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Against Monopoly

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Monopoly corrupts. Absolute monopoly corrupts absolutely.





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The Curious World of 'Secret' Trademarks

It is a well known secret that California-based burger chain In-N-Out has a 'secret' menu that is not displayed or advertised at any of their stores. It allows people to order items that are not found on any of their limited menus.

When you order a 3x3 burger, or "Animal Style" burger, In-N-Out service people will know what you are talking about.

However, I have a problem with a judge ruling that such terms are trademarks owned by In-N-Out. [PDF alert. Hat-tip Courthousenews.com]

Even if In-N-Out actually registered a trademark in such terms, a minimum requirement for trademark protection demands that the mark actually be used in commerce. If you deliberately hide a mark from the public, you should lose trademark protections. (And no, simply referring to the terms on a company website should not count. If you don't use the mark on the product or place of business, there is no mark to protect.)

Although I recognize the legitimacy of trademarks to protect against actual consumer confusion in the marketplace, I think the judge blew it on this one.


Comments

Justin, you point out that a trademark must be used in commerce, which I gather means a for-profit business, as opposed to a non-profit organization. Is my surmise correct? The reason I ask is that in 1999 or thereabouts, the Anti-Defamation League's attorney wrote a letter to the Anarchist Anti-Defamation League threatening it with a lawsuit if it didn't stop using that designation. It did this in the early 1960s as well against the Italian-American Anti-Defamation League. (The 1999 letter used to be on the web and could be found with a google search. I don't know if it's still up.)

In view of the fact that Microsoft never sued Peoplesoft, Viasoft, or who knows what other software company using soft in its name (and I'm sure there are other examples, like Delta Homes and Delta Airlines), did the Anti-Defamation League have a good case? Bear in mind that it propbably would have brought a suit in New York, which has whacky courts, to say the least. (I know from painful personal experience 10 months ago.)

The other way of looking at it is that if trademark is to prevent confusion, there can be no confusion if a trademarked term is used in secret.

If someone else uses the term for a similar product:

  1. in secret - then context disambiguates.
  2. in public - then it can't be confusing until/unless In-N-Out starts using their term in public (by which time it's probably too late because they've allowed their mark to become diluted).

Trademark must be regarded as arbitration over naming, not as a grant of monopoly.

I think there also has to be commercial or economic damage shown to the original holder of a trademarked name and it has to be demonstrated that the public would be confused in such a way that there was a loss of some sort. What economic damage the Anarchist Anti-Defamation League inflicted on the Anti-Defamation Leegue is beyond me. In any event I think the latter is a non-profit organization and would have a very weak case.

The Anarchist Anti-Defamation League should have stood its ground IMO. That it didn't is a shameful blot in the history of anarchism.

I'm not so sure whether economics comes into this.

Certainly there can be economic consequences for merchants and customers alike (as well as for impostors passing off, deliberately or otherwise).

The degree of economic advantage or loss may be brought in to determine penalty or reparation, but I wouldn't conclude that trademark is necessarily invalid unless its use is clearly commercial.

The point is "Who made me?", not "How much money am I worth?"


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