Seattle Trademark Lawyer

Plaintiffs CommScope, Inc. of North Carolina, CommScope Solutions, Inc., and CommScope Solutions Properties LLC sued defendants Electro Products, Inc., and Daniel Oberholtzer, its owner and president, for allegedly selling counterfeit versions of plaintiffs’ communications patch panels. Communications patch panels are used in settings where accurate data transmission is critical, such as hospitals. Plaintiffs allege they learned of the counterfeit products after they began investigating customer complaints about faulty equipment traceable to defendants.

Defendants allege that a few months after the litigation began, an FBI agent left a business card on Mr. Oberholtzer’s door with a note asking Mr. Oberholtzer to call him “ASAP.” After talking with the agent, Mr. Oberholtzer’s attorney believed his client was being investigated for smuggling or importing the counterfeit communications patch panels, which raised Fifth Amendment concerns. Mr. Oberholtzer then stopped responding to plaintiffs’ discovery requests and moved to stay the civil proceedings until the alleged criminal investigation was resolved. 

On February 12, Western District Judge Ricardo Martinez declined the request. Applying the six-factor test set forth in Keating v. Office of Thrift Supervision, 45 F.3d 322, 324 (9th Cir. 1995), the court found:

“Judicial expediency and the court’s ability to manage its caseload … favor denying Defendants’ motion to stay. Although Defendants argue that a criminal proceeding would clarify and streamline the case, the Plaintiffs counter that this lawsuit is not particularly complex, the bulk of discovery has already been conducted, and a subsequent trial would be relatively brief. The Plaintiffs have the more persuasive argument.”

The court also found that “because there is currently no indictment, there is no indication when, if ever, such a parallel criminal proceeding would be available to streamline the instant case. Rather, this case would remain on this Court’s docket for an indeterminant amount of time.” However, “[i]f the circumstances change and an indictment does issue, Defendants may move the Court for a stay of these proceedings at that time.”

The case is captioned as CommScope, Inc. v. Electro Products, Inc., No. 06-0577 (W.D. Wash.).

Plaintiffs are now 0-for-3 under the Trademark Dilution Revision Act, which lessened and clarified the amount of proof needed to establish a claim for federal dilution of a famous trademark. In Century 21 Real Estate LLC v. Century Surety Co., No. 03-0053, 2007 WL 433579 (D. Ariz.), the District of Arizona found that plaintiff did not establish a genuine issue of material fact that defendant’s use of CENTURY blurred plaintiff’s use of CENTURY 21.

In doing so, Judge Stephen McNamee reconsidered his March 2006 summary judgment dismissal of plaintiff’s dilution claim in light of the TDRA, which became effective October 6.

The court recognized the TDRA revised the Federal Trademark Dilution Act in “three significant ways: (i) a likelihood of dilution, rather than actual dilution, is now a prerequisite to establishing a dilution claim; (ii) courts may apply four factors to determine whether a mark is famous and protection is denied to marks that are famous in only ‘niche’ markets; and (iii) courts may apply six factors to determine whether there is a likelihood of dilution.”

The court noted: “[a]lthough the TDRA no longer requires actual dilution, the new law does not eliminate the requirement that the mark used by the alleged diluter be ‘identical,’ ‘nearly identical,’ or ‘substantially similar,’ to the protected mark.” Applying that standard, the court found that “there is no genuine dispute of fact that the mark “Century 21” is not substantially similar to the mark “Century.”

The court also noted that “[l]ike the substantial similarity element, the TDRA does not eliminate the requirement that consumers mentally associate the mark used by the alleged diluter with the protected mark.” The court found plaintiff failed this standard as well.

Finally, the court found plaintiff could not make out a case for likelihood of dilution based on the six-factor test. As the court summarized, “the main problem with [plaintiff’s] dilution theory is that [plaintiff] has never registered the term ‘Century’ alone, prohibits Franchisees from abbreviating or shortening the name ‘Century 21’ to ‘Century,’ and has not produced any survey information to demonstrate that consumers recognize or associate the term ‘Century’ (in isolation) with the mark ‘Century 21.’ Moreover, there is no dispute that the word ‘Century’ is extensively employed in both the real estate and insurance industries and therefore is clearly not distinctive.”

This decision follows the Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC, and AutoZone, Inc. v. Strick cases (which STL discussed here), which likewise found that dilution had not occurred under the new standard. For dilution plaintiffs, maybe the fourth time’s a charm.

On Friday, The Broken West played live on the air on KEXP, a great indie-rock station, which also happens to be located right here in Seattle. I hadn’t heard them before, but their story was familiar. Until last year, they were known as The Brokedown. Then they received a cease-and-desist letter from a band called The Brokedowns. With 1,000 copies of their debut album already pressed, they went into “panic mode” and changed their name to The Broken West.

The Broken West: They Learned Trademark Law the Hard Way

“I think we probably could have fought it, but it would have been really expensive and time consuming,” frontman Ross Flournoy said.

