Trademark Genericide And One Big Way The DOJ Admits That Its Antitrust Lawsuit Against Google Is Utter Garbage

from the admitting-their-own-bullshit dept

Don't misread the title of this post to think there's only one thing wrong with the DOJ's antitrust complaint against Google. There's plenty. But on the list is this particular self-defeating argument included in the complaint -- the complaint where the DOJ basically has but one job: show that Google is a monopoly.

To understand it, we need to first understand the idea of "trademark genericide." That's what happens when your brand name is, well, just too good and people start using your branding as the default word to describe the product or service in general. Famous examples include "Band-Aid," "Thermos," "Xerox," and plenty of other words we're all used to using in lower-case form to describe things that aren't actually produced by the companies that had those trademarks.

The issue here is not actually whether Google has lost its trademark rights due to genericide, which is a technical question particular to the operation of trademark law and not relevant to the issues raised here. The DOJ isn't actually arguing that Google has anyway. But what it is arguing is that the same basic dynamic has occurred, where the branded name has become a widely adopted synonym to describe other people's similar goods and services. However, in doing so, it has blown up its own argument because that means there are other similar goods and services. Which means that Google is not a monopoly.

Look at what it argued (emphasis added):

Google has thus foreclosed competition for internet search. General search engine competitors are denied vital distribution, scale, and product recognition—ensuring they have no real chance to challenge Google. Google is so dominant that “Google” is not only a noun to identify the company and the Google search engine but also a verb that means to search the internet. [complaint p. 4]

This argument makes no sense. On the one hand it asserts that Google has foreclosed competition for Internet search, and in almost the next breath it asserts (and as an attempt at proving the first assertion, bizarrely) that "Google" has now become the generic word for Internet searching offered by everyone. If "Google" is now being used by consumers to describe the use of competing goods and services, it means that there are competing goods and services. Ergo, Google is not a monopoly, and thus the alleged premise for bringing this antitrust action is unsound.

There are, of course, many reasons why this antitrust action against Google is unsound, but it does seem odd that the DOJ would so candidly confess such a notable one in the introduction of its own complaint.

Especially because even the DOJ itself admitted later in the complaint that there are actually competing search engines, namely Bing, Yahoo, and DuckDuckGo.

Google has monopoly power in the United States general search services market. There are currently only four meaningful general search providers in this market: Google, Bing, Yahoo!, and DuckDuckGo. According to public data sources, Google today dominates the market with approximately 88 percent market share, followed far behind by Bing with about seven percent, Yahoo! with less than four percent, and DuckDuckGo with less than two percent. [p. 29]

But the argument it made in this later section to try to wish away the import of these competitors did not do much better than the previous one in the logic department.

There are significant barriers to entry in general search services. The creation, maintenance, and growth of a general search engine requires a significant capital investment, highly complex technology, access to effective distribution, and adequate scale. For that reason, only two U.S. firms—Google and Microsoft—maintain a comprehensive search index, which is just a single, albeit fundamental, component of a general search engine. Scale is also a significant barrier to entry. Scale affects a general search engine’s ability to deliver a quality search experience. The scale needed to successfully compete today is greater than ever. Google’s anticompetitive conduct effectively eliminates rivals’ ability to build the scale necessary to compete. Google’s large and durable market share and the significant barriers to entry in general search services demonstrate Google’s monopoly power in the United States. [p. 31]

Once again, the DOJ has managed to swing and miss in trying to argue that Google is a monopoly with its rushed and unthoughtful lawyering. Google obviously isn't, not with actual competitors, and the DOJ's apparent fallback argument of it being a monopoly somehow due to monopolistic effect similarly fails. It whines that scale is important for a search engine's success, and that there are significant barriers to entry to becoming a competitive player in the search engine space. But the DOJ offers nothing more than "it must be antitrust!" to hand-wave away why Google has managed to succeed better than its rivals, including rivals like Yahoo that had entered the market long before Google (and for whom barriers to entry should not have been an issue), and rivals like Microsoft (which the DOJ acknowledges is able to achieve the same scale as Google). The market has had choices—choices that even the DOJ cannot ignore, no matter how much it is desperate to because of how their existence undermines its case.

And so with the "la-la-la-I-can't-hear-you" approach to antitrust enforcement the DOJ tries to wish these inconvenient facts away, arguing that Google's size and share of the market somehow magically evinces an antitrust violation, with little more support than "because we said so."

