Michael McAndrew
Trademark
Outline and Bibliography – 10/14/05
Working Title: Mind Your Business: Asserting Exclusive Rights in Common Words Under Trademark Theory
Outline
A. Introduction
a. This section will provide a basic understanding of the subject matter of the paper. Specifically, it will introduce the notion that trademark holders of common words are at times able to assert exclusive rights in those words. As a result of this narrow opportunity under traditional trademark law, aggressive (and at times suspect) trademark holders have attempted to create a monopoly on common words by policing their marks via numerous channels. The threat of litigation, coupled with business realities and an audience unfamiliar with the law, at times has resulted in a windfall of licensing fees for the trademark holder, where such a claim likely would have failed before a tribunal. This maneuver reveals a monetary tactic at odds with traditional trademark, yet facilitated by the trademark system.
b. This section will provide a roadmap of the subsequent sections of the paper, and their role in examining the implications of this practice.
B. History and Background
a. This section of the paper will contain the relevant historical information necessary to the paper. The primary focus will be on the practices of Leo Stoller, although other entities such as Entrepreneur Media will be discussed.
b. Leo Stoller, a Midwestern entrepreneur, claims to have blanket trademark rights to the word ''stealth,'' among others. Since first registering the term in 1985 to cover an array of sporting goods, Mr. Stoller has registered nearly two dozen additional trademarks involving the term, covering such diverse products and services as crossbows, pool cues and insurance consultations. In addition, Mr. Stoller claims to hold and administer as many as two dozen other ''stealth'' trademarks. In conjunction with this expansion across industries, Mr. Stoller and his companies have sued on trademark grounds nearly sixty times, and have written dozens of letters to companies, organizations, and individuals, asserting rights in the trademark ''stealth.'' In some cases where he has threatened to sue, Mr. Stoller has offered to drop objections in exchange for thousands of dollars, and has succeeded in a few instances. These instances, as well as a few isolated victories, demonstrate questionable success in light of Mr. Stoller's high failure rate before the courts.
c. Entrepreneur Media Inc. ("EMI") applied in 1985 to register the word "entrepreneur" for use in magazines, books and other publications ''pertaining to business opportunities,'' as well as for computer programs. Since that time, the company's Entrepreneur Magazine has grown to a circulation of 560,000. While EMI declines to quantify how many lawsuits it has filed, or how many cease-and-desist letters it has sent, the company has stated that in the last ten years it has resolved or settled about forty instances of actual or potential trademark infringement. The company has pursued action involving a series of how-to business books called "The Virtual Entrepreneur"; the name of a California public relations company (EntrepreneurPR), and use of the word in a quarterly periodical it published (Entrepreneur Illustrated); a publication entitled "Publishing Entrepreneur" in Traverse City, Michigan; consulting firm Ernst & Young's "Entrepreneur of the Year Magazine," in conjunction with its annual awards program; The Donald H. Jones Center for Entrepreneurship at Carnegie Mellon University; as well as the holders of the Internet addresses "entrepreneurs.com" and "entrepreneur.net." EMI has applied for more than one hundred trademarks related to entrepreneurs, and continues to register trademarks with the word “entrepreneur” in them.
C. Discussion
a. This section of the paper will focus on the law surrounding the issue, with particular focus on the claims being asserted and the courts’ analysis in Stoller and its related decisions.
b. A mark can gain incontestable status if the registrant continuously has used it for five years, and such status would entitle the holder to the exclusive right to use the mark on or in connection with the specific category in which it was registered. Incontestable status serves as conclusive proof that a mark has secondary meaning.
c. Courts tend to examine such cases under traditional infringement analysis, and have applied a similar eight-factor test as in Sleekcraft and Polaroid. The goal of this analysis is to establish whether a reasonably prudent consumer in the marketplace is likely to be confused as to the origin of the good or service bearing the mark. Only if the goods are quite similar, and the goods closely related, will infringement be found.
i. A weak mark along the continuum of marks will not weigh in favor of likelihood of confusion.
1. A descriptive mark is only entitled to protection if it has acquired secondary meaning and has become distinctive of the applicant’s goods in commerce.
