Los Angeles Business Law Blog

Many California residents use Amazon Prime to order products. However, a trucking company called Prime Inc. says that Amazon is infringing on its trademark by using the word "prime" on trailers used to deliver goods. The company has filed a lawsuit in the Western District of Missouri seeking financial damages related to the infringement. Specifically, the company claims that it is entitled to three times Amazon's profits or three times the losses that the infringement has caused.

Prime says that it first used the word on trucks 40 years before Amazon did. The company further claims that the word prime is paramount to its marketing message, which could leave it vulnerable if the trademark is not allowed to stand. Although some could claim that Amazon uses the word prime in a different manner, the lawsuit asserts that they are identical in appearance and commercial impression.

The Supreme Court decided in June 2019, that trademarks with foul language would be legally permitted, striking down a long-time ban on the practice. The ban on immoral or offensive language in trademarks affected companies in California and many other states, but the court decided that this ban violated the constitutional free speech rights of Americans. The restriction on trademark language had been in place since 1905.

All nine justices agreed that the ban on foul language trademarks was a constitutional violation. Several of the justices, however, wrote a separate opinion stating that a ban on scandalous language could be permitted. In 2017, the court struck down a similar ban on disparaging trademarks when they decided on a case involving a rock band with an offensive name. The Patent and Trademark Office said that it is evaluating the latest decision.

Businesses in California may want to pay close attention to their insurance coverage, especially if they will be dealing with intellectual property issues. This is illustrated in one case where a company sought coverage from their insurer for a lawsuit that accused the firm of infringing a trademark. However, the insurance company said that its policy did not provide coverage for intellectual property disputes, disclaiming its responsibility to defend the case. The company's case was dismissed after the insurance company demonstrated exclusions in its business liability and technology policies that addressed trademark infringement cases.

The company claimed that it was entitled to receive coverage for its legal defense under its coverage for personal and advertising injury. The description of this listed eight different situations, including alleged copying of an advertisement. However, an endorsement on the company's policy excluded nearly all of the eight different allegations, including copying in advertising and associated trademark infringement. In addition, the company also sought to use its technology policy to obtain coverage. However, the court accepted the insurer's argument that this policy covered technology services provided to others and excluded all intellectual property claims.

California-based band Guns N' Roses is suing a brewery in Colorado over a menu item that bears the name "Guns N' Rosé" ale. The band claims the name the establishment is using for its ale creates the false impression that they are somehow associated with it. The brewery at the center of the matter attempted to trademark the name for its product in 2018, which is what ultimately attracted the band's attention.

The trademark infringement litigation related to this matter was initiated after the brewery was contacted by the band's manager. The business subsequently withdrew their trademark application. However, they continued to sell the rosé ale. The brewery also sells merchandise with the name that's similar to the one that's been used by the band for more than 30 years.