Which is not nearly a good enough basis for this sort of extraordinary action.

Filed Under: antitrust, doj, genericide, trademark
Companies: google

Costco Gets Trademark Judgement Overturned, Defeating Tiffany And Co.

from the ring-the-bell dept

Readers here will be sick of this, but we're going to have to keep beating it into the general populace's head: trademark law is about preventing confusion as to the source of a good or service. The idea is to keep buyers from being fooled into buying stuff from one company or person while thinking they were buying it from another. That's basically it.

It's a lesson still to be learned, and one which a federal judge has imparted on famed jewelry maker Tiffany & Co. The backstory here is that back in 2013, on Valentine's Day of all days, Tiffany & Co. sued Costco over the latter's advertisement of "Tiffany" style rings.

U.S. District Judge Laura Taylor Swain said Tiffany deserves $11.1 million, plus interest, representing triple the lost profit from Costco's trademark infringement, plus the $8.25 million in punitive damages awarded by a jury last October.

The Manhattan judge also permanently barred Costco from selling anything that Tiffany did not make as "Tiffany" products, unless it uses modifiers suggesting that the products have, for example, a Tiffany "setting," "set" or "style."

The reason for that last bit is that Costco's argument against the judgement was that its references to "Tiffany" were about an iconic setting for engagement rings. Tiffany & Co. did indeed make that setting famous, but tons of non-Tiffany rings are sold with that style. In fact, it's become such a generic term in the industry after nearly 150 years of use that articles discussing the setting essentially note that there is no trademark concern to have here. From Forbes, for instance:

The formula was immensely successful. So much so that the term “Tiffany setting” has reached Kleenex status—it’s now used colloquially throughout the jewelry industry to describe any multi-pronged solitaire setting, Tiffany or no.

So, even if there were a trademark claim to be had here at one point in history, that ship has sailed. Except in the lawsuit against Costco, the court disagreed, leading to an appeal by Costco.

And with that appeal comes a reversal of the lower court's decision.

A federal appeals court Monday overturned a $21 million verdict against Costco Wholesale Corp. for trademark infringement over its marketing of diamond rings labeled as “Tiffany,” ruling that the lower court judge who had issued an initial ruling in the case had failed to adequately consider contrary evidence.

Costco’s evidence “was sufficient to raise a question as to whether potential buyers of Costco’s diamond engagement rings were actually confused by the appearance of the word “Tiffany” on Costco’s signs,” the ruling said.

Now, this was the overturning of a summary judgement by the lower court. In other words, this ruling is essentially stating that the lower court improperly kept this from going to a full trial, where Costco would be allowed to present evidence that its use was proper given the generic nature of the term, as well as evidence that there was little to no customer confusion to be had. And that evidence is quite good, actually.

Here again we go back to the beginning of this post, where we lay out that trademark law is supposed to be about keeping customers from being fooled as to the source of a good or service. Well, Costco decided to run a real life experiment on this of its use of the term "Tiffany."

It said after the complaint was filed, Costco sent a letter to all customers who had purchased the engagement rings with Tiffany settings and reminded them that its return policy entitled them to return their rings for a full refund at any time, but only 1.3% of its customers returned their rings.

Tiffany & Co. is already making noises about trying this case again, but hopefully it will instead simply bask in the glory that is a setting so popular that it's become generic. If not, I'd expect Costco to win out on the merits.

Filed Under: genericide, rings, settings, tiffany setting, trademark
Companies: costco, tiffany

Velcro's Hilarious Trademark Lesson Video Actually A Good Lesson In Just How Stupid Trademark Law Has Become

from the genericide-insanity dept

So, you've probably heard stories in the past about the fear some trademark lawyers have about "genericide" -- where their product's name becomes so attached to the product that it's considered generic and the trademark no longer applies? Think kleenex and xerox for example. We've found, over the years, that people get a bit too worked up about this, leading trademark lawyers to make some really dumb demands along the way to try to "prevent" what is generally impossible to actually prevent. We also often see people claim (falsely) that this means companies are required to stop any and all uses of their mark, even when not infringing (or, even worse, seeing people falsely claiming that the same thing applies to copyright). Either way, the company Velcro has taken... well... quite a unique approach to the fact that everyone calls their most famous product "velcro" -- even when made by competitors. They made an absolutely hilarious "We are the World"-style video begging you not to call it Velcro and telling you, in no uncertain terms, that they it's "fucking hook & loop." Really.

