Good article summarizing the latest round of prominent cases in the U.S. and the EU addressing online companies’ liability for trademark infringement of their users: http://bit.ly/cbbH37 d
Posts Tagged ‘Trademarks’
Online companies get a bye on using trademarks
Wednesday, July 21st, 2010EU Court Rules That Adwords Do Not Infringe Trademark Laws
Friday, July 9th, 2010Concurrent Use of Trademarks in Different Geographic Locations
Wednesday, June 30th, 2010Generally, trademark owners have exclusive rights to use their mark to label or identify their goods and/or services. However, trademarks may overlap under either of the following circumstances:
1. In different industries; or
2. In different geographical locations.
The most frequently litigated of these exceptions has been the concurrent use of trademarks in different geographical locations, as courts have had to determine the appropriate geographical scope of territorial priority rights in a particular trademark.
Concurrent Use in Different Geographical Areas
Although two companies must typically use an entirely different mark in order to avoid confusing the public as to who makes what, courts have typically permitted concurrent use of the same or similar mark by restaurants in different parts of the country. The rationale behind permitting concurrent use of a mark in different geographical areas is that there is little likelihood of confusion.
For example, in Weiner King, Inc. v. Wiener King Corp., the federal district court permitted concurrent use of “Weiner King” as a mark for restaurants featuring hot dogs in New Jersey and “Wiener King” as a mark for restaurants in North Carolina. Similarly, in Pinocchio’s Pizza Inc. v. Sandra Inc., the court permitted concurrent use of “PINOCCHIO’S” as a mark for restaurants in Maryland and “PINOCCHIOS” as a mark for restaurants located elsewhere in the country.
Concurrent Use Application and Proceedings
The Trademark Trial and Appeal Board (the Board) holds a concurrent use proceeding to determine whether an applicant is entitled to concurrent registration of a trademark. In order to initiate a concurrent use proceeding, a concurrent user must submit a concurrent use application, in which the applicant meets the following criteria:
1. Concedes that its use is not exclusive
2. Specifies the goods and/or services and area or mode of use for which the applicant desires registration
3. Identifies one or more persons which concurrently use the same or similar mark for the same or similar goods or services
4. Provides certain information concerning use of the mark by each listed concurrent user
Under Section 1052(d) of the federal Lanham Act, the Board Director may issue concurrent registrations upon finding that “confusion, mistake, or deception is not likely to result from the continued use by more than one person of the same or similar marks.” Further, an applicant is only entitled to concurrent registration if they have used the mark in commerce prior to the applicable date specified in the provision.
Priority of Use Test to Determine Ownership
The generally accepted rule on how to determine ownership of trademark rights is by the “first use date.” Specifically, the priority of use standard dictates that the first to actually use a mark in the sale of goods or services gains exclusive rights to the mark in the geographic area in which the mark is actually used.
In addition to gaining ownership rights in a trademark by way of actual use of the mark in a specific geographical area, ownership rights may also come from “constructive use.” Under this theory, federal registration of a trademark with the U.S. Patent and Trademark Office (PTO) raises the presumption that the registrant owns the mark, and fixes the registrant’s nationwide priority rights in the mark. However, federal registration of a mark does not give the registrant priority over others who have previously used the mark in commerce. As such, federal registration by one mark user places the burden on a concurrent user to show their prior and continued use of the mark.
Geographical Range of Prior Use
The Lanham Act requires the Board Director to “prescribe conditions and limitations as to the mode or place of use of the mark” in issuing concurrent registrations. Typically, the Director will grant territorial priority in a mark to the “senior user” who has applied for federal registration (as discussed above). However, the territorial rights of a senior user are subject to the rights of a “junior user” who has used the mark prior to the senior user’s application for federal registration.
When actual use of a mark by a senior user has been limited, courts frequently consider four factors to determine territorial priority in a mark, including:
1. The volume of sales of the product in a particular geographical location
2. Growth trends in the area
3. The market penetration as a function of the total product market
4. The amount of advertising
If a senior user satisfies the aforementioned criteria, actual use of a mark in a territory is not necessary to establish priority in the mark. Because pre-existing federal registration gives a registrant nationwide priority in a mark, it is important to conduct a trademark search before becoming committed to a particular trademark and using it in a particular geographical location.
If you have any questions relating to trademarks, copyrights, or any other intellectual property issues, please call Darren Geliebter or Mathew Lombard at 212-551-1755.
