The Chilling Effect Trademark Bullying Can Have on Speech

"Basketball going through a basketball hoop the NCAA trademark bullying"

The National Collegiate Athletic Association has and continues to aggressively enforce its trademark rights in the MARCH MADNESS trademark. In fact, its reputation for trademark enforcement is so well known that the KFANN sports radio station in Minneapolis, MN will not use the entire phrase MARCH MADNESS in an advertising spot for a local restaurant chain for fear of being sued by the NCAA. Instead, the word MADNESS is replaced with the sound of buzzer to indicate that the NCAA Men’s Basketball Tournament can be watched at this particular restaurant. This is a prime example of the chilling effect that trademark bullying can have on speech even when the speech is legal.

The NCAA’s first Trademark Trial and Appeal Board proceeding was commenced on May 24, 2007 against the University of Kentucky’s BIG BLUE MADNESS trademark application. Since then, NCAA has opposed:

  1. MOJO MADNESS for “prepared potatoes,” which is it ultimately lost when Shakey’s USA, Inc. voluntarily amended its description to “MOJO brand potatoes prepared at Shakey’s restaurants.” As an aside, this is a good example of how details a broad goods description may have to become in order to win a likelihood of confusion battle.
  2. MARCH RADNESS for a variety of clothing articles, which the NCAA won.
  3. LIVE THE MADNESS for a variety of clothing articles, which the NCAA won.
  4. APRIL MADNESS for sweepstakes, which the NCAA won.
  5. MARKDOWN MADNESS for automobile dealerships, which the NCAA lost.
  6. MARCH MATNESS for a website featuring entertainment information, which the NCAA won.
  7. MARCH IS ON! for coordinating and promoting athletic events, which the NCAA lost.
  8. MUNCH MADNESS for dips, processed vegetables, and chips, which the NCAA won.
  9. BASKETBALL MADNESS for downloadable video games, which is ongoing but suspended in light of a lawsuit filed in the United States District Court of the Eastern District of Kentucky. As an aside, the NCAA also petitioned to cancel the mark XOOKER, which is owned by the same owner of the BASKETBALL MADNESS mark. Hard not to construe that action as clear trademark bullying.
  10. And the most recent proceeding against MARCH MULLIGANS for sweepstakes, games of chance, and contests.

These are just the actions taken by the NCAA before the Trademark Trial and Appeal Board, but the NCAA has a reputation for also firing off demand letters. Some of these actions are legitimate, but several of them are not. It’s this overreaching that creates a trademark bully.

Not every use of another party’s trademark amounts to infringement. Under the doctrine of nominative fair use, a party – even a competitor – can use another party’s trademark to refer to that party provided only so much of the trademark is used to refer to the trademark owner. In other words, don’t use the full logo if the words are enough to refer to the trademark owner. In the case of the KFANN advertising spot, the radio station can legally use MARCH MADNESS to refer to the NCAA Men’s Basketball Tournament and should fear reprisal from the NCAA because of its overly aggressive trademark enforcement behavior.

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.

Petition Started Over Disney’s HAKUNA MATATA Trademark

"Disney Hakuna Matata t-shirt"

Using a foreign word in the United States as a trademark is a common naming practice. Sometimes, the foreign word possesses a cache that its English counterpart does not. Depending on the word, this practice can have some negative consequences.

In August of 2018, we saw the outrage from Hawaii when a Chicago-based restaurant chain tried to tell a single location Hawaiian restaurant it could not use the word ALOHA as part of its business name. And as 2018 was drawing to a close, we saw the same outrage against Disney manifested in a petition posted on the Change.org website. The petition was started by Shelton Mpala and has 178,813 supporters.

The problem, as Shelton Mpala sees it, is that “Hakuna Matata” is a Swahili phrase that translates to “no trouble” in English. It is a word that has been used by most Kiswahili-speaking countries and Disney’s trademarking the word is stealing a portion of African culture.

Disney has trademarked the phrase HAKUNA MATATA for t-shirts. But Healthy Pride Supplements has trademarked the same phrase for “multi-vitamin preparations; vitamin supplements; dietary and nutritional supplements” and another company has trademarked the phrase for wedding planning.

Trademarking a foreign word does not mean the word cannot be used in any context or any purpose. What it means is that in a commercial context on certain goods and services, prospective purchasers have the right not to be confused between the goods or services being offered in the marketplace. After all, trademark law is a consumer protection law.

