Author: Sylvia Mulholland

Costco’s “Tiff” gets Costly

According to Tiffany & Co., imitation is NOT the sincerest form of flattery!

A federal jury ruled Thursday that Costco Wholesale Corp. should pay $5.5 million to Tiffany & Co. for violating the iconic jeweler’s trademark through the sale of diamond engagement rings labeled “Tiffany.”  The $5.5 million far surpasses the $781,000 that Costco has argued should be the maximum it owes, which the retailer says it based on some 2,500 rings that the court ruled infringed on the trademark name.

Costco’s argument that it was merely a description of ring settings is not all that far-fetched. A “Tiffany” setting, developed in the 19th century by Charles Lewis Tiffany to raise up a diamond for maximum sparkle, is often considered to be a type of ring setting, and people inside and outside the industry toss the term around similarly to how the word “Kleenex” has become synonymous with facial tissue.

While the diamonds may be genuine, the court says Costco went too far with its use of the word “Tiffany,” to the point of letting — or even encouraging — customers to believe they were buying Tiffany rings, and not just rings with Tiffany settings.

Costco last year took steps to address this issue, agreeing with a request by Tiffany to stop using its name. Costco also sent a letter to customers clarifying that the rings were not “Tiffany & Co.” products and offered refunds to those who were disappointed.   Good thing Costco didn’t pack its rings in robins’ egg blue boxes!  That color is also a Federally registered trademark: “The mark consists of a shade of blue often referred to as robin’s-egg blue which is used on boxes” according to the registration.

Redskins Offensive Trademark

REDSKINS TIME OUT AT FEDERAL APPEALS COURT

A federal appeals court has postponed hearing arguments as to whether the trademark REDSKINS is offensive.
Both the team and the federal government agreed the case should be put on hold until the U.S. Supreme Court decides another trademark case that raises the same basic issues. The team is challenging a decision by the U.S. Patent and Trademark Office to cancel the trademark for the name “Redskins” on the grounds that it is offensive.

While that case was pending, the U.S. Supreme Court agreed to hear a dispute involving Asian American musicians from Portland, who were refused trademark registration for their band’s name, The Slants (see my other Blog Post on this). The USPTO refused to register THE SLANTS as a federal trademark for names considered offensive, which is the same law at issue in the Redskins case.

A lower court found that provision to be unconstitutional, as a restraint on free speech, so the feds are now appealing. A decision is expected by late June. Although the loss of a registration would not strip the team from being able to use the name, it would bar them from federal benefit protections including the right to exclusive nationwide use of the mark, and to enforce its trademark rights against infringers.

There are many reasons why a trademark might be threatened, one of which could be changes on social standards, or perhaps changing meanings.

The history of the fight for the Redskins brand can be found on Wikipedia here

See also, our article on the band ‘The Slants’

“The Slants” Trademark Case Heard by Supreme Court

“The Slants” had their trademark challenged as disparaging and took it to the Supreme Court.

Asian American Simon Tam is battling the federal government over his band’s trademark, under a federal law that forbids the registration of “disparaging” marks.  The Slants first tried to register their band name in 2011, but the U.S. Patent and Trademark Office (“USPTO”) refused the trademark application for “The Slants” as being offensive to people of Asian ancestry.  Tam appealed.

Last December, the appeals court of the federal circuit ruled that the law in question [Section 2(a) of the Trademark Act, which prohibits registration of a trademark that “consists of or comprises immoral, deceptive, or scandalous matter; or matter which may disparage or falsely suggest a connection with persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt, or disrepute”]  violates the Constitution.

“It is a bedrock principle underlying the First Amendment that the government may not penalize private speech merely because it disapproves of the message it conveys,” said the appeals court in the ruling, which noted that denying The Slants the request for a trademark amounted to “viewpoint discrimination.”

The dispute provoked a lively Supreme Court argument in January over free speech, political correctness and the government’s refusal to sanction what it sees as a racial slur.

The justices struggled over whether the refusal by Congress and the Patent and Trademark Office’s to register trademarks that can be seen as disparaging people or their beliefs violates the 1st Amendment.