When I first saw it, I thought it was a John Oliver or SNL-style parody video, but nope. It's real. It's on Velcro's official YouTube feed, and they even have a behind the scenes "making of" video to explain how the video was made and how it came about (including the fact that two actual Velcro lawyers are in the video).

Of course, they insist they're doing this to get people talking about the importance of calling it "hook and loop" though I think at best, it will just get people talking about how incredibly dumb trademark law has become, where this kind of thing is seen as necessary. The only people who will now start calling it "hook and loop" are likely to be people doing it ironically. In which case, they may go with the longer "this is fucking hook and loop," as the song suggests. But, as the song itself suggests, it's totally ridiculous that the company has to do this to try to get you to stop saying the brand name that the company spent "60 plus years" building. The song also jokingly references other genericized brands, such as Clorox, Band-Aid and Rollerblades.

Thankfully, they don't seem to get the finer points of the law really wrong in the song -- noting that the patent on velcro expired 40 years ago, and if everyone calls everything similar velcro, the company might "lose our circle R." Of course, they leave out the fact that if they lose the trademark... it's actually probably not that big a deal. People will still call all similar products velcro, but Velcro-brand velcro will almost certainly still be able to charge a premium, since people will recognize the brand name.

And that's really what highlights how dumb all of this is. Even if you lose the trademark to genericide, that doesn't mean the company packs up and moves on. It just shows how much the brand itself has resonated, and companies have lots of ways to continue to capitalize on that brand, even without the registered trademark. So, while I can always get behind hilarious videos concerning oddities in trademark, copyright or patent law, this video seems like a much better lesson in the stupidity of trademark law (and how much lawyers overreact to the fear of genericide) than any legitimate argument against calling someone else's velcro-like fastner "velcro."

Filed Under: generic, genericide, songs, trademark, velcro
Companies: velcro

Spin Bike EBay Listing Removed Because 'Spin Bike' Is Apparently A Non-Generic Trademark

from the sit-and-spin dept

Sometimes you try really hard at something and you still fail. Such is the case with Mad Dogg Athletics' attempt to keep its "spinning" trademarks from becoming generic. We wrote about the company's marks on stationary bike classes nearly five years ago, when it was busy suing several gyms in Denmark for offering spinning classes. In fact, both before and after those legal actions, MDA has been incredibly active in trying to enforce its trademarks. They tried really, really hard.

But the company failed. Much like other types of workout classes, nobody sees spinning as a source identifier any longer. Nobody thinks of Mad Dogg Athletics. Hell, most people haven't even heard of MDA. But the company hasn't given up, as shown by how it got eBay to remove a listing for an exercise bike for using the term "spin."

VeRO is ebay’s Verified Rights Owner program. VeRO allows a right’s owner (someone who has a verified trademark, copyright, etc.) to request removal of an item. This action, of course, is not without controversy. Business owners have claimed that this process is often abused and overreaching. I will leave that discussion for another day. For now, you should know that a company by the name of Mad Dogg Athletics, Inc. (MDA) is a member of the eBay VeRO Program and uses this program to enforce the nearly one hundred trademarks it owns, which include: spin, spinning, spinner, spin yoga, spinfitness, and spin daddy. With that said, only MDA’s Spin® bike can be called that, and so my client’s “spin bike” listing was removed due to use of the word spin.

Actually going after eBay listings for using a word like "spin" would be ridiculous in its own right, but this is about something much deeper for MDA: the term spinning is generic. It just is. And it's not like this kind of trademark-to-generic evolution is without precedent. Yoga and Pilates went through a similar transition, having been source-identifiers for consumers but soon turning into descriptions of a particular process or type of class, rather than any kind of brand. Keep in mind, as the link above notes, the test for whether a term is generic is the wider public's perception, not the individual purchasers' perception. Go ask someone on the street whether "spinning" is associated with any particular brand and see what reaction you get. It's generic.

