Avoiding “Another” Trademark Trap: “Don’t Sweat It” When it Comes to Trademark Selection

Lontex Corporation v. Oakley, Inc. and Tips for Selecting a Trademark

Lontex Corporation v. Oakley, Inc.

In September of 2013, Oakley, Inc. was sued for trademark infringement for using the trademark / phrase “Sweat it Out” for sweatbands. The plaintiff, Lontex Corp., is a manufacturer of athletic apparel and owner of several United States trademark registrations for the mark SWEAT IT OUT for athletic apparel, including sweatbands.

The complaint alleges that Oakley’s use of SWEAT IT OUT for sweatbands constitutes counterfeiting and is likely to confuse or deceive consumers into believing that Oakley’s sweatbands originate with or are sponsored by Lontex in violation of the Lanham Act (Trademark Act).  Lontex also alleges that Oakey’s misuse of the mark SWEAT IT OUT constitutes willful trademark infringement. Thus, Lontex is requesting that the court award triple damages, costs and reasonable attorneys’ fees.  This case underscores the need for brand owners to understand proper trademark selection.

Tips for Selecting a Trademark 

There are many reasons why trademark owners should carefully select and clear new product names, trademarks and even product slogans and phrases.  Some of which include selecting trademarks and slogans that are immediately eligible for trademark protection and do not infringe third party rights.  

Even when brand owners select trademarks and/or slogans that would likely not infringe third party trademark rights, it may still be prudent, in some cases, to choose another mark.  For example, it is not a good idea to select marks that would likely draw fire from a competitor that aggressively enforces its marks against uses of similar marks – even when consumer confusion is unlikely (we call those parties “Trademark Bullies”). Furthermore, selecting marks that would likley get “lost in the marketplace noise” with other similar trademarks is also not advisable.     

Tips for Selecting a Trademark
   United States Patent and Trademark Office 

There are instances when good business decisions (based on sound legal advice) are to simply consider different product names or slogans rather than spend hundreds of thousands of dollars (or more) defending a trademark dispute brought by an over-zealous plaintiff with a weak case.  You might win the legal battle, but at what business and economic costs?  Companies should also obviously steer clear of adopting infringing trademarks, product phrases and slogans and marks that would likely draw fire from a competitor for credible reasons.   

Brand owners should instead spend their time and resources on brand development and growth and not on defending unnecessary trademark infringement allegations over the use of product slogans or phrases, not to mention the possibly of spending thousands or hundreds of thousands on re-branding (and, yes, I said the “R” word). 

Not until trademark attorneys understand the gray of trademark law will they understand the gray of trademark law and recognize that selecting a different mark altogether is sometimes your best business option – even if that is not what you want to hear.  From time to time I need to remind clients that they do not hire me so that I can tell them what they want to hear – but rather what they need to hear.

To read more about my views on trademark clearance and selection, read my blog posts here, here and here.

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Trademark Titan Two-Minute Snap Shot: Trademark Trial and Appeal Board and its Legal Effect for Trademark Disputes

The United States Trademark Trial and Appeal Board (“TTAB”) has the authority to determine numerous trademark registration issues, including whether a trademark is eligible for federal trademark registration and whether one party’s trademark is entitled to registration over another party’s trademark based upon priority of use and likelihood of consumer confusion.  The TTAB does not have the authority to award damages for trademark infringement or prevent the use of an infringing trademark in the marketplace.

USPTO Image 2In other words, the TTAB decides whether a party or which party is entitled to trademark registration and thus the trademark rights conferred by it.  However, the TTAB cannot stop a third party from infringing your trademark in the marketplace.

Before spending thousands and potentially hundreds of thousands of dollars on a dispute before the TTAB aimed at preventing the ownership of a registration, trademark owners confronted with the option of opposing or canceling a third party’s trademark registration at the TTAB should first consider whether the proper forum for the dispute is in court.  If the subject mark is infringing your trademark, likely to confuse consumers as to the source of the parties’ respective products, diluting your mark and/or tarnishing the reputation of your mark and brand, a court action may be the best option.

Furthermore, even if you receive a favorable decision at the TTAB, that decision may not be recognized in a later court action between the parties involving the same marks and products.  Accordingly, if you have a pending case or an option for a case at the TTAB, consider strategy early and whether the end game is to prevent the use of an infringing mark by the opposing party, receive payment for damages and possibly get attorneys’ fees or if you are only seeking a limiting agreement from the opposing party.

Simply preventing the registration of a third party’s mark may not be the result you need.  When the target mark is vulnerable to a trademark registration opposition or cancellation proceeding at the TTAB, one strategy is to file a complaint with the TTAB and simultaneously file a complaint in court.  Once the complaint is filed with the court, file a petition to suspend the case at the TTAB pending the outcome of the court action.  Another strategy is to file a proceeding at the TTAB and seek settlement whereby the opposing party agrees to discontinue the use of the infringing mark.  If settlement is not reached quickly, your next step is to consider whether to suspend the TTAB action and file a court action.

Before any action is taken in a trademark dispute, it is always best to know what you want before the guns are drawn, the merits of your case and your strategy.  Otherwise, you just might end up wasting your time, money and resources.