While The Slants are proud of their music, it’s always gone hand-in-hand with political advocacy. They seek to help other marginalized groups, ranging from gays and lesbians to the Black Lives Matter movement, through workshops and charitable activities.

“Arts and activism have always moved forward together,” Tam says.

This case is similar to the Redskins case and can be found in much more detail on wikipedia

Trademarks for Start-Ups – Do I need to worry about a trademark when my business is just getting started?

QUESTION:

I just thought up a GREAT name for my start-up but I did not do a trademark search. The business name looks clear. It took forever to come up with this name! Do I really have to worry about trademarks now? Money is so tight!

ANSWER:

Coming up with the perfect name is the most important step to attracting customers, but what about a trademark search? Let’s say you want to register SUZIE’S CUPCAKES LLC in the State of Delaware, and you’ve got your cupcake pans greased, and are ready to start baking and shipping. And you’ve registered suziescupcakes.com as your domain. Sounds yummy!

But, not so fast! SUSIECAKES is a Federal trademark and even though it uses a different spelling of “Suzie” and the word “cakes” not “cupcakes,” the owner of that trademark could threaten you with a trademark infringement lawsuit. Why? Because SUZIE’S CUPCAKES could well be considered “confusingly similar” to SUSIECAKES, and the SUSIECAKES registered trademark is enforceable in all 50 States. While you may not be ready to file for a Federal trademark just yet, you should consider having a experienced trademark attorney conduct a search and give you a legal opinion on the use of your business name. Many trademark attorneys charge a fixed fee for a search and opinion. It could be the best investment you’ll ever make for your business!

Disclaimer: The foregoing fact situation has been created by way of example only and is not intended, nor should be construed as, legal advice.

The Truly Dead, The Walking Dead and Zombie Trademarks – Can I use an abandoned trademark?

QUESTION:

The trademark I want to use and register, ZOMBOID, is marked DEAD on the United States Patent and Trademark (“USPTO”) Register.  Can I go ahead and use it on my products (video games) and register it as my trademark?

ANSWER:

DEAD can mean a lot of things in trademark speak.  There’s the Really Dead, The Walking Dead and what we call Zombie Trademarks — the ones that can rise from the grave to walk again in interstate commerce and make your life miserable.

Patents and copyrights expire, but a trademark can live forever, so long as it’s being used commercially.  Sometimes, an owner will stop using a trademark altogether, with no intent to use it again. This is truly “abandoning” the trademark (the “Really Dead”) and abandonment is presumed after three years of non-use and is also grounds to seek cancellation of a Registered Trademark.    But there are a lot of hurdles to get over to finding out if a trademark is Really and Truly Dead and therefore available to you.

DEAD TRADEMARK APPLICATIONS

In the case of applications for trademarks that have been filed in the USPTO, a trademark can be abandoned while the application is in the works, or after it has registered.

So, with ZOMBOID, for example, a trademark application filed by Mattel back in 1992 and again in 2004, for toys and games, both now noted as DEAD in the USPTO, the notation also says ABANDONED.  That sounds good, right?  Yes, but we need to know more.  Digging into the USPTO file reveals that Mattel apparently lost interest in the ZOMBOID trademark.  Their applications went all the way through the year-long process, but Mattel failed to submit proof that they had started using ZOMBOID for toys and games.

Since the last ZOMBOID application was abandoned over ten years ago, this is a pretty good indication that ZOMBOID may be available now, but it’s not a certainty.  The USPTO Trademark Register changes every day and there are over 5 million active trademarks of record now.

A check of Mattel’s website for ZOMBOID, and a general Google search for ZOMBOID could reveal that Mattel, or someone else, is now actually using the ZOMBOID trademark.  Even if that person, or company, never filed an application to register the trademark ZOMBOID, they would have “common law rights” flowing from actual use of ZOMBOID, and your application for ZOMBOID could be successfully opposed by that user if and when they find out about it.

