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What is Trademark Bullying?
The United States Patent and Trademark Office (USPTO) has defined trademark bullying as the practice of a trademark holder using litigation tactics in an attempt to enforce trademark rights beyond a reasonable interpretation of the scope of the rights granted to the trademark holder. This means that some businesses, both large and small, are filing trademark suits against trademark holders in an attempt to forcefully dissuade that trademark holder from using their own trademark. These actions, called strike suits, typically begin with a cease and desist letter objecting to how the business is using their trademark in commerce. If a cease and desist letter is disregarded or if the business responds that it will not cease their use, a lawsuit typically results.
The USPTO has undertaken a study on the problem of trademark bullying and has requested information from U.S. trademark owners, practitioners, and others regarding their experiences with trademark litigation tactics.
The USPTO released their initial findings of this study in their Report to Congress in April 2011.
Trademark Litigation Study PDF 334kb
Why is Trademark Bullying a Problem?
Trademark bullying is a problem because businesses are using their trademarks as a means to expand their market share without actually sometimes having meritorious claims. The would-be plaintiffs are sending cease and desist letters or filing lawsuits in the hopes that the would-be defendant will cease using non-conflicting trademarks simply to make it more expensive for a business to enter or remain in the market. Small businesses, for example, typically do not have excess resources available to engage in an expensive legal battle against a well-established business engaged in the practice of trademark bullying. In this case, small businesses will typically concede and stop using their trademarks, even though the claim might have little merit. The financial burden of defending a legitimate trademark or giving up that trademark’s use because of trademark bullying can have a detrimental impact on the business climate and the predictability of trademarks in general.
For a more detailed analysis of the trademark bullying problem, please see the article Trademark Extortion: The End of Trademark Law by Kenneth L. Port.
For a more detailed analysis of the history of trademark litigation, please see The Mitchell Study on Trademark Litigation.
What We are Doing
William Mitchell students and faculty have paired with State Representative Joyce Peppin, R-Rogers, to introduce legislation in Minnesota to respond to the problem of trademark bullying. The legislation, entitled Small Business Trademark Protection Act, seeks to provide an alternative settlement process for trademark disputes between large and small companies that are fighting over the same and similar trademarks. “There are already so many obstacles and costs associated with starting a small business and making it profitable” said Rep. Peppin. “Leveling the playing field so that small businesses can defend themselves in frivolous and expensive trademark disputes is one thing we can do to help small business thrive in Minnesota.” Neither William Mitchell nor Representative Peppin is opposed to legitimate enforcement of legitimate trademark rights by any party. This Act is in response only to those trademark claims that can be called “bullying” under the Patent and Trademark Offices’ definition of bullying.
The following resources are currently available for small business owners who believe they may be victims of Trademark Bullying.
USPTO Trademark Webpage
USPTO Small Businesses Webpage
Minnesota Department of Employment and Economic Development
National Federation of Independent Business
DuetsBlog (Winthrop and Weinstine)