Imitation, they say, is the sincerest form of flattery. But in the trademark world, imitation is sincerely unwelcome.
And if a business found to have been competing unfairly by mimicking a mark persists in making minor tweaks to that mark, again to edge nearer to a competitor, courts don't flatter. They penalize.
So operates the so-called safe distance rule, which readers familiar with this column will recall my having discussed last fall in the context of a dispute between Innovation Ventures, owner of the 5-Hour Energy mark, and imitator N2G, which sought to market the 6-Hour Energy Shot.
The safe-distance rule vests broad discretion in a court to ensure that the Lanham Act is not frustrated by manufacturers who seek to circumvent injunctions with subsequent modifications. The rule permits courts to issue injunctions that sweep even more broadly than the Lanham Act would otherwise permit against a manufacturer who has not already been found liable for trademark infringement.
A competitive business, once convicted of unfair competition in a given situation, can thereafter be required to keep a safe distance away from the margin line — even if that requirement presents a handicap as compared with those who have not disqualified themselves. In sum, having crossed the line of fair competition, a manufacturer can be viewed with more prejudice by a court, and may be ordered to stand farther back from that line. This is according to the 5th Circuit in Sunbeam Products, Inc. v. West Bend Co.
Why does this matter? More importantly, what exactly does it mean? In IP, LLC v. Interstate Vape, Inc., the plaintiff found out the hard way: The safe distance rule did not offer IP, LLC the remedy it had hoped for.
IP, LLC sells electronic cigarettes, vaporizers and accessories including e-liquid under the 24/7 and 24/7 VAPOR trademarks. Defendant Interstate Vape had previously sold its own e-liquid flavor under the 24/7 mark. Prior to the instant case, IP, LLC had sent Interstate Vape a cease-and-desist letter challenging Interstate Vape's use of the 24/7 mark. The parties settled: Interstate Vape agreed to discontinue use of the 24/7 mark and not use any designation confusingly similar to the 24/7 designation.
After settling, however, Interstate Vape changed the name of the challenged product to 24 Certified. Shortly thereafter, IP, LLC filed suit against Interstate Vape in federal court in the Western District of Kentucky, seeking a preliminary injunction against Interstate Vape's use of the 24 Certified mark.
At the hearing, IP, LLC argued that the court should apply the principles of the safe-distance rule to its case, contending that Interstate Vape should be required to modify its 24/7 mark significantly. But the plaintiff's hopes were fated to go up in smoke.
Originally published in InsideCounsel
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