Trademark Bullying: Shielding Your Brand Against Aggressive Trademark Tactics

In the United States Patent and Trademark Office (USPTO) Trademark Litigation Study reported to Congress regarding unfair trademark litigation tactics, the USPTO defined 'Trademark Bullying' or 'Trademark Trolling' as the excessive enforcement of trademark rights. This involves persons and entities using their registered trademark brands to unduly harass other businesses beyond reasonable legal interpretations or even that allowed under the law. Unfortunately, this learned behavior appears to match strategies used by patent entities and copyright bullies, where some companies adopt a legal tactic of sending threatening demand letters or suing to force settlements. For more information about responding to demand letters, see our Checklist For Responding to Demand Letters.

This Blog is for Both the Trademark Bully and the Bullied:

Both Can Lose by Their Trademark-Related Actions and Inactions!

What is Trademark Bullying?

Trademark bullying is the intentional or negligent misrepresentation of the strength of a trademark beyond what is allowable at law. Trademark trolls, which can be large or small businesses, often overextend their rights as defined under the Lanham Act. They frequently issue threatening cease-and-desist letters based on shaky grounds. They intentionally or negligently misinterpret the Lanham Act, and in doing so, overemphasize the strength of their trademark or exaggerate how their trademark prevents you from using your trademark in commerce. These trademark overreaches often appear in the form of a demand letter that pressures the recipient to stop using their mark or face a lawsuit. Some letters aim to extract licensing fees, quick settlements, or push for co-existence agreements from those they accuse of infringement. While not all these cases go to court, the mere threat of litigation can be enough to economically coerce smaller businesses or individuals into compliance. Unfortunately, many do choose to simply give up rather than defend themselves in expensive litigation and accept whatever time, effort, and funds they invested in designing their logo and hiring their original lawyer who filed their trademark application.

Why You Should Not Be a Trademark Bully?

Trademark bullying is a significant challenge for businesses of all sizes. Not only does it put the bully at risk of losing its trademark, but it also stifles innovation and is unnecessarily anti-competitive. You have every right to protect your trademark, but a fair and just society also demands it is done the right way and in the correct manner. You must find a balance between unproductive aggressive enforcement tactics and responding effectively within a trademark enforcement demand letter.  Do you really want to risk losing your trademark because you sent an overreaching trademark cease and desist letter to a competitor? 

A petition to cancel can be filed against a trademark bully to cancel the bully's trademark with the Trademark Trial and Appeal Board (TTAB). While "trademark bullying" itself is not a standalone legal ground for cancellation, the abusive enforcement tactics of a bully can lead to closer scrutiny and the potential discovery of valid grounds for canceling the trademark. Most often, we've seen trademark bullies fail to realize that the person or entity they demand to cease and desist is actually the senior user or first to use the mark. This gives priority to the bullied party and provides a basis to file for cancellation of the bully's mark. Baron Philippe de Rothschild v. Paramount Distillers, Inc., 923 F. Supp. 433, 438 (S.D.N.Y. 1996) states that even if the defendants' mark is incontestable, it would not be incontestable against a senior user. Similarly, DeRosier v. 5931 Business Trust, 870 F. Supp. 941, 948 (D. Minn. 1994) highlights that while defendants’ use of their properly registered service mark is otherwise incontestable, that use must yield to a prior user's adoption of the same or a confusingly similar service mark within a specific geographic area.

The Lapp Test: Essential Steps Before Sending Or Responding To A Cease and Desist Letter

Before sending or responding to a cease and desist letter, it’s crucial to assess these factors through the Lapp Test to ensure you have well-founded position grounded in the facts and the law.  The Lapp Test originates from the case Interpace Corp. v. Lapp, Inc., 721 F.2d 460 (3d Cir. 1983). In that case, the court established a set of factors to determine the likelihood of confusion between two marks. These factors have since been widely adopted in by the courts in trademark infringement cases to provide a systematic approach to evaluating the potential for consumer confusion. The “Lapp Test” helps weigh the likelihood of confusion between two marks by considering the following factors:

• Strength of Owner’s Mark:

How distinctive and recognizable your mark is.

• Similarity of the Marks:

The degree of resemblance between the two marks.

• Consumer Sophistication:

The attention and care consumers use when making purchasing decisions, especially for high-cost items.

• Duration of Use:

How long the alleged infringer has used the mark without causing confusion.

• Actual Confusion:

Evidence of actual consumer confusion, or lack thereof.

• Intent:

The intent behind the alleged infringer’s use of the mark.

• Marketing Channels:

Similarity in marketing and advertising methods.

• Target Audience:

Whether the sales and marketing efforts target the same audience.

• Goods or Services Similarity:

The similarity of the goods or services associated with the marks.

• Consumer Perception:

How consumers perceive the relationship between the goods or services.

• Market Presence:

Whether consumers might expect the trademark owner to enter the infringer’s market.

Striking the Balance With Trademark Enforcement Letters

Trademark owners must carefully weigh the risks of aggressively enforcing their trademarks against the dangers of not being assertive enough, which can risk the trademark entering the public domain due to non-enforcement. Overzealous enforcement can lead to accusations of trademark bullying and potential legal backlash. However, failing to adequately protect a trademark can result in the loss of rights and brand dilution. It's crucial for mark owners to find the right balance and avoid overreaching

Trademark Enforcement and Defense Lawyers Serving You

Consult Wilson Legal Group's trademark lawyers to effectively navigate the complexities of trademark enforcement. Proper evaluation and early legal advice can prevent costly litigation and aid in protecting your brand. The USPTO defines a trademark bully as “a trademark owner that uses its trademark rights to harass and intimidate another business beyond what the law might be reasonably interpreted to allow.” Our trademark attorneys will employ the Lapp Test before sending or responding to a cease and desist letter to help provide the most strategic protection for your trademark and your brand's legitimacy:

• Prevent Unnecessary Litigation: The Lapp Test helps assess the likelihood of consumer confusion, which is a key factor in trademark infringement cases. By thoroughly evaluating this, you can avoid unnecessary and costly litigation if the likelihood of confusion is low.
• Strengthen Your Case: If the Lapp Test indicates a high likelihood of confusion, it strengthens your position and can make your cease and desist letter more compelling. This can lead to quicker and more favorable resolutions without going to court.
• Avoid Baseless Claims: Conducting the Lapp Test ensures that your claims are valid and not overreaching. This helps maintain credibility and avoids potential counterclaims of trademark bullying or bad faith.
• Legal Obligation: Trademark owners are legally required to enforce their rights to avoid losing them. However, this enforcement must be done responsibly. The Lapp Test provides a structured way to assess the situation and ensure that your actions are justified.

Don't be a trademark bully or face trademark bullies alone; let our trademark attorneys help you protect and defend your trademark rights and brands.