Riding Coattails Is A Bad Idea.

The recent Under Armour complaint against Body Armor could not be better timing for my first substantive post.  A behemoth fitness and training apparel company pitted up against a beverage company with an upstart sports drink.  What’s clear from the complaint is that Under Armour has invested serious resources and time into building its brand and that it is going for Body Armor’s jugular.  For those interested in reading the complaint, go to The Trademark Blog.  Under Armour is suing Body Armor under the Lanham Act for trademark infringement, trademark dilution and cybersquatting, as well as some state based claims.

These claims are best explained through clear-cut examples.

Trademark Infringement:  Company A uses a similar mark (name, logo, symbol or a combination) to that of Company B on its website selling circa 1985 sweatbands.  Customers longing for the Richard Simmons look set out to purchase Company B’s head and wristbands.  Customers see a package of sweatbands and believe that it’s Company B’s product.  But rather it’s Company A’s.

Trademark Dilution:  Nike has devoted significant time, resources and money developing its swoosh logo.  It’s so well recognized that a customer immediately associates the swoosh with Nike, even if the swoosh stands alone.   Nike can stop Company X from using a variation of the swoosh, even though Company X is putting the swoosh on computer monitors and customers know Nike has nothing to do with computer monitor.

Cybersquatting:  John Doe registers and parks the domain www.rebockshoes.com with GoDaddy.  He hopes that people looking for Reebok shoes will mistype the name in the URL and they will be directed to his domain, which contains advertising links to Reebok’s competitors.  John Doe has no legitimate interest in the name Rebock or Reebok and it’s clear that he registered and used the domain in bad faith (to capture Internet traffic looking for Reebok shoes).  Reebok sends John Doe a nasty gram demanding that he transfer the domain to Reebok.  John Doe not only ignores the transfer request, he offers to sell Reebok the domain for $10,000, which further evinces Mr. Doe’s bad faith.

While the above examples are clear-cut, the majority of cases winding up in litigation are not.

The Under Armor case will be rife with legal issues.  And a couple in particular are worth pointing out.  A key issue that Under Armour must prove is that it has priority to use the “Armour” or “Armor” (the spelling difference is inconsequential) mark in the sports beverage market.  The primary fight will be over the “natural zone of expansion.”  Apparently, Under Armour has used its mark to advertise and sell bottled water since 2005.  I’ve never seen Under Armour bottled water, but that may be due to the fact I live in the West.  The reason why the “natural zone of expansion” is where the fight will occur is because the “Body Armor” mark was used to sell energy drinks beginning in July 2007.  These dates are before both companies filed their respective trademark applications for sports beverages.  It will be critical for Under Armour, an athletic apparel company that incidentally sells bottled water, to convince the court that it was natural for its brand to move into the sports beverage market.  Because a beverage company (Body Armor) selling energy drinks will have a relatively easier time persuading the court that moving into sports beverages was a natural expansion.  Since trademark priority is established by who first used the mark in commerce, the registrations for sports beverages will likely be irrelevant.

A second issue is the similarity between the marks.  The use of “Armour” or “Armor” is similar.  Also, Under Armour alleges that Body Armor uses  the word “protect” in its tag line and its interlocking logo infringes upon Under Armour’s marks.  Straight out of Malcolm Gladwell’s book, “blink,” my snap judgment is that the Body Armor logo significantly resembles the Under Armour logo, especially when displayed horizontally.  What’s your impression?

So did the Body Armor people try and ride Under Armour’s coattails to capture UA’s cool factor?  There’s no denying that Under Armor gear is popular, not just among athletes, but with people of all shapes and sizes.   If the Body Armor logo conjures up that same cool factor that consumers associate with Under Armor, its “superdrink” sports beverage product has a huge boost out of the gate.

These are only two of the issues that the court will confront.

As mentioned above, Under Armour is going for the jugular, which is not all that unusual for this type of case.  Especially when you have a big company with the resources to fund this type of litigation.  But discussing Under Armour’s requested remedies will give upstart companies a little flavor of what can happen.  Under Armour is requesting a court order that Body Armor stop using any of its “Body Armor” marks in commerce; requiring that it destroy all product, advertising, packaging and other materials bearing the marks; that the United States Patent and Trademark Office cancel all of Body Armor’s trademark registrations and pending applications; that Under Armour take control  of the www.drinkbodyarmor.com domain; that Body Armor send out corrective advertisement to customers; and pay damages, including punitive damages.  The Body Armor people are well heeled, but if all, or even most, of Under Armor’s remedies are granted, Body Armor will most likely be crippled.

The lesson to be learned here is that upstart fitness and training companies should be cautious when creating a brand and should think long and hard about any notions of trading off someone else’s hard work in developing a brand.  It’s not a good idea.  I brought an unfair competition (common law trademark) on behalf of a client against a competing company, and I’ll never forget the defendant owner calling me up in despair about how expensive (time and money) to change his company’s name, purchase a new domain and develop a website, among other things he was required to do.  Be smart, do your due diligence for competing marks and don’t try and ride the coattails or even come close to crossing that line.  It could cripple your business and cause you to lose your investment, or at a minimum, force you to spend a huge sum of money changing everything.

 

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