List of the Top 500 Global Bank Brands Released

"cover page for top 500 bank brands report"

Brand Finance released its annual list of the top global bank brands. China’s banks topped the list with ICBC coming in at the number one spot, valued at $79,823M. The U.S. banks cracking the top ten are Wells Fargo at number five; Bank of America at number six; CITI at number seven; and Chase at number eight. The Visual Capitalist created a helpful visual showing the rise and fall of the top ten brands over the last ten years. As a sector, banks lagged behind hotels, autos, tech, beer, oil & gas, airlines, insurance, and utilities.

The methodology used by Brand Finance to value a bank brand is the Royalty Relief approach. This methodology estimates the likely future revenues attributable to a brand by calculating a royalty rate that would be charged for its use, to arrive at a “brand value” understood as a net economic benefit a licensor would achieve by licensing the brand in the
open market.

Brand Finance assigns a Brand Strength Index number, which is applied to the prevailing royalty rate ranges for like goods or services based on prior licensing deals or court decisions. For example, if the prevailing royalty rate range is 0-5% and the Brand Strength Index number is 80, then the royalty rate would be set at 4%. Basically, the stronger the brand the higher on the range a particular brand will land.

For Brand Finances analysis, it is key get a high Brand Strength Index number. The Brand Strength Index is made up of three variables: Marketing Investment, Stakeholder Equity, and Business Performance. Of the three variables, Stakeholder Equity is the most subjective, but one metric considered in this analysis is “awareness.”

We talked before about what is takes to build a strong brand worth billions of dollars. Starting with a unique mark that is conceptually strong and not part of a crowded field is an important first launch pad.

Pharma Case Provides Lesson for Searching A Fanciful Mark

"picture of three white pills displaying a fanciful mark"

A recent TTAB decision is instructive on how to break up a fanciful mark when conducting a trademark search. When faced with a fanciful mark, it may be tempting to search only for the entire coined term. But it is important to break up the fanciful mark and search the parts even if the parts themselves are not known words.

AbbVie Biotechnology Ltd. applied to register the mark SKYRIZI (in standard character form) for pharmaceutical preparations and substances. The Trademark Office found no issue with AbbVie’s application and published it for opposition. However, Novartis AG had an issue with AbbVie’s SKYRIZI application and filed a Notice of Opposition against the registration of AbbVie’s mark. Novartis claimed rights in a prior registration for IZIRIZE (in standard character form) also for pharmaceutical preparations.

The parties agreed to use the Board’s Accelerated Case Resolution procedure through with the parties stipulated that the goods were related, the channels of trade were overlapping, and the parties targeted the same class of consumer. The two factors that remained in dispute were: (1) similarity of the marks; and (2) strength of the IZIRIZE mark.

AbbVie argued that RIZ was a conceptually weak term when used in connection with pharmaceutical goods. Regardless of the industry, the 10 third-party registration minimum trend we saw emerge in 2018 applies. To support its argument AbbVie offered 19 third-party registrations for marks that contained the letter string RIZ for pharmaceutical products. For example, ACARIZAX; BACTRIZOLE; RIZIMO; and ORIZON. Despite the evidentiary issues with the admission of the third-party registrations, the TTAB found that the 19 third-party registrations established the RIZ word string was conceptually weak for pharmaceutical products.

The weakness finding is instructive of the importance to break up even fanciful marks into any logical components and include those parts in any preliminary trademark search. In this case, the Board did not find that RIZ was a known word, acronym, or abbreviation. Nevertheless, the Board focused on it to determine whether it was a weak term, and the strength of a mark has a direct impact on the similarity of the marks analysis. Having found that RIZ was weak, the Board found that the use of SKY as opposed to IZI was sufficient to distinguish the marks at issue. And these two factors where enough to outweigh the stipulated factors that favored a finding of confusion. Therefore, the Board dismissed the opposition proceeding.

Not breaking up a fanciful mark and searching any logical components could result in a missed record that could be a knockout.

