The “Hon” Controversy

If you are from Bawlmer, you probably say “hon.”  It is a local tradition.  The word is a part of our local vernacular.  However, Denise Whiting, owner of a restaurant named “Cafe Hon” registered the word “hon” as a trademark with the federal patent and trademark office.  The registrations online (which Whiting has subsequently abandoned after a public outcry) include these uses: (a) retail gift shops (see: Hon Trademark Reg) (IC 035), (b) paper goods, namely, bumper stickers, napkins, note cards, gift cards, greeting cards, stationery, wrapping paper, gift bags, note pads, note paper, calendars, pens (see: Hon Trademark Reg 2) (IC 016), and (c) restaurant services (see: Hon Trademark Reg 3) (IC 043).  Ms. Whiting’s use with her restaurant was not controversial, as Cafe Hon has been around for quite some time in Baltimore.  The public outcry was over her registrations for various goods with the “Hon” logo.

Trademarks, whether registered or not, are intended to identify the source of goods of a product or service.  Trademarks, in one way or another, have been in use by craftsmen and traders for thousands of years.  Trademarks serve an important purpose in commerce today, in that brand names distinguish a particular maker’s goods from competitors.  Businesses may invest millions of dollars over time in building up brand name recognition with the public.  Brands, with time, become associated with a particular product’s quality or attributes (the taste of Coke is strongly associated with its mark, and distinguishes it from Pepsi and other soft drink products).

In the “Hon” controversy, the public outrage was over Whiting’s claim of exclusivity for gift shop goods. Interestingly, even though the baseball team, the Orioles, evokes strong public response and is strongly identified with Baltimore, there is not much controversy over their trademarks or their exclusive right to use those marks on t-shirts and baseball hats (and a whole lot of other merchandise based on their trademark registration: O’s Trademark Reg).  I suppose the public doesn’t claim to own the “O’s” (that’s Peter Angelos, hon), but is there that much of a difference?  I haven’t seen any bumper stickers inviting the Orioles to sue to challenge the “O’s” trademark registration.

Property rights, whether the right is to a physical thing or an intangible, are limited by certain public interests.  For a piece of real property, you have to pay your property taxes or risk the loss of title to your property.  The public may also have certain limited rights to enter your property (like the sidewalk that runs through the front yards of many homes in Maryland).  And the air roughly 100 feet above your home is not yours, either.  The exclusive rights in intellectual property are also limited by certain public interests.  For example, there is the concept of the “public domain” in copyright law.  Original works of authorship can be dedicated to the public domain, or end up there after a certain period of time from when the work was originally created (a work today doesn’t end up in the public domain for quite some time, but older works created before the 1920’s are generally in the public domain).

The Lanham Act provides the statutory basis for trademark registrations in the U.S.  Section 1052 identifies certain exceptions to the right to register a particular mark.  Unlike the U.S. Copyright Act, which provides for a “public domain” of works that otherwise would be entitled to protection, the Lanham Act has a much more limited set of circumstances that would prevent registration of a mark.  For example, immoral or deceptive marks can’t be registered.  The coat or flag of a state can’t be registered as a mark.  A living person’s name, portrait or signature can’t be registered without that person’s consent.  The mark cannot be confusingly similar to another registered mark.  The mark cannot be merely descriptive of the product (e.g., “Table” brand tables won’t work).  But, words in the public vernacular are not necessarily protected by these exceptions.  As subsection (f) notes, a mark that has become distinctive over time as to that person’s goods can be registered.

Irregardless of the Lanham Act, Whiting abandoned her marks after local outcry about “Hon.”  There was a strong sense among some in the public that “you just can’t do that” with the word “Hon.”  Some invited Whiting to sue them so that they could challenge her marks in court.  The Baltimore Sun ran a number of articles on the controversy.  Public opinion was against the registration of the word “Hon.”  Ultimately, Whiting abandoned or “Hon” marks in response to it all.  Tempest in a teapot?  Maybe.  But don’t mess with our “Hons.”

China Registrar Scam

I received this email today for my domain name,  Allegedly, another company wants to register my domain name as a .cn and .asia domain.  I can’t imagine that there are actually people in China that would be that interested in a Maryland attorney’s web site (maybe the same people looking to hire me to enforce a Maryland judgment for $800,000 against some poor ex-husband, but in reality are trying to scam my attorney trust account).  However, you will note that the real China domain name registration center is CNNIC, and the registrar listed below,, is not listed on CNNIC’s list of authorized registrars.  So, this is almost certainly a scam.  I might have my lawyer send them a cease and desist letter!

