Confusion and Conflict Over "Candy Crush" Trademark Status

Over the last several weeks, news reports began to circulate that King.com Limited, the software developer that designed the hugely popular "Candy Crush Saga" game, had trademarked the term "CANDY" in the United States, and had begun to send cease and desist demands to developers who were using the term "candy" in connection with other, unauthorized applications.

The developer is also the creator of PetRescue Saga and the FarmHeroes Saga.

Yesterday, the Los Angeles Times reported on the more accurate status of the matter.

Namely, the game maker had applied for a federally registered trademark for the word "CANDY" nearly a year ago, and on January 15, 2014, the application was "approved for publication" in the Official Gazette.

This status means that the public has thirty (30) days within which to file any formal oppositions to the pending trademark application.

If, after that period, no one objects (or any formally litigated opposition is unsuccessful), the application will proceed to receive a federal registration.

To protest King's trademark application, several game developers have reportedly created a "Candy Jam" protest website that encourages others to create unauthorized games themed around "candy."  Extra credit may be offered to those who also use the words "scroll", "memory", "saga", "apple", or "edge".

One of the creators of the protest website reportedly told the Los Angeles Times: "Reaching a point where a company is allowed to trademark a common word is complete nonsense.  You don't need to have a great understanding of the laws to understand that this is ridiculous and totally unethical."

But these protesters are legally incorrect.  During the prosecution of the application, the U.S. Trademark Examiner conducted an exhaustive search and found that the word "CANDY" is not commonly nor descriptively used in connection with any other mobile digital applications.

The Examiner did find an existing trademark for "KANDY" in one of the classes of services at issue, but that conflict seems to have been resolved.

The Declaratory Judgment Complaint -- Being Quicker on the Draw

As a routine practice, a brand owner's trademark lawyers send formal cease and desist letters to companies or persons who become accused of using a confusingly similar name or design without authorization.  

Such a letter is often sent before a lawsuit is filed.  
It is not legally necessary for a brand owner to send such a demand letter, but (depending on the circumstances) many brand owners believe that it is helpful to give notice before filing suit.


This process also allows the accused infringer to settle potential litigation for smaller (or no) damages, depending on the circumstances.  


For example, some infringers may agree to share their sales figures of accused products, and in doing so, deter the brand owner from seeking excessive damages.


Of course, there is never a guarantee that the brand owner will agree to settle, and these documents can have the opposite effect, and end up fueling litigation.


Trademark lawyers send out dozens, hundreds -- even thousands of such demand letters each year.  Most of the time, the recipients apologize, comply with the letter's demands and move on.
 In some cases, the unwise recipient just ignores the letter, leading to a second, usually more aggressive letter or a lawsuit.


But in some rare cases, if the recipient of a letter receives what could be interpreted as a legally baseless or overly aggressive threat leading to a reasonable apprehension of imminent litigation, he may opt for a highly aggressive strategy -- sue the brand owner first.  
In other words, he is quicker to the draw in gunslinger terminology.

This process is called invoking declaratory judgment jurisdiction.  The reason is that the plaintiff is seeking a "declaration" that he is not infringing.

Upon receiving a cease-and-desist letter, the recipient may seek a tactical advantage by instituting declaratory judgment litigation in a more favorable jurisdiction.
  The end result may require the sender of the cease and desist letter to appear in a distant court, at their own expense, in a case that it never would have actually brought.

The declaratory judgment plaintiff also could catch the overly aggressive brand owner off guard, and put it in the posture of being a defendant rather than a plaintiff.
  This tactic seems to have worked, at least initially, for the recipients of a cease and desist letter from the Subway sandwich chain's lawyers.


In 2011, Subway's lawyers sent a cease-and-desist letter to Casey’s General Stores, a midwest convenience store operator, demanding that it stop using the word “footlong” to describe its sandwiches.

Casey’s struck back with a declaratory judgment lawsuit against Subway, arguing that the chain has no trademark rights to what it considered to be a generic term.


The suit noted that Subway has tried to register the mark protection for “footlong,” but was refused by a trademark examining attorney who was skeptical of the distinctiveness of the term, noting that restaurants across the country use the word to describe submarine sandwiches on their menus.


Thus, Subway became the unwilling defendant in a declaratory judgment case brought by an accused infringer, putting the validity of its very trademark in jeopardy.

Bakery Battle: Univ. of Alabama Program Threatens Local Cake Maker

Mary Cesar, the owner of Mary’s Cakes & Pastries in Northport, Alabama has routinely placed a script letter “A” on cakes she designed for University of Alabama-sponsored functions.

But Cesar recently received a formal cease and desist letter, demanding that she stop using "trademarks, name, logos, colors, slogans, mascots and other indicia associated with the University."

The letter was sent by Collegiate Licensing Company in Atlanta, which has a contract with UA to provide licensing services for the university's trademarked items.

"If UA sues us, it will put us out of business because we are a really small mom-and-pop-type of business," she told the Associated Press.

Cesar said her research indicated it would cost $750 to $3,000 to apply for a license to use the trademarks, a fee she said wasn't justified by her small volume of bakery items.

Cesar opened her bakery in Northport six years ago after moving to Alabama from California. Her main business is custom-decorated cakes. The bakery also makes pastries and cookies, including theme-shaped cookies that she varies throughout the year.  She reportedly started selling cookies shaped like elephants, hats and footballs, particularly during the fall, beginning several years ago.

The hat cookies had a light gray icing and squiggles like a houndstooth pattern, invoking memories of Paul W. "Bear" Bryant, and she had another cookie resembling Nick Saban's signature straw hat.  The elephant and football cookies often had a capital "A'' on them, making them popular with many local football fans.

UA has a reputation for aggressively protecting its brands.  But earlier this year, a federal appeals court sided with Alabama artist Daniel Moore in a trademark dispute involving UA. Moore is known for original paintings with sports themes, including many paintings depicting major moments in UA football games.

UA sued Moore, claiming he infringed on the university's trademarks by showing trademarked words and images in his paintings.

A federal appeals court rejected UA's argument this year, ruling the paintings were an artistic expression protected by the First Amendment.

Excuse Me...Who Does This "Lost Dog" Belong To?

The Lost Dog Coffee Shop in Shepherdstown, West Virginia (population 1,734) recently received a formal cease and desist letter from an attorney representing "The Lost Dog Cafe," a restaurant located in Arlington, Virginia, sending shockwaves throughout the small West Virginia town.

Hundreds of town residents have signed an online petition, but the Arlington-based cafe is not backing down from its threats.

On January 3, 2000, Shepherdstown, West Virginia was the unlikely site of the Peace Talks between Israel and Syria where both sides were urged to make the hard choices needed to end a half-century of conflict.

Those negotiations didn't quite work out like everyone had hoped, and it doesn't seem that this dispute will end anytime soon, either.  

The owner of the Lost Dog Coffee Shop has indicated that he has no intention of acquiescing to the Lost Dog Cafe's "trademark bullying."

Someone should remind the parties that there is always a bigger dog on the block:  The Lost Dog Cafe located in downtown Binghamton, New York, has a concurrent use right recognized by the U.S. Patent and Trademark Office senior to everyone.

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.