Trademark Law Hits Home When It Messes with My Favorite Restaurant
I'm enough of a geek (well, actually, I'm probably mostly always a geek when any sentence starts out this way) to think that it's always somehow at least a little bit "cool" when real life "LAW" intersects - in a nonthreatening way, mind you - with my everyday life. Which is WHY I simply HAD to write this blog post about the recent change in name of one of my favorite Dublin, Ohio (and now that I know about the larger Worthington location, even more favorite) Central Ohio restaurants.
My Jason's Restaurant & Bar began life in a smallish location on Dublin's main drag that had previously been home to a Bruegger's Bagels or some such enterprise. It quickly became one of my favorites as a lawyer working in Dublin beause of its eclectic menu featuring both Asian cuisines and more traditional American fare, terrific decor, and reasonable prices. Parking was sometimes an issue, but hey you can't have everything and the Worthington location may solve some of those issues.
Unfortunately for Jason's, a competitor was eyeing the territory and decided to move in. Jason's Deli has a federal trademark and thus was able to force Jason's Restaurant & Bar to change its name. Click here for the local newspaper account of the predicament the owner of my Jason's found himself in.
GUEST POST BY CHERYL SCOTNEY
So how can this be? How can an already established local eatery be forced to give up the name it has worked hard to establish in the community to an outsider? For answers, I went to my friend Cheryl Scotney, a Registered Patent Attorney with Standley Law Group LLP. At my request, she agreed to pen the following guest post addressing the general issue this sort of thing raises - although she cautions that she can only surmise the actual sequence of events and actions taken (or not taken) in the particular Jason's incident.
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A GUEST POST BY CHERYL SCOTNEY >>>>>>>>>>>>>>>>>>>
The story is an old one… a central Ohio restaurant opens with its chosen name but the name is not protected by trademark registration. Some years later, after the restaurant is successful and has acquired goodwill in the restaurant name, it is required to change its name. Another restaurant is entering the area with a confusingly similar name. The new restaurant entering the market has obtained federal trademark rights in its name -- many years before the central Ohio restaurant opened. The new restaurant demands a name change by the existing central Ohio restaurant.
This scenario can happen with restaurants or any other new business venture. That is why it is extremely important for small business owners to adequately protect their new business name.
In some recent cases, the small business owner did not perform a federal trademark search or file for federal trademark protection before opening their business. The small business owner may be able to go on for several years with no problem. However, a trademark issue may then arise when the small business owner becomes successful and is thrust into the public eye and/or when a new business with a pre-existing federal trademark registration for a confusingly similar trademark comes to town.
The small business owner (who may no longer be all that small at this point) may be required to change its name or pay legal fees to fight for their business name. A defense to any trademark infringement claim may be that the small business owner was using the mark in Ohio prior to the federally registered entity coming to town. Unfortunately, the defense would not be successful as federal trademark rights that were secured prior to the opening of the Ohio restaurant supersede any trademark rights acquired by the Ohio restaurant. The cost of changing signs, menus, advertising, uniforms and other printed and online advertising is significant. But the most costly is the loss of goodwill that is associated with the business name.
Several recent Ohio cases point to the fact that it is not a good idea to pick your personal name as the trademark or service mark for your company. This only becomes an issue when your small business becomes successful and another company acquires your company through a sale. The sale will most likely include assignment of all trademarks associated with the company. The seller will then be in the position that he/she can no longer do business using his/her own name.
It is also important to file a trademark application in the correct party’s name. Whatever entity is going to be using the mark with the sale of the goods or services is the correct entity to list as applicant. If a person is in the process of filing paperwork to incorporate or set up an LLC, then filing a trademark application should wait until that business paperwork is filed and accepted. This is done to avoid issues of fraud and liability.
Securing Ohio trademark or service mark rights in your company’s name may be of little value in today’s advertising environment. A federal trademark registration is the best means of protection. Unbeknownst to most, an Ohio trademark/service mark registration application requires an applicant to verify that “no other person has a registration of the same or of a confusingly similar trade mark/service mark in the United States Patent Office for the same or similar goods” (Line 10) and that the applicant is the “owner of a concurrent registration in the United States Patent Office of this trade mark/service mark covering an area including this State” (Line 11). Verification of these statements implies that a comprehensive federal trademark search was performed prior to filing the Ohio trademark/service mark application.
A typical comprehensive trademark search performed by a competent trademark attorney costs about $300/mark or if searched through an outside search service, such as CorSearch, the cost is about $600/mark. A trademark search should include a federal search on the exact mark, alternate spellings or similar marks, a search of all 50 states trademark and service mark databases, a search of domain names and a common law trademark search (usually performed on the Internet or in business listing databases).
Cheryl S. Scotney is a Registered Patent Attorney at Standley Law Group LLP located in Dublin, Ohio. She has a degree in Chemistry and focuses her practice on the preparation and prosecution of domestic and foreign patent and trademark registration applications, in the filing of opposition and cancellation trademark proceedings, and in the preparation and prosecution of copyright registration applications. She can be reached at cscotney@standleyllp.com or by phone at (614) 792-5555.