2. The need of others in the marketplace to use the term, along with a lack of practical synonyms, weighs toward a term being descriptive.
a. Widespread use of the word by others may serve as confirmation of the need to use that word.
ii. Exclusive right to use common terms tends to be limited to the common and necessary uses of the terms.
1. A marketplace replete with products using a particular trademarked word indicates not only the difficulty in avoiding its use but also, and directly, the likelihood that consumers will not be confused by its use.
2. The fact that the term resides in the public domain lessens the possibility that a purchaser would be confused and think the mark came from a particular single source.
iii. Weak marks may be strengthened by such factors as extensive advertising, length of exclusive use, public recognition, etc
iv. Similarity of marks or lack thereof are context-specific concepts
1. The more closely related the goods are, the more likely consumers will be confused by similar marks
2. Consumers may well recognize that a defendant uses a specific term for what the word means, not because of an association with the plaintiff’s mark.
v. There is a broad societal interest in preserving common, useful words for the public domain.
D. Analysis
a. Stoller's mark is a weak mark along the continuum of marks, lacking in secondary meaning. This lack of secondary meaning in the trademark "stealth" denies him the exclusive right to use the mark. Furthermore, his coverage of the term across industries reflects a lack of incontestable status in any specific category in which it has been registered.
b. Even if Stoller possessed an exclusive right to use this common term, such a right would be limited to the common and necessary uses of the terms. Yet Stoller’s actions extend beyond any reasonable necessary use.
c. There is a broad societal interest in preserving the term "stealth" for the public domain, where Stoller has demonstrated a tepid intent to use the term in commerce. The need of others in the marketplace to use the term, along with a lack of practical synonyms, weighs toward the term being merely descriptive. A marketplace open to the use of the word "stealth" across industries diminishes the likelihood that consumers will be confused and believe the term indicates a single source of origin. Consumers may well recognize that the use of the word "stealth" may merely reflect what the word connotes, and not an association with the plaintiff's mark.
d. Stoller's weak mark could be strengthened by such factors as extensive advertising, length of exclusive use, and public recognition, which he has failed to show. Unlike Entrepreneur Media, Stoller engages at best in de minimis advertising of his mark and, moreover, does little to demonstrate an actual use in commerce. When coupled with his attempts to reach into various industries, this lack of traditional trademark use does not situate his mark in close relation to those he challenges, when viewed contextually.
e. If the instinct is that terms such as Stoller’s are at best descriptive, the only means of establishing secondary meaning, or lack thereof, is to appear before a tribunal, unless a company is willing to take its chances and continue their use, as some have. A more typical response to such an undertaking, and the costs and publicity associated with doing so, is to avoid pursuing such recourse.
E. Conclusion
a. With a scant record of any victories for “stealth” in court, Stoller is getting licensing fees from people where the need for a license or possibility of confusion is unlikely. The only grounds he has to do this is that he registered the mark at some point; therefore, trademark law is serving, in effect, to facilitate these abuses.
Bibliography
- Colin Moynihan, He Says He Owns the Word 'Stealth' (Actually, He Claims 'Chutzpah,' Too), N.Y. Times, July 4, 2005, at C5.
2. Leo Stoller d/b/a Central Mfg. v. York Int'l Corp., 2003 WL 21301457, Trademark Tr. & App. Bd., Jun 04, 2003.
3. Central Mfg. Co. v. Board of Regents, University of Texas System, 2005 WL 2464005, Trademark Tr. & App. Bd., Sep 30, 2005.
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31. Mark R. Becker, Streamlining the Federal Trademark Dilution Act to Apply to Truly Famous Marks, 85 Iowa L. Rev. 1387 (2000)
32. Sara Stadler Nelson, The Wages of Ubiquity in Trademark Law, 88 Iowa L. Rev. 731 (2003)
33. Trademark Protection and Practice, Volume 1: Analysis, Chapter 2 Trademark Subject Matter, 1-2 Trademark Protection and Practice § 2.03
34. Trademark Protection and Practice, Volume 2: Analysis, Chapter 5 Likelihood of Confusion, 2-5 Trademark Protection and Practice § 5.11