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Trending Trademarks

Comments and analysis on trademark issues affecting the fashion, high-tech, multimedia and consumer products industries

Perfect Your Foreign Trademark Rights Early or Risk Losing Them Forever

Posted in Infringement, Litigation, Multimedia, Registrations

On July 18th a U.K. judge ruled that Twentieth Century Fox Films must change the name of its television show, “Glee”, because it infringes the name of a chain of British comedy clubs named “The Glee Club.”  The judge ruled in favor of the clubs on the theory of “wrong way round” confusion, which is known as “reverse confusion” in U.S. jurisprudence.  Traditionally, courts address likelihood of confusion in trademark cases by determining whether customers mistake the junior user’s products as coming from the same source as those of the senior user.  Reverse confusion, on the other hand, arises when the junior user so saturates the market with advertising and other promotion of its mark that the consuming public comes to believe that the senior user’s products come from the same source as those of the junior user.  Fox’s promotion and broadcast of “Glee” in the UK market was apparently so overwhelming that the judge believed that consumers were likely to believe that the comedy clubs were also Fox businesses.

The “Glee” case follows a January decision by the Opposition Division of the Office for Harmonization in the Internal Market (OHIM), the entity that administers the European Community Trademark (CTM), rejecting an opposition filed by the popular American website, Pinterest, against the UK company Premium Interest Ltd.’s application to register the trademark PINTREST in the EU.  Premium Interest applied to register PINTREST in the EU after Pintrest had commenced business and applied to register its mark in the U.S., but before Pintrest applied for registration in the EU.  Pintrest was unable to prove to OHIM’s satisfaction that its PINTREST mark had sufficient “local significance” in the UK, so OHIM refused to recognize any unregistered rights in the PINTREST mark in Europe.  The decision cast a serious cloud over Pintrest’s right to use its mark in Europe.

These cases are stark reminders of two very important strategic considerations:

  1. U.S. trademark owners should conduct trademark searches both domestic and international markets that are of potential significance, even if the foreign search is merely a “knock-out” search for identical marks; and
  2. U.S. trademark owners should develop and implement strategies for global trademark protection sooner, rather than later, in order to avoid ending up in the same position as Pintrest in the EU and, perhaps, elsewhere.

While international searching and registration are costly, the cost to either defend an infringement suit or change branding in an entire geographic region can be exponentially more.  With some forethought it is possible to spread the costs of searching and registration over several months or years.  Sullivan & Worcester’s Intellectual Property Group provides tailored, strategic advice regarding domestic and international trademark portfolio development.  For more information contact the author.

Las Vegas Sands Goes “All In” Against Online Trademark Infringement

Posted in Internet, Litigation, Multimedia

Las Vegas Sands Corp. (“Sands”), the international casino and hotel giant, is one of the most famous gaming brands in the world. To protect its famous mark from infringing uses, Sands recently left the casino and took to the internet.

On June 27, 2014, Sands filed suit in the U.S. District Court for the District of Nevada against the unknown registrants of thirty-five internet domain names who were allegedly using the Sands trademark, its Chinese equivalent (“Jinsha” characters, which translate to “golden sands”), and Sands’ Venetian Resort design trademark on websites “to falsely affiliate” with Sands. Sands’ complaint included claims of trademark infringement, false designation of origin, trademark dilution, and unfair competition.

In its complaint, Sands alleged that the defendants operate “a network” of Chinese-language websites that direct users to overseas online casinos not affiliated with or licensed by Sands. Each website prominently features Sands’ registered trademarks. Additionally, some of these websites also display photos and graphics of Sands hotels and casinos, such as the iconic Marina Bay Sands Hotel in Singapore. Screenshots of several of these websites are included as an exhibit to Sands’ complaint (available here). Sands argued that the defendants’ unauthorized use of its marks for commercial purposes diluted Sands famous brand and detracted from the “substantial goodwill and excellent reputation” the marks have come to represent.

The defendants registered their allegedly infringing websites through the domain name registrars eNom, Inc., Name.com, Inc., and GoDaddy.com, Inc. According to Sands, the defendants concealed their identities by using privacy protection services, such as Whois Privacy Protection Service, Inc. and DomainsByProxy, LLC, which are offered directly by the domain name registrars. These services allowed the defendants to register domain names using proxy data, instead of using their true names and contact information.