Dear Manager:

This email is from China domain name registration center, which mainly deal with the domain name registration and dispute internationally in China and Asia.  On April 18th 2011, We received HAITONG  company’s application that they are registering the name ” faithatlaw ” as their Internet Keyword and ” faithatlaw .cn “、” faithatlaw ” 、” faithatlaw .asia “domain names etc.., It is China and ASIA domain names. But after auditing we found the brand name been used by your company. As the domain name registrar in China, it is our duty to notice you, so I am sending you this Email to check. According to the principle in China, your company is the owner of the trademark, In our auditing time we can keep the domain names safe for you firstly, but our audit period is limited, if you object the third party application these domain names and need to protect the brand in china and Asia by yourself, please let the responsible officer contact us as soon as possible. Thank you!

Best Regards,

Oversea marketing manager
Office: +86(0)21 6191 8696
Mobile: +86 1366152 9704
Fax: +86(0)21 6191 8697

Rescuecom v. Google: Trademark Infringement

In a recent post on Google’s use of trademark words as advertising search terms, one of the questions I raised was whether Google was really any different than a newspaper that might run an ad that was infringing on a third party’s trademark.  Rescuecom, Corp. v. Google, Inc. may help to provide some insight into this question.

In Rescuecom, the Court of Appeals for the Second Circuit was asked to determine if the plaintiff had alleged a cause of action for trademark infringement against Google.  Rescuecom alleged that some of its competitors were purchasing its trademark as a keyword that would trigger the competitor’s ad when a google user searched with Rescuecom’s trademark.  For fun, I searched with this trademark but got no advertisements on google or yahoo.  I guess that the competitors got shut down by all of the litigation that was ongoing in this matter.

In any event, the Court goes on to discuss whether google’s practice of offering trademarks for auction to competitors could be infringement by google.  The Court noodle’s through the complaint in this manner: (a) most of google’s revenue comes from advertising, (b) google has a financial stake in the effectiveness of the advertisements it runs for advertisers, (c) trademarks of well known companies have value as keywords for advertisers, therefore, google can be liable for trademark infringement if the trademark is “used in commerce” as that is defined in section 1127 of the Lanham Act, and the use is likely to cause confusion on the part of users of google’s search engine when those users are presented with advertisements from competitors to the trademark holder.

The Court does not fully explain the logic in (b) above.  For those that use google’s AdWords, an advertiser can create an ad and determine when that ad will display on google’s web site based on keywords that are used by google users to search for web content.  For example, if you were looking for Starbucks and used that trademark as a search term in google, google will return web pages it thinks are relevant to that result, along with advertisements that are tied to that search term.  Advertisers can place a bid on the maximum amount they will pay for a click on their ad.  So, if there were multiple advertisers with “Starbucks” as their keyword, the one with the highest bid would display at the top of the list of advertisements (usually in the right hand column, but google also has ads at the top of the search results listing on the left periodically).  Clicking on an advertisement will take the user to the advertiser’s web page, which will not necessarily be Starbucks’ home page.

Google also benefits from a competitor outbidding the trademark holder per click through the AdWords system.  So if Starbucks and I both decided to run an ad in AdWords based on the trademark “Starbucks,” I could force Starbucks to increase the amount it would pay per click by automatically increasing my bid for the same keyword.  Google, in fact, has a tool to allow bids to automatically change based on the market for a keyword.

Consumers, I suppose, could be confused by this.  Rescuecom alleged that consumers were likely to be confused (and they were losing business to their competitors as a result) by the ads because they display in a “manner which would [not] clearly identify them as purchased ads…”  Rescuecom, at *6.  And the competitors that were using Rescuecom’s mark were in the same business as Rescuecom, and I seriously doubt they would put a link at the top of their page that would say “Looking for Rescuecom Corp?  Here is a link to their page.”  I suppose if I wished to sell my “Karbucks” brand coffee, the easiest way to advertise it would be to buy the trademark “Starbucks” on AdWords, and just have a very large marketing budget to bid on that keyword.  Maybe that is the reason that Starbucks coffee is around $12-$15 per pound – the AdWords bids keep going up because of competing trademark infringers!