Reasons for Registering a Trademark both with the USPTO & Internationally
Friday, June 25th, 2010- Valuable Asset – The most important reason to register your trademark is to preserve your rights in this valuable asset. In many countries of the world, even though you have created a trademark and are using the trademark, if you do not register that trademark, you have no rights in it. A third party can misappropriate “your” trademark and obtain ownership rights by registering before you do. Although there are many other countries, in addition to the United States, which provide certain rights to mere trademark users (i.e., common law rights that commence as of first use), asserting trademark rights based on mere use of a trademark is expensive and time consuming, not to mention the fact that you may fail if your usage is not sufficiently notorious. Thus, a trademark registration is a valuable asset for use in asserting your trademark rights against other parties. Furthermore, since a trademark registration is viewed as an asset, it can be used to collateralize a loan or it can often be sold to a third party.
- Fend Off Other Parties – Trademarks can be misappropriated innocently by coincidence, or intentionally, by competitors, distributors, or professional trademark pirates. Trademark pirates can learn about new and upcoming trademarks by attending trade shows and watching the media and thereafter seeking to register these trademarks in strategic foreign countries. They hope to sell these trademarks at a handsome profit to the companies which introduced the trademark. If you register first, you not only foil the trademark pirate, you also make it easier for other parties to determine that the trademark is already protected when they do a trademark search on a new trademark that they are considering using.
- Prevent Trademark Dilution – Another important reason to register trademarks is to prevent what is known as “dilution”. Dilution occurs when a number of companies use similar trademarks on similar goods. Potential purchasers are then exposed to numerous trademarks that have certain similarities as to these related goods, and this minimizes the legal and practical value of a trademark as a source identifier. Other companies are much less likely to adopt a trademark which is similar to or identical to your trademark if you have taken the necessary steps to register it. If you do not register your trademark, it is much more difficult for other parties to become aware of your interest in the trademark.
- Potential Loss of Goodwill – Another danger is the loss of good will which can arise by an infringing product or service of poor quality. This can happen when someone else enters the marketplace and commences the sale of goods or services with the same or a similar mark. If those goods or services are of poor quality, purchasers may well associate the poor quality item with your company, resulting in your loss of good will and sales. However, this is less likely to occur if you register your trademarks, since many companies take steps to avoid infringing a trademark of which they are aware.
- Defensive Registrations – Trademarks can also be registered in nearly all countries in the world outside the United States as a defensive measure. In those countries, a company or individual need not use its trademark prior to obtaining a registration. Therefore, even in potential markets, you can prevent a third party from registering or using a trademark if you are the first party to obtain a registration. By obtaining a registration in advance of your use, you can be virtually assured of the unfettered ability to exclusively use your trademark in that country provided you begin use before the registration is subject to cancellation for non use.
- Licensing the Trademark – Another reason for registering trademarks is the monetary value of a trademark registration per se. Besides being a property right which can be sold or collateralized, a trademark can be licensed. Quite often, companies enjoy substantial revenue in royalties from licensing their trademarks. If a trademark is licensed, however, it is very important, not only to register the trademark, but also to record the license agreements, where possible. License agreements must be carefully drafted to assure quality control of the licensed products and/or services by the trademark owner. A trademark license should be reviewed by an attorney who is knowledgeable in these matters, since the improper drafting or enforcement of a license agreement or the failure to record a license agreement can result in the invalidity of the trademark.
Online Trademarks Challenges- Part 1
Thursday, April 29th, 2010Brand owners have a responsibility to police third-party use of their marks, unless they want to have those rights either diminished or lost altogether over time. Policing the marketplace has always been a challenge. The Internet raises new unforeseen challenges every day. On this blog we are going to run a multi-part series addressing these concerns– the goal will be to educate our readers on the various types of Internet-related trademark issues and when possible, offer some strategies for dealing with these challenges. While there are no easy solutions, one thing is clear- brand owners must be more vigilant than ever in protecting the goodwill established in their valuable trademarks.
Today’s topic: Phishing Attacks. ”Phishing” is defined on Wikipedia as:
the criminally fraudulent process of attempting to acquire sensitive information such as usernames, passwords and credit card details by masquerading as a trustworthy entity in an electronic communication. Communications purporting to be from popular social web sites, auction sites, online payment processors or IT administrators are commonly used to lure the unsuspecting public. Phishing is typically carried out by e-mail or instant messaging,and it often directs users to enter details at a fake website whose look and feel are almost identical to the legitimate one. Even when using server authentication, it may require tremendous skill to detect that the website is fake. Phishing is an example of social engineering techniques used to fool users,[2] and exploits the poor usability of current web security technologies.