Three days after Sands filed its complaint, the district court issued a temporary restraining order requiring the domain name registrars to remove or disable the websites in question pending trial. The court also permitted Sands to subpoena the privacy protection services for the purpose of identifying the unknown defendants. In its order, the court stated that Sands would “suffer irreparable injury to its valuable trademarks” unless these domains were temporarily restrained. Moreover, the court reasoned that its order was justified because Sands “is likely to succeed on the merits” of its trademark infringement and false designation of origin claims if the case proceeds to trial.

Despite this order, Sands still faces the constant threat posed by infringing online content. This is particularly true because of the ease with which individuals can anonymously register websites that display infringing content and falsely associate with the Sands brand. The threat of trademark infringement is heightened online because users from all over the world—including countries like China, India, and Russia where intellectual property protections are weak or not enforced—can easily target their content to consumers in the United States. Due to the anonymity of the infringing parties and the variances in foreign legal systems, U.S. trademark owners may find it more difficult to procure enforceable judgments to prevent this activity. As a result, these infringing websites can dilute and tarnish the Sands brand, and allow their unknown registrants to free ride on the strength of Sands’ marks and divert consumers for commercial gain.

Nevertheless, by policing and pursuing known instances of infringing use, Sands has helped protect itself from a future defense of trademark abandonment. It has also successfully removed at least some infringing uses of its trademarks from the marketplace, which will help reduce consumer confusion and protect the Sands brand. The fact remains, however, that even with the protections and remedies afforded under U.S. law, the burden of enforcement for civil matters remains squarely on the shoulders of the trademark owner, whose ability to protect its rights in practice may be limited by its financial resources and its success in locating infringing parties.

The case is Las Vegas Sands Corp. v. Unknown Registrants of WWW.368.COM, case number 2:14-cv-01049, in the U.S. District Court for the District of Nevada.

Preclusive Effect of TTAB Likelihood of Confusion Rulings Up for Debate Before Supreme Court

Posted in Infringement, Litigation, TTAB Proceedings

In trademark infringement suits, how much weight, if any, should federal courts give to Trademark Trial and Appeal Board (“TTAB”) decisions on the likelihood of confusion between marks? Today, it depends—the circuits are split. That may soon change, however, as the U.S. Supreme Court last week agreed to take the issue under review.

Case Overview

On July 1, 2014, the Supreme Court granted certiorari review to B&B Hardware, Inc. v. Hargis Industries, Inc., a trademark infringement case from the U.S. Court of Appeals for the Eighth Circuit. In B&B Hardware, a divided panel of the Eighth Circuit ruled that the TTAB’s finding of a “likelihood of confusion” for purposes of trademark registration is a different issue than a federal court’s determination of a “likelihood of confusion” for purposes of trademark infringement. As a result, the Eighth Circuit ruled that the TTAB’s decisions should be given neither preclusive effect nor deference in infringement actions.

The appeal stems from a trademark dispute between B&B Hardware, Inc. (“B&B”) and Hargis Industries, Inc. (“Hargis”). B&B does business as Sealtight Technology, and sells self-sealing fasteners used in the aerospace industry under the mark “Sealtight.” Hargis does business as Sealtite Building Fasteners, and sells construction fasteners used in the metal construction industry under the mark “Sealtite.” B&B registered its mark with the U.S. Patent & Trademark Office, and, when Hargis subsequently applied to register “Sealtite,” filed an opposition with the TTAB.

The TTAB held for B&B. Applying the multifactor likelihood of confusion balancing test used by the Federal Circuit, the TTAB found that Hargis’s mark was likely to confuse consumers and denied registration. In light of its TTAB victory, B&B sued Hargis in federal district court, alleging trademark infringement and arguing that the TTAB’s likelihood of confusion finding should preclude the court from examining the issue. The district court disagreed and sent the issue to a jury, which ultimately found against B&B. B&B appealed based on issue preclusion, but the Eighth Circuit affirmed.

Circuit Split

As B&B noted in its petition for a writ of certiorari, circuits are split on whether TTAB decisions on the likelihood of confusion should be given preclusive effect or deference in trademark infringement actions in federal court. This split centers primarily on the TTAB’s analysis of the similarity of the trademarked products’ marketplace usage and channels of trade.