In the case of Disney, that does not even mean that HAKUNA MATATA can never be used on a t-shirt by anyone. A purely ornamental as opposed to a trademark use of the phrase HAKUNA MATATA is allowed despite Disney’s trademark rights.

Nevertheless, while the Chicago-based restaurant may have had a better argument regarding the use of ALOHA by another restaurant, companies choosing to adopt foreign words as their trademark in the United States need to consider the non-trademark backlash that may result because of the general misunderstanding of trademark rights.

KFC’s Unique Brand Extension: a Fire Log

"KFC brand extension into a fire log"

Kentucky Fried Chicken a/k/a KFC took its brand to a whole new level with the KFC fire log. Now, you can have the smell of KFC’s fried chicken not just at dinner time, but all day long. At least you could have had that smell if you were lucky enough to get your hands on one. Apparently, the KFC fire log sold out in hours.

KFC’s decision to launch a fire log under its well-known KFC brand is a bold, but helpful brand extension. It is helpful because brand extensions increase the strength of the mark. The more opportunities consumers have to encounter a mark, the more likely they are to associate the mark with a single source.

It is also a common misconception that a trademark must be used at all times otherwise the trademark rights are abandoned. A trademark must be continuously used, but that use needs to be consistent with the nature of the goods or services being offered for sale. In this case, KFC is offering the logs for a limited time. So long as KFC repeats this activity in 2019, it will be able to maintain its trademarks rights for KFC in a fire log.

Another good example of this are businesses at county or state fairs. There are several businesses that exist solely to sell their goods for a limited time during a state or county fair. But they do this every year and don’t lose their trademark rights when the fair closes for the year.

What is also interesting about the article is KFC’s statement that “[t]he smell of the Colonel’s Original Recipe fried chicken is unmistakable.” This statement suggests a non-traditional trademark in the form of a smell. The definition of a trademark in the Trademark Act is extremely. It says that anything can function as a trademark provided it is capable of distinguishing and indicating the source of goods or services. If the smell of the Colonel’s fried chicken is unmistakable, then pursuing non-traditional trademark protection may be worth considering. These types of trademarks generally require more effort to protect, but they are a great addition to any trademark portfolio.

Using Sans-Serif Font Makes a Bland not a Brand

"Brandless website showing sans serif brand"

A recent Fast Company article identified displaying a trademark in sans-serif font as the hottest branding trend in 2018. If you were part of this trend, the article labeled your trademark a bland not a brand. According to the article, blanding occurs when the trademark lacks any meaningful differentiation from its competitors. Even a coined trademark is incapable of being a brand if it is not accompanied by something that makes is visually pop. The author says “[t]he point is differentiation; by definition, that’s what branding is.”

We have the large tech companies:  Apple, Google, Aribnb, and Uber, to thank for this trend. Because of the nature of their businesses and market status, just the word in sans-serif font functions as a brand not a bland. Their success has spawned a legion of imitators who can’t do the same thing. “The problem is that the blands haven’t earned the branding they ape.”

The article alludes to differentiation occurring through more than just sight, which is absolutely true. All the messaging done through advertising and public relations ultimately is embodied in the trademark, and that is what consumers recognize when they see a trademark even if it is just the word. If your brand strategy is to use the trademark in a sans-serif font, that is perfectly okay so long as you are using other collateral to differentiate your business and to tell your brand story. The experience consumers have with your business will influence the differentiation in the marketplace more than any visual cues your trademark may possess.

For example, look at the evolution of the Google trademark. The color placement and font style has changed over the years, but that is pretty much it. Starting out, the GOOGLE trademark could have been considered a bland not a brand by the article’s standard. Over time, Google has clearly become a well-known brand that consumers trust regardless of how the GOOGLE term is presented.

The question for young companies is whether you need eye-catching branding to begin with or if can build the differentiation you need other ways. What is important for young companies to keep in mind is that it takes time to build a brand and is something that can’t be rushed. Patience is key and so is the commitment to sticking with the brand strategy.

Rare Loss for Plaintiff in Alcoholic Beverages TTAB Case

"Thunder Road whiskey bottle wins at TTAB"

Breweries, distilleries, and wineries that are defendants in Trademark Trial and Appeal Board cases have not fared well this year. More often than not, alcoholic beverage defendants foolishly cling to overly broad goods descriptions that ultimately prove to be their downfall. The scene was set for another plaintiff victory in a recent TTAB case, but in a rare turn of events the defendant prevailed because it properly offered sufficient third-party use evidence to establish the term in common with the plaintiff’s mark was conceptually weak.

