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Trademark Coexistence Agreement

National Mall in August

National Mall in August

A trademark coexistence agreement is an agreement between two parties about their respective use of the same or similar trademarks.  They generally allow two trademark owners to use identical or similar marks, usually in a manner designed to avoid consumer confusion.  They are helpful in several situations.  A trademark coexistence agreement can be used to resolve disputes between two parties, or to prevent potential disputes, or to overcome rejections by the Trademark Office.

Trademark Coexistence Agreement to Resolve Disputes

Trademarks are fundamentally intended to prevent consumer confusion.  When two marks are the same or similar, the public can be confused about who the source of the product or service is.  This can flare as a trademark infringement dispute, where one party sues – or threatens to sue – the other party for having a trademark which is too similar to its own.

If the parties can resolve this dispute, they will usually execute an agreement.  The agreement might require one party to change its name, or it might allow that party to continue using its name, perhaps for a short period of time or maybe even permanently.  For those latter two options, a trademark coexistence agreement – or at least a coexistence provision – will be used.

To Prevent Disputes

Sometimes, before a client files its trademark application, it will conduct a pre-filing clearance search to see if there are other similar or identical marks already registered or used.  This allows the client to evaluate the risk of proceeding forward.  Occasionally, a trademark applicant will proceed forward even though there is a similar trademark already registered, because the applicant feels the mark is different.  In that event, the applicant will sometimes proactively reach out to the prior trademark registrant and request a trademark coexistence agreement to potentially head off even the unlikely risk that consumers will be confused.

To Overcome Rejections

When a trademark application is filed, the Trademark Office examines it before it will register the trademark.  During examination, the Office will reject the trademark application if it finds any registered marks which pose a likelihood of confusion.

The rejection will stand, and the application will become abandoned, unless the applicant responds and overcomes the rejection.  Often times, the applicant can present arguments based on case law or evidence.  Sometimes, however, there may be reasons to present other arguments.

A trademark coexistence agreement is persuasive evidence in response to a rejection.  While not completely binding, the law gives significant weight to a trademark coexistence agreement.  Examiners will generally, but not always, withdraw a rejection the applicant has a trademark coexistence agreement.  However, Examiners will refuse to accept those agreements when they fail to address real conditions and concerns.

Trademark Coexistence Agreement Elements

The Trademark Office’s desire to see “real” agreements reflects the need for a trademark coexistence agreement to be more than just an agreement to use two similar marks.  It must actually address the likely concerns of not just the trademark owners but the consumers as well.  For instance, it could discuss concerns such as:

  • The level of experience and familiarity the two parties have with the respective industry and their customers
  • The similarities and differences in the marks’ sight, sound, and appearance
  • The similarities and differences in the goods and/or services
  • The similarities and differences in the customers and channels of trade
  • Restrictions on any future trademark filings of the parties
  • Amendments to the trademark application or registration details
  • Geographic restrictions on the parties’ respective uses
  • Goods and/or services restrictions on the parties’ respective uses
  • Industry restrictions on the parties’ respective uses
  • Any limitations to how the parties’ trademarks will be displayed or styled
  • Any disclaimers that either of the parties should use
  • Any restrictions on how the parties’ goods and/or services may be advertised
  • Any restrictions on the channels of trade for the parties’ goods and/or services
  • What the parties will do in the event of actual confusion

Trademark coexistence agreements are not the right solution in all situations.  In some cases, a trademark coexistence agreement can weaken a trademark owner’s rights and should be avoided.  Speak with a local trademark attorney if you think you need a trademark coexistence agreement or have been approached by someone requesting you to sign one.

Limitation of Liability Clauses – You Definitely Want One, But Why?

Over El Paso and Ciudad Juarez

Over El Paso and Ciudad Juarez

Many sophisticated business contracts contain limitation of liability clauses. By contractually limiting your liability, you can better plan for your level of exposure in the event something goes wrong. Limitation of liability provisions can be helpful risk management tools if drafted correctly.

