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Best Practices in Trademark Clearance and Selection

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  • 1. Silver Linings Playbook:Best Practices in Trademark Clearance & SelectionStephen Coates,Susan Natland & Jonathan HymanACCA Doubleheader,Disneyland,April 30, 2013The recipient may only view this work. No other right or license is granted.
  • 2. 2© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Why Clear a Mark?Goals:• Manage risk–Lower risk of a lawsuit, C & D or other objection–Lower risk of having to rebrand• Manage costs– Will prosecution be costly?– Is a third party objection likely?
  • 3. 3© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Why Clear a mark?** Duty to search before adopting a mark?– No affirmative duty, but good business practice– A search could rebut claim of willful infringementAssess three areas:1. Risk of conflict2. Likelihood of registrability3. Protectability/Scope of protection
  • 4. 4© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.LogosCase Study: New Beer LaunchTwo Versions• SASQUATCH = 12 oz (normal size) bottle name• DWARF = 6 oz (small size) bottle name
  • 5. 5© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Case Study: New Beer LaunchBottle Shape/Ornamentation:- Mini bottle for the DWARF beer- Beer cap ornament for smallbottle- Foot design embossed on thebeer cap of large bottleSlogan (large bottle):“THE MONSTER OF BEERS”Slogan (small bottle):“SMALL SIZE…SAME BIG TASTE”Flavors:ALASKAN JUNIPERCANADIAN MAPLE
  • 6. 6© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.New Beer Launch: Roll-Out Plans & Timing12 Months to 18 MonthsRoll-Out DWARF Beer in the U.S. and Abroad3 to 6 MonthsRoll-Out SASQUATCH Beer in the U.S.6 Months to 12 MonthsRoll-Out SASQUATCH Beer Abroad in AU, EU and CA
  • 7. 7© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.The Draft: Creating a Strong Brand?Business and LEGAL Attributes of a Good Brand• Appropriate• Credible• Appealing• Relevant• Memorable• Enduring• Easy to Pronounce PROTECTABLE AVAILABLEBusinessLegal
  • 8. 8© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.ArbitraryFancifulSuggestiveDescriptiveGenericThe Draft: Is the Brand Protectable?BRAND STRENGTH CONTINUUMThe commonname for aproductMerely describesa function,characteristic, orpurpose of theproductBrings to mind afunction, characteristicor purpose of theproduct but in asuggestive/creativewayA coined term or a wordwith no significance inrelation to the goods orservices with which it isusedAPPLE(apples)RAISIN BRAN (cereal)BABY BRIE (brie cheese)LE CROISSANT SHOP (café)KODAK (film)APPLE (computers)EXXON (oil)COPPERTONE (suntan oil)CHICKEN OF THE SEA (tuna)WHIRLPOOL (washers)NoProtectionInherentlyProtectableCapable of EventuallyBecoming Protectable
  • 9. 9© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.The Draft: Team Descriptive vs. Team SuggestiveDescriptive SuggestiveCHAP STICK (skin preparation stick) ORANGE CRUSH (orange drink)RAISIN-BRAN (raisin and bran cereal) BOILING CRAB (seafood restaurant)HOLIDAY INN (motel) 7-Eleven (food store chain)TWENTY FOUR HOUR FITNESS(gym)L’EGGS women’s hosieryWORLD BOOK (encyclopedia) ROACH MOTEL (insect trap)COMPUTERLAND (computer store) CITIBANK (urban bank)INTELLIGENT (vehicle tires) CHEW ‘N CLEAN (dentrifice)JOY (detergent) HULA HOOP (plastic hoops)Good Rule of Thumb: The more creative or abstract,the more likely to be suggestive and not descriptive
  • 10. 10© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.The Draft – Not All Brands Are Created Equal• Public policy behind descriptive marks/generic terms– Competitors need ability to describe theirproducts/services• Risks of descriptive marks– Competitors use same or similar terms to describetheir products/services and dilute your marketingmessage– Limited ability to enforce unless acquire secondarymeaning– Could spend more resources enforcing/protectingthe mark than actually spend on branding
  • 11. 11© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.The Risks of Choosing a Descriptive or Weak BrandTrademark Registration May Not Be ImmediatelyGranted if the Mark is Descriptive• Must satisfy higher burden to Trademark Office (usuallyrequires showing 5 years of use in the U.S.; even harder inEurope)• In the interim, someone else may begin using your brandScope of Protection May be Narrow if the Mark is Weak• If in a crowded field of similar marks• If the mark is borderline descriptive
  • 12. 12© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.The DraftWhere DoYour Proposed New Brands Fall?Brands Fall?DWARF for beerSASQUATCH for beerCANADIAN MAPLE flavor of beerALASKAN JUNIPER flavor of beer
  • 13. 13© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.The Draft: Is the Brand Protectable?ArbitraryFancifulSuggestiveDescriptiveGenericAvoidWE WANTTHESE!!NoProtectionCapable of EventuallyBecoming ProtectableInherentlyProtectableDWARFSASQUATCHALASKAN JUNIPERCANADIAN MAPLEProduct = Beer
  • 14. 14© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.The Draft: Relative Strength of a Mark• Is it like this?• Or this?• Or this?• If you are the only oneyou may have strongrights• Could be dangerous ifyou are the junior user• Safety in numbers, butthere could beterritorial battles andlikely a weak mark
  • 15. 15© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Training Camp – Set Up ProtocolSet up a protocol to keep business team happy
  • 16. 16© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Training Camp – Set Up Protocol• A clear protocol can help avoid issues• Clearance process should empowermarketing/business team and notleave them feeling on the sidelines• Set a time frame forsearching/clearance so can managemarketing/business teamsexpectations• Set budget for clearance (andobtaining registration)?
