CASE STUDY: Unintentional Trademark Infringement

A New York City entrepreneur loves New York, fine coffee and his coffee shop Everyman Espresso. He also loves tattoos, adorning one on his fingers “I [coffee cup image] NY.” The tattoo was so expressive of his personal passion, he began using the tattoo images as a logo on his website, storefront and retail promotional items like coffee mugs and T-Shirts.

New York State quickly issued a cease and desist letter asserting its I ♥ NY mark. The State claimed his logo created confusion as to whether the State sponsored his company or was somehow connected.

While he did not think he was infringing, and there was no likelihood of confusion (no reasonable customer would think NY State sponsored the coffee shop), his lawyer responded to the infringement that the coffee shop owner would immediately stop using the logo image.

End of story? Hardly; New York state pushed  for all of the coffee shop’s financial records so it could determine the magnitude of damages the State should collect. This will be an expensive misstep for this entrepreneur. Legal fees and damages likely cost him $10,000 or more. Most people believe that if you stop after you are “caught,” you can avoid paying penalties and damages. Lay people believe the Big Guy won’t sue the Mom & Pop Shops. Whether plain denial or folklore, this is simply not how it plays out in every case.

That is a risky practice that can hurt your pocketbook. More often, the trademark owner will want to recover at least the cost of hiring its attorney to enforce the mark against you. It may also want to use your case as an example to deter future infringers. Trademark owners want a clear reputation for strong enforcement of their intellectual property rights. Being the bully sometimes pays off in the business world.

Our office is often called upon on by both sides of this scenario. A new business owner can mitigate the risk of a similar problem with a low-cost trademark clearance search. Even if you find someone else using the mark, it may not pose a barrier to your use of the name, slogan or logo for your business purposes. For business owners with valuable marks to protect, we can show them how to implement an affordable program police their marks to stop problems (potential infringers) at their inception.

It is important to understand there are many different types of trademark searches. A direct hit search will not be enough to “clear” your mark for use. This is a search on TESS trademark search using the exact words contained in the mark or codes for elements of a stylized mark. In this case, a search of “I [coffee cup] NY” would have found zero hits, yet there is arguably a likelihood of confusion. A professional trademark search goes much further and looks for similar but not identical marks in the Federal Register,  State Registers (all 50 of them) and even looks to identify unregistered business names that could potentially pose  a problem. Finding “hits” in your search results is not very useful if you don’t have the specialized knowledge and experience to interpret those results.

Our firm often consults with business owners on modifications they can make to their proposed trade name or mark to minimize any chance of confusion, and a claim of infringement.

If you want peace of mind about your business’ marks, contact our office for a free consultation.