In other cases, where an application shows as ABANDONED, it may be because the applicant missed a due date to respond to an examining attorney’s inquiry or objection (called an “Office Action”).  While a trademark is moved to the WALKING DEAD zone shortly after such a failure, it can easily be resurrected for up to two months by paying extra fees and filing a “Petition to Revive.”  In other cases, the application may have been refused for any one of a number of legal reasons, and that could mean yours will be refused as well.

Beware most of a DEAD application that is shown as WITHDRAWN.  Almost no one withdraws an application, even if they have lost interest in the trademark, unless forced to.  Usually, unwanted trademark applications simply die a natural death, expiring for lack of attention.  But a withdrawal usually indicates a legal fight has taken place, and the applicant settled the matter by withdrawing its application.  This is a big red flag.

Even after clearing the above hurdles, you need to do, or have a professional do, a proper trademark search to determine if ZOMBOID is currently registrable.  Are there other similar trademarks that have been filed in the meantime that may be considered “confusingly similar” by the USPTO? What about ZOMBIE BOY, ZOM-BOYD, ZOMBOY, ZOMBIE-OID and other variations?  If used on videogames, any one of these could be a death knell to your ZOMBOID application, with an examining attorney issuing an immediate refusal.

DEAD TRADEMARK REGISTRATIONS

What about actual trademark Registrations that are shown as DEAD? Usually, these are noted as CANCELLED, and that usually means they were not properly renewed.

In many cases, however, the trademark owner does not even know the trademark has been cancelled.  The USPTO sends only a single courtesy reminder of renewal, to the last address on the file.  Many a trademark owner is horrified to find its trademark has been cancelled and rushes to file a fresh application, often based on long use in commerce.  What that means to your ZOMBOID application, is that it could be formally opposed by the original owner of the cancelled trademark, on the basis of earlier use, and a failure to renew on time.

But the Registration might also be CANCELLED because another party filed a Cancellation Action against it. Tread with extreme caution over these gravesites! Someone wants this trademark, or something similar, very badly.

ZOMBIE TRDEMARKS

A reminder that ZOMBIE MARKS still live and walk among us occurred last year after Strategic Marks LLC sought to live up to its company name by filing trademark applications for long abandoned Macy’s trademarks.  The matter was finally resolved after Macy’s sued, by a court-ordered settlement.  Macy’s was allowed to keep some of its “heritage brand” marks, including MARSHALL FIELD’S, on the basis that the public still had residual feelings and recognition of them, and could be confused into thinking that Macy’s itself was again opening stores under this name.  (Given the climate for retail stores lately, this seems highly unlikely.)  MARSHALL FIELD’S is therefore a true Zombie Mark, walking again after 15 years of abandonment by Macy’s.  But these are rare.

Normally, three years of non-use is considered technical and legal abandonment of a trademark.  Strategic Marks still managed to secure trademark rights in BULLOCK’S DEPARTMENT STORE and MAY COMPANY, among others.

To sum up, in terms of trademarks, “DEAD” may not really mean “DEAD”  or at least, not forever.   You need play detective to figure out if you can use and register a trademark without a legal challenge.  Start with investigating the USPTO file, find out all you can about the reason the trademark application or registration was abandoned or cancelled.  Do more due diligence, search the previous owner’s website, do a Google search, an Amazon search and all other Internet searches that may give you more information about the trademark and who may be using it now.  Lastly, obtain a professional search opinion as to whether the trademark you want is now registrable in the USPTO.

USPTO Trademark Audits Coming Soon! Do your registered trademarks need pruning?

Do any of your renewed trademark registrations list more than one good or service in a single class? If so, that trademark could be subject to a random audit by the United States Patent and Trademark Office (“USPTO”).

Pleased with the results of its two-year pilot program, the USPTO is now poised to make good on its threat to clear “deadwood” from the Register, currently overflowing with more than 5 million active trademarks. 

The audit, set to launch soon establishes a permanent random audit program for trademarks with more than one good or service per class.

TEN PERCENT OF RENEWED TRADEMARK REGISTRATIONS WILL BE AUDITED! Let’s say you have a registered trademark in Class 25 that covers the following goods: “Women’s clothing namely, pants, shorts, tops, jackets, skirts, dresses, pantsuits, coats, sweaters, vests, belts, gloves, pajamas, nightgowns.”  