First, limitation of liability clauses often limit the amount of liability to which you can be exposed in connection with the contract at hand. This can be done by specifying an actual dollar amount as a liability maximum, but such a limitation may also expressed as a fraction of the amount exchanged in the contract. For example, parties to a licensing agreement may provide that the liability of either party will not exceed the amount of royalties earned during the most recent year during the contract term.

Additionally, limitation of liability clauses frequently limit the type of liability to which a party can be exposed. This is commonly done by prohibiting either party from incurring special, consequential, incidental, punitive, or indirect damages. Limitation of liability clauses may also exclude damages for lost profits or interruption of business. Essentially, the goal is to limit a party’s ability to collect with respect to any damages or other losses that are not directly caused by the party at fault. For example, imagine that a plumber tasked with installing new sinks in a restaurant bathroom accidentally causes a pipe to burst and floods a significant portion of the restaurant. The restaurant must close for 2 days while the flooding is mitigated. If the plumber has excluded the restaurant’s ability to collect lost profits or other indirect damages, the plumber may be responsible for fixing the broken pipe and cleaning up the water, but she will not be liable for any profits lost by the restaurant resulting from the 2-day closure.

In negotiating limitation of liability clauses, note that sophisticated parties often ask for “carve-outs”, a.k.a. certain bad acts to which the limitations will not apply. The most common carve-outs are gross negligence, fraud, and willful misconduct. However, a party may also ask for more specific carve-outs if they are particularly concerned about certain risks, like intellectual property infringement, breaches of confidentiality obligations, or security incidents.

Finally, note that certain liability limitations may be prohibited by law, so you should consult with your attorney to determine whether there are any restrictions on limitations of liability in your jurisdiction that might be applicable.

Sovereign Immunity for Copyright Infringement

Pictographs by the Fremont People, Jones Hole Creek, Utah

Pictographs by the Fremont People, Jones Hole Creek, Utah

An author is petitioning the Supreme Court for the second time, arguing that Texas A&M should be liable for copyright infringement after copying an important page from his book.

The case raises questions that the Court has touched upon before:

  • Are the Aggies protected by sovereign immunity?
  • Are the states fee to commit copyright infringement without penalty?
  • Did Texas make an unauthorized taking of the copyrighted work?
  • Is copyright infringement never a taking?
  • Is there any other type of liability here?

In 2020, the court decided Allen v. Cooper, holding that sovereign immunity protected states from copyright infringement claims. This case affected the author’s first petition to the Court.  Now he is trying again, challenging sovereign immunity for copyright infringement and its relationship to the Constitution.

Sovereign immunity is the sometimes qualified protection given to states to infringe on the rights of others. Policy decisions underpin much of sovereign immunity.  But should it allow a state entity – like Texas A&M University – to copy someone else’s hard work and creative expression?  Should Texas A&M be subject to copyright infringement despite the policy?

More available here at Patently-O.

Crumbl Cookies Trademarks

Riding up to Big Mountain, UT

Riding up to Big Mountain, UT

Earlier this year, Crumbl Cookies sued two competitors.  Crumbl started in Logan, Utah, not far from where I happen to be writing this today in Bountiful, Utah.  Crumbl sells large ornate cookies in pink boxes and has a menu that rotates periodically.  Crumbl feels that other companies have tried to jump into the same space, trade off their goodwill and reputation, and compete unlawfully.

Crumbl sued Crave Cookies and Dirty Dough for trademark infringement, trade dress infringement, and unlawful competition.  The CEO of Dirty Dough published the trademark complaint on his LinkedIn and Facebook pages, so this post addresses that action only.

Essentially, the complaint boils down to Crumbl’s claim that “Dirty Dough … sells and promotes cookies using packaging, decor, and presentation that is
confusingly similar to Crumbl’s established and successful trade dress and brand identity.”

Crumbl claims it has certain intellectual property rights in its business, including:

  • Delivery services for its scratch-made gourmet cookies
  • Packaging in oblong pink boxes that have “no extra space”
  • The color pink
  • The CRUMBL COOKIES logo, featuring a “whimsical, outlined-shaped drawings, including a cookie with a bite taken out of it”
  • Seamless ordering expiring on the Crumbl app
  • Weekly rotating menus

Crumbl will have to establish that it actually has these rights, which will involve arguing that others don’t.  One challenge for Crumbl will be differentiating and delineating its packaging, cookie styles, menus, etc. from those of other cookie companies.  This could be quite difficult.  It will involve defining the market, defining the products, defining the customers, identifying the features or characteristics that make its product unique among its competitors, and other things that are highly fact dependent and may require a great deal of expert work.