Up-and-coming bands seem to re-live this story again and again. Blink 182 was Blink before another group named Blink threatened to sue. Dinosaur Jr added the suffix after the San Francisco band The Dinosaurs protested. Looking no further than Seattle, rockers Kill Sybil say they changed their name from Sybil because of an R&B singer with the same name; ECU reportedly changed its name from ICU because New York-based Intensive Care Unit threatened to sue; and Nirvana (Seattle) settled a case brought by Nirvana (UK) so it could keep its legendary name. 

There is a definite pattern here. Unfortunately for the upstart bands, the cease-and-desist letter comes after an album is released, a tour has begun, or some amount of name-recognition has taken hold. That makes the name change that much more painful. It’s admittedly not realistic to expect a new group to hire a trademark lawyer before starting to play local venues. But it should not be unrealistic for a band to seek trademark advice before putting out its first disc or going on its first tour. At the very least, a careful Internet search for similar names could save band members anguish down the road.

Take a tip from Fall Out Boy, who was nominated for “Best New Artist” at last year’s Grammy Awards. It re-named its song “My Name is David Ruffin and These Are the Temptations” to “Our Lawyer Made Us Change The Name Of This Song So We Wouldn’t Get Sued.” Why? Because it wanted to avoid a lawsuit from the estate of ex-Temptations singer David Ruffin. And, as The Wall Street Journal Law Blog reported, because the lead singer’s dad is a lawyer.

Lucky for them. As I’m sure The Broken West would tell you, a little trademark due diligence on the front end can avoid a painful name change later on.

The same holds true for any new business or product.

The World Intellectual Property Organization today found in favor of Mercer Island-based appraiser Richard Hagar of American Home Appraisals in a domain name dispute brought by Wisconsin-based appraiser American Appraisal Associates, Inc., over AHA’s AmericanAppraisals.com domain name.

Applying the Uniform Domain Name Dispute Resolution Policy’s three-part test, the single-member panel found that AAA had rights in its AMERICAN APPRAISAL and AMERICAN APPRAISAL ASSOCIATES registered trademarks, to which it found AmericanAppraisals.com was confusingly similar.

However, the panel concluded that AAA had failed to prove the remaining two elements. Since AAA’s marks consist of “everyday words,” the panel found “it makes it more difficult for [AAA] to establish that [AHA] selected the disputed domain name with [AAA’s] mark in mind and not simply to describe [AHA’s] own business.” The panel found that AAA had offered no evidence that AHA selected AmericanAppraisals.com “with the intent to take advantage of [AAA’s] marks or the reputation surrounding them and no evidence from which the Panel could reasonably make such an inference.”

The panel also found no evidence AHA had registered AmericanAppraisals.com in bad faith because it had not attempted to sell the domain name, regularly engaged in acquiring domain names consisting of third parties’ marks, or used the domain name for anything other than a legitimate business.

Full disclosure: this blogger represented Mr. Hagar and American Home Appraisals in the proceeding.

If I win, can I get my attorney’s fees? It’s a common question. Unfortunately, the answer is “probably not.” Under the Lanham Act, a party who prevails in a trademark infringement, false designation of origin, or dilution suit can recover its attorney’s fees only in “exceptional circumstances.” In the Ninth Circuit, that means a plaintiff can get fees when the district court finds the defendant acted “maliciously, fraudulently, deliberately, or willfully.” Earthquake Sound Corp. v. Bumper Indus., 352 F.3d 1210, 1216 (9th Cir. 1997). A defendant can get its fees when the plaintiff’s case was “groundless, unreasonable, vexatious, or pursued in bad faith.” Stephen W. Boney, Inc. v. Boney Serv. Inc., 1127 F.3d 821, 827 (9th Cir. 1997).

In the last month, STL blogged about two cases in which fees were awarded. By definition, those cases were exceptional. In Horphag Research Ltd. v. Garcia (discussed here) the Ninth Circuit found that defendant Larry Garcia “made deliberate and calculated attempts” to confuse his herbal supplement with plaintiff Horphag’s herbal supplement by “altering quotations from research publications that refer exclusively to Horphag’s product” to make it appear as though they were referring to Mr. Garcia’s product. Given these findings, the Ninth Circuit found the Central District of California did not abuse its discretion in awarding fees.

Closer to home, in Derek Andrew, Inc. v. Poof Apparel Corp. (discussed here), the Western District found the defendant copied the plaintiff’s twisted heart logo on the hangtags affixed to its garments. The court found defendant then willfully continued to sell garments with the infringing hangtag after plaintiff notified it of its infringement, and assured plaintiff it would attempt to remove the infringing hangtags from its inventory when it had no intention of doing so. The court concluded “this is an exceptional case in light of Poof Apparel’s conduct after it was notified of the infringing hangtags.” On that basis, it awarded Derek Andrew its fees.

What do these cases reveal about fee awards? Such awards are not unheard of but they still are rare. Even with a strong case you should not expect an award and realistically should hope for one only if you can prove the opposing party’s conduct was truly outrageous.

This is my biggest gripe with the Lanham Act. I think fee awards should be routine.