For example, the Eighth Circuit in B&B Hardware ruled that TTAB decisions should be accorded neither preclusive effect nor deference because the TTAB’s balancing test does not give sufficient weight to the trademarked products’ marketplace context. The Eighth Circuit reasoned that, in the trademark registration dispute, the TTAB did not decide “the same likelihood-of-confusion issues … as those brought in the [trademark infringement] action before the district court.” In particular, the Eighth Circuit noted that the TTAB largely “ignore[d] a critical determination of trademark infringement, that being the marketplace usage of the marks and products.” Indeed, when applying its multifactor test for likelihood of confusion, the TTAB determined that, based on the usage disclosed in B&B’s trademark registration, B&B’s “Sealtight” product moved in different channels of trade than Hargis’s “Sealtite” product, and that this factor weighed against B&B. Yet, the TTAB still found a likelihood of confusion and rejected Hargis’s application for registration based on the similarity of the marks and the underlying products. Ultimately, the Eighth Circuit concluded that, “While this approach may be appropriate when determining issues of registration,” for issue preclusion to apply in a federal trademark infringement action, the TTAB must have given the marketplace context greater weight.

Unlike the Eighth Circuit, every other circuit that has addressed this issue has concluded that TTAB decisions on the likelihood of confusion carry at least some weight in trademark infringement proceedings. For instance, the Third and Seventh Circuits have both given preclusive effect to such TTAB rulings in trademark infringement cases because the same issue—the likelihood of confusion—already had been “actually litigated.” Jean Alexander Cosmetics, Inc. v. L’Oreal USA, Inc., 458 F.3d 244, 254 (3d Cir. 2006).

Similarly, the Second Circuit has also permitted issue preclusion, but has taken a more fact-specific approach to determining whether it applies. To receive preclusive effect, the TTAB’s analysis “must have taken into account, in a meaningful way, the context of the marketplace.” Levy v. Kosher Overseers Ass’n of Am., Inc., 104 F.3d 38, 42 (2d Cir. 1997). It is unclear, however, whether this standard requires the TTAB to have examined the products’ actual marketplace usage, rather than the usage anticipated or set out in an application or registration.

Finally, the Fifth and Eleventh Circuits have forged a middle road, denying issue preclusion but generally affording TTAB decisions a presumption of correctness “out of respect for the expertise of the TTAB.” Freedom Sav. & Loan Ass’n v. Way, 757 F.2d 1176, 1181 (11th Cir. 1985). These circuits dictate that courts should accept the TTAB’s likelihood of confusion findings “unless the contrary is established by evidence which carries thorough conviction.” American Heritage Life Ins. Co. v. Heritage Life Ins. Co., 494 F.2d 3, 10 (5th Cir. 1974).

Given this circuit split, how should the Supreme Court rule? In an amicus brief in support of B&B’s petition for certiorari, the U.S. Solicitor General argued for a clear-cut issue preclusion standard based entirely on “whether the actual usage of the marks at issue in the infringement action differs materially from the usage of the marks set forth in the application for registration and in the opposer’s prior registration submitted in the [TTAB] proceedings.” Applying this standard to B&B Hardware, the TTAB’s ruling would receive preclusive effect if the usage disclosed in B&B’s initial registration and considered by the TTAB concerned the same goods and channels of trade at issue in the federal infringement action. Conversely, issue preclusion would not apply if the marketplace context at issue in the infringement action differed materially from that considered by the TTAB.

Implications for Practitioners

In the grand scheme of trademark law, the question of issue preclusion is a relatively narrow one. Nevertheless, the Supreme Court’s decision in B&B Hardware could have wide-ranging implications for practitioners and trademark owners.

On one hand, a decision in favor of the Eighth Circuit view that denies preclusive effect or deference to the TTAB ruling is likely to reduce the incentive to use that forum as a less-expensive means for resolving trademark disputes. On the other hand, a decision that provides for preclusive effect in all cases is likely to lead to the same outcome, since parties that perceive an advantage in the thorough review of marketplace factors will be forced to bring cases in the federal courts or risk not being able to present such evidence. Although not raised as an issue in B&B’s petition for certiorari, the Supreme Court will also have to consider what rule applies in cases involving intent-to-use applications where there is, by definition, no evidence of the applicant’s marketplace use to consider.

