Mistakes Some Brands Make

For all the discussion of the outer limits of brand protection explored by companies who are pushing the envelope, here are five common mistakes that many brands make by not doing nearly enough.

1.  FAILING TO REALISTICALLY BUDGET.  Some companies fail to allocate an appropriate and realistic budget to support all the needs of a robust brand protection program.  This is one of the biggest mistakes that even well established, sophisticated companies make. A typical marketing department will comfortably spend millions of dollars a year placing glossy advertisements in Vogue that will attract a customer’s attention for a millisecond as she flips the pages. But that same company will spend a fraction of that budget to take down dozens of high-profile counterfeit websites that show up in a search engine's top results for the brand, even when those websites will confuse thousands of customers and measurably hurt sales.


2.  RELYING SOLELY ON THE GOVERNMENT.  Another mistake that some brand owners make is assuming that law enforcement personnel and Customs agents are familiar with their brands when they encounter counterfeits of their products during a raid or investigation.  The truth is that well-intentioned police officers and Customs agents can only seize and detain items that they have a reasonable suspicion is fake.  A brand owner cannot assume that the Customs officer looking through a cargo ship at a major port knows how to tell a real pair of sunglasses from a counterfeit.  That is why it is so important to reach out to law enforcement and develop ongoing relationships.  Train them to detect the differences between real and fake products of your brand.

3.  PRIORITIZING INCORRECTLY.  It is important to prioritize targets based on a variety of factors including size, but it can be a mistake to place seemingly “low-level” targets on the back burner for too long. In fact, some of the largest counterfeiting and smuggling rings can be uncovered by pursuing a seemingly small target, such as a storefront or street peddler. Sometimes, these sources will reveal a treasure trove of information about their counterfeit supply chain that can lead to significant seizures of counterfeit goods.

4.  GOING IT ALONE.  Another mistake some brands make is to go it alone, and try to take on the entire counterfeit industry in isolation. But savvy counterfeiters deliberately rip off dozens of brands in order to diversify and spread their risk, and also focus on what sells best in any given season.  Therefore, it doesn’t make much sense for brands to refuse to partner and share information with other brand owners, who are also victims in this struggle.

5.  GIVING UP ENTIRELY.  The absolutely worst mistake a company can make is to give up entirely and abandon their brand to the vicissitudes of the counterfeiters' marketplace.  Brand protection efforts require a long-term strategy, and while it sometimes feels like bailing out the ocean with a spoon, it is critical to stay the course.

Partially Functional Product Designs Can Become a Trademark

Do you recognize this shape?

According to a recent decision issued by the U.S. Trademark Trial and Appeal Board (the "TTAB"), this rectangular shape is a valid trademark belonging to Hershey's for its iconic chocolate bars.

By Evan-Amos (Own work) [Public domain], via Wikimedia Commons

One key issue in such product configuration trademark cases is whether the design features sought to be protected as a trademark are primarily “functional."  If the overall design is functional, trademark protection is barred.  Primarily functional products can be protected by patents, but trademark law ends where functionality begins.

The TTAB held that while the individual rectangular shapes scored within the chocolate bar are functional (because they make it more convenient to easily divide the bar into equal pieces), the candy bar's overall design, when considered in its entirety, was not primarily functional.

Instead, the TTAB determined, based on the evidence presented that reflected a wide variety of shapes and designs used for chocolate bars, that the combination of rectangles with a raised border in Hershey's design is not primarily functional and, therefore, may be protected as a trademark.

The second issue that the TTAB considered was whether Hershey's product design had “acquired distinctiveness” in the marketplace for candy.

Product designs and configurations are not considered “inherently distinctive” as are many other types of trademarks. Therefore, in order to be protected as a trademark and registered on the Principal Register, Hershey's must demonstrate that relevant consumers considered the product design to be a source identifier. 

Evidence of distinctiveness can consist of consumer surveys, evidence as to the length of time a mark has been in continuous and substantially exclusive use, revenue of products bearing the trademark, advertising expenditures to promote goods bearing the mark, unsolicited media coverage, and evidence that the product configuration has been promoted in advertisements as a source indicator. 