I suppose that google could use the existing trademark database, TESS, which is maintained by the US Patent and Trademark Office, and simply prevent anyone (or anyone other than the current trademark holder) from bidding on a particular registered and active trademark.  Factually, there is also a question of whether much of google’s advertising money comes from the mis-use of trademarks.  For example, I do have the word Starbucks in an ad that I have run, but the link in my ad takes you to an article on my blog about another trademark infringement case against a Starbucks competitor.  I’m not selling coffee on my blog (at least not yet), so no danger of infringement.  When I originally created the ad, there was a lag before approval of it, where I presume that google at least had the opportunity to check to see if I was trying to infringe Starbucks’ mark.  Stay tuned!

Google AdWords and Trademarks as Search Terms

Google has been sued by a number of trademark holders on the grounds that competitors can establish an adwords account with Google and bid on trademarks as search terms that users of the search engine may use to search.  The consequence is that a high bidder on a trademark search term may see ads from AdWords paid for by competitors of the trademark holder.

Suit was brought to the EU.  A ruling is expected next year.  However, a senior judge on the EU Court reviewing the complaint, offering a non-binding assessment of the situation, stated that Google’s AdWords service probably falls within an “information society services” exemption for trademark infringement, so long as Google remains “neutral” about the information that it provides to search users.  (See the Article on Yahoo News here)

AdWords itself works by allowing advertisers to bid on particular keyword search terms.  A high bidder’s display ad will appear next to google search results, (sometimes at the top, but more often in the right hand column on the search results list).  For example, a google search for “Louis Vuitton” returns the official web site of the corporation as the first result in the left hand column of results.  However, advertisers selling knock-offs and fakes appear in the right hand column, taking users off to unapproved web sites offering products that compete (mostly on price) with the trademarked item searched for by the user. was one of the advertisers when I searched today; they appear to be offering “Louis Vuitton” products at 60-90% off the list price.  According to, LV offers their products for sale exclusively through their web site, and through  (See the information here on the LV website, FAQ | Questions About Louis Vuitton) does not appear to be a legitimate LV reseller, and they are not the only advertiser that pops up on a search for the trademark “louis vuitton.”

Trademark law in the U.S. is governed by the Lanham Act, codified in 15 U.S.C. 1051 et seq.  Sections 1114 and 1125 are the typical basis for bringing a trademark infringement claim against an alleged infringer of one’s trademark.  Section 1114(1)(a) requires that an infringer use a registered mark in commerce in connection with the sale or advertising of a good that is likely to cause confusion on the part of the prospective buyer of the thing advertised.  Louis Vuitton has a registered word mark, (registration number 2904197), filed in 2003 and registered in late 2004 in the U.S. that it uses worldwide to indicate that LV is the maker of the thing to which the trade mark is affixed.  Another party offering for sale a bag identified as “Louis Vuitton” without permission of the LV is likely an infringer of LV’s trade mark.

The question is whether Google could also be a trademark infringer by selling ad placement services to the infringing advertiser.  Google does benefit from the auction of trademark terms available for advertising on its site.  To the best of my knowledge, Google does not take down advertisements that might be infringing or that would direct a search user away from the legitimate business web site of the trademark holder whose trademark is being used as a keyword.  On the other hand, Google does not write the infringing ads, either.  Arguably, Google is not selling goods with a false designation mark or causing the advertisements to be created by the actual infringer.  In this way, Google is similar to a newspaper that sells classified ad space to advertisers.  I don’t think that a newspaper would be liable for trademark infringement for running the ad of a third party that was infringing on another’s mark or might confuse customers about whose products were being advertised.  Does AdWords work that much differently to expose Google to heightened or joint liability with infringers?

Trademark Infringement & Starbucks

Starbucks is a well known, international purveyor of coffee products, with thousands of stores throughout the world.  Starbucks v. Wolfe’s Borough Coffee, Inc., No. 01 Civ. 5981 (LTS)(THK), 2005 U.S. Dist. LEXIS 35578 (S.D.N.Y. Dec. 23, 2005) (Starbucks I).  Starbucks Corporation was formed in 1985 in Washington State, after the original founders had been in business for themselves since 1971 in the Seattle Pike’s Place Market.  Id. at *3. Under a traditional trademark analysis, Starbucks has spent a substantial amount of money to market its coffee products worldwide (over one hundred thirty-six million dollars worth from 2000-2003).  Id. at *5.  One should not use a trademark similar to “Starbucks” without expecting trouble.