Trademark cases are highly fact-specific and do not often lend themselves to hard and fast rules like those reflected in the Eight Circuit’s opinion and, to a lesser extent, in the decisions from the Third and Seventh Circuits. The Second Circuit’s approach, which relies on a more fact-specific analysis that considers the extent and importance of marketplace evidence before deciding on preclusion, appears to be the most sensible approach. Regardless of the direction it takes, the Supreme Court’s decision should resolve the current circuit split in favor of a uniform approach and bring clarity to the applicable law.

The case is B&B Hardware, Inc. v. Hargis Indus., Inc., 716 F.3d 1020 (8th Cir. 2013), cert. granted, No. 13-352 (U.S. July 1, 2014).

USPTO Cancels Washington Redskins’ Trademarks, Says Name Is Disparaging to Native Americans

Posted in Registrations, Sports, TTAB Proceedings

In a precedential opinion, the Trademark Trial and Appeal Board (the “TTAB”) today ruled that the petitioners in Blackhorse v. Pro-Football, Inc. established by a preponderance of the evidence that the term “redskins” is disparaging to Native Americans and cancelled six registered trademarks owned by the Washington Redskins football team.

The TTAB’s 2–1 decision is based on Section 2(a) of the Lanham Act, which bars registration of marks that disparage persons or bring them into contempt or disrepute. For the Redskins’ marks to meet Section 2(a)’s standard, the TTAB noted that “a substantial composite, which need not be a majority, of Native Americans” must have found the term “redskins” disparaging at the time the marks were registered.

To support its ruling, the TTAB first examined dictionaries published between 1967 and 1992 (the period of time over which the six marks in question were registered) for definitions of “redskins.” These each defined the term as an “offensive, disparaging, [and] contemptuous” slur against Native Americans.

The TTAB also relied heavily on a 1993 resolution of the National Congress of American Indians, the country’s oldest and largest Native American organization, which reflected Native Americans’ past views of the term as a racial slur. Based on this resolution, the Board concluded that the word “redskins” was, “at a minimum,” disparaging to roughly thirty percent of Native Americans when the respective marks were registered, and that thirty percent constitutes a “substantial composite” of the relevant population.

Today’s decision follows years of legal battles regarding the same six Washington Redskins’ trademarks. In 1999, in Harjo v. Pro-Football, Inc., the TTAB also held these marks to be disparaging under Section 2(a). The team and the NFL appealed the ruling to the U.S. District Court for the District of Columbia, which in 2003 overruled the TTAB, stating that there was insufficient evidence of disparagement. The U.S. Court of Appeals for the District of Columbia Circuit affirmed the district court’s ruling in 2005 based on the equitable defense of laches.

In today’s decision, however, the TTAB ruled the laches defense inapplicable based largely on the relative youth of this group of petitioners compared to the petitioners in Harjo. Several Blackhorse petitioners had just turned eighteen, the age of majority necessary for standing in such a proceeding, when the petition was filed, and thus could not be found to have delayed asserting their rights for a sufficient amount of time to establish a laches defense.

The lone dissenting administrative judge disputed the cancellation, arguing that the petitioners provided little additional evidence other than what was submitted in Harjo, and that such evidence was inconclusive and insufficient to establish that the marks were disparaging at the time they were registered. The dissent also emphasized that this case was “not about the controversy, currently playing out in the media, over whether the term ‘redskins’ … is disparaging to Native Americans today.”

As the dissent suggests, and as we have covered in the past on Trending Trademarks, in recent years the controversy surrounding the Redskins’ name has notoriously played out in the public eye. The team’s owner, Daniel Snyder, has repeatedly deflected arguments that the name is offensive, famously telling USA TODAY, “We’ll never change the name. It’s that simple. NEVER—you can use caps.” Meanwhile, pressure has mounted from civil rights leaders, fifty U.S. Senators, and even President Obama to urge Snyder and the NFL to rename its Washington franchise.

Importantly, the TTAB’s ruling does not bar the team or the NFL from continuing to use the Redskins name. It could, however, affect the team’s ability to fully monetize its brand through merchandising because it forecloses certain benefits of federal trademark registration that could help the team defend its marks against unauthorized use. These benefits include the presumption of validity at trial and the ability to enlist the help of the U.S. Customs and Border Protection Service to combat the importation of infringing, counterfeit goods. As a result of the TTAB’s opinion, in a press release the team has already indicated that it plans to appeal in federal court.