Hershey's submitted all of these types of evidence to exceed its burden of proof. In addition, Hershey's also provided evidence that Williams-Sonoma attempted to copy the design of the candy bar to use as the shape of a brownie baking pan:

The TTAB ultimately found that the evidence demonstrated that the candy bar design had acquired distinctiveness and could be registered on the Principal Register as a trademark.

Do you recognize these other trademarked product designs?

Can Religious Symbols Be Trademarked?

At the intersection of intellectual property, culture and the First Amendment lies the interesting question:  Can religious symbols be trademarked under U.S. law?

In short, the answer is yes.


There is no inherent or statutory bar for a symbol that has acquired religious connotations and spiritual meaning to a group of believers to become protected as a federally registered commercial trademark, provided that certain legal conditions are met.


For example, the mark must be "used in commerce" and become associated with a "single source."


These legal requirements demand that some form of commercial goods or services are offered in connection with the mark by a single entity, either a church, not-for-profit organization or corporation.  Therefore, a "generic" religious symbol such as a crucifix would not be protectable because it represents a system of beliefs that is not associated with a single identifiable "source."  That is, the Roman Catholic Church could lay a claim to it, but so could Orthodox, Protestant denominations, and thousands of other Christian organizations.


Additionally, even the name of a church or religion can be trademarked.  For example, "THE EPISCOPAL CHURCH" is a federally registered trademark for religious instruction services (see right).


In one federal lawsuit testing the bounds of these concepts, the Te-Ta-Ma Truth Foundation-Family (the “Foundation”) sued the World Church of the Creator (the “World Church”), alleging that the World Church infringed its registered trademark for “Church of the Creator.”

The World Church was one of three primary divisions of the white supremacist movement. The mission of the Defendant was twofold: (1) to ensure the survival, expansion and advancement of the white race and (2) to eliminate Jews, blacks and “mud- races.”  The Foundation, on the other hand, was a denomination professing universal love and respect, and actively included everyone who wished to join.  In order words, the beliefs ensconced by the World Church were diametrically opposed to the beliefs practiced by the Foundation and therefore fundamentally incompatible.

On appeal, the Seventh Circuit  Court of Appeals held that the World Church infringed the Foundation’s trademark. The court held that the Foundation’s name did not preclude others from distinguishing themselves and implied that the name encapsulated the Foundation’s identity: “[U]sing ‘Church of the Creator’ as a denominational name leaves ample options for other sects to distinguish themselves and achieve separate identities.”

The issue affects all organized religions.  For example, a Lubavitch Jewish religious group that uses a symbol of the Torah and Hebrew letters on a shield has litigated whether or not this symbol can legitimately function as a trademark. The Trademark Trial and Appeal Board held that it could.

In an article titled "Register Trademarks and Keep the Faith:  Trademarks, Religion and Identity," Professor David A. Simon writes about some of the issues confronted when religious organizations wage secular court battles over the unauthorized use of religious trademarks.

Professor Simon notes that such litigation is not a traditional trademark dispute.  Such cases are focused on protecting rights to compete in commerce.  Here, the dispute is driven by a unique cultural struggle to protect religious identity, but the parties are forced to use the secular litigation system to resolve essentially cultural, "identity" disputes.

He suggests a novel approach to resolving such disputes that is modeled on the Uniform Dispute Resolution Procedure ("UDRP") triggered when there are disputes surrounding the legitimacy of Internet domain names.

In any event, even if permitted under intellectual property law, applying secular trademark concepts to legal disputes involving religious identity and cultural control remains an uneasy fit.

Congressional "Outrage" Over Chinese-Made Ralph Lauren Uniforms?

American politicians, including Senate Majority Leader Harry Reid (D-NV), expressed "disgust" and "outrage" that Ralph Lauren's sartorial donation to the 2012 Olympics were made in China, and demanded that the uniforms be "burned."

But where is Congress's disgust and outrage about this alarming trend?