Crumbl will then need to argue that Dirty Dough is infringing its rights.  The complaint makes a first pleading on this, for example, by suggesting that the two companies use the same channels of trade including storefronts, websites, and social media accounts.  Of course, for that example, what company doesn’t sell through those channels?  Crumbl attempts to paint the companies as similar because they both use pictures on their respective Facebook pages showing cookies laid flat, shot from above.  Crumbl argues that the two companies both use a cookie image with a bite taken out.  Crumbl even presents in its complaint side-by-side photos of cookies decorated in a similar fashion, such as with a white swirl pattern, chocolate candy bar, or sprinklers:

Crumbl Cookies compared to Dirty Dough cookies

Crumbl on the left, Dirty Dough on the right

These are all going to be difficult arguments.  Certainly, Crumbl has grown quickly and become well-known in Utah.  However, whether it has the sort of fame and exclusivity necessary to exercise the rights it claims it has is an entirely other story.  The case will take a great deal of time to develop, and will probably twist and turn as evidence is exchanged, experts testify about cookie marketplaces and packaging practices, and the parties focus on some arguments more than others.  At this stage, it is far too early to tell what will happen, but this case and the Crave case do establish one thing: they show would-be competitors that Crumbl is not afraid to go to the mat.

Trademark Assignment

Boston Public Library

Boston Public Library

Trademarks are assets of a company. Just like any other asset, they can be bought and sold. However, unlike other assets, trademarks cannot generally be sold by themselves. In other words, a trademark must be sold with something else, something which is related to the trademark. A trademark assignment is the typical mechanism by which a trademark is transferred.

Proper Trademark Assignment

A trademark assignment is either or both of the act of transferring a trademark and the document by which the trademark is actually transferred. Companies will transfer a trademark when they are bought or acquired, or when a specific service or product line is sold or spun off. A trademark assignment actually changes the ownership of the trademark from the first party to the second.

A trademark assignment, if done properly, will usually identify and state a few things. First, the document will identify the trademark itself, usually with a serial or registration number (if a trademark application has been filed or granted), the mark itself, and often with the list of goods and/or services with which the mark is used. This information is often sufficient to clearly identify a trademark. For common-law trademarks – trademarks which are merely used but not filed at the USPTO – the trademark assignment may only be able to identify the mark and its corresponding goods/services. If possible, additional information can be included describing the first use of the mark or geographic areas of use, but one must be careful not to identify that information in a way that unintentionally limits the scope of the trademark’s rights.

The trademark assignment should also identify whether or what other assets, or products, or goodwill is being conveyed with the trademark. The transfer cannot occur in isolation. For example, if Nike were to sell its Air Jordan trademark to Adidas, it could not just give the trademark to Adidas in exchange for a boatload of cash; it would have to also move its inventory of shoes, or plans for designing the shoes, or the Nike division and all the workers responsible for designing Air Jordan shoes.

Improper Trademark Assignment

A trademark assignment can be improper for a number of reasons.  For example, someone may attempt to improperly assign an intent-to-use application, may assign the trademark without a written document, or may not actually have the rights to assign it.  One problem that can arise is a naked assignment. A naked assignment is a transfer of a trademark without any accompanying goodwill. In the above example, if Adidas just sent money to Nike for the ability to use AIR JORDAN and for nothing else, that would be a naked assignment and presumed invalid.

If a trademark assignment transfers a trademark from a company that no longer exists, that assignment can be invalid. Depending on the state law, some companies have the ability to transfer assets during a limited wind-down period after dissolution of the company, but those laws vary from state to state or may not allow it all. Even the local law forbids a non-existent company from transferring a trademark, the conveyance may be invalid. In some cases, clawback, retroactive, or nunc pro tunc agreements might be a possibility, but those should be carefully researched and approached with great skepticism.