The case is Blackhorse v. Pro-Football, Inc., No. 92046185 (T.T.A.B. June 18, 2014).

Reversing Ninth Circuit, Supreme Court Allows POM Wonderful to Sue Coca-Cola Under Lanham Act

Posted in Food & Beverage, Infringement, Litigation

Who has the right to sue to prevent misleading and deceptive labeling of food and beverage products—private trademark owners, or the federal government? Trick question! According to the U.S. Supreme Court, the answer is both.

Yesterday, in a unanimous opinion, the Supreme Court ruled that POM Wonderful, LLC (“POM”), the pomegranate juice producer, is not precluded from suing the Coca-Cola Company (“Coca-Cola”) under the Lanham Act for deceptively labeling its juice products, even though food and beverage labels are governed by the Food, Drug, and Cosmetic Act (“FDCA”) and the U.S. Food and Drug Administration (“FDA”) regulations issued thereunder. Thus, POM’s private false advertising claim is not barred simply because the federal government has the authority to regulate the misbranding or mislabeling of food and drinks. The Court emphasized the discrete purposes of the two laws: the Lanham Act is a private mechanism by which competitors can protect their brands, whereas the FDCA is a public protection measure under which the government can regulate health and safety.

The Supreme Court’s ruling reversed the U.S. Court of Appeals for the Ninth Circuit, which had held that the enforcement of food and beverage labeling is under the exclusive purview of the federal government. The Ninth Circuit had stated that in cases where the Lanham Act and FDCA govern the same label, the FDCA is superior and bars Lanham Act claims. The Supreme Court disagreed, holding that, “Competitors, in their own interest, may bring Lanham Act claims like POM’s that challenge food and beverage labels that are regulated by the FDCA.”

This case stems from POM’s contention that Coca-Cola, which sells juice products under its Minute Maid brand, misleads consumers about the contents of its juice to the detriment of competitors like POM. The product at issue is a juice blend labeled “Pomegranate Blueberry” in large print, followed in smaller type by the words “Flavored Blend of 5 Juices.” In reality, this product contains just 0.3% pomegranate juice and 0.2% blueberry juice, and consists of over 99% apple and grape juices. POM argued that Coca-Cola’s label misleads consumers to think that its product contains primarily pomegranate and blueberry juice, and that this injures sellers of pomegranate juice like POM.

The Court’s ruling was not a surprise, as the justices expressed pointed skepticism of Coca-Cola’s defenses during oral arguments. Coca-Cola’s lawyer argued that, “we don’t think that consumers are quite as unintelligent as POM must think they are. They know when something is a flavored blend of five juices [and] the non-predominant juices are just a flavor.” In response, Justice Anthony Kennedy cracked, “Don’t make me feel bad because I thought that this was pomegranate juice.” The Court’s unanimous ruling seems to indicate that Justice Kennedy was not alone.

This decision could be a boon for trademark owners. Already, commentators have speculated that as a result of this opinion, litigation involving misleading product labeling will increase, “because companies can no longer claim a safe harbor from those suits simply because the [FDA] authorized their labels.” The Court has cleared up confusion surrounding the intersection of these two federal laws and has provided trademark owners in the food and beverage industry with confidence to protect their rights even if a FDA regulation also governs product labeling. Although POM will still have to prove that Coca-Cola’s labels are in fact deceptive and misleading under §43 of the Lanham Act, yesterday’s ruling affords POM the opportunity to have its day in court.

The case is POM Wonderful LLC v. Coca-Cola Co., No. 12-761 (U.S. June 12, 2014).

When Good Fabergés Go Bad; Luxury Jeweler Sues Brooklyn Banquet Hall For “Shameless” Appropriation Of Its Mark

Posted in Dilution, Fashion, Food & Beverage, Infringement, Litigation

This week, luxury jeweler Fabergé filed a lawsuit against Brooklyn restaurant Faberge for what it has deemed a “shameless” appropriation of the jeweler’s famous mark and distinctive storefronts.

The original Fabergé was founded in 1842 in St. Petersburg, Russia, and has been most famous historically for designing elaborate jewel-encrusted Fabergé eggs for Russian Tsars and a range of other jewelry and luxury products sold internationally, including in New York.  The restaurant/lounge opened last fall in Sheepshead Bay, Brooklyn, New York, and offers a menu of steak, seafood and cocktails.