I would also point out that Ralph Lauren is one of America's iconic and most successful designers, who has done more for promoting American fashion and supporting the American Olympic team, than all of Congress combined.

Under Armour Lawsuit Full of Rhetoric, but Legal Test is Straightforward

Billion dollar sportswear and sneaker manufacturer Under Armour recently filed a trademark infringement lawsuit accusing Maryland-based startup beverage company BodyArmor of copying Under Armour's name, logo and marketing.  Here are a few observations about this particular lawsuit.


First, purely from a marketing and promotion standpoint, the filing of this case was probably the greatest gift that the startup beverage maker could have possibly received from anyone.

Indeed, the opportunity to generate and benefit from massive amounts of free press was capitalized upon by BodyArmor's owners -- the same mega-entrepreneurs who founded vitamin water, sold that brand to the Coca-Cola Company in 2007 for $4.1B, and who are considered leading experts at creative brand building in the beverage industry.


In fact, normally filing an Answer to a Complaint is a fairly mundane procedural act, as an Answer typically contains standard denials, recitations and defenses, but little fireworks or rhetorical opportunities.

However, seizing the moment and a unique opportunity for using litigation as part of brand building, BodyArmor issued an unusual, nationwide press release along with the filing of its Answer, threading populist themes of "fighting back against trademark bullying," a refrain often cited by accused infringers today.

In its Answer, the Defendant countered by alleging that "[i]t is nearly impossible that consumers or retailers of either brand would confuse the two.  Under Armour and BODYARMOR operate in disparate industries, produce distinctly unrelated products, and share no branding or logo similarities."

Nonetheless, despite the rhetoric of "bullying" and personalities involved, the merits of the trademark case require a fairly garden variety legal analysis. 


The case will turn on the jury evaluating existing marketplace conditions, and determining whether or not consumer confusion is likely based on perceptions of the beverage's name, logo and marketing materials.

To ultimately prevail on its trademark infringement claims, Under Armour will need to demonstrate to a jury, by a preponderance of the evidence, that ordinarily prudent consumers encountering the BodyArmor product and advertisements in the marketplace will likely be confused into believing that the beverage emanates from, is endorsed, sponsored by, or affiliated with Under Armour.


This analysis involves using a flexible eight-factor test called the Polaroid test first articulated by Judge Friendly in a famous case brought by Polaroid against a company called Polarad Electric.


The eight factors described in the Polaroid case are:  the strength of the trademarks involved, the proximity of the products in the marketplace, the likelihood that the second-comer will "bridge the gap" in the marketplace between himself and the senior user, the sophistication of the consumers, any instances of actual confusion, the quality of the junior user's products, the intent of the junior user, and the similarity of the competing marks.

Further, marshaling evidence will entail the parties introducing competing consumer surveys through expert witnesses, who are skilled professionals with advanced marketing degrees and backgrounds, charging hundreds of dollars per hour.


Each expert witness will presumably challenge aspects of the adversary's expert's methodology and reach the exact opposite conclusion about the likelihood of confusion.

The parties and their witnesses will also spend countless hours scrutinizing the respective trademarks bit by bit, comparing them side-by-side, as well as examining the appearance of the respective products themselves.  


But in the end, when all the rhetorical fireworks are over, and the allegations of "fighting back against bullying" die down, the case will ultimately be decided based upon whether the jury believes that Under Armour has sustained its burden of proving that consumer confusion from the beverage is likely under prevailing marketplace conditions.

Is it Trademark Infringement to Make Your Own Fakes?

The Huffington Post is reporting that there is a run on a particular pantone of red paint in the United Kingdom.

Why red paint?

Faced with the high price of genuine Christian Louboutin designer pumps, some cash-strapped British wannabe fashionistas are painting the soles of their high heel shoes a specific shade of red, in a deliberate imitation of the designer's federally registered trademark.

In response to the Huffington Post article, I was asked the obvious question by many people:  "Is that practice legal in the United States?"