In 2004, Wolfe’s Borough Coffee, a small coffee manufacturer that distributes its brands in a store in New Hampshire and through some New England supermarkets, was sued by Starbucks in the southern district of New York for trademark infringement and dilution under the Lanham Act and state law.  Id. at *6.  Wolfe’s Borough Coffee was trading with two allegedly infringing names: “Mr. Charbucks” and “Mister Charbucks,” both similar to the trademark “Starbucks” used by the famous coffee house of the same name.  Starbucks v. Wolfe’s Borough Coffee, Inc., 559 F. Supp. 2d 472 (S.D.N.Y. June 5, 2008) (Starbucks III).  Yet, Starbucks lost in district court on all of its claims.  Starbucks I, 2005 U.S. DIST LEXIS 35578 at *29.  Starbucks appealed, the second circuit reversed in 2007 because of a change to the Lanham Act in 2006 by Congress through the Federal Trademark Dilution Act, and the trial court affirmed its prior decision in favor of the defendant in 2008.  Starbucks v. Wolfe’s Borough Coffee, Inc., 477 F.3d 765 (2nd Cir. 2007) (Starbucks II); 15 U.S.C. §§ 1125(c), 1127 (2008); Starbucks III.

Starbucks Claims

Starbucks sued Wolfe’s under federal and state law, alleging trademark infringement under sections 1114 and 1125(a) of the Lanham Act, trademark dilution under sections 1125(c) and 1127 of the Lanham Act and also under New York law, and unfair competition under state common law.  15 U.S.C. §§ 1114(1), 1125(a) (2008); Id. at §§ 1125(c), 1127; N.Y. Gen. Bus. Law § 360-1 (1999).  This case note will focus on the allegation of trademark dilution.

In order to prove trademark dilution, the plaintiff must demonstrate that (a) the plaintiff’s mark is famous, (b) the defendant is using commercial use of the famous mark, (c) the defendant’s use came after the plaintiff’s use, and (d) the defendant’s use of the plaintiff’s mark dilutes the plaintiff’s mark.  Starbucks I, 2005 U.S. DIST LEXIS 35578 at *22.  The defendant had conceded the first three elements leaving only the last element of the rule in dispute.  Id.

Moseley v. Victoria’s Secret Catalogue, Inc., 537 U.S. 418, 433 (2003) requires a plaintiff to prove actual dilution rather than a likelihood of dilution in order to prevail under the Lanham Act anti-dilution section.  New York law is less stringent than federal law in this area, and the court reasoned that if the plaintiff could not prevail under state law, it also could not prevail under federal law.  Starbucks I, 2005 U.S. DIST LEXIS 35578 at *25.  The court examined the likelihood that the defendant’s use of its marks would either blur or tarnish the plaintiff’s marks, and concludes that plaintiff could not prevail under either standard.  Id. at *30.  Blurring occurs when a defendant uses the plaintiff’s mark to identify defendant’s products, increasing the possibility that the plaintiff’s mark will no longer uniquely identify plaintiff’s products.  Id. at *25.  Tarnishment occurs when a plaintiff’s mark is associated with products of a shoddy or unwholesome character.  Id. at *26.

The court’s review of the record caused it to conclude that the plaintiff had failed to demonstrate actual or likely dimunition “of the capacity of the Starbucks Marks to serve as unique identifiers of Starbucks’ products…” because the plaintiff’s survey results did not show an association with the defendant and the mark “Charbucks,” only that respondents associated the term “Charbucks” with “Starbucks.”  Id. at *27.  The court also held that the plaintiff’s survey results did not substantiate that the mark “Charbucks” would reflect negatively on the Starbucks brand.  Id. Plaintiff therefore lost on its dilution claims.

Change in Dilution Act

Prior to 2006, dilution of a famous mark required that the plaintiff demonstrate actual dilution to prevail under section 1125(c) of the Lanham Act.  Moseley, 537 U.S. at 433.  However, Congress amended the applicable statute to only require that the defendant’s use was “likely to cause dilution.”  Starbucks II, 477 F.3d at 766.  The second circuit held it was not clear if the amended Lanham Act’s prohibition of dilution of famous marks was coextensive with New York law, the latter being the basis for the trial court not finding dilution of Starbucks’ marks.  Id. Therefore, the appeals court vacated the trial court’s judgment and remanded for further proceedings.  Id.