Separate Trademark Assignment Documents

When conveying a pending or registered trademark, it is best to record the trademark assignment with the USPTO. Recording at the USPTO makes the assignment public record. As such, sometimes parties may want to draft a trademark assignment as a stand-alone document. This allows those parties to record the trademark assignment by itself without making all the details of a much larger deal public.

For example, if Nike were acquiring Under Armor, there would be hundreds of pages of agreement details covering purchase price, debt obligations, transition periods, stock purchases, employee handling, etc. The vast majority of these details would be irrelevant to the transfer of the trademark, and neither company would probably want to make those details public (and likely, the agreement would have a confidentiality clause preventing those details from being made public). To still be able to record the trademark assignment, the lawyers would put the assignment in an exhibit. The exhibit would probably be only one or two pages and would not contain any details regarding the bigger detail. The lawyers could then file only that particular exhibit with the USPTO while maintaining the rest of the agreement in confidence.

Is The Disney Font Copyrighted?

I have been in Boston the past week, and while visiting Faneuil Hall, my family noticed a storefront sign that felt familiar, shown at right.

Faneuil Hall is a nearly three-hundred-year-old building that a rich merchant, Peter Faneuil, had built to house various merchants.  This “Cradle of Liberty” was a meeting location for patriots in the years before the Revolutionary War.  Atop the Faneuil Hall is/was a golden weathervane in the shape of a grasshopper, apparently a good luck imitation of the grasshopper weathervane above the Royal Exchange in London.

Which brings us to the storefront name, Grasshopper Creamery.  The restaurant itself is gone now; I assume this place sold ice cream and fudge or something similar to tourists like me.  I have no idea why it is gone, but I suspect it was not because of intellectual property infringement.

The storefront sign font clearly is the Disney font.  Or a Disney font.  My wife immediately said, “hey, that looks like Disney’s lettering” when she saw the sign.  And it does.  The A, S, and E in the word signs look very similar.

So, is this trademark infringement?   Probably not.  Without doing something more, trademark rights do not attach to a font set, and they do not attach to particular letters such that the use of a similar font on other letters would constitute trademark infringement.  In other words, Disney’s use of the above trademark for ice cream and other food services would not create such strong rights that it could leverage them against a company with an entirely different name like GRASSHOPPER.

But, is it copyright infringement?  This question is tougher to answer.  To be clear, using a font for ten letters (WALT DISNEY) does not create ownership rights in a full set of 26 letters scripted in that font.  In fact, using a font for ten letters as a name (like WALT DISNEY) does not even create copyright rights in that name, because copyright protection cannot substitute in short phrases in names.

Then is there any infringement, any protection at all?  Potentially.  Typographers do protect fonts with copyright.  When an artist develops a new font, he or she can protect it and can register it for official protection with the US Copyright Office.  This gives the artist strong rights and makes it much easier to license to typesetters, printers, artists, and software companies.  Disney may have done this with its font.  If so, it alone would have the right to use those protected letters, and it alone would have the right to license the use of those letters.  In some cases, fair use can allow permissive use, but those circumstances are specialized, limited, and almost certainly would not cover storefront signage for a commercial enterprise.  I am not certain as to whether Disney did copyright its font set, so this question remains unanswered in my book.

NDAs and Compelled Disclosure

Non-Disclosure Agreements and contract clauses involving confidential information probably look very familiar to those involved in the business world.  It may seem like no big deal to agree to keep another party’s information confidential – you have standard policies and procedures in place to prevent unauthorized disclosures and all of your employees are required to sign their own NDAs.  However, what happens if you receive a subpoena or court order requiring that you disclose the confidential information of a third party?  Depending on what your contract says, you could be on the hook for an expensive response.