I know I am not a professional cycler by any stretch, but as someone who at least recreationally partakes in indoor cycling, I had never even heard of the MDA. I bet you if I polled the people at my class, most haven’t either. It’s also important mention that on its page for “indoor cycling,” Wikipedia states, “[i]t is commonly called spinning.” Yelp allows you to search for “spin” and “spinning studio.” ABC News refers to SoulCycle as a spin studio. For the record, they are not. I dare you to search any cycling studio’s reviews for the word “spin.” Almost every review I found seemed to use the word interchangeably.

This is a good thing. And, actually, it's something that MDA could take advantage of, if it so desired. After all, MDA was indeed the originator of the term and it would be good business to make a marketing campaign out of its expertise with spinning. Instead, MDA appears to want to rage against the inevitable with legal action after legal action. Sadly, despite all of that effort, it isn't going to work -- and the company is just, well... spinning its wheels.

Filed Under: bike, generic, genericide, spin, spin bike, trademark
Companies: ebay, mad dogg athletics, mda

Is Twitter Worried About Losing Control Over The Word 'Tweet?'

from the one-of-a-million-things-to-worry-about-when-you're-pushing-$18B-of-'pape dept

IPKat points out a rather interesting concern listed by Twitter in its IPO documents. Apparently, the company is worried about the word "tweet" becoming a generic term.

Among the stated risks was the concern that its trade marks could suffer genericide and become unenforceable. Specifically, Twitter stated in its filing, "[t]here is a risk that the word 'tweet' could become so commonly used that it becomes synonymous with any short comment posted publicly on the Internet, and if this happens, we could lose protection of the trademark." How great is this risk? This Kat has yet to hear anyone refer to short messages posted anywhere other than Twitter as a Tweet.

Like IPKat, I've yet to hear anyone use the word "tweet" as anything other than in Twitter or bird-related contexts. The future may bring some watering down of the term, but it's highly unlikely that "tweet" will become the next "xerox," "kleenex" or "google."

Google genericide is an interesting case, at least as much a product of the search engine's ubiquitous use as anything else. It's definitely less of a mouthful than telling someone you'll "perform an internet search" or other words to that effect. The IPKat points out that Google's genericide was anticipated by the search giant, which made a few clumsy efforts to head it off.

Google comes to mind as a company that faced such a risk as its popularity skyrocketed. It launched media campaigns reminding consumers that they were "searching the web on Google" or "Googling, but only on the Google platform," and they were never, ever, "googling."

Of some comfort to Google (other than its billions of dollars) is the fact that if someone says they're "googling," they're almost certainly doing it "on the Google platform." Google's market share in search is dominant enough that "googling," while being used in a generic way, is actually not a generic term. Googling happens on Google at least two-thirds of the time. Without a doubt, some people may be "googling" using other platforms, and I'm sure that somewhere, at some time, someone has uttered the completely feckless phrase, "I'll google it on Bing." Presumably this speculative person was promptly subjected to a corrective beating by horrified bystanders, unless said conversation took place within shouting distance of Redmond. (In which case, a beating still occurred, but the speech error being corrected was completely different.)

Is Twitter truly concerned that any truncated internet missive will be genericized as a "tweet" in the near future? I would say it's about 100% not concerned about this eventuality. However, the nature of mandatory financial filings like these (along with 10-Qs, 10-Ks, etc.) is that every potentially negative eventuality, however unlikely, must be conveyed to purchasers in order to stave off hordes of angry shareholders wielding pitchforks and lawyers should the unlikely occur and severely devalue their holdings.

Twitter's major problems are the patent battles it faces. Its own patent policy is groundbreaking in terms of allowing the inventors to retain their rights to their inventions (unlike most companies). The added stipulation that these patents cannot be used offensively sets a standard few companies are likely to follow. The concern about the potential cost of patent battles is in the filing as well, and IBM has already decided to coattail ride Twitter's innovation by slapping it with a frivolous infringement suit. Success paints a big target on your back, as Twitter points out in its filing.

...we are presently involved in a number of intellectual property lawsuits, and as we face increasing competition and gain an increasingly high profile, we expect the number of patent and other intellectual property claims against us to grow…

So, will Twitter become a trademark bully? Probably not. (Although its tendency to aggressively control usage of its API is somewhat concerning…) It has real problems to deal with, and if "tweet" goes generic, it will just be sign that it's thoroughly dominated a market -- not an indication that its brand has been weakened.

Filed Under: genericide, trademark, tweet
Companies: twitter