I had to pause to make sure that I was absolutely convinced that the following statement was really true:

"Yes.  This practice is absolutely legal in the United States."

Intentionally applying a counterfeit, imitation trademark to a product for one's own personal use, assuming that there is ZERO chance that the item will ever be sold or offered for sale to anyone -- is perfectly legal under current U.S. trademark laws.  It is perfectly legal to own, wear and proudly display a counterfeit product on one's own person.

The Lanham Act, codified at 15 U.S.C. § 1051 et seq., is the primary federal statute of trademark law in the United States.  The Lanham Act prohibits a number of activities, including trademark infringement, trademark dilution, false advertising and false designation of origin.

If someone were to offer a product for sale that infringes upon, dilutes or causes confusion with a protectable trademark or design, that person would be civilly (and possibly even criminally) liable under the Lanham Act for monetary damages and an injunction (a court order) against their continued conduct.  The goods can also be confiscated and destroyed.

In a case where I represented French designer Hermes of Paris, a 3-judge panel on the influential U.S. Court of Appeals for the Second Circuit in Manhattan unanimously wrote:

"Such a practice [of selling knockoffs] does harm the public, however, by creating post-sale confusion, not just among high-end consumers, but among the general public, which may believe that the knockoff is actually the genuine article.  In fact, high-end consumers may be less confused than the general public in the post-sale context because many of them will be aware of the existence of copies.  In either case, a loss occurs when a sophisticated buyer purchases a knockoff and passes it off to the public as the genuine article, thereby confusing the viewing public and achieving the status of owning the genuine article at a knockoff price."  Hermes Int'l et al. v. Lederer de Paris Fifth Avenue, Inc., et al., 219 F.3d 104, 106 (2d Cir. 2000).

But in each of its relevant prohibitions against knockoffs, the Lanham Act deliberately utilizes a key word -- commerce.

Absent some form of actual, intended or apparent "use in commerce," the imitation shoes that a person makes solely for their own personal use and display cannot be accused in a federal court as being an infringement, dilution or false advertising.

Indeed, that result is true even if the copycat shoes are admittedly designed to cause the third-party, "post-sale" consumer confusion that the Court of Appeals said is harmful.

Cheap knockoff shoes can also "dilute" the fame and power of a well-known brand (especially if the imitation shoes are lousy quality, which would "tarnish" the fame of the red-sole Louboutin trademark).

But the manufacture and use of personal copycat red soled shoes, assuming no use in commerce other than the mere act of a private person wearing them, is simply not illegal under current U.S. federal law.

That perverse outcome means that even if an ill-intentioned person were to manufacture many pairs of such shoes, for no commercial purpose other than to deceive their friends and onlookers into believing that they are fashionable enough to own a hundred pair, there is nothing the trademark owner can legally do to stop that person.

Perhaps the more interesting and unresolved question is...could a designer accuse a famous celebrity who chooses to wear knockoffs on the red carpet, of essentially "endorsing" the fake goods in an unlawful commercial manner?

10 Strange, But Real Federally Registered Trademarks

Section 2(a) of the Lanham Act, 15 U.S.C. Section 1052(a), bars the registration of trademarks that are deemed “immoral” or “scandalous." However, no aspect of U.S. law addresses the registration or use of trademarks that are just plain...strange.  Here are ten favorites:


10.  JUNK IN THE TRUNK® for trash collection.  To be distinguished from FOR THE JUNK IN YOUR TRUNK® brand of pickup truck cargo liners.
9.  CORNHOLIO®  for t-shirts and baseball caps. One of the stranger facts about this trademark registration owned by South Carolina-based Cornholio, Inc., is that it claims a first use in commerce in 2008, but characters Beavis and Butthead who made the mark famous, went off the air in 1997.
8.  OBESITY IS SUICIDE BY OVERDOES [sic] OF FOOD®  Owned by the Michigan-based Fat Loss E-School Corporation.  Typographical error included on original registration certificate.
7. BACK OFF BABY®  For bustiers.
6.  SLIMY GRIMY®  Registered since 1981 and now incontestable.  For cleaning preparations, namely, boat hull cleaning preparations.
5.  ZOMBIES VS. CHEERLEADERS®  For comic books but recently abandoned.  Not sure who I was rooting for here.
4.  DISGUSTING ANATOMY BRAIN® and DISGUSTING ANATOMY HEART® are both registered for toys "and playthings."  What such playthings that aren't toys are they talking about here??
3.  THE GREASY WIENER®  for restaurant services.  Not health food-specific, I suspect.
2.  FULL CONTACT BINGO®  Electronic Arts recently applied for this title in connection with online computer gaming.  Not yet a trademark, just an application, but I've already ordered my advance copy of the game.
1.  DEAD LAWYER®  For a variety of items, including mouse pads.

