Loss of Trademark Rights: Embracing Negative Trademarks

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Loss of Trademark Rights: Embracing Negative Trademarks

Red Sox fans, Mets fans, and baseball fans of any team other than the Yankees will tell you that the Yankees are evil. Now, so have a panel of federal judges. Last month, the Yankees successfully blocked a trademark application by Evil Enterprises for the phrase “Baseball’s Evil Empire”. Evil Enterprises initially applied for a trademark back in July of 2008, and it’s been the source of a five year fight between the baseball club and the t-shirt makers since. The phrase originated back in 2002 when an executive of the Boston Red Sox first used it to disparage the Yankees. Since then, it has been popularly used in articles, sports columns, and TV highlight shows as a label for the Yankees.

The Yankees have never used the phrase themselves, however, and that is why this is such an interesting trademark case. The team argued that they have “implicitly embraced” the “Evil Empire” theme as a “badge of honor” by playing music from Star Wars during their home games. The team does not necessarily want to make t-shirts with the phrase on it, yet they still wish to block others from doing so. The Yankees had not registered the trademark for itself. But, nonetheless, they now own the trademark. This is because there is a likelihood of confusion and that people now associate the term with the Yankees. If the Trademark Trials and Appeals Board, the TTAB, were to allow Evil Enterprises to have the mark, then consumers would think that their products were official Yankees apparel. This confusion would lead to a dilution of the Yankees brand, since the phrase has a negative connotation. Evil Enterprises claimed that its mark was a “spoof and parody.”  A primary test of trademark infringement is whether there is a likelihood of confusion as to the source of goods and services. Here, the TTAB held that this standard was met.

But, this rationale only explains why Evil Enterprises did not win the exclusive rights to the phrase. Understanding why the TTAB gave those rights to the Yankees, rather than leaving the phrase in the public domain, is far more complex. The purpose of trademarks is to identify the source of goods and services. It matters far less who invented the idea, the important factor is who is using the trademark. Where a trademark comes from does not matter. But, instead, where the trademark goes and who and what it identifies will dictate registration. To determine that, this case hinged on the ‘public use doctrine’. The public use doctrine provides that the public’s use of a term to describe a company can confer trademark rights. The TTAB explained that “[i]t is well-settled that in order to establish rights in a mark, a party need not have actually used a mark if the public nevertheless associates the mark with the goods or services of that party.” Some examples of the public use doctrine include: Coca-Cola Co.‘s mark COKE, Apple’s mark MAC for its Macintosh computers, American Express’s mark AMEX, McDonald’s mark Mickey D’s, and Volkswagen’s mark BUG for its Beetle’s. None of these companies had used those phrases at the time at which they were trademarked. But, since the public so closely identified them with these marks, they were granted exclusive ownership.  “The Public Use doctrine states that abbreviations or nicknames used only by the public can give rise to protectable trademark rights to the owner of a mark which the public has modified.” George & Co. LLC v. Imagination Entertainment Ltd., 575 F.3d 383, 403 (4th Cir. 2009). However, the cases cited by the TTAB panel all properly apply the doctrine to the public’s adoption of shorthand or abbreviations for a trademark owner’s mark. In George & Co. LLC v. Imagination Entertainment, the Plaintiff sought to apply the public use doctrine in the reverse. Id, at 383. The Plaintiff had a dice game titled “LCR”, which stands for “Left Center Right.”  Id, at 390.  They claimed that the Defendant’s mark, LEFT CENTER RIGHT, was infringing upon its LCR mark. Id, at 392. The Plaintiff argued that the public use doctrine applied so that LCR’s elongated form “LEFT CENTER RIGHT” would be covered. Id, at 403.

The Fourth Circuit held that the public use doctrine is limited to where the formal mark is well-known and the nickname “adds distinctiveness” to the formal mark. Previously, that ruling is was thought to only include where the public abbreviates or nicknames a mark, not the other way around. Here, the Yankees have greatly expanded this doctrine, since “Evil Empire” is in no way an abbreviation of Yankees. While the TTAB’s opinion is not a precedent, so it will in no way change the law, it does indicate how a judge can interpret broadly the public use doctrine.