The complaint, filed in the U.S. District Court for the Eastern District of New York, asserts that Faberge’s restaurant exhibits “an effort to free-ride on the enormous good will” established by the jeweler and simply “confuse[s] consumers and members of the general public.”

The restaurant has responded that its name differs from the jeweler’s in that there is no accent on the final ‘E’ of the name, and the ‘A’ is shaped like the Eiffel Tower, thus distinguishing the restaurant’s mark from the jeweler’s.  Even if the two marks are very similar, or even arguably the same, as we’ve previously discussed here on Trending Trademarks, trademark rights are typically limited to particular classes of goods or services; consequently, companies operating different types of businesses may often use the same trademark simultaneously.  The owner of the restaurant rightfully pointed out that the two companies are in completely different and non-competing industries; fine jewelry versus food services.

These, however, may be distinctions without a difference. Owners of marks as famous as Fabergé have broader rights to use and defend their marks, including the right to prevent use of a confusingly similar mark if it is likely to generate confusion among consumers.  It is also worth noting the restaurant’s façade, patterned in purple and gold diamonds (depicted above), which bears a striking similarity to the jeweler’s retail boutiques in London and Kiev.  Finally, the complaint asserts that the restaurant’s menu “directly and obviously” alludes to the historical legacy of Fabergé (though specific items were not explicitly named).  Considered as a whole, these facts could be sufficient evidence to support the restaurant owners’ bad faith and wilful misuse in adopting the name, look and feel of their establishment.

The case is Faberge Ltd. et al. v. Yusufov et al., case number 1:14-cv-03519, in the U.S. District Court for the Eastern District of New York.

TTAB Repels “Asshole” Trademark Registration

Posted in Registrations, TTAB Proceedings

Is the word “asshole” so scandalous and vulgar such that it is unworthy of trademark registration? According to the Trademark Trial and Appeal Board (the “TTAB”), the answer is definitively “yes.”

In a precedential opinion issued on May 30, 2014, the TTAB affirmed a trademark examiner’s decision to refuse to register “Asshole Repellent” as a mark for a novelty spray-top can gag gift because it is “scandalous” under Section 2(a) of the Trademark Act. Section 2(a) is an absolute bar to registration of marks that involve an “immoral, deceptive, or scandalous matter” from the standpoint of “a substantial composite of the general public” in terms of contemporary attitudes.

The TTAB relied heavily on several dictionary definitions that define “asshole” as a vulgar word. As its opinion stated, dictionary definitions alone can be sufficient to establish that a proposed mark is scandalous under Section 2(a). The applicant, Anthony Michalko, contended that while at one time the public at large may have found the word scandalous, in its modern usage the term “is at its worst ‘impolite.’” Although the TTAB noted that its role is not “to moralize” about the freer use of obscenities in popular culture, it also acknowledged the “enduring vulgarity of some terms, despite changing times or norms.” Thus, despite being used more frequently now than in the past, the TTAB held that the word has not lost its profane meaning, and is still scandalous and barred from registration.

It is reasonable to question whether the TTAB has over time taken a consistent approach to evaluating potentially scandalous or obscene marks under Section 2(a). On the whole, the Trademark Office’s reliance on dictionary definitions arguably has led it to take a conservative approach to registration. For example, it has rejected applications for the marks “Cock Suckers” (referring to rooster-shaped lollipops), “Sex Rod” (referring to clothing), and “AWSHIT Works” (referring to hats and clothing items), largely ignoring the context in which these “scandalous” terms were being used.

Here, however, the applicant Michalko raised an interesting argument that the Trademark Office has been inconsistent in applying its standards for vulgarity because it has previously permitted registration of hundreds of marks that contain the word “ass.” The TTAB, however, dismissed this argument as having “little, if any, probative value” in determining whether to register Michalko’s mark. But does this assessment make sense? A search of the Trademark Electronic Search System reveals 437 live marks which incorporate the word “ass,” including many—such as “Blast That Ass,” “Fake Ass Bitch,” “Ass Juice,” and “Tight Ass“—to which a substantial portion of the general public might take offense. Although “ass” may have one or more inoffensive meanings, it is transparent that in these examples the word is not meant to signify, for instance, a four-legged beast of burden, but in fact connotes a scandalous use, which some may deem more offensive than Michalko’s applied-for mark. In this context, it is difficult to square the TTAB’s opinion with such past registrations.

