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First U.S. Registrant Offers to Sell MUGGLES Trademark for $1 Million

I came across an interesting piece — the Ventura County Star reported on July 22 that California native Jim Salzer owns the first U.S. trademark registration for MUGGLES, which he had planned to use in connection with a nightclub to be called “Cafe Muggles.” The nightclub never got off the ground, but Mr. Salzer liked the sound of it so he held onto his registration, which he obtained in 1981. The word “muggles,” of course, entered the popular lexicon as a word for for people without magical powers beginning in June 1997 when J.K. Rowling published her first “Harry Potter” book.

Now, Mr. Salzer wants to sell his MUGGLES mark to Warner Bros., which owns the “Harry Potter” movie and merchandising juggernaut. His asking price? $1 million. Warner Bros. has refused to bite and now, the article says, Mr. Salzer is keeping a “watchful eye” on its use of the word.

I don’t know why. The article doesn’t indicate that Mr. Salzer ever put the mark to use, other than as a cat character with that name that he’s used in “advertising and products over the years.” If he hasn’t put the mark to trademark use — that is, to identify the source of goods or services — he doesn’t have any trademark rights to “sell.” However, the Patent and Trademark Office’s database confirms he has made at least some trademark use. It states he first used the mark in commerce in 1979, and that Mr. Salzer filed his ten-year affidavit of continued use in 2001. Yet, even if Mr. Salzer has continuously used MUGGLES as a trademark, his registration is for “retail gift and novelty store services, and restaurant and night club services.” Therefore, unless Warner Bros. opens a gift shop, restaurant, or nightclub under the name “Muggles,” I wouldn’t think that Mr. Salzer would have much of a case.

That’s one bit of trademark law Leo Stoller overlooked when he offered to license GOOGLE to Google and STEALTH to Columbia Pictures when it was marketing its movie, “Stealth.” (Background via the TTABlog here and here.) Indeed, that little flaw in Mr. Stoller’s business model led to his downfall as a trademark wheeler-and-dealer.

Speaking of Mr. Stoller, I can’t resist noting that the bankruptcy court for the Northern District of Illiniois yesterday reportedly auctioned off his trademark portfolio, such as it is. One of the bidders? A company calling itself the “Society for the Prevention of Trademark Abuse LLC.” 

I’ve got some ideas, but someone really has to fess up to who’s behind this outfit.

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Reader Comments (1)

The auction process has not yet been completed. Stoller has been given a last opportunity to provide documents to the trustee. These documents would have to establish an intrinsic value for each of the marks in Stoller's estate and corporations that is higher than the bid offered. He has until July 31. (Stoller has testified numerous times before this judge that he did not have these documents. Where he plans to "discover" them is anybody's bet although parties experienced in Stoller litigation will likely have a pretty good idea of where the documents will come from.)

The hearing on the sale will commence on August 7. The sufficiency of Stoller's evidence and his credentials as an expert in TM valuation will be tested. If deemed to be insufficient to establish a higher value, the Society for the Prevention of Trademark Abuse, LLC will be declared the winning bidder. The Society will become the sole owner of the Stoller TM portfolio along with all stock of his corporate entities.

The Society for the Prevention of Trademark Abuse, LLC was established for the purpose of buying Stoller's IP portfolio, license, claims, and all rights in all pending actions. The Society's plan is to convey the marks others may want/need to clear the way for their own applications to proceed, wind up all pending matters in a manner consistent with the known and trustworthy evidence, (Because there is no evidence of actual use of any mark by Stoller and no evidence of actual efforts at quality control for any of his purported licensees, proper resolution of the cases should be straightforward.)

Any party who is involved with a pending proceeding should contact me as the Society's Director so that appropriate documents can be executed to conclude the proceedings. Providing a draft Stipulated Dismissal with parallel waivers of claims will help facilitate resolution of the cases.
July 26, 2007 | Unregistered CommenterLance Johnson

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