The Internet is Becoming a Perpetually Lawless Frontier

In the American frontier of the 19^th Century, outlaws found virtually unbounded opportunities to rob pioneers of their treasured few possessions, while the few understaffed lawmen faced difficulty detecting, arresting, holding, and convicting wrongdoers.  In the early 21^st Century, the Internet represents a similarly lawless frontier.  A virtually infinite supply of domain names and websites has generated a gold rush mentality, as millions have sought to cash in by speculating on the virtual real estate that the Internet seems to offer.

The Internet’s frontier mentality has also attracted its share of brigands.  Those seeking to rob web users of their hard-earned money are the same types of predators who mastered the arts of deceit, theft and counterfeiting on the bygone frontier.  While their methods may be far more sophisticated, their fundamental approach is the same as old-fashioned con men.

Without any form of meaningful regulation, a dramatic new expansion of the Internet frontier is occurring, and is threatening to undermine any semblance of law and order that has been struggling to develop over the Internet.  The Internet Corporation for Assigned Names and Numbers, (“ICANN”) recently announced that it has received applications for more than 1,900 new domain name extensions, including: .BID, .BUY, .DEAL, .DESIGN, .DISCOUNT, .FASHION, .FREE, .GIFT, .HOT, .JEWELRY, .LOL, .LUXURY, .ONLINE, .SALE, .SHOP, .STORE, .VIP, .WATCHES, .WEB, .WTF, and .WOW.  Hundreds of these applications will likely be approved, and tens of millions of new domain names may be in use with these new extensions by the end of next year.

“ICANN’s program may open up new opportunities, but it also presents a whole new frontier of potential—and likely—abuse by those seeking to profit from the name, reputation, and content of others,” said Scott Bain, Chief Litigation Counsel for the Software and Information Industry Association, quoted by the Washington Post.

But everyday e-commerce web users are already facing a never-ending barrage of spurious websites selling counterfeit products online.  It is absolutely clear that in the absence of appropriate and effective legal structures requiring stricter verification and identification of domain name ownership and control, a dramatic and unprecedented expansion could be catastrophic for brand owners and consumers alike. 

Faced with the bruising public defeat of the Stop Online Piracy Act (“SOPA”) in January 2012, brand owners have undertaken aggressive actions to address online counterfeiting, including filing mega-lawsuits in federal court using existing laws and technology.  However, the online counterfeiting threat persists, and by some accounts has increased markedly.

ICANN president Rod Beckstrom said in a recent press conference that the group has added new provisions to protect intellectual property, including the option for rapid takedown when brand holders feel their IP may be threatened.  ICANN also reserves the right to take a domain name back if it there is significant abuse.

But ICANN should not be entitled to create a perpetually lawless frontier without applying consistent and binding legal regulations about the already-rampant intellectual property abuse occurring on the Internet.  

Without strict disclosure and domain name ownership laws in place, ICANN runs the risk of establishing the Internet as perpetual “wild west,” without any lawmen on their way to bring law and order to the troubled frontier.

Congress should act now to intervene and hold additional public hearings on how ICANN’s proposed domain name expansion program will affect consumers and brand owners, in the absence of laws addressing intellectual property abuse and consumer fraud already perpetrated online.