  • 17. 17© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Training Camp – Set Up Protocol• Get marketing/business teamto “buy in” to strong marks• Meet with marketing/businessteam regularly to:- understand productlaunches- game plans for the year
  • 18. 18© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Training Camp – Questions to ask your team beforesearching• Is this a new mark or a variation of an existingmark?• What is the meaning/origin for choosing themark?• Is the mark based on someone else’s mark?• When is product launch? Has it occurred already?• Are there any logos or distinctive stylizations?• Are there any alternate marks being considered?• Any unique trade dress to consider protecting?
  • 19. 19© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Training Camp – Questions to ask your team beforesearching• What are the products/services?–Are there product/service extension opportunities?–Are there any ancillary products/services to consider?–What are future plans for the brand?• What countries are you targeting with your brand?
  • 20. 20© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Your PlaybookTypical steps in protocol• Marketing/business team develops marks• PR Issues?• Is it protectable?• Is it available?– Knock out search on USPTO website/other TM offices– Is domain name available?– Further searching• In-house search?• Full search?• Foreign search?• If mark is clear, implement registration process
  • 21. 21© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Key Equipment• TM office websites– http://tess2.uspto.gov/bin/gate.exe?f=tess&state=4804:g2z8gq.1.1– http://ttabvue.uspto.gov/ttabvue/• Madrid database -http://www.wipo.int/madrid/en/services/madrid_ express.htm• OHIM (EU) TMview – free and covers most of Europehttp://tmview.europa.eu/tmview/welcome.html• Canada - http://www.cipo.ic.gc.ca/app/opic-cipo/trdmrks/srch/bscSrch.do?lang=eng• Pacer (litigation searching)
  • 22. 22© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Key EquipmentOther important websites• Amazon – check to see if products being sold• www.archive.org – view what a website previouslylooked like• Translations – www.freetranslations.com• WhoIs – check domain name registration data, whenwas it registered, when does it expire, who owns it• Acronym Finder – www.acronymfinder.com
  • 23. 23© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Calling the Right PlayHow much searching is enough?• Budget?• Where will products be sold?• Is it a house mark, brand name, or secondary mark?– MOLSON house mark– DWARF BEER; SASQUATCH– product name– ALASKAN JUNIPER, CANADIAN MAPLE - flavors• Do we need to search for trade dress, logos, tag lines,etc.?
  • 24. 24© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Calling the Right Play• Full search – looks at USPTO and state databases, as wellas unregistered, common law uses• In-house search – typically just USPTO and state records• Consider at least in-house worldwide screening search atthe outset• Full search for important marks• Consider conducting in-use investigations – multipleinvestigations can be cost prohibitive• Specialized Searching – e.g., for trade dress (can be moredifficult to search in-house) for alcohol products, checkCOLA records; for entertainment properties, do titlesearch
  • 25. 25© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Calling the Right Play - Don’t Fumble• Surnames – not registrable on Principal Registerwithout secondary meaning• Geographic terms considered descriptive• Geographically misdescriptive marks not registrable• Translate foreign word marks into English and clearthem• Even full searches have limitations and there are timelags• Check for words with similar meanings –YETI/ABOMINABLE SNOWMAN
  • 26. 26© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Calling the Right Play - Don’t Fumble• Does the mark have a negative connotation or slang? Inforeign languages?– Is the use of DWARF as a brand offensive?– CHEVY NOVA – CHEVY DOESN’T GO– P&G detergent DREFT was originally “Dreck” which isYiddish/German for “crap”– Rolls Royce SILVER SERAPH was originally SILVER MISTbut “mist” sounded like German slang for manure• Consider engaging local expert, especially in China, forlocalized translations/transliterations• Register local translations/transliterations - YOWIE inAustralia
  • 27. 27© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Safe vs. Risky Plays - What is the risk?• What is risk tolerance of company?• How deep to search? When to clear a mark?– Depends on the product– Depends on the mark (house mark, product mark, feature levelmark)– Depends on the shelf life – part of permanent product line vs.seasonal use– How easy is it to remove if worst case scenario?• Online only use could be easy to revise• Removing mark from product or cover with sticker?– Is a mark technically ever “clear” or without some risk?– How much risk is too much risk?– How comfortable is the business team with damage control?
