By Jay McDaniel
McDaniel & Park, P.C.
Trademarks that use a geographic terms are often useful, but may be weaker and more difficult to protect. Nonetheless, the company that carefully manages its intellectual property can use and protect those marks. This article examines three recent decisions in the United States District Court for the Southern District of New York to analyze the successful defense of geographic trademarks.
Many businesses want to include some geography in their names: New York Electric Supply, Bergen County Chevrolet, and New Jersey IT Pros are a few examples in which the location of the business is part of the name. In this way, the local business tells its potential customers that it is local. However, before investing time and money to build recognition in a name, business owners should be aware that these trademarks may be difficult to claim and keep.
The reason for this difficulty is that “descriptive” names are less distinctive and, in an enforcement action, the party seeking to claim the trademark will often have to prove that the mark has acquired a secondary meaning. Here are some guidelines:
- Attempt to register the trademark with the US Patent and Trademark Office (PTO). Once the mark is registered and remains in use for five years, it becomes incontestable and is presumptively distinctive. In trademark law, distinctiveness is always a requirement.
- Protect the underlying value of the mark so that it identifies both source and quality. A mark that identifies a quality product or service is easier to protect.
- Choose a mark that is unique and police the use of the trade mark. This means keeping an eye out for other companies that may start using a confusing variant of the name.
- Keep track of all that makes the mark special, including newspaper or other media coverage and advertising. Keeping copies of anything that mentions the trademark is a good idea.
The Value of Registration
The strongest protection for a trademark is registration on the principal registry. A mark that has been registered on the principal registry and in continuous use for at least five years is presumed to be valid and entitled to protection. A recent decision in New York State Electric & Gas Corp. v. U.S. Gas & Electric, 2010 U.S. Dist. Lexis 26110 (W.D.N.Y. March 19, 2010) nicely draws the distinction. In this case, U.S. Gas sought to use the acronym NYG&E and the name New York Gas & Electric. New York State Electric & Gas objected and filed suit. U.S. Gas then moved to dismiss the complaint.
The NYSEG trademark was registered and thus incontestable; not so with the name New York State Electric & Gas. To prevail, NYSEG would have had to show that the name New York State Electric & Gas had acquired a secondary meaning in the market. Here, the claimed trademark was descriptive, meaning that name simply describes the qualities of the product or service - gas and electric service in New York. The protectability of a trademark is in a hierarchy that begins with generic terms, which are not protectable. The word “car” is one such generic term. Next are descriptive terms, like New York State Electric & Gas, which are not considered distinctive unless they have acquired a secondary meaning. At the top of the hierarchy are words that are suggestive or fanciful, both presumed to be inherently distinctive.
A descriptive mark will not be granted registration on the principal register, but may be registered on the PTO’s supplemental register. The details of registration on the principal or supplemental register are beyond the scope of this article. In general terms, registration on the supplemental register provides the registrant with the opportunity to record a trademark that is in use in commerce and capable of distinguishing the applicant’s goods or services, but is not inherently distinctive and has not (yet) acquired secondary meaning. If and when the descriptive mark acquires sufficient secondary meaning, the owner may seek registration on the principal register.
Thus, the business owner seeking to protect a trademark should consider whether the descriptive name can be recast in a way that would permit registration on the principal register. When that is not possible, a registration on the supplemental register is a good idea. The advantages of a registration on the supplemental register are significantly fewer than that of the principal register, but allows for descriptive terms to be recorded and to develop the necessary distinctiveness and public recognition.
Acquiring Secondary Meaning
Courts look at various factors to determine whether a descriptive mark has acquired secondary meaning. These include advertising expenditures, studies linking the name to a source, sales success, unsolicited media coverage, attempts to plagiarize the mark, and the length and exclusivity of the mark’s use. See ITC Ltd. V. Punchgini, Inc., 518 F.3d 159, 162 (2d Cir. 2008).
The opinion in The New York City Triathlon, LLC v. NYC Triathlon Club, Inc., demonstrated just how important these factors can be. 2010 U.S. Dist. Lexis 21745 (S.D.N.Y. March 9, 2010). In this case, the plaintiff was the organizer and sponsor of the New York City Triathlon (claiming registration of both “The New York City Triathlon” and “The NYC Tri”), which brought suit against one of its former vendors, a triathlon equipment retailer. The defendant, which was also an authorized vendor at the annual triathlon event, changed its name from SBR Triathlon Club to NYC Triathlon Club. Not surprisingly, when The New York City Triathlon caught wind of the change, it filed suit claiming trademark infringement.
The trial court, in granting a preliminary injunction enjoining plaintiff from using the disputed name, considered a number of factors of which businesses should be aware.
- Plaintiff demonstrated it had used the NYC Triathlon marks exclusively for a period of 10 years.
- Plaintiff had filed a trademark application, though it had not been approved.
- Plaintiff was “extremely protective and permitted use of the mark only with its written authorization.”
- Plaintiff demonstrated the financial success of its use of the trademark.
- Plaintiff paid “relentless” attention to the quality of the services provided under the trademark.
- Plaintiff documented substantial unsolicited media coverage.
The court concluded that the defendant NYC Triathlon Club changed its name to capitalize on the good will that the plaintiff built up in the trademark over the years. In short, and notwithstanding the fact that the disputed trademark was nothing more than two non-trademarkable generic terms joined together in a purely descriptive mark: “Given the great success of the NYC Triathlon, the extensive media coverage, and the strong reputation plaintiff has developed among consumers, plaintiff’s NYC TRIATHLON marks have most certainly obtain secondary meaning and can be considered string marks.”
Vigilance
Constantly monitoring the marketplace for potential competitors for a mark is important. The time to challenge the use of the mark is while it is still new in the marketplace and before it acquires any secondary meaning of its own. In Miss Universe, LP v. Villegas, 2009 U.S. Dist. Lexis 114886 (Dec. 9, 2009 S.D.N.Y.), the court was called upon to examine whether the “Miss Asia USA” pageant, a local event in California, infringed the “Miss USA” pageant. It was a close call, but the court found that the Miss Asian USA pageant did not infringe the senior the Miss USA mark. (Miss USA is the pageant used to select the US representative to the Miss Universe contest.)
The Miss USA mark has been the subject of multiple lawsuits over the years and the issue of whether the mark is protectable was not at issue. (Miss Nude USA and Miss USA – World were held to infringe. Miss Venus USA did not). Here, the question was whether there was likelihood of confusion between the Miss USA and Miss Asia USA marks and, in particular, how strong the plaintiff’s mark was when compared to another established mark, even if the latter’s use was quite limited. This likelihood of confusion inquiry involves a number of factors, including the strength of the marks, the similarity of the marks, the proximity of services, and the likelihood that plaintiff’s mark will “bridge the gap” and expand into the field occupied by the defendant’s mark.
These factors, the court said, were equally balanced, and since plaintiff had the burden of proving infringement by a preponderance of the evidence, it lost. My view is that the real tie breaker is hidden in the facts: the Miss Asia USA program had been in existence since 1988 and had developed its own culturally based format and its own good will. The case was lost in the years before it was filed when the Miss USA pageant might have discovered the fledgling pageant and, if necessary, brought a successful claim for infringement.
In other words, a challenge to the competing use found in the Miss Asia USA pageant would have been more likely to succeed, in my opinion, if it had been made before the defendant’s mark had acquired its secondary meaning. The weighting of the factors would certainly have been different and, in all likelihood, the outcome favorable to plaintiff.