You recently renewed it at the 5 or 10 year mark, stating use was continuing for all listed goods,  and thought you could forget about the trademark until the next renewal date.  That used to be true, but not anymore.

If your trademark is selected for audit, The USPTO can chose two goods or services from your listed goods or services and demand proof of use for those two (say “pajamas” and “vests” in our example).   Depending on your response, the USPTO may then issue an additional Office Action requiring more and better proof.  

Trademark owners will have up to six months to respond and can either submit the required proof of use, or ask for deletion of those goods or services for which the mark is not being used.

IF THE TRADEMARK OWNER FAILS TO RESPOND, THE REGISTRATION WILL BE CANCELLED! In the 2-year pilot program, the USPTO randomly selected 500 registrations for which the owners were required to submit proof of use for additional goods or services per class.  

In 51 percent of the registrations selected, the trademark owners failed to supply the proof of use requested. The owners of 35 percent of the registrations selected asked that the USPTO delete certain goods/services, that the owners had initially claimed were in use.   And a whopping 16 percent of selected registrations were Cancelled because the owners failed to respond at all.

If you are a trademark owner with registrations having multiple goods/services in a single class, are you prepared to prove use for all the goods/services listed if your trademark is selected for the random audit?

A PRO-ACTIVE APPROACH Go over your trademark portfolio, and assess which, if any, of your trademarks are vulnerable, if audited.  You may chose to file a Post-Registration Amendment now, deleting the unused goods or services, to save yourself the time and expense if your trademark is chosen for audit.  

E-mail or call me if you are interested in filing an amendment now for any of your trademarks listing goods and/or services not currently being provided by you or your company.

Trademark & Domain Name Scam Alert

If you own a trademark application or registration, you will eventually receive solicitations from private companies not associated with the United States Patent and Trademark Office (USPTO) or from our office, if we are your attorney of record.

Often these look like official government documents, emphasizing data such as the trademark application serial number, the registration number, the International Classes, filing dates, and other information publicly available from USPTO records, including your, or your company’s, name and e-mail or mailing address. Here are the two most popular scams.

The Fraudulent Trademark Invoice Scam The most common trademark scam is the fraudulent invoice scam.  The scammers send invoices to trademark owners indicating that some action must be undertaken in connection with the owner’s applications or registrations, such as “publication,” “registration,” “renewal,” or “recordation,” or even “fix your trademark” if there is an outstanding office action on your application.  Often threatening language is included to say that if payment is not received by a certain date, the trademark owner’s rights will be adversely affected.  The invoices are usually for payments from $500 to $3000. Many trademark owners pay these fraudulent invoices because they look authentic, with official sounding names, such as the “United States Trademark Maintenance Service,” the “Patent and Trademark Organization,” and the “Trademark Office, Ltd.”

However, paying them will not benefit the trademark owner in any way, and since most scammers are located abroad, there is no way to contact or take action against them.  One scammer, operating under the names “Trademark Clearance Center” and “Trademark Compliance Office,” was recently prosecuted.  However, this is the first time a trademark scammer has ever been prosecuted, and while the scammer was in business, he is believed to have collected $1.85 million over a two-year span.   Clearly, thousands of trademark owners have been duped into paying.

As a general rule, do not pay any trademark invoices from unknown sources, no matter how authentic they may seem.  All official correspondence relating to U.S. trademark applications and registrations will be from the “United States Patent and Trademark Office” in Alexandria, Virginia, and if by e-mail, from the domain “@uspto.gov.”  Such correspondence will be delivered directly to the trademark owner (if no attorney is of record) or to the trademark owner’s attorney.  But the USPTO will never send a trademark owner an invoice.  UPTO fees are usually due when documents are filed, and if additional payment is ever required, the trademark owner or the owner’s attorney will be notified through a UPTO “Office Action,” not an invoice.   In summary, any request for payment that does not come from the UPTO or the trademark owner’s attorney is, by definition, fraudulent.

