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A Cautionary Tale in Trademark Protection image

A Cautionary Tale in Trademark Protection

By: Mark Seavy

A recent federal appeals court decision in Rolex’s trademark infringement lawsuit against BeckerTime provides a cautionary tale for IP owners.

While the Fifth Circuit U.S. Court of Appeals found BeckerTime infringed in selling decades-old preowned branded watches containing Rolex’s parts, it didn’t award damages. Instead, it ruled Rolex waited too long in asserting its trademark rights. BeckerTime produced reconditioned customized watches that bore Rolex’s brand but added diamonds, aftermarket bezels, bracelets, and straps.

Indeed, a lower court found that Rolex “should have known” about BeckerTime in 2010 and “no later than” 2013 given that one of its employees wrote the alleged infringing watches were “pieces of junk.” However, Rolex didn’t sue BeckerTime until 2020.

“This case stands out as a reminder that trademark owners who drag their feet in enforcing their rights against infringers may be disappointed when asking a court to award increased damages and obtain injunctive relief,” said Gregory Battersby, Managing Member of the Battersby Law Group. “There are excellent remedies for trademark owners against infringers, but some of those remedies may be unavailable to those owners who wait too long to initiate actions.”

Failing to take action against infringers will weaken a trademark and, importantly, hurt an IP owners’ ability to enforce their rights against future infringers, Battersby said.

Part of enforcing those rights also involves continually using the trademarks, especially in new products that can lay the groundwork for registering new marks.

Zamboni, for example, is a well-known supplier of ice resurfacing machines used in countless skating rinks. The corporate name is so well known that it’s often used generically for resurfacing machines similarly to the way the brand Kleenex is often used interchangeably for “tissues.”

For its part, Zamboni announced a new model, the ZX5, last fall. In addition to simplifying ice resurfacing operations and improving sustainability, the new machine features a design by Pininfarina, an Italian design house known for its work with sports cars like the Alfa Romeo Spider, the Cisitalia, and Lancia Aurelia. It marked the first time Zamboni went outside the company for a design.

The machine, which is expected to debut this fall for the 2024-2025 season, also contains improved troubleshooting and diagnostics. It sells for $150,000 and, globally, fewer than 1,000 machines are expected to sell per year.

“Our licensing program is also a great asset in protecting the mark, as it helps reinforce the protection of our registrations in a number of classes in the U.S. and internationally,” said Michael Zamboni, Engineering Product Development Manager at Zamboni Company, and great-grandson of the company’s founder, Frank Zamboni. “People may casually reference our trademark and the product identifier, but we spend a significant amount of time and resources to make it known that Zamboni is the brand name, not a noun, and we make ice resurfacing machines in connection with that trademark.”

The same protections would typically hold true for theatrical film releases, including the likes of the recent Warner Bros. film Wonka. Yet that didn’t prevent House of Illuminati from launching a non-licensed Wonka-inspired “experience” in Glasgow. Billed as an immersive “celebration of chocolate,” the event fell short of the film—and of the reportedly AI-produced marketing materials—and was cancelled after children were left in tears at a sparsely decorated warehouse.

And while most unauthorized pop-ups are more successful than this recent Wonka-themed offering, their continued proliferation means licensors must decide how (and how soon) to enforce their trademark rights in response.

“You shouldn’t overstate your connection to the brand owner and can’t imply a connection to a brand that doesn’t exist,” said Jed Ferdinand, a Partner at the law firm Meister Seelig & Fein. “You should not use a trademark owner’s collateral and photos to help sell something. That implies a false association when the company has no right to that property.”

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