Another Acronym to Add to the Bad Rebrand List

"Coffee by Design rebranded product packaging may be a bad rebrand"

Earlier this year, we wrote about AdAge’s list of the worst rebrands in 2018. Topping the list were acronyms, nicknames, and abbreviations. If Coffee by Design finished its rebrand to CBD in 2018 instead of 2017, it may have made the list as well.

Coffee by Design was founded in 1994 in Portland, Maine. The company operates four coffeehouses and coffee roastery that sells to nearly 500 wholesale and mail order customers around the globe. In 2010, Coffee by Design obtained a federal trademark registration for the acronym CBD in connection with “coffee shops” and “coffee.” In 2010, the CBD acronym did not dominate the Coffee by Design packaging, and the packaging did not change much, if at all, in 2015. But in 2017, Coffee by Design decided to change all of its packaging and marketing materials – from cups to bags – from Coffee by Design dominating to its new CBD logo dominating.

It was after this change was implemented that the problems started happening. In 2016, Maine residents voted in favor of legalizing recreational marijuana. Governor Paul LePage vetoed the adult-use pot bill, which the Maine Legislature overturned. That paved the way for marijuana retail shops to begin doing business in the spring of 2019.

Apparently, the owners of Coffee by Design did not know that CBD was a common acronym for cannabidiol, an ingredient in some products. All of a sudden, there was an influx of retail shops in Portland, Maine and other states where marijuana is legal promoting the sale of CBD products. This was causing confusion in markets where Coffee by Design was known.

It also caused some of Coffee by Design’s customers in geographic areas that do not allow marijuana sales or who simply do not agree with marijuana use, to question the quality of Coffee by Design’s product. As a result, Coffee by Design has spent considerable time and money to educate its customers that its CBD mark does not stand for cannabidiol. For example, the company had to prepare a list of talking points for its 65 employees to better handle questions about the confusion.

Despite the clear confusion occurring, Coffee by Design does not plan to rebrand again. The owners think the confusion will subside as the sale of marijuana becomes old news, and instead made a plea for the marijuana retailers to use cannabidiol instead of CBD when promoting their products. Well, we hate to burst Coffee by Design’s bubble, but that is likely not going to happen. When you choose a descriptive mark, businesses are allowed to exploit the descriptive meaning of the mark. Our best guess is the use of the CBD acronym is not going away any time soon.

2018 Trademark Weakness Trend Carries Over to 2019

"bmx biker landing on RED BULL branded ramp which does not have conceptual weakness"

In 2018, we wrote frequently on the strength trend we saw emerging from the Trademark Trial and Appeal Board decisions. The emerging trend was that in order to demonstrate conceptual weakness a trademark applicant had to be able to introduce a minimum of 10 third-party registrations for marks: (1) sharing the same term; and (2) registered for identical or related goods or services. The ability to meet this minimum threshold had a direct bearing on the success of one of the more common arguments made by trademark applicants to overcome a registration refusal.

In 2019, we have seen the first TTAB case to carry over this trend. Morganti Flavio Innovaciones Gastronomicas, S.L. applied to register the mark PINKCOW & Design for, among other goods, “soft drinks.” Anticipating a potential issue with Red Bull GmbH, Morganti voluntarily excluded “energy drinks” from its entire goods description in International Class 32. The Trademark Office found no issue with Morganti’s PINKCOW & Design mark and published the mark for opposition.

Red Bull, on the other hand, had an issue with Morganti’s application and opposed the registration of its mark. Red Bull alleged that the PINCOW & Design mark was likely to cause confusion with its prior registered marks RED BULL for, among other goods, “soft drinks.”

Morganti unsuccessfully argued that Red Bull’s product was an energy drink not a soft drink. Therefore, the goods descriptions at issue were legally identical because they both included the phrase “soft drinks” and the evidence showed that Red Bull’s product satisfies the ordinary definition of an “energy drink” and “soft drink.”

Red Bull was able to demonstrate that its RED BULL was commercially strong. Consequently, Morganti had to demonstrate the conceptual weakness of the RED BULL mark to counteract Red Bull’s evidence. Unfortunately, Morganti fell two short of the minimum number of the third-party marks target with a showing of eight.