The Foreign Domain Name Registrar Scam This scam involves e-mails from foreign domain name registrars (foreign companies authorized to register country-code top-level domains, such as .cn for China) or companies purporting to be foreign name registrars, alerting trademark owners that foreign companies are seeking to register domain names incorporating the owner’s trademarks.  The e-mails typically indicate that the registrars are aware of the trademark owners’ rights, that they have placed the domain names on hold to give the owners an opportunity to register the names, and that, if the owners fail to act, the domains will be registered to the foreign company.  Many trademark owners have been tricked by this scam, especially when the e-mails are from registrars who operate authentic-looking websites.

Sometimes the scammers register the foreign domain names, and sometimes they disappear after receiving payment.  However, even when trademark owners acquire the names, they are usually purchased at inflated prices, and unnecessary, since no one is really attempting to register the foreign domain name.  Of course, trademark owners should register such names if doing so makes commercial sense, but not as a result of this scam.

The best defense against this scam is simply to ignore all e-mails from unknown sources containing warnings about the registration of foreign domain names, no matter how authentic the e-mails or the senders seem.  Domain name registrars do not research whether anyone has prior rights in a domain name, and there is no procedure for placing holds on domain name registrations.

As in the United States, foreign domain names are registered on a first come, first served basis.  Further, most domain name disputes can only be resolved through the arbitration procedures described in the domain name registration agreements.  Another sign that the emails are fakes is that the cost of the foreign domain names is much higher than the normal domain name price of about $10-$20 and the e-mails usually contain generic salutations, such as “Dear Sirs,” and tend to be poorly written.

Questions About Scams
The fraudulent invoice and foreign registrar scams are the most common trademark and domain name scams, but there are others.  If you have any question about whether a particular invoice or e-mail is a scam, please contact us or another attorney before taking any action or making any payment.

We, when we enforce your trademark and represent you, will be aware and act on any scams on your behalf.



Rush to File Disparaging Trademarks

The Rush to File Disparaging Trademarks…. Racially offensive trademark applications are piling up at the U.S. Patent and Trademark Office.  

The Supreme Court decided in March that  the federal government couldn’t ban trademarks because they are disparaging. The Supreme Court struck down part of the Trademarks Act that bans offensive (disparaging) trademarks.  

The ruling is expected to help the  Washington Redskins in their legal fight to keep the team name as a registered trademark.   The justices ruled that the 71-year-old trademark law infringes on free speech rights.

SLANTS

The ruling is a victory for an Asian-American rock band the Slants (see my previous post).   The case was also closely watched for the impact it would have on the REDSKINS.

REDSKINS

The Redskins made similar arguments after the trademark office ruled that the name offends American Indians, and cancelled the team’s trademark.

Justice Samuel Alito said trademarks are not immune from First Amendment protection as part of a government program or subsidy.

“Speech may not be banned on the ground that it expresses ideas that offend,” Alito said, in his opinion for the court.

Domain Names & Trademarks

BUILD A GREAT  BRAND ONLINE, BUT DON’T FORGET  YOUR TRADEMARK! 

GOT A GREAT BRAND?

Choosing a good brand name for a website can be a huge challenge, especially since every top level domain you want seems to be taken already.  But once you find and purchase a perfect domain, don’t use it right out of the gate.

TRADEMARK IT!

Spend some more time and effort to make sure your domain/brand is legally protectable. A registered trademark is essential to build and maintain true brand value.

DON’T ASSUME!

People often assume that once they have registered a domain name, they are free to use the name however they want.  Not true.  The only way to be sure that you have exclusive rights to a brand is to obtain a trademark registration for it.

RESEARCH!

Make sure no other business has applied for or registered a trademark for your domain name, or one that is confusingly similar.  Trademark attorneys and USPTO Examiners spend most of their days assessing confusing similarity between trademarks.   If you start selling your goods or services online, using a domain that is confusing with a registered trademark in the same field, you could find yourself on the wrong end of a trademark infringement lawsuit.

REGISTER!