Phishing is a fraudulent, criminal offense. Trademark law can also be used as a supplementary weapon to deal with phishing attacks. A variety of federal and state anti-fraud laws in the U.S. can be triggered by phishing activities because the act incorporates deception and the fraudulent imitation of another company’s trademarks in order to lure recipients into divulging confidential financial information. This use of another company’s trademark in an email message in order to pose as that party fraudulently likely constitutes a form of both trademark infringement and false advertising, both of which are illegal under the Lanham Act.
Another potential legal weapon may eventually be the Anti-Phishing Consumer Protection Act of 2008, which was introduced to Congress a few years ago but has not yet been enacted.
The Abercrombie Test: Generic, Descriptive, Suggestive, Arbitrary & Fanciful Marks
Thursday, April 29th, 2010The Lanham Act, the U.S. federal trademark statute, protects marks that perform source-identifying functions. Specifically, under the Lanham Act, a person must use or intend to use a mark to “identify and distinguish [his or her goods]…from those manufactured or sold by others and to indicate the source [of the goods].” In essence, trademark law places a premium on marks that are distinctive.
The Abercrombie Test
Following the “classic formulation” set forth by a federal appeals court in Abercrombie & Fitch Co. vs. Hunting World, Inc., courts frequently classify marks into five categories. In order of generally increasing distinctiveness, these categories of marks are: (1) generic; (2) descriptive; (3) suggestive; (4) arbitrary; and (5) fanciful.
Generic Marks: Ineligible for Protection
According to the Abercrombie court, “a generic term is one that refers, or has come to be understood as referring, to the genus [or class] of which the particular product is a species.” To cite the court’s example, “Ivory” would be generic when used to describe a product made from the tusks of elephants. Generic marks can never be protected as trademarks.
Descriptive Marks: Eligible for Protection Only if Accompanied by Secondary Meaning
“A term is descriptive if it forthwith conveys an immediate idea of the ingredients, qualities or characteristics of the goods.” Descriptive marks are not inherently distinctive, i.e.they do not identify a particular source. As such, they can only be protected if they have acquired “secondary meaning.” According to the U.S. Supreme Court, “secondary meaning is acquired when in the minds of the public, the primary significance of a product feature…is to identify the source of the product rather than the product itself.”
Various courts have cited the following examples of descriptive marks: “Tasty” bread; “Trim” nail clippers; and “Car Freshener” deodorizer.
Suggestive Marks: Automatically Eligible for Trademark Protection
The Abercrombie court described a suggestive mark as one that “requires imagination, thought and perception to reach a conclusion as to the nature of the goods.” In other words, a suggestive mark will tend to connote a characteristic of a product, and thereby enable a consumer to infer something about the product from the mark. Because a suggestive term is deemed inherently distinctive, it is automatically entitled to protection (i.e., without secondary meaning). “Chicken of the Sea” and “Coppertone” are examples of suggestive marks.
Arbitrary or Fanciful Marks: Automatically Eligible for Trademark Protection
According to the Abercrombie formulation, fanciful marks typically consist of “words invented solely for their use as trademarks.” For example, “Kodak” and “Clorox” are fanciful marks. However, “when the same legal consequences attach to a common word, i.e., when it is applied in an unfamiliar way, the use is called ‘arbitrary.’” An example of an arbitrary mark is “Apple” for computers.
Both arbitrary and fanciful marks are completely unrelated to the goods they adorn. However, while an “arbitrary” mark is typically well-known in a different context, a “fanciful” mark is newly invented. Like suggestive marks, arbitrary and fanciful marks are deemed inherently distinctive, and are automatically entitled to trademark protection.
Illustration
A federal appeals court set forth the following example to illustrate these legal concepts:
“The trade name ‘Pet Store’ for a shop that sold pets would be generic. The word ‘penguin,’ by contrast, would be descriptive when used in the name of a shop that specialized in items relating to a certain polar species; suggestive when denominating an air conditioning company; and arbitrary when the name of a book publishing company. (If the book publisher wanted a fanciful mark, it could use a made-up word, like ‘Penquell.’)”
Community Trade Mark Fees Reduced as of May 1 2009 (Reminder)
Wednesday, November 11th, 2009The Community Trade Mark (CTMs) was introduced in 1996 to cover all 27 countries that comprise the European Union (Member States). In order to maintain a CTM, use of the mark in just one country (however minimal) is enough to sustain a mark.
As of May 1, 2009, the fees for filing a Community Trade Mark application have been reduced significantly – down by 40%, or 44% for electronic filings. There has also been a simplification of the fee structure with the removal of the registration fee altogether.
