leanings.  While I do not practice CrossFit myself, I know a good 1-2 punch when I see one – and, for now, Results Plus is down for the count.

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Paul A. Borovay is an associate with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.   Paul’s practice focuses on litigation in trademark, media, online gaming and entertainment, advertising, as well as trademark prosecution and counseling.

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January 15, 2014

Ninth Circuit Declares GoDaddy Not Contributorily Liable For Cybersquatting

Filed under: Cybersquatting, Domain Name, TM Registration — Tags: , , , , , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 1:08 pm

Paul Borovay F LRBy Paul A. Borovay, Associate

In December, the Ninth Circuit held that the Anticybersquatting Consumer Protection Act (ACPA), 15 U.S.C. § 1125(d), does not support a cause of action for contributory cybersquatting.  Petroliam Nasional Berhad v. GoDaddy.com, Inc., 737 F.3d 546, 548 (9th Cir. 2013).[1]

Petrolium Nasional Berhad (Petronas), a major oil and gas company with its headquarters in Kuala Lumpur, Malaysia, owns the trademark PETRONAS.  In 2009, Petronas discovered that a third party had registered the domain names “petronastower.net” and “petronastowers.net.”  The third party then used GoDaddy’s domain name forwarding services to forward visitors of the two domain names to a pornographic web site. GoDaddy took no action against the alleged cybersquatting, claiming that (1) it did not host the site; and (2) it was prevented by the Uniform Domain Name Dispute Resolution Policy (“UDRP”) from participating in trademark disputes regarding domain name ownership.  Id. at 548.

Petronas sued GoDaddy in the United States District Court for the Northern District of California on a number of theories, including cybersquatting under 15 U.S.C. § 1125(d), and contributory cybersquatting. Following limited discovery, the district court granted summary judgment in favor of GoDaddy. Petroliam Nasional Berhad v. GoDaddy.com, Inc., 897 F. Supp. 2d 856 (N.D. Cal. 2012) aff’d, 737 F.3d 546 (9th Cir. 2013).  Petronas appealed only with respect to its claim of contributory cybersquatting.

The Ninth Circuit defined cybersquatting as “registering a domain name associated with a protected trademark either to ransom the domain name to the mark holder or to divert business from the mark holder.” Petroliam, 737 F.3d at 550 n. 3 (citing Bosley Med. Inst., Inc. v. Kremer, 403 F.3d 672, 680 (9th Cir.2005)).  Under the ACPA, a person may be civilly liable “if … that person has a bad faith intent to profit from that mark … and registers, traffics in, or uses a [protected] domain name.” 15 U.S.C. § 1125(d)(1)(A). Petronas argued that the ACPA provided for a cause of action for contributory cybersquatting, claiming that “Congress intended to incorporate common law principles of secondary liability into the Act by legislating against the backdrop of the common law of trademark infringement and by placing the ACPA within the Lanham Act.”  Petroliam, 737 F.3d at 550.  The Ninth Circuit disagreed.

Beginning its analysis with the text of the ACPA, the Ninth Circuit noted that the ACPA imposes civil liability for cybersquatting on persons that “register[ ], traffic[ ] in, or use[ ] a domain name” with the “bad faith intent to profit” from that protected mark. 15 U.S.C. § 1125(d)(1)(A). The plain language of the statute thus prohibits the act of cybersquatting, but limits when a person can be considered to be a cybersquatter. Id.  Taking notice that the statute makes no express provision for secondary liability, the Ninth Circuit held that “[e]xtending liability to registrars or other third parties who are not cybersquatters, but whose actions may have the effect of aiding such cybersquatting, would expand the range of conduct prohibited by the statute from a bad faith intent to cybersquat on a trademark to the mere maintenance of a domain name by a registrar, with or without a bad faith intent to profit.” Petroliam, 737 F.3d at 550-51.

Petronas then argued that Congress incorporated the common law of trademark, including contributory infringement, into the ACPA, citing a number of district courts decisions that relied on that reasoning in finding a cause of action for contributory cybersquatting. See Verizon Cal., Inc. v. Above.com Pty Ltd., 881 F.Supp.2d 1173, 1176–79 (C.D.Cal.2011); Microsoft Corp. v. Shah, No. 10–0653, 2011 WL 108954, at *1–3 (W.D.Wash. Jan. 12, 2011); Solid Host, NL v. Namecheap, Inc., 652 F.Supp.2d 1092, 1111–12 (C.D.Cal.2009); Ford Motor Co. v. Greatdomains.com, Inc., 177 F.Supp.2d 635, 646–47 (E.D.Mich.2001).[2]  Again, the Ninth Circuit was not persuaded, holding that the “circumstances surrounding the enactment of the ACPA [. . . ] do not support the inference that Congress intended to incorporate theories of secondary liability into that Act.”  Distinguishing between the Lanham Act’s codification of unfair competition and common law trademark infringement and the ACPA, the Ninth Circuit stated that claims under traditional trademark law and the ACPA have distinct elements. Petroliam, 737 F.3d at 552  (for example, under the ACPA a mark holder must prove “bad faith,” which is not a requirement under traditional trademark infringement claims, and cybersquatting liability, unlike traditional trademark infringement, does not require commercial use of a domain name).[3]  As a consequence, the Ninth Circuit held that the ACPA simply created a new statutory cause of action to address the new cybersquatting problem and that imposing secondary liability on domain name registrars would unnecessarily expand the scope of the ACPA.