Because the Board found that Red Bull’s mark was strong and the goods at issue were legally idential, Red Bull’s mark was entitled to a broad scope of rights. Those rights extended to Marganti’s PINKCOW mark, and so the TTAB granted Red Bull’s opposition.

North Carolina Jury not Kind to Walmart in BACKYARD Lawsuit

"Woman counting money as jury orders Walmart to pay $95.5M"

About a month ago we talked about the trademark infringement loss Walmart suffered over its use of the BACKYARD GRILL mark. We reported that in the first case, Walmart was ordered to pay Variety Stores $32.5M. Walmart successfully appealed this decision and the case was retried before a jury. The jury found in favor of Variety Stores and the case entered the second phase where the jury would decide how much Walmart is obligated to pay Variety Stores.

The jury has spoken and has ordered Walmart to pay Variety Stores $95.5M. This is a little less than three times the $32.5M a judge ordered Walmart to pay Variety Stores in 2016. This is one of the larger damage awards involving trademark infringement, but million dollar and multimillion dollar damage awards are not uncommon in trademark infringement cases.

On August 22, 2018, DatabaseUSA.com, L.L.C. was ordered to pay Infogroup, Inc. $4M for the trademark infringement claim and $43.6M for the unfair competition claim. On July 31, 2017, iShow.com was ordered to pay Lennar Corp. $5.5M for its trademark infringement. On October 5, 2016, Costco Wholesale Corporation was ordered to pay Tiffany and Company $15.8M for trademark infringement.

Walmart made the decision to adopt a mark with known words and that shared the dominant term BACKYARD with another trademark owner. From a trademark searching perspective, marks comprised of known words generally exist to a certain degree in a crowded field. If you layer in international markets on top of it, the probability of finding a mark that is 100% in the clear in every jurisdiction is extremely low. When a trademark owner decides to adopt a mark with known words, the owner needs to accept some amount of risk and work to put himself and herself in the best defensible position should an issue arise.

A New Trend for the Relatedness of Goods or Services Factor?

"White Horse Auto dealership related goods or services to car washes"

A recent Trademark Trial and Appeal Board decision involving car dealerships and car washes may signal a change in how the Board will assess the relatedness of goods or services likelihood of confusion factor. White Horse Auto, LLC filed a service mark application to register the mark WHITE HORSE AUTO (in standard characters) for “automobile dealerships.” White Horse Wash, LLC opposed the registration of White Horse Auto’s application on the ground of priority and likelihood of confusion.

Not surprisingly, the Board found that the marks were virtually identical. And White Horse Auto failed to demonstrate that the WHITE HORSE phrase was diluted for automobile related goods and services. Ultimately, this case came down to whether the services at issue were sufficiently related to likely cause confusion.

The Board held that providing automobile-related services by the parties was not enough by itself to establish the services at issue were related. “A finding that the goods are similar is not based on whether a general term or overarching relationship can be found to encompass them both.” This a departure from cases the TTAB decided as early as last year. For example, in the SONIA SONI LIFE IS A RECIPE, the broad description “spices” was enough for the Board to conclude that the applicant’s goods covered the registrant’s goods. The only time the Board departed from this interpretation was when the goods or services descriptions at issue were vague or involved technical goods.

In the present case, there is nothing vague nor technical about “automobile dealerships” or “car washes,” nor is either description vague. Nevertheless, the Board looked at the real world marketplace to determine what the actual services were. And based on the similarities the Board found in the circumstances surrounding the marketing of the two marks, the Board concluded the services at issue were related. Unfortunately for White Horse Auto, its application was denied registration. But if at first you don’t succeed, it’s okay to try again.

More importantly for trademark searchers, could we be seeing a change in how the Board assesses the relatedness of the goods and services factor? This is definitely an issue to watch in 2019 as the Board decides more cases because the relatedness of goods or services factor is critical to not only conducting trademark searches but also assessing whether a likelihood of confusion exists between two marks.

