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6 David & Goliath Trademark Disputes

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Every businessperson would agree that trademark infringement is a serious issue. But when a multi-million dollar corporation goes after a mom-and-pop store, you can't help but root for the underdog. Most of the time, David doesn't stand a chance against a Goliath of the industry, but here are a handful of cases where the little guy fought back and didn't end up empty-handed. And sometimes, against all odds, he even wins.

1. Microsoft v. MikeRoweSoft

At 17 years old, Michael Rowe started his own website design company. Looking for a catchy name for the business, he decided to create a parody of computer software giant Microsoft using a variation of his own name. Rowe purchased the URL

The Bill Gates empire caught wind of the site and threatened to sue for trademark infringement. To avoid litigation, they graciously offered Rowe $10 to reimburse the expenses incurred in buying the web address. When the story started hitting online news sources, the outcry from average web surfers was intense. A defense fund was set up in Rowe's name and people donated around $6,000 to help him fight the power.

After the online commotion died down, Rowe began to realize just how much was at stake if he saw this case through. His measly $6,000 was nothing compared to the billions Microsoft had at its disposal. And should he lose, Rowe would be responsible for the court costs of a team of Microsoft lawyers, a fee he'd be struggling to pay for the rest of his life. He began to wonder if he should just take his $10 and throw in the towel.

However, the bad press Microsoft received was enough to make them sweeten the deal. In the end, Rowe handed over the website in exchange for Microsoft Certification training, a trip for his family to a tech conference in Redmond, Washington, assistance to set up a new website, and an Xbox videogame system.

2. Burger King v. Burger King

burger-kingBack in the early 1950s, Gene and Betty Hoots bought the Frigid Queen ice cream stand in Mattoon, Illinois. A few years later, they expanded to a new building, where they sold burgers and fries. When looking for a name for this new venture, it was suggested that a queen needs a king, so they called the business "Burger King." They registered the name with the State of Illinois in 1959, giving them exclusive rights to the moniker in the Land of Lincoln.

However, there was another Burger King you might have heard of that was busy building three dozen burger joints all across the South. Thanks to this success, they expanded into the Midwest and, in 1961, opened a restaurant in Skokie, Illinois, followed shortly by another in Champaign, Illinois, just an hour north of Mattoon. By 1967, Burger King Corporation had opened 50 locations across the state.

After years of legal back-and-forth between the companies, Gene and Betty Hoots finally sued the Burger King Corporation in an effort to stop them from using the name Burger King in Illinois. However, because the Home of the Whopper was by then a nationwide chain, the corporate giant was allowed to keep the name.

But that didn't mean the Hootses had to change the signs on their building. The courts ruled that they owned the exclusive rights to the name Burger King within their business region, legally defined as a 20-mile radius around town. To this day, if the other Burger King wants to open a location there, they have to pay the Hootses to use the name.

3. The North Face v. The South Butt

winkelmann_southbuttA few years ago, while walking the halls of his St. Louis-area high school, Jimmy Winkelmann noticed a disturbing trend—every kid in his class was wearing the same fleece jackets from popular clothing company The North Face. Frustrated by their conformity, Jimmy came up with a parody clothing line, The South Butt, and began selling sweatshirts out of a local drugstore. Whereas The North Face's logo is an abstract drawing of Half Dome, the famous granite feature at Yosemite Park, The South Butt's logo is based on the famous feature we all have. And while North Face's ads suggest you "Never Stop Exploring," the South Butt encourages you to instead "Never Stop Relaxing."

While some might think Winkelmann's idea is good for a laugh, not everyone finds it so funny. In August 2009, The North Face sent The South Butt a cease and desist letter in an attempt to stop the parody clothes from being produced. Undeterred, Winkelmann and his lawyer are planning to file for a declaratory judgment, which they hope will give them the right to move forward and get The South Butt products into retail stores in time for Spring.

The actions taken by The North Face have actually drawn more attention to The South Butt and its website, During the first few years he was in business, Winkelmann sold a total of around two hundred pieces of South Butt merchandise. Thanks to The North Face, though, sales for this November alone have reached over $100,000.

