Seattle Trademark Lawyer

Bizarre comparison: Is it false advertising for BMW to pick on Volvo?

I thankfully don’t watch many commercials. But maybe I’m missing out.

From what I gather, this bizarre commercial first aired during the Super Bowl. But it’s new to me.

I think the commercial is bizarre because in an effort to promote its supposedly clean diesel SUV, BMW portrays an exhaust-belching car that unmistakably is an old Volvo. A diesel Volvo, apparently. 

While I appreciate BMW’s desire to contrast clean with dirty, did it have to select such a distinctive car design to pick on? It could have selected any number of nondescript cars to outshine. Instead, it portrays its competitor’s car as being almost evil. BMW’s shiny new offering by comparison looks like it might single-handedly save the planet.

It seems incredible that Volvo doesn’t have a problem with this. It really reminds me of the old “Polar Seltzer” commercial spoofing the Coca-Cola polar bears seen in Coke commercials during the Winter Olympics. Competing Polar Seltzer’s bears humorously reject a can of Coke upon being admonished by a sign to “Keep the Arctic Pure,” and reach instead for a can of Polar Seltzer. Nice gimmick, but Coke sued for false advertising because Polar Seltzer wrongly suggested Coke is impure. Coke famously won, and Polar had to change its ad.

If old diesel Volvos don’t actually spew soot like the conclusion of “Citizen Kane,” I think BMW is taking the same unfair advantage that Polar Seltzer took.

Following is a guest post from my former student and recent UWSL LL.M. graduate, Pongtawat (“Val”) Uttravorarat, on “secondary meaning in the making,” a doctrine he argues would help startups like new restaurants protect their creative trade dress.

Imagine you open a new restaurant with unique décor that you’ve been refining for months. Right of the bat, someone is so impressed with your design that he or she opens a restaurant with a very similar design. What can you do?

Normally, a trade dress owner has to prove its trade dress is inherently distinctive or has acquired secondary meaning through length of use, number of sales, and advertising expenditures. However, after the Supreme Court’s decision in Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 (1992), there is no bright line defining whether trade dress is deemed inherently distinctive. Confusingly, subsequent courts have applied inconsistent tests.

If you fail to show the distinctiveness, you are left with one option: to show that consumers have associated the unique décor with a single source of restaurant services. Establishing secondary meaning takes time…. Not just few months; it takes years. What if you are a startup? How can you show you have acquired a secondary meaning in only a few months and a modest amount of money spent promoting your new restaurant? If you cannot, should you lose your design to a copycat? This is one of the problems many startup restaurants face: they cannot protect their trade dress against intentional copiers.

Since design patent protection is costly – and stopping copying through copyright in this situation can be difficult – I suggest courts adopt a “secondary meaning in the making” doctrine to loosen the burden of proving secondary meaning. Such a doctrine existed in the 1980s, particularly in the Second Circuit, but it was pretty well eroded by the early 1990s. In my view, the doctrine still has merit in connection with startups.

The secondary meaning in the making doctrine protects trade dress that has not fully developed secondary meaning, but is in the process of doing so through the owner’s advertising and efforts to protect it from being deliberately appropriated or copied in bad faith. The doctrine would help startup restaurants protect their valuable trade dress against intentional copycats by showing that consumers have begun to recognize particular décor with a particular restaurant. 

However, courts would need to set a clear standard for determining what evidence is required to prove secondary meaning in the making, while remaining flexible enough to make such determinations on a case-by-case basis. Allowing startup restaurants to prove secondary meaning in the making would promote new innovation because competitors would not be allowed to copy original trade dress and instead would be forced to create their own original designs. In the end, consumers would benefit.

Mr. Uttravorarat’s thesis on the doctrine of secondary meaning in the making, “Resounding Secondary Meaning in the Making Doctrine: Solution for a Startup Restaurant with Non-Distinctiveness Trade Dress,” is available here. 

Chicago… I proclaim it the most beautiful city in America.

I just made a crack commando visit to the Windy City.

Or as I have decided, the most beautiful city in America.

I long thought San Francisco deserved that honor, but I was wrong.

Chicago. What a town.

I blew in town for barely 24 hours to talk about the Rosetta Stone v. Google keyword advertising appeal. With oral arguments scheduled to be heard in Richmond tomorrow, it was a pretty timely discussion. I was asked to focus on Rosetta Stone’s side, which was easy. Of course, the Eastern District of Virginia got the result right: Google shouldn’t be liable for selling trademarks as sponsored links in its search engine results. But taking Rosetta Stone’s position in the Association of Intellectual Property Firms’ panel discussion was a no-brainer given how badly the Eastern District of Virginia stumbled on the way to the right result.