Thunder Road Brands, LLC applied to register the mark THUNDER ROAD (in standard characters) for “alcoholic beverages, namely, Tennessee sour mash whiskey and moonshine.” E. & J. Gallo Winery opposed the registration of the THUNDER ROAD mark based on its prior registered mark THUNDERBIRD for the broad description “alcoholic beverages except beers.” Thunder Road Brands did not bring a motion to narrow E. & J. Gallo Winery’s broad description to the actual THUNDERBIRD product, which is a flavored fortified wine.

Accordingly, with the goods being legally identical – thus less similarity between the marks required for a likelihood of confusion to exist – and the marks sharing the THUNDER term in the first position, things were not looking good for Thunder Road Brands. Its only hope was to convince the TTAB that the THUNDER term was so incredibly weak that the difference between ROAD and BIRD was enough to avoid a likelihood of confusion.

E. & J. knew this and offered evidence of its commercial strength:  (1) continuous use since 1957 (over 60 years); (2) sales volume and revenue from 2009-2016; (3) advertising expenses from 2009-2015; (4) two YouTube videos showing a THUNDERBIRD television advertisement; and (5) third-party publicity in two songs, one by ZZ Top and the other by The Beastie Boys. The TTAB was unpersuaded by this evidence because it was stale and showed a downward trend. Strength or fame must be determined at the time of trial.

Similarly, E. & J. relied on two stale brand awareness studies, but more importantly E. & J. failed to properly authenticate the studies. Nevertheless, while the evidence did not establish fame for likelihood of confusion purposes, the Board did find that the evidence demonstrated the THUNDERBIRD mark was entitled to broader than normal scope of protection. However, based on what happened next, “broader than normal” probably means THUNDER used with a bird name.

Thunder Road Brands offered 25 third-party registrations and 13 Internet examples of THUNDER formative marks mostly for beer. These examples were relevant because the Board found that beer, wine, and spirits are related goods. The Board held that these third-party examples were enough to outweigh the evidence of commercial strength offered by E. & J. to the degree that it concluded the THUNDER term for alcoholic beverages is overall a weak term.

What makes trademark issues deceptively simple is the interplay between the likelihood of confusion factors, which are generally overlooked by attorneys that merely dabble in trademark law. In this case, because the Board found the THUNDER term was weak, the difference between ROAD and BIRD was sufficient to distinguish the marks despite the goods being legally equivalent.

Girl Scouts Lawsuit Highlights Problems with Descriptive Marks

"Girl Scouts logo descriptive marks"

Despite both organizations having descriptive marks, the Girl Scouts of America recently sued the Boy Scouts of America for trademark infringement after the Boy Scouts announced its plans to drop the word “BOY” from its mark and allow girls to participate in its program. The Girl Scouts accused the Boy Scouts of undermining the Girl Scouts by attempting to covertly recruit girls into its organization. In its complaint, the Girl Scouts identify instances of alleged actual confusion where the Boy Scouts advertised that both boy and girl scouts may join its organization.

A defining characteristic for both the Boy Scouts and Girl Scouts from their inception and for about a century later was that boys joined BOY SCOUTS and girls joined GIRL SCOUTS. These terms describe a significant characteristic, feature, or purpose of the respective organizations. Accordingly, the terms BOY and GIRL do not have any source identifying significance, and the Boy Scouts can delete this term from its mark without changing the overall commercial impression of the mark. In other words, the Boy Scouts will not abandon their prior trademark rights by deleting BOY from the mark.

Trademark law also does not restrict or limit the operations of a company or organization. Despite historically accepting only male applicants, the Boy Scouts can broaden its applicant pool to include girls, adults, etc. In fact, broadening applicant pool may be evidence of a natural zone of expansion. When the expansion occurs, it will be promoted and certain words may be required for the promotion.

In the case of the Boy Scouts, the decision to broaden its applicant pool requires it to use the word “girl” in order to attract female applicants. Using the word “girl” in this way even with or in close proximity to SCOUTS is a classic fair use. Classic fair use occurs when another party uses a term to exploit its descriptive meaning. It is another negative aspect to adopting descriptive marks.

Trademark Fame Lacking Admissible Evidence

"Misel Disel preshave liquid too similar to Diesel despite no trademark fame finding"

Plaintiffs arguing trademark fame for purposes of the likelihood of confusion analysis is about as common as defendants arguing the plaintiff’s trademark is conceptually weak. Plaintiffs want to establish trademark fame because strong marks are entitled to a broad scope of protection. For the record, trademark fame for likelihood of confusion purposes is different from fame for trademark dilution purposes.