  • 28. 28© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Safe vs. Risky Plays - What is the risk?Assessing risk –• No mark is “risk free”• Define parameters so legal and marketing/businessteam are on same page with level of risk – what is low,moderate, high really mean to the company?• Example– Low risk of conflict – greater than 75% chance ofprevailing in a conflict– Moderate risk of conflict – 35%-75% chance ofprevailing in a conflict– High risk of conflict – less than 35% chance ofprevailing in a conflict
  • 29. 29© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Safe vs. Risky Plays - What is the risk?Assessing risk –• What increases risk?– Closer the marks– More distinctive the third party mark– Closer the goods/services– Overlap customers– Overlap channels of trade– How vigorously third party enforces brand
  • 30. 30© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Safe vs. Risky Plays - What is the risk?Assessing risk –• Cannot always predict how a third party willreact– Some third parties may use objection as away to get $ - are you a deep pocket?– Reaction could depend on how visible youruse is– Could there be a bad PR situation?• Consider risk of reverse confusion
  • 31. 31© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Safe vs. Risky Plays - What is the risk?Search results yield a hit:• Investigate – if ongoing litigation, be mindful of contactingtarget directly– When did use commence?– On what goods/services?– What geographic area?– Still using/abandoned?– www.archive.org• If no use, do you get aggressive – file cancellation actionearly?– Cut off resumption of use– Contact to purchase registration?
  • 32. 32© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Audibles – Fixes for Potential Issuesau•di•blen. 1. (in football) an alternativeplay called by the quarterbackIf key domain name registered:• Is it in use or parked?- Order snapback?- Purchase anonymously• What alternate domain names can you pursue?- For beer: ____beer.com- For beverage: drink____.com- For products/clothing: shop____.com
  • 33. 33© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Audibles –Fixes for Potential Issues• Would a tweak of the mark or addition of house markor other elements mitigate risk to an acceptable level?• Consider limitations to the use and/or goods andservices to cover under trademark filings• Consider purchasing prior rights• Time permitting, utilize building block approach toincrease fence of protection around the brand• Consider different branding in different jurisdictions(many times, not ideal, however)
  • 34. 34© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Avoiding PenaltiesSilly mistakes to avoid
  • 35. 35© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Illegal Procedure – Not Enough SearchingDon’t just search where product will besold. Also --• Search where products will bemanufactured• Search where potential infringementscan occur• These should be key targetjurisdictions for registration as well
  • 36. 36© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.False Start – Proceeding Without a Knock OutKnock out search –• Can be done quickly and cheaply to avoidspending money when could easily knowof issue– Don’t just check identical mark• DWARF• DWARVES• LITTLE PEOPLE– If knock out is clear, don’t stop there
  • 37. 37© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Illegal Substitution• Marketing/business team should notify legal:– If change mark– If change products or services• DWARF tequila?– If change territory• Consider new searches
  • 38. 38© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Personal Foul• Don’t use own mark as descriptive termon webpage or Wikipedia• Don’t tout functional elements oncollateral or in utility patents for anydesign for which you would like to seektrade dress protection or for any colorsthat you would like to try to protect• Coach business team to use marks in amanner that would be sufficient to perfectregistration
  • 39. 39© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Bad Coaching• An abandoned or cancelled mark could still be in use• Not checking for common law uses as they could limit rights• For marks which are closer to the line of descriptiveness,not checking to see how PTO handles the term– Will the PTO require a disclaimer?• Not checking to see if there have been any oppositions orcancellations filed by third parties? Lit search?– Are there any litigious parties or those that vigorouslyenforce their brands?– CHAMPAGNE; GALLO; ARMOUR• Registering a company with the Secretary of State does notmean you are free to use the company name as a mark
  • 40. 40© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Bad Coaching• Not ordering watch service as soon as file – forimportant marks– Ideally obtain application and publication watch– Consider domain name watch• Not grabbing relevant domain names prior to or assoon as file for mark• Not digging in– Logo/design mark• Who came up with it?• Do we need an assignment?• Can we file for copyright?
  • 41. 41© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.Things that will get you benched• Delay of game: Taking too long to clear a mark• Saying everything has unacceptable “risk”• Not giving clear guidance on availability andregistrability– Give suggestions if there is an alternate available –can a slight tweak alleviate a conflict?– Take the time to explain issues orwhy mark is not clear
  • 42. 42© 2013 Knobbe, Martens, Olson & Bear, LLP all rights reserved.STATEGIC PLAYS = TOUCHDOWN!QUESTIONS?
  • 43. Stephen Coates scoates@amazon.comSusan Natland Susan.Natland@knobbe.com 949-760-0404Jonathan Hyman Jonathan.Hyman@knobbe.com 310-551-3450