Specifically, the old CTM application fee (if filed by paper) was 1050 Euros, and has now been reduced to 900 Euros; the CTM application fee (if filed electronically) has been reduced from 900 to 750 Euros, the CTM application fee for a collective mark has been reduced from 1800 to 1300 euros, and the Madrid Protocol registration fee has been reduced from 1450 to 870 euros. The CTM registration fee has been removed completely (it used to be 850 euros).
If you have any questions about utilizing the CTM system, contact our office at any time.
Federal Rights & Remedies for Unauthorized Use of Trademarks
Friday, September 11th, 2009Trademarks are important tools used to protect both consumers and sellers of goods or services. Trademarks identify the origin or source of a good or service, allowing consumers to make informed decisions regarding quality. Trademarks also establish goodwill of businesses that are able to associate the quality of their good or service with their mark. In addition, trademarks ease the marketing and advertising processes as consumers learn to recognize certain trademarks in connection with the related good or service. Validly established trademarks are strongly protected by laws against infringement.
Protection of Registered and Unregistered Trademarks
In general, registered trademarks receive the most protection and are more likely to receive monetary awards for infringement. However, trademarks do not have to be officially “registered” to be protected. The Lanham Act is the federal law on trademarks which offers protection to trademark owners against the false commercial exploitation of their trademarks by competitors.
Under the Lanham Act, federally registered trademark holders can take advantage of the traditional infringement action, while any valid trademark owner may have a federal claim for unfair competition. Regardless of whether the trademark is federally registered, a party claiming the infringement must be able to establish that they have developed a protected interest in a trademark.
Trademark Infringement of Federally Registered Trademarks
The owner of a trademark effectively has a property interest in that mark, and anyone who misuses that mark is “infringing” upon their protected trademark rights. Section 1114 of the Lanham Act provides registered owners of a trademark with an action against anyone, without consent of the registered owner, who:
1. Uses a reproduction, counterfeit, copy or colorable imitation of a registered mark;
2. In connection with the sale, offering for sale, distribution or advertising of goods or services;
3. In interstate commerce;
4. In such a way that is likely to cause confusion, mistake or to deceive (consumers).
False Designations of Origin, False Descriptions and Dilution of Trademarks
Similar to an action for federally registered trademark infringement, section 1125 of the Lanham Act provides valid trademark owners with a civil action against anyone who:
1. Uses any word, term, name, symbol or device or any combination thereof, or any false designation of origin or false or misleading representation of fact;
2. In connection with the commercial advertising and promotion of goods or services;
3. In interstate commerce;
4. In such a way that is likely to cause confusion, mistake or to deceive or which misrepresents the nature, characteristics, qualities, or geographic origin of goods or services.
However, a claim for goods which are marketed in violation of this section does not require the trademark to be federally registered. This section of the Lanham Act generally provides the broader federal claim against unfair business practices.
Likelihood of Confusion
Regardless of whether the trademark is federally registered, it is well established that a plaintiff claiming trademark infringement (or federal unfair competition) must demonstrate that the infringement caused a “likelihood of confusion.” In other words, trademark owners must show that the consuming public would be confused, misled or deceived as to the origin of the defendant’s goods or services caused by the use of their trademark (or a confusingly similar mark).
Factors that courts typically consider in determining whether there is a likelihood of confusion include:
1. The degree of similarity between the marks and of the goods and services;
2. The strength (or distinctiveness) of the plaintiff’s mark;
3. Any evidence of actual confusion by consumers;
4. The intent of the defendant in adopting its mark;
5. The physical proximity of the goods or services in the retail marketplace;
6. The degree of care likely to be exercised by the consumer; and
7. The likelihood of expansion of the product lines.
Remedies
Since the Lanham Act is primarily remedial in nature, the most frequent remedy awarded to a successful complainant is an injunction. An injunction is a court order which prevents the defendant from engaging in further infringement. Injunctions are the only available remedy in cases where the infringement is found to have been innocent.
In addition, successful plaintiffs may also be entitled to recover monetary damages in the form of profits made by the defendant on the infringement, actual damages sustained by the plaintiff and the plaintiff’s court costs. The court may also award treble damages (up to three times the amount of actual damages) and attorneys’ fees if the trademark was federally registered or the defendant intentionally used a counterfeit mark.
The Concurrent Use of Trademarks in Different Geographical Locations
Wednesday, August 26th, 2009Generally, trademark owners have exclusive rights to use their mark to label or identify their goods and/or services. However, trademarks may overlap under either of the following circumstances:
1. In different industries; or
2. In different geographical locations.
The most frequently litigated of these exceptions has been the concurrent use of trademarks in different geographical locations, as courts have had to determine the appropriate geographical scope of territorial priority rights in a particular trademark.