The Ninth Circuit’s decision was not surprising.  The purpose of the ACPA and the UDRP is to provide trademark owners with a remedy against those actively using their trademarks in “bad faith.”  As a domain name forwarding provider, GoDaddy simply did not meet the explicit definition of a “cybersquatter.”  Consequently, trademark owners must use the tools the ACPA and the UDRP provide to go after those the ACPA defines as liable, that is, the cybersquatters themselves.[4]

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Paul A. Borovay is an associate with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.   Paul’s practice focuses on litigation in trademark, media, online gaming and entertainment, advertising, as well as trademark prosecution and counseling.


[2] The Ninth Circuit commented that some of these district courts that recognized a cause of action for contributory liability required that a plaintiff show “exceptional circumstances” in order to hold a registrar liable under that theory. See Above.com Pty Ltd., 881 F.Supp.2d at 1178; Shah, 2011 WL 108954, at *2; Greatdomains.com, Inc., 177 F.Supp.2d at 647. The Ninth Circuit noted that the “exceptional circumstances” test has no basis in either the Act, or in the common law of trademark. Petroliam Nasional Berhad v. GoDaddy.com, Inc., 737 F.3d 546, 553 (9th Cir. 2013).  Rather than attempt to cabin a judicially discovered cause of action for contributory cybersquatting with a limitation created out of whole cloth, the Ninth Circuit explicitly declined to recognize such a cause of action in the first place.  Id.

[3] As a practical point, the Ninth Circuit noted that GoDaddy, a registrar holding over 50 million domain names, would have to presumably analyze its customer’s subjective intent with respect to each domain name, using the nine factor statutory test outlined in 15 U.S.C. § 1125(d)(1)(B).  Moreover, domain name service providers would then be forced to inject themselves into trademark and domain name disputes. which is contrary to the purpose of the ACPA and the UDRP. Petroliam Nasional Berhad v. GoDaddy.com, Inc., 737 F.3d 546, 549-54 (9th Cir. 2013).

[4] UDRP proceedings are a cost-effective means to protect your trademark online and to keep third parties from diverting people from your legitimate websites and siphoning off ad revenue.

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January 10, 2014

Kanye West Sends Cease and Desist Letter to Stop New COINYE WEST Virtual Currency

Filed under: Cybersquatting, Domain Name, TM Registration — Tags: , , , , , , , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 12:01 pm

Paul Borovay F LRBy Paul A. Borovay, Associate

Whether you are in the Yeezus camp or the My Beautiful Dark Twisted Fantasy camp, or even if either of those references mean nothing to you, you might still be interested to know that a new currency is in development – in a few days we will all be able to own some COINYE WEST.  Or will we?

As the Wall Street Journal first reported, Kanye West has tried to stop seven anonymous coders behind a new virtual currency called COINYE WEST, similar to bitcoin.  Not surprisingly, Kanye West, by and through his attorneys, has claimed trademark infringement, unfair competition, cyberpiracy and dilution.  You can read the cease and desist letter here.  While the company has changed its domain name from coinyewest.com to coinyeco.in, the coders launched their site on January 7.

West has built a music empire on his KANYE WEST brand, a brand that, according to West’s interview with BBC Radio 1, is the most influential in the world.  As if being the “number one rock star on the planet” was not enough, West’s “I am a God” statement truly makes him a being to reckon with.

While West might be a bit high and mighty (pun intended), he does understand the importance of protecting his brand.  This situation highlights the cross section between trademark rights and the new and evolving internet frontier.  First it was domain names, then came AdWords, and now crypto currency.  While COINYE WEST might face an uphill battle if the case proceeds to court, similar disputes are certain to arise as new technologies develop.  At Pattishall, we strive to stay on the forefront of emerging technologies.  And, while I may not be in the market for any COINYE in the near future, I will be ready to purchase some KARDASH-CASH if Kim Kardashian ever makes any available.[1]

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Paul A. Borovay is an associate with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.   Paul’s practice focuses on litigation in trademark, media, online gaming and entertainment, advertising, as well as trademark prosecution and counseling.


[1] KARDASH-CASH is not a real trademark, nor is it a real currency.  I just made it up for fun.

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