On Remand

The district court took back up the Starbucks case under the amended anti-dilution statute.  To demonstrate blurring of a famous mark, the amended Lanham act requires a court to consider all relevant factors including: “(i) [t]he degree of similarity between the mark or trade name and the famous mark[;] (ii) [t]he degree of inherent or acquired distinctiveness of the famous mark[;] (iii) [t]he extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark[;] (iv) [t]he degree of recognition of the famous mark[;] (v) [w]hether the use of the mark or trade name intended to create an association with the famous mark[;] and (vi) [a]ny actual association between the mark or trade name and the famous mark.”  Starbucks III, 559 F. Supp. at 476 (citing 15 U.S.C. § 1125(c)).

Degree of Similarity

The district court held that a plaintiff must demonstrate under this element that the marks are very or substantially similar.  The court pointed out that the defendant’s marks appear on packaging that is very different from the plaintiff, and the defendant used the rhyming term “Charbucks” with “Mister,” where Starbucks appears alone when used by the plaintiff, therefore the court found this factor to weigh against the plaintiff.  Id. at 477.

Distinctiveness of Starbucks Mark

Given the extent of the use of the Starbucks mark by plaintiff and the amount of money expended by the plaintiff in its marketing program, the court found this factor favored the plaintiff.  Id.

Exclusive Use by Starbucks
The fact that the plaintiff polices its registered marks, and the amount of money spent on using the mark both led the court to weight this factor in favor of the plaintiff.  Id.

Degree of Recognition of Starbucks’ Mark

Again, given the longevity and number of customers that visit Starbucks stores, the court found this factor to favor the plaintiff.  Id.

Defendant’s Intent to Associate with Starbucks’ Mark

The court finds that while the defendant intended to allude to the dark roasted quality of Starbucks brand coffees, the fact that the marks are different and the defendant had not acted in bad faith led the court to weigh this factor in favor of the defendant.  Id. at 478.  The court reasoned that the defendant used this mark to distinguish its own lines of coffee products, with the Mr. Charbucks brand being the dark roasted coffee as compared to other Wolfe’s Borough/Black Bear coffees.  Id.

Actual Association with Starbucks’ Mark

Here, the court found that while there was an association with the Starbucks’ mark to some respondents to the survey conducted by Starbucks, this association alone is not enough to find dilution.  Id. Instead, the court found that the defendant’s marks would not cause customers to confuse the defendant’s products with the plaintiff’s.  Rather, customers would tend to see the playful reference to a quality of Starbucks’ coffee – the dark roast – to distinguish one kind of Wolfe’s Borough brand coffees from other Wolfe’s Borough brand coffees.  Id.

Tarnishment Analysis

The amended Lanham Act also provides a specific definition for dilution by tarnishment: “[an] association arising from the similarity between a mark or trade name and a famous mark that harms the reputation of the famous mark.”  15 U.S.C. § 1125(c)(2)(C) (2008).  The court held that the plaintiff’s survey evidence could not support a finding of dilution by tarnishment, because the plaintiff’s survey was susceptible to multiple and equally likely interpretations.  Starbucks III, 559 F. Supp. at 480.  In addition, the court found that the defendant’s coffee products were not of actual poor quality, so any actual association between the defendant’s coffees and Starbucks would not likely be damaging to Starbucks.  Id.

As a result, Starbucks lost its case on remand for trademark dilution.  One might almost say that Starbucks has become so synomous with quality dark roasted coffees that their brand name can’t be diluted by other quality coffee brands.  Instead, the Starbucks mark is a victim of its own success in the world.  Add that to the list of reasons why a Starbucks on every street corner is not a good idea.

Note: This post was originally published in the Annual Intellectual Property Law Update, volume II, June 2009, Maryland State Bar Association Intellectual Property Section – Publications Committee.

Second Life Avatars and First Life Trademarks

More and more, the body of laws that govern our “first lives” are traveling into the world of Second Life, an online virtual world that allows people to own land, buy and sell products for Linden Dollars, and now, register trademarks based on graphics created by a user in Second Life.  Click here to read the full article.

This should probably come as no surprise, given the strong and growing commercial activity within Second Life.  According to their site, in-world users of Second Life are exchange about USD$35 million each month for virtual goods and services.  First life laws on trademarks were created in part to encourage commerce by helping consumers know the actual source for the goods they were buying.  It seems to me that the next step will be first life businesses like Nike and Rolex seeking a way to enforce their trademark rights in a first life court against Second Life infringers.