Of course, the TTAB’s ruling does not proscribe Michalko’s continued use of his mark as an unregistered trademark. The Trademark Act’s bars to registration do not override the freedom of expression granted by the First Amendment. Rather, they simply set the parameters within which the federal government will grant the privileges associated with trademark registration, such as the presumption of validity at trial, nationwide constructive use and notice, and the potential of achieving incontestability. As a result, owners of unregistered scandalous or vulgar marks like Michalko may find it more difficult to enforce their rights.

The case is In re Michalko, Serial No. 85584271 (T.T.A.B. May 30, 2014).

Video Interview with LXBN TV: Discussing Amazon’s Trademark Infringement Lawsuit

Posted in Consumer Products, Infringement, Internet, Litigation, Technology

Following the post, “Amazon’s Red Hot Video Streaming Service Under Fire,” I  had the opportunity to speak with Colin O’Keefe of LXBN regarding the trademark infringement lawsuit.

Amazon’s Red Hot Video Streaming Service Under Fire

Posted in Consumer Products, Infringement, Internet, Litigation, Technology

A recent trademark infringement case against Amazon.com, Inc. (“Amazon”) has thrust the company’s latest product, the Amazon Fire TV, from under the spotlight to under the red light.

On April 17, 2014, Wreal, LLC (“Wreal”), maker of an adult entertainment video streaming system called FyreTV, sued Amazon in the Southern District of Florida for trademark infringement, false designation of origin, and three related state-law claims. Amazon has yet to answer Wreal’s complaint, and has declined multiple media requests for comment on the case.

In its complaint, Wreal describes itself as “a pioneer” in the market for on-demand Internet streaming technology. Wreal states that it has sold its FyreTV product—a television set-top box that delivers exclusively adult video content—since 2007, and has spent millions of dollars developing and marketing its system. The complaint establishes that Wreal registered the marks FyreTV and FyreTV.com in 2008, and that it has enforceable and incontestable rights in both marks. (Note: the website contains explicit content and is NSFW).

Wreal’s suit against Amazon centers around the likelihood of reverse confusion resulting from Amazon’s use of the mark “Fire TV” to refer to its own proprietary set-top streaming product, released in April 2014. In support of its claim, Wreal contends that the Fire TV and FyreTV marks are pronounced the same way, look nearly identical, and refer to products that perform “a substantially similar” function. Despite the fact that Amazon’s product offers mainstream films and television programs, whereas Wreal’s product is a portal to pornography, viewed broadly “[b]oth products provide instant access to a massive library of streaming video services that consumers can view in the convenience of their own home.”

Additionally, Wreal argues that because Amazon is a massive company with immense resources, its use of the Fire TV mark could destroy consumers’ association between FyreTV and Wreal. As a result, the public might view Wreal as an unlawful imitator of Amazon. This, Wreal argues, would dilute the goodwill built up in the FyreTV mark and cause the company irreparable harm. The complaint also offers some evidence of actual consumer confusion on social media in the wake of Fire TV’s release.

On its face, Wreal’s complaint presents a strong case for trademark infringement. In defense, Amazon’s best argument seems to be that its Fire TV mark is not likely to confuse consumers because the product it represents is marketed to a different audience (consumers at large) than Wreal’s FyreTV (consumers of adult entertainment). When it comes to evaluating the proximity of two marks, however, courts tend to think expansively and are willing to find infringement even if the marks are used in distinct product markets. Thus, the court would likely place more weight on Wreal’s other arguments.

Amazon undoubtedly anticipated this lawsuit before it began selling Fire TV. Indeed, Wreal notes that a free search of the USPTO’s Trademark Electronic Search System for the mark “Fire TV” shows that Wreal owns registered trademarks in Fyre TV and FyreTV.com. Moreover, multiple news outlets raised the issue of consumer confusion on the same day Amazon released Fire TV. Nevertheless, Amazon likely concluded that the value of expanding its “Fire” brand of electronic products from e-readers to video streaming devices outweighed the potential repercussions of Wreal’s suit.