4, 5 & 6. McDonald's v. McEverybody

If you want to use the name Mc-anything for your business, think again. There's a good chance Ronald and his lawyers will be on you like barbecue sauce on a McNugget. Here are just a few of the many trademark infringement cases McDonald's has brought against small businesses that dared use some variation of "Mc" in their name:

"¢ Back in 1996, if you were looking for a quick lunch in Buckinghamshire, England, you might have stopped at Mary Blair's McMunchies, a small corner deli whose name combined slang for snack food and the owner's Scottish heritage. McDonald's threatened to sue her, saying the "Mc" prefix was a registered trademark. To the rescue came Lord Godfrey MacDonald, head of the MacDonald Clan of Scotland, who started a campaign against the corporation's harassment of businesses using the Mc prefix. McDonald's received enough bad press that they eventually dropped the case against McMunchies as well as many other small McBusinesses in the UK.

"¢ Danish business owner Allan Pedersen tried MacAllan whiskey while visiting Scotland. He liked it so much he decided to name his hot dog shop after it and even got permission from the distillery to do so. McDonald's, though, felt the name was a little too similar to their own, so they sued. After repeated trials and appeals, the case wound up in Denmark's Supreme Court, which ruled that Pedersen could keep the name, citing that no one would mistake the one-man hot dog shop with a multi-national hamburger franchise.

mccurry2"¢ In 2001, an Indian restaurant in Malaysia opened, calling itself McCurry. The owners said they chose the name as an acronym of sorts for one of their signature dishes, Malaysian Chicken Curry. Shortly after, McDonald's sued, citing not only the Mc-name, but also that the restaurant's red sign with white block lettering was a little too close for comfort. After eight years in court, in September 2009, the Malaysian Court of Appeal declared that the two businesses were diverse enough that customers would not confuse them, allowing McCurry to keep its name. Now that the owners of McCurry's have won their case, they're thinking about starting up a franchise.

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The Secret to the World's Most Comfortable Bed Might Be Yak Hair
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Savoir Beds laughs at your unspooling mail-order mattresses and their promises of ultimate comfort. The UK-based company has teamed with London's Savoy Hotel to offer what they’ve declared is one of the most luxurious nights of sleep you’ll ever experience. 

What do they have that everyone else lacks? About eight pounds of Mongolian yak hair.

The elegantly-named Savoir No. 1 Khangai Limited Edition is part of the hotel’s elite Royal Suite accommodations. For $1845 a night, guests can sink into the mattress with a topper stuffed full of yak hair from Khangai, Mongolia. Hand-combed and with heat-dispensing properties, it takes 40 yaks to make one topper. In a press release, collaborator and yarn specialist Tengri claims it “transcends all levels of comfort currently available.”

Visitors opting for such deluxe amenities also have access to a hair stylist, butler, chef, and a Rolls-Royce with a driver.

Savoir Beds has entered into a fair-share partnership with the farmers, who receive an equitable wage in exchange for the fibers, which are said to be softer than cashmere. If you’d prefer to luxuriate like that every night, the purchase price for the bed is $93,000. Purchased separately, the topper is $17,400. Act soon, as only 50 of the beds will be made available each year. 

[h/t Travel + Leisure]

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Mike Mozart, Flickr // CC BY 2.0
Fart Gallery: A Novel History of Spencer Gifts
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Mike Mozart, Flickr // CC BY 2.0

When U.S. Army Corps bombardier Max Spencer Adler was shot down over Europe and imprisoned by the Nazis during World War II, it’s not likely he dreamed of one day becoming the czar of penis-shaped lollipops and lava lamps. But when Adler became a free man, he decided to capitalize on a booming post-war economy by doing exactly that—pursuing a career as the head of a gag gift mail-order empire that would eventually stretch across 600 retail locations and become a rite of passage for mall-trekking teens in the 1980s and 1990s.

To sneak into a Spencer Gifts store against your parents' wishes and revel in its array of tacky novelties and adult toys felt a little like getting away with something. Glowing with lasers and stuffed with Halloween masks, the layout always had something interesting within arm’s reach. But stocking the stores with such provocations sometimes carried