Overlooking the 40th St Trailhead in Phoenix

Overlooking the 40th St Trailhead in Phoenix

Most NDAs and confidentiality clauses expressly provide that the recipient of confidential information is permitted to disclose that information if it is required by law, whether due to a subpoena, court order, or other type of compelled disclosure.  Many such clauses also provide that in the event a recipient is legally required to disclose information, the recipient must first provide the party who had originally disclosed the information with notice so that they can determine whether to challenge the compelled disclosure.  It is customary for the agreement to expressly state that if the disclosing party wishes for the recipient to challenge the compelled disclosure, the disclosing party must do so at their own cost and expense or reimburse the recipient for their related expenses.  This prevents the recipient from having to incur its own legal fees to contest the disclosure of information that isn’t its own.

However, what happens if the challenge is unsuccessful?  Alternatively, what if the disclosing party doesn’t object to the compelled disclosure?  This is where things get tricky.  The recipient of the confidential information will then need to determine how to respond to the order requiring disclosure.  To do so properly, the recipient will almost certainly need the advice of counsel to determine what information must be disclosed, whether any information should be redacted, and to properly label, process, and produce the information.  Depending on how much information is responsive, the recipient could be on the hook for tens of thousands of dollars in legal fees simply by virtue of having access to a third-party’s information.

Accordingly, if you are about to sign an NDA or confidentiality clause in anticipation of your receipt of a significant amount of another party’s confidential information, review it carefully to determine what your obligations will be if you are legally compelled to disclose the confidential information.  If the agreement is not clear about who will be responsible for expenses incurred in connection with challenging the court order or otherwise disclosing information as required, consider amending the agreement to clarify that the disclosing party will be responsible for paying all related expenses in connection with the recipient’s response to the compelled disclosure.  And best practice is to seek the advice a competent local corporate attorney who can advise on you on the specific consequences and risks of the NDA.

Electronic Trademark Registration Certificates

The Trademark Office will soon start issuing electronic trademark registration certificates instead of paper ones.

The Trademark Office has for years created an electronic registration certificate and mailed a paper version, which has a decorative stamp and ribbon. After June 7, 2022, if trademark owners want a physical copy of the registration certificate, they will have to specifically order one and pay a $15-25 fee.

The Trademark Office has been trying to modernize its processes. The trademark offices of many other countries around the world have issued only electronic trademark registration certificates. The USPTO now harmonizes with those practices.

The Trademark Office also claims that “many of our customers indicated that they would prefer to receive their electronic trademark registration certificate in a digital format rather than as a paper certificate.” I find this a bit hard to believe because the digital format has been available for over a decade at an easily-accessible, public website. Perhaps customers have complained that they don’t want the paper certificate because it is redundant. I have actually found the opposite, that clients do want the paper copy and sometimes want additional copies for display.

The Trademark Office also claims this will increase the speed with which registration copies are issued. I’m not sure this is true either, as electronic trademark registration certificates are already available online the day they issue – the paper copies just come in the mail a week or two later. Rather than making the process faster, the Trademark Office just eliminated a step at the end. It should, however, have a slight environmental impact. The Trademark Office issues about 400,000 trademark registration certificates a year, which is at least some paper savings.

Applicants who file applications after June 7 will have to order paper registration certificates and pay a fee. If they want a one-page “presentation copy” on heavy paper with a gold foil seal, the government fee will be . If they want a certified copy – used in court or in foreign trademark office – the fee will be $15. A presentation copy is not a certified copy. Certified copies are officially stamped and issued, while presentation copies are essentially just ornamental.

Receiving a Trademark Final Office Action

Arizona Snowbowl Ski Resort above Flagstaff

Arizona Snowbowl Ski Resort above Flagstaff

Trademark applications are examined after they are filed.  This is part of the trademark prosecution process, and it sometimes results in an initial refusal, or “office action.”  Office actions are simply official letters from the Trademark Office.  The Trademark Office uses them to communicate about issues that have to be resolved in an application. If you receive multiple office actions, one will be considered a final office action.

When any office action issues, you have an opportunity to respond.  Under current law, you have six months to file a response.  Fail to file in that time, and your application will abandon.  Often the issues in an office action can be resolved fairly straightforwardly.  Sometimes, a quick phone call to the Examiner is enough.

Occasionally, though, the issues raised are more serious obstacles, and in some cases, one response may not be sufficient.  If your initial response does not resolve the issues in the office action, the Trademark Office will typically send a second office action.  A second office action usually is a “final office action.”