In the past, Amazon has creatively resolved reverse confusion claims out of court. For example, in 1999, after becoming a popular online bookseller, Amazon was sued for trademark infringement by the Amazon Bookstore Collective, a small but long-established feminist bookstore. Amazon resolved the suit by purchasing the bookstore’s rights in the “Amazon” name and then licensing them back to the store, along with paying a small cash settlement.

Today, the stakes are higher for Amazon. It is no longer just a bookstore—it is the world’s largest online retailer with billions of dollars in revenue. Wreal certainly recognized Amazon’s wealth in its complaint, asking the court not only for injunctive and compensatory relief, but also to force Amazon to disgorge profits resulting from its sales of Fire TV units. Although the parties will likely settle, Wreal may be in for a multimillion dollar payday. For Amazon’s sake, hopefully its decision to expand the “Fire” brand is worth the consequences.

The case is Wreal, LLC v. Amazon.com, Inc., case number 1:14-cv-21385, in the U.S. District Court for the Southern District of Florida.

You Can’t Rip Off CrossFit

Posted in Infringement, Internet, Litigation, Sports

CrossFit, Inc., the high-intensity fitness company with a reputation for diligently protecting its trademarks, has been pursuing a seemingly routine infringement action against a Chelmsford, MA gym for nearly a year. Recently, however, the case took an unexpected turn when a CrossFit executive was revealed as the voice behind the CrossFit Ripoff Report (the “Ripoff Report”), a website devoted to identifying—and advising its readers to avoid—gyms that advertise CrossFit training but are not licensed CrossFit affiliates.

In June 2013, CrossFit sued Donny Mustapha, owner of the Chelmsford Sports Club, for infringing on its trademark by offering “CrossFit style training.” CrossFit contended that Mustapha was not a licensed, dues-paying CrossFit affiliate. In response, Mustapha argued that CrossFit had abandoned its trademark by failing to police its use by third parties and by engaging in naked licensing. Mustapha also counterclaimed that certain negative online comments about his gym posted by CrossFit members and encouraged by the Ripoff Report were defamatory.

Initially, CrossFit denied any relationship to the Ripoff Report and sought dismissal of Mustapha’s defamation counterclaims. The court has since rejected all but one of the counterclaims on First Amendment grounds, but not before Mustapha was able to prove, based on a subpoena of the website’s domain name information, that the Ripoff Report was in fact created and published by CrossFit’s social media director. In a recent interview, CrossFit’s general counsel said he was “surprised” to learn of the executive’s involvement.

From a trademark law perspective, regardless of whether the Ripoff Report was created independently by an employee or was authorized by CrossFit itself, the website is a useful way for CrossFit to monitor and raise awareness of infringing use of its trademark. Federal trademark law requires trademark owners to take affirmative steps to enforce their marks to prevent abandonment of trademark rights. As an infringement watchdog, the Ripoff Report helps CrossFit defend against claims that CrossFit abandoned its mark, or that the mark has become generic—a fate that has befallen a number of well-known trademarks over the years, including ASPIRIN and THERMOS, and, more recently, PILATES.

From a marketing perspective, the effects of the Ripoff Report are less clear. CrossFit may have viewed the Ripoff Report as a dynamic guerilla marketing effort—a supposedly fan-created alternative to the company’s existing IP infringement reporting system. The Ripoff Report claims it was “created by the CrossFit community, for the CrossFit community.” Such sites can help build brand awareness, foster a sense of community around the brand, and help deter potential counterfeiters and grey marketeers. Once it was revealed to be part of an astroturfing advocacy campaign created by CrossFit itself, however, the credibility of the site’s image of a grassroots community united to protect the CrossFit brand was undermined. Moreover, one has to question whether better control and monitoring of content on the Ripoff Report website could have avoided the defamation counterclaim the company is now facing, and all the costs and headaches that may arise from that litigation.

Trademark owners who are interested in using websites, blogs, and other social media to protect and develop their brands need to make sure that the message is controlled by the company, and not its employees. Although the question of whether the CrossFit employee who was operating the website was authorized by CrossFit to do so may have legal ramifications in court, in the marketplace it falls to CrossFit to clean up the mess left behind.

The case is CrossFit, Inc. v. Mustapha, case number 13-11498-FDS, in the U.S. District Court for the District of Massachusetts.