Introduction
In order to maintain trademark rights, trademark owners are encouraged to enforce and police their trademarks through civil actions. Enforcing trademark rights is encouraged and incentivized by the Lanham Act because failure to do so may result in harsh consequences for trademark owners. Some of these consequences include weakening of strength or abandonment of the mark, which may result in loss of trademark rights. However, large companies go above and beyond to police and protect their trademarks. At times, this overenforcement is unethical and crosses a fine line between following the law and abusing the law, causing a number of negative consequences for society and competitors.
The United States Patent and Trademark Office (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.” Essentially, these trademark bullies will take preventative measures to enforce their trademarks far beyond what is reasonable or necessary and go after vulnerable defendants with trademarks that are not likely to cause consumer confusion in reality. For example, Apple is known as a trademark bully and has gone after many individuals and small businesses just for attempting to register trademarks for other types of stemmed fruit in many different industries. One victim of Apple is singer-songwriter Stephanie Carlisi. Carlisi goes by the stage name of Franki Pineapple. Apple targeted Carlisi for her trademark in 2020, even though it was obvious that there was not an actual likelihood of consumer confusion between Carlisi’s pineapple mark and Apple’s well-known apple mark for its products and services.
Trademark bullies use threatening tactics such as sending cease-and-desist letters and filing lawsuits against many defendants, even when the likelihood of success is low. Many of these small businesses and individuals do not have the time, money, or resources to enter into litigation with large companies like Apple, often resulting in default judgments against the defendants for ignoring the lawsuits. Consequently, small businesses and individuals are often intimidated and are likely to alter their marks to appease the larger companies’ demands and avoid legal battles, even when the likelihood of a successful infringement claim is minuscule. This ends up limiting small businesses and individuals in terms of creating and using their trademarks and ultimately enabling unfair business tactics, thereby reducing fair competition. Another negative consequence of trademark bullying is higher prices and less choices in the marketplace (as a result of monopolies and unfair competition), which also weakens consumers’ ability to identify the sources of goods and make informed purchasing decisions. Even if victims of trademark bullying do not exit the market entirely, trademark abuse may lead to increased costs for creating new trademarks or force victims to use less desirable marks. Further, trademark bullying can inhibit both commercial and noncommercial speech. Consequently, it is important to put a limit on how far trademark bullies can go to police their marks. As the law currently stands, trademark bullies have unlimited incentives to overly police their marks and no incentive to limit this overenforcement because doing so would serve them no benefit.
Many solutions have been proposed to address trademark bullying, including introducing new legislation, imposing judicial sanctions, adjusting the power and responsibilities of the USPTO, fee shifting, and publicly shaming trademark bullies. However, these solutions are neither comprehensive nor effective enough to curb the issue in the real world.
This Note proposes adopting a modified version of the misuse doctrine used in patent and copyright law to serve as a defense to trademark abuse and to disincentivize companies from engaging in trademark bullying, while also balancing legitimate infringement claims. The Note argues that this would be the most comprehensive solution to the issue of trademark bullying because it would serve as a defense to trademark abuse. A misuse doctrine in the context of trademark law would cause companies engaging in abusive tactics to lose rights or face other consequences if a defendant can show misconduct. Although trademark law is very distinct from copyright and patent law, adopting a modified version of the misuse doctrine would greatly disincentivize large companies from sending cease-and-desist letters or engaging in litigation or other threatening tactics unless doing so is justified by legitimate infringement. This Note argues that adopting a misuse defense in trademark law is the most feasible and comprehensive way to tame trademark bullying. This Note begins by providing background and context on trademark bullying in Part I, including how trademark law allows for trademark bullying, what constitutes trademark abuse, examples of trademark bullies, and the effects of trademark bullying. Part II discusses existing scholarship and proposed solutions to the issue of trademark bullying and explains why those solutions are inadequate. Part II then provides context on how the misuse doctrine is used in other areas of intellectual property law and how the doctrine’s use in trademark law would differ from its use in other areas of law. Finally, Part III proposes adopting a modified misuse doctrine in trademark law and addresses the benefits and drawbacks of this solution.