Concurrent Use in Different Geographical Areas
Although two companies must typically use an entirely different mark in order to avoid confusing the public as to who makes what, courts have typically permitted concurrent use of the same or similar mark by restaurants in different parts of the country. The rationale behind permitting concurrent use of a mark in different geographical areas is that there is little likelihood of confusion.
For example, in Weiner King, Inc. v. Wiener King Corp., the federal district court permitted concurrent use of “Weiner King” as a mark for restaurants featuring hot dogs in New Jersey and “Wiener King” as a mark for restaurants in North Carolina. Similarly, in Pinocchio’s Pizza Inc. v. Sandra Inc., the court permitted concurrent use of “PINOCCHIO’S” as a mark for restaurants in Maryland and “PINOCCHIOS” as a mark for restaurants located elsewhere in the country.
Concurrent Use Application and Proceedings
The Trademark Trial and Appeal Board (the Board) holds a concurrent use proceeding to determine whether an applicant is entitled to concurrent registration of a trademark. In order to initiate a concurrent use proceeding, a concurrent user must submit a concurrent use application, in which the applicant meets the following criteria:
1. Concedes that its use is not exclusive
2. Specifies the goods and/or services and area or mode of use for which the applicant desires registration
3. Identifies one or more persons which concurrently use the same or similar mark for the same or similar goods or services
4. Provides certain information concerning use of the mark by each listed concurrent user
Under Section 1052(d) of the federal Lanham Act, the Board Director may issue concurrent registrations upon finding that “confusion, mistake, or deception is not likely to result from the continued use by more than one person of the same or similar marks.” Further, an applicant is only entitled to concurrent registration if they have used the mark in commerce prior to the applicable date specified in the provision.
Priority of Use Test to Determine Ownership
The generally accepted rule on how to determine ownership of trademark rights is by the “first use date.” Specifically, the priority of use standard dictates that the first to actually use a mark in the sale of goods or services gains exclusive rights to the mark in the geographic area in which the mark is actually used.
In addition to gaining ownership rights in a trademark by way of actual use of the mark in a specific geographical area, ownership rights may also come from “constructive use.” Under this theory, federal registration of a trademark with the U.S. Patent and Trademark Office (PTO) raises the presumption that the registrant owns the mark, and fixes the registrant’s nationwide priority rights in the mark. However, federal registration of a mark does not give the registrant priority over others who have previously used the mark in commerce. As such, federal registration by one mark user places the burden on a concurrent user to show their prior and continued use of the mark.
Geographical Range of Prior Use
The Lanham Act requires the Board Director to “prescribe conditions and limitations as to the mode or place of use of the mark” in issuing concurrent registrations. Typically, the Director will grant territorial priority in a mark to the “senior user” who has applied for federal registration (as discussed above). However, the territorial rights of a senior user are subject to the rights of a “junior user” who has used the mark prior to the senior user’s application for federal registration.
When actual use of a mark by a senior user has been limited, courts frequently consider four factors to determine territorial priority in a mark, including:
1. The volume of sales of the product in a particular geographical location
2. Growth trends in the area
3. The market penetration as a function of the total product market
4. The amount of advertising
If a senior user satisfies the aforementioned criteria, actual use of a mark in a territory is not necessary to establish priority in the mark. Because pre-existing federal registration gives a registrant nationwide priority in a mark, it is important to conduct a trademark search before becoming committed to a particular trademark and using it in a particular geographical location.
Facebook allowing users to create personalized URLs/usernames for their Facebook Pages
Friday, June 12th, 2009Facebook Inc., the online social network, will soon allow users to create personalized usernames for their Facebook pages (e.g. facebook.com/[your name]). The introduction of this new feature will commence at 12:01 AM EDT on Saturday June 13, 2009. This new feature poses significant risks of cybersquatting to trademark owners, just as the unlawful registration of domain names has done over the past years.
Facebook has offered trademark and brand owners an opportunity to prevent Facebook users from using their trademarks as part of their usernames by providing a form, which can be accessed at:
At this time we strongly urge our clients, as trademark owners, to visit the Facebook site and register trademarks before any cybersquatters get there first. The clock is ticking so please act quickly.
For Facebook’s Notice of Intellectual Property Infringement (Non-Copyright Claim), please go to: http://www.facebook.com/copyright.php?noncopyright_notice=1
If you have any questions about this recent development or need any assistance, Matt and I are here to help.