One of the issues in the case was contributory infringement — whether Google should be liable for enabling counterfeiters to infringe Rosetta Stone’s trademark. That led to a discussion of the Ninth Circuit’s Sept. 9 decision in Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc. — which also involved contributory liability.

In that case, Louis Vuitton complained to Web host Akanoc Solutions that some of Akanoc’s customers had been selling counterfeit Louis Vuitton merchandise on their Web sites. Indeed, Louis Vuitton complained on 18 separate occasions, and Akanoc did not act on the warnings.

The result? The Northern District of California jury charged Akanoc with actual knowledge of the trademark infringement and slapped it with a damages award of $31,500,000.

The Ninth Circuit pared the award back to $10,500,000, but affirmed the jury’s finding of contributory infringement.

In doing so, the court found: “Plaintiffs asserting contributory trademark infringement claims must prove that defendants provided their services with actual or constructive knowledge that the users of their services were engaging in trademark infringement. An express finding of intent is not required.”

The court found that Akanoc’s continuing to allow its customers to operate Web sites about which Louis Vuitton complained 18 times made Akanoc separately liable.

Back to Rosetta Stone. According to Rosetta Stone’s appellate brief, the language software company provided evidence it complained to Google about 200 instances of sponsored links advertising counterfeit product. Yet, after receiving such notice, Google continued to sell Rosetta Stone trademarks as keywords to those same advertisers. The court seemingly ignored this evidence when it granted Google’s motion for summary judgment.

Louis Vuitton ought to give the Fourth Circuit pause tomorrow when it considers the propriety of the district court’s decision.

The case cite is Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc., __ F.3d __, 2011 WL 4014320, Nos. 10-15909 and 10-16015 (9th Cir. Sept. 9, 2011).

I’ve had a soft spot for this confusing trademark ever since they did a bit about it on Seinfeld.

From Sunday’s NYT: “It did not call itself the flagship Ray’s Pizza because it never really had a fleet. It was not Original Rays or Famous Ray’s or Original Famous Ray’s or Real Ray’s or Ray’s on Ice or any of the other cloned shops sprinkled like shredded mozzarella all over town. It was simply Ray’s Pizza, and in the great pizza wars of New York City, it was respected as having been the first….”

Oft imitated trademark or no, Ray’s Pizza is closing its doors.

As NYT put it, “the original that was so original it did not have the word ‘original’ in its name — appears doomed to close at the end of the month.”

No idea whether its copied name played a role in its demise (the story says the closure follows a real estate dispute), but Ray’s could have put a stop to its imitating competitors a long time ago.

While being original might mean you don’t have to call yourself original, you certainly don’t have to tolerate competitors that do.

Champions Real Estate Services, Inc., will stop using “Realtor” in connection with its real estate sales offices.

Its stipulating to a permanent injunction cut short a trial in the Western District that would have decided the National Association of Realtors’ trademark infringement lawsuit against Champions and its owners, who ended their relationship with the Association but continued to use the group’s registered trademark, REALTOR.

Champions has offices throughout western Washington.

Defendant Patricia Lord, one of Champions’ owners and its designated broker, admitted in the stipulation that she told the agents she managed that “Any real estate agent may use and be called ‘Realtor’ whether or not you are a member of the Board of Realtors” and “All real estate agents are Realtors.” She also acknowledged that she referred to herself as a “Realtor” on her Twitter account and a Google profile page as recently as this month.

The stipulated injunction — entered on the second day of trial — may have avoided a showdown as to whether REALTOR is generic for real estate agents, a claim Ms. Lord previously made. However, the state of that defense was not clear (to STL, at least) given the court’s recent decision on summary judgment.

On Aug. 22, Western District Judge James Robart granted partial summary judgment in the Association’s favor, finding Champions and Ms. Lord secondarily liable for the trademark infringement and false designations of origin committed by their agents. In doing so, the court concluded that the Association’s REALTOR marks are “strong.”

The court entered judgment in favor of the Association on Sept. 13.

STL post on the Association’s complaint here.

The case cite is National Association of Realtors v. Champions Real Estate Services Inc., No. 10-0049 (W.D. Wash.) (Robart, J.).