More often than not, a trademark fame argument fails not because the evidence of fame does not exist, but because the plaintiff fails to properly admit the evidence to the Trademark Trial and Appeal Board. During the discovery period it is easy to get fixated on obtaining the evidence the party needs and not on the admissibility of the evidence being acquired. This was the problem Diesel S.p.A. encountered in its recent case before the Trademark Trial and Appeal Board.

Misel Disel, LLC filed an application seeking registration on the Principal Register of the mark MISEL DISEL (in standard characters) for “smooth shave enhancer, namely, pre-shave liquid.” The Trademark Office reviewed the application and found no conflicting marks that would bar registration under Trademark Act Section 2(d). The MISEL DISEL mark was published for opposition and Diesel S.p.A. opposed the registration of the mark.

Diesel was the owner of several prior registrations for DIESEL (in standard characters) and DIESEL formative marks, but the Trademark Trial and Appeal Board focused on one:  DIESEL (in standard characters) for, among other goods, “pre- and after shave creams and lotions.” The Board found that the MISEL DISEL and DIESEL marks were similar, the goods closely related, and there was no weakness based on the co-existence of third-party registrations. Misel only came up with three registrations for DIESEL and none were for goods remotely close to pre- and after shave creams and lotions.

Diesel argued that its DIESEL mark was famous for likelihood of confusion purposes. To support this argument, it relied on documents only. It offered no testimony, which was Disel’s fatal mistake.

Financial information is key to establishing trademark fame, but this information must be offered through testimony. It is not self-authenticating evidence. Web pages can be self-authenticating, but the Web pages are admissible of what they show on their face only, not to prove the truth of any matter asserted in the them.

Documents produced in response to a Document Request are also inadmissible unless other authenticated through a Request for Admission.

Because Diesel did not give any consideration to admissibility, it was left with minimal evidence on trademark fame and the Board was unable to find that the DIESEL was famous for likelihood of confusion purposes.

Gucci Satisfies the 7 Factors that Determine Famous Trademarks

"Man holding a GUCCI shopping bag one of the famous trademarks"

Famous trademarks are the pinnacle of brand recognition and a distinction more trademarks reach than you would expect. Famous trademarks come in two varieties:  famous trademarks for a dilution claim and famous trademarks for a likelihood of confusion claim. The absolute pinnacle of brand recognition is a famous mark for a dilution claim, but a brand needs to pass through famousness for a likelihood of confusion claim to get there, which in and of itself is a good place to be.

Trademark fame plays a dominant role in the process of balancing the likelihood of confusion factors because famous trademarks enjoy a wide latitude of legal protection. Famous trademarks cast a long shadow that competitors must avoid. Consumer surveys provide direct evidence of fame and the best evidence of fame, but consumer surveys are not commonly used primarily because they are expensive to obtain.

Accordingly, circumstantial evidence is primarily relied on to establish the trademark’s fame. The most common categories of circumstantial evidence used to establish trademark fame:

  1. Volume of sales;
  2. Amount of advertising expenditures; and
  3. The length of time that both sales volume and advertising expenditures have been high.

These factors are indicative of a famous mark because they provide a sense of popularity among consumers and the likelihood of consumers encountering the mark. But equally important to these three common categories of evidence are:

  1. The length of the use of the mark;
  2. The trademark owner’s market share;
  3. Trademark licensing activities; and
  4. The variety of goods bearing the mark.

These factors were on display recently in the Gucci America, Inc. v. UGP, LLC case involving the GUCCI brand. Uberto Gucci – the great-grandson to the original founder Guccio Gucci – filed a trademark application to register the mark UBERTO GUCCI & Design for “electronic cigarettes.” Gucci America, Inc. opposed the application alleging prior use and registration of the GUCCI mark for a variety of goods.

While most of the financial information was submitted under seal to maintain its confidentiality, but sales of GUCCI products in the U.S. were reported to be in the billions of dollars. Gucci America’s advertisements appeared in publications with a combined circulation exceeding 220 million, it has 4.9 million Twitter followers, 17.4 million Instagram followers, 16 million FaceBook followers, and received over 16.2 million FaceBook likes. These data points show how important social media is to not only creating brand awareness, but also in legal determinations involving the strength of a mark.

Millions of people visit the Gucci website, several books have been written about the brand, and it is consistently ranked as a top global brand. All of this circumstantial evidence lead the Trademark Trial and Appeal Board to find that the GUCCI mark is famous and that its rights extend to electronic cigarettes.