Registered trademarks take approximately one year to be registered with the Federal Government. The cost is between $1000-$1500 from start to finish, and the application undergoes a rigorous examination and publication process.   But at the end, a registered trademark is probably your most valuable business asset.  Without a strong brand, what have you got?  Who would ever find your amazing product or service?

BOOST YOUR BRAND!

Build brand value online by advertising, public relations, SEO and a beautiful and functional website.  A federal trademark will help you prevent cybersquatting by competitors or criminals, since a domain name dispute can be initiated and, if “bad faith” on the part of the cybersquatter can be established, or the confusing domain was obtained after your trademark registered, ICANN may order it transferred over to you, or cancelled.

A registered trademark gives the owner exclusive rights to use the trademark in connection with the international classes of goods or services for which it is registered.   A registered trademark owner has legal rights to prevent others from using it for those classes, and to be compensated for unauthorized use.

Registering your trademark gives you all the intellectual property protection the law provides.  An unregistered trademark or brand name can be difficult or impossible to enforce.   Avoid all this headache by nailing down your trademark as early as possible in your startup business.

GO GLOBAL!

You can apply for trademarks on a country-by-country basis under national law, such as in the US and Canada, and in the European Union where one application covers 28 member countries.  Many international advantages can be obtained by having your trademark registered in at least one jurisdiction where you plan to do business, or actually do business.

We can’t condone the advice given by someone else without understanding your own circumstance, but this is a good read

Vulgar and Scandalous Trademarks given the Green Light

THE “SLANTS” Decision of 2017 In 2017, the US Federal Court  decision in Matal v. Tam (i.e., the “Slants case”) (see our previous Post) ruled that  the ban on  registration of disparaging trademarks under § 2(a) of the Lanham Act (Trademark Act) was  an unconstitutional restriction on free speech. 

Recently, the  US Court of Appeals for the Federal Circuit took up a similar constitutionality question. The bar on registration of trademarks comprised of immoral or scandalous matter, under the same section of the Trademark Act came under fire.

WHAT THE USPTO DID WITH ‘FUCT’ To issue a refusal of a trademark application under this section of the Trademark Act, the Trademark office (“USPTO”)  looks to whether a “substantial composite of the general public” would find the mark scandalous in the context of contemporary attitudes.   The USPTO, and then Trademark Trial and Appeal Board (“TTAB”) also refused to register the applied-for word “FUCT” as a trademark.  The general public would find it to be phonetically identical to the past tense of common vulgarity, the TTAB said, and , and thus, vulgar and scandalous itself.  

APPEAL TO THE FEDERAL COURT The Applicant, Erik Brunetti, appealed, arguing that substantial evidence did not support the TTAB’s finding that the FUCT mark is vulgar, and that even if it is vulgar the Act does not expressly prohibit registration of vulgar marks.  He also challenged the constitutionality of § 2(a)’s bar on immoral or scandalous marks.   The Court  did away with his first argument.  There was substantial evidence relating to the meaning of FUCT, to  support the TTAB’s finding that it was vulgar.  In addition, the Federal Circuit cited prior case law that said the USPTO may prove that a trademark is “scandalous” by establishing it is vulgar.

The USPTO conceded that § 2(a)’s ban on registering immoral or scandalous marks is a content-based restriction.  But  because trademark registrations qualify as either a government subsidy program or a limited public forum,  the First Amendment is not implicated.  In the alternative, the USPTO argued that trademarks are commercial speech, implicating only an intermediate level of scrutiny, and so no First Amendment review is required.  

THE DECISION The Federal Circuit determined that the USPTO’s rejection of trademarks under § 2(a)’s bar on immoral or scandalous marks, targets expressive messages, and is therefore subject to strict scrutiny, which it cannot survive. The Court bemoaned the potential proliferation of offensive trademarks in US commerce.  But  the bar in § 2(a) against immoral or scandalous marks is unconstitutional because it violates the First Amendment.  Therefore, the  Court reversed the TTAB’s ruling that the trademark FUCT was not registrable. The effects of this decision will become more clear as 2018 progresses, and the limited number of previously not registrable popular vulgar terms are snapped up as brand names.  And trademark attorneys will keep a watch on which other trademark rule might get the axe next!