New gTLD Extensions: Get Ready for the Internet on Steroids

The group which essentially governs the Internet, known as the Internet Corporation for Assigned Names and Numbers ("ICANN"), recently released a list of thousands of applications for new generic top-level domains ("gTLD's"). Once approved, these new extensions would add to the already growing list of domain extensions that include popular .COM, .NET and ,ORG, and somewhat less popular .BIZ, .INFO, and .US. The applications include obvious brand protection extensions like .GOOGLE and .TIFFANY, as well as thousands of generic applicants like .SHOP and .STORE. Demand Media alone submitted more than 130 applications, including .AIRFORCE, .ARMY, .NAVY and .NINJA(huh?). The primary problem from a brand protection standpoint is that the Internet domain name system is already glutted with a virtually infinite number of available combinations to promote mischief and erode brand reputation online. To demonstrate the point, here is a list of just some of the applied-for Top Level Domains in the ICANN new gTLD Program 2012:

• .adult

• .auto

• .baby

• .boats

• .book

• .car

• .cards

• .cars

• .diamonds

• .diet

• .dog

• .energy

• .equipment

• .events

• .events

• .flowers

• .furniture

• .garden

• .gift

• .glass

• .gold

• .grocery

• .guitars

• .home

• .homegoods

• .homesense

• .horse

• .house

• .jewelry

• .kids

• .kitchen

• .luxe

• .luxury

• .mail

• .media

• .memorial

• .mobile

• .motorcycles

• .pets

• .pharmacy

• .phone

• .photo

• .photography

• .pics

• .pictures

• .porn

• .sex

• .sexy

• .solar

• .tattoo

• .tickets

• .tickets

• .tires

• .tools

• .toys

• .video

• .watch

• .wedding

• .yachts

• .clothing

• .beauty

• .fashion

• .hair

• .ink

• .makeup

• .salon

• .shoes

• .skin

• .spa

• .style

• .tattoo

• .ads

• .and

• .are

• .auction

• .bargains

• .best

• .bid

• .black

• .blackfriday

• .blue

• .boo

• .buy

• .buzz

• .center

• .channel

• .cheap

• .christmas

• .city

• .click

• .codes

• .community

• .compare

• .cool

• .country

• .coupon

• .day

• .deals

• .direct

• .directory

• .discount

• .dot

• .duck

• .ecom

• .ads

• .exchange

• .exposed

• .express

• .fail

• .feedback

• .foo

• .forsale

• .free

• .frontdoor

• .glean

• .global

• .gripe

• .guru

• .hangout

• .here

• .home

• .hot

• .ing

• .jot

• .joy

• .land

• .link

• .loft

• .lol

• .market

• .markets

• .media

• .meme

• .new

• .next

• .ninja

• .now

• .online

• .page

• .parts

• .pink

• .place

• .plus

• .prod

• .promo

• .qpon

• .red

• .rocks

• .sale

• .save

• .seek

• .shop

• .shopping

• .silk

• .site

• .space

• .spot

• .star

• .store

• .sucks

• .support

• .today

• .top

• .town

• .trading

• .tube

• .web

• .website

• .world

• .wow

• .wtf

• .xyz

• .yellowpages

• .you

• .zip

• .zone

Concerned about the implications for online brand protection yet?

Kate Spade on Receiving End of Infringement Complaint

The estate of the late artist Vera Neumann has filed a federal copyright infringement suit in the Southern District of New York against designer Kate Spade. According to the complaint, the estate owns the copyright to a design entitled “Poppy Field" created by Neumann in 1978. The complaint claims that Kate Spade admitted that she had been inspired by Neumann's designs: "Kate Spade has indicated, at least several years ago, that among the items and products that have inspired her designs are the silk-screened scarves of Vera," which Spade referred to in her book “Style by Kate Spade.”  

The estate is seeking "an amount not as yet known, but believed to be in excess of one million dollars plus interest" in damages. This amount purportedly represents "all gains, profits and advantages derived by Spade's use of the infringement of Neumann's copyright."

Neumann's "Poppy Field"

Kate Spade's alleged infringement