Visual Similarity Sinks SEXIFIT Trademark Application

"Sexifit logo refused primarily because of visual similarity"

SEXIFIT is the name of a workout program primarily directed at women that focuses on strength and core. The workout was developed by a former NFL and NBA dancer. The name is a composite word comprised of a spelling variation of SEXY (i.e., SEXI) and FIT to form the unitary mark SEXIFIT. Unfortunately, the Board’s primary focus on visual similarity would lead to the downfall of a trademark application that included this term.

Procheer Fitness and Dance filed an application to register the mark THE OFFICIAL SEXIFIT & Design mark in connection with “providing fitness instruction services in the field of dance, and physical fitness.” The United States Patent and Trademark Office examined the application and finding no likelihood of confusion issue, published the mark for opposition.

During the 30 day opposition period, ICON Health & Fitness, Inc. opposed the registration of Procheer’s mark alleging it was likely to cause confusion with its prior registrations for IFIT. ICON Health & Fitness owns several fitness brands: Nordictrack, Freemotion, Proform, and iFit. The iFit brand is a mobile application combined with a virtual personal trainer. Although in the fitness or exercise field, a fitness class is different than personal training and definitely appeal to different classes of consumers.

Nevertheless, none of these limitations appeared in THE OFFICIAL SEXIFIT & Design application nor in any of the IFIT registrations. Accordingly, because the Trademark Trial and Appeal Board was forced to compare fitness and exercise with fitness and exercise, it had to conclude the services at issue were related. However, what was abnormal was the Board conclusion that ICON’s IFIT mark was famous for fitness instruction services when all the evidence presented demonstrated that IFIT may be famous for fitness equipment. Fame is not transferable this way.

When it came to the similarity of the marks, the Board gave no consideration to the difference in meaning between the THE OFFICIAL SEXIFIT & Design mark and IFIT mark. Likewise, it gave no consideration to the phonetic dissimilarity between SEXIFIT and IFIT. For trademark searchers, this is an example that visual similarity between two marks is generally the most important consideration when evaluating two marks.

The Board also ignored the design elements in the SEXIFIT & Design mark stating that the literal element is the most important because consumers use words to order and refer to goods and services. Focusing on the literal portion of the mark, the Board found that ICON’s entire IFIT mark was incorporated into the SEXIFIT portion of Procheer’s mark. This is another example for trademark searchers to pay attention to. If a prior registered mark is subsumed in its entirety in the mark you are searching and you can’t find dilution or have credible argument about the unrelatedness of the goods or services at issue, then the mark likely is unavailable.

Accordingly, primarily focusing on visual similarity, the Board granted ICON’s opposition and denied registration of Procheer’s THE OFFICIAL SEXIFIT & Design mark.

Who Wants Some Football with Their Commercials?

"mercedes-benz stadium in background of super bowl trophy and new england patriots and los angeles rams football helmets when most viewers cared more about the commercials"

Super Bowl LIII was the culmination of the 2018-2019 National Football League season. It was a hard fought game between the New England Patriots and Los Angeles Rams with the Patriots winning their sixth Super Bowl. Although the game was entertaining, a significant number of people tuned in just for the ads.

Prior to the Super Bowl, the American Marketing Association published some interesting statistics about the big game. According to the AMA article, the price for a 30 second advertisement was more than $5 million. In 2018, 114 million people watched the Super Bowl, which represents about a third of the United States population. About 25% of surveyed Super Bowl viewers consider the commercials to be the most important part of the game.

At first impression, these statistics convey that only a select group of companies are capable of taking advantage of the Super Bowl platform to promote their goods or services. But for trademark owners the statistics should represent something more. These statistics are the type of information trademark owners need to collect to establish consumer recognition of their brands for purposes of secondary meaning and to established the strength of their mark.

Spending $5 million on a commercial is a significant number, but if it reaches only a relatively small number of prospective purchasers then its significance decreases. Context is key when assessing secondary meaning and strength. As a trademark owner, you should track not only advertising spend but also advertising reach. Internet advertising makes this easy by collecting impression statistics, but this type of data should be collected for other forms of advertising as well.

If you watched the Super Bowl for the commercials, you can see who the winners and losers were by checking out the USA Today Ad Meter. You can even exercise your Super Bowl viewer right and weigh in with you opinion.