The Trademark Office sends a trademark final office action when the issues are ones that were presented at least once before and when you at least had a chance to resolve them.  There are a limited number of options for responding to a final office action:

Request for Reconsideration

One option for responding to a trademark final office action is submitting a request for reconsideration.  This is essentially a second bite at the apple.  When you file a request for reconsideration, you can present new arguments and evidence to try to convince the Examiner that you are right.  If you file a request for reconsideration and the Examiner does not side with you, the application will become abandoned unless you take further action.

If you file the request early in the response period, then the Examiner might return the denial before the six months is up.  If so, then you can potentially file a notice of appeal to prevent your application from abandoning. The Trademark Trial and Appeal Board (“TTAB“) hears and decides appeals.

However, if you file the request late in the response period, the Examiner may very well return a denial after your six months has expired.  You will not have to file anything else in the application at this point, and it will abandon.

Because of these timing concerns, some applicants file a notice of appeal when they file a request for reconsideration.  This assures them an escape route: if the Examiner denies the second argument, then they will at least have one last shot with an appeal.  And, typically, when a notice of appeal is filed together with the request for reconsideration, the TTAB will actually suspend the appeal to give the Examiner a chance to review first.  After all, if the Examiner reviews it and agrees with you, then it saves the TTAB considerable time.


An appeal takes the case off the Examiner’s desk and asks that a panel of administrative judges at the TTAB review it.  To file an appeal, you must first file a notice of appeal and then follow-up with an appeal brief.  The Examiner gets a chance to file a brief in response to yours.  You then have the option to file a reply brief – a final brief that address the Examiner’s brief.  Once the case is fully briefed, the TTAB then considers all of the briefs and the evidence of record.  It renders a decision.  The TTAB frequently affirms the Examiner, so you must pursue an appeal with caution and care.  If the TTAB disagrees, your only option to save the application is to further appeal the decision into the federal court system.  If the TTAB agrees with you, however, the case will be returned to the Examiner with instructions to allow the application to continue through prosecution.

Design Patent Application Priority Claims

Snowbasin in Clouds, Utah

Snowbasin in Clouds, Utah

Patent applications possess priority claims to couple them to other patent applications.  This often arises when a non-provisional utility patent application claims priority to a provisional application.  The provisional application is a “temporary” filing but can establish a filing date to which the later-filed non-provisional or “real” patent application claims priority.  If the priority claim is good and valid, then the later-filed non-provisional application is considered to have been effectively filed as of the provisional application’s filing date.

Priority also occurs when a later-filed non-provisional utility application is connected to an earlier-filed non-provisional utility application.  The later-filed app may claim the same subject matter or may present new subject matter.  Filing non-provisional applications in this way builds a “family” of patent applications with parent and child applications.  Provisional applications are often the first applications in such families.

While utility patent applications can be strung together to build these families, design applications are more difficult to incorporate.  A design patent application primarily presents a set of drawings as both the disclosure and the claimed coverage, but utility applications rely on both detailed written description and drawings.

By law, a design patent application cannot claim the benefit of a provisional.  That doesn’t mean, however, that an applicant cannot attempt to claim priority to a provisional application.  An applicant could certainly make a priority claim in the design application.  I have seen instances where the Office technically recognizes it by listing the provisional as a parent in the continuity information section of the Patent Office online portal.  But the priority claim is still wrong and invalid, the Patent Office online system just doesn’t realize it.

37 C.F.R. § 1.78 is clear: (a) An applicant in a nonprovisional application, other than for a design patent, … may claim the benefit of one or more prior-filed provisional applications under the conditions set forth in 35 U.S.C. 119(e) and this section.

MPEP 211 further plainly states: “Design applications may not claim the benefit of a provisional application under 35 U.S.C. 119(e). See 35 U.S.C. 172.  Thus, where a design patent application claims benefit under 35 U.S.C. 120 to an intermediate nonprovisional utility patent application that directly claims the benefit of a provisional application, the design application cannot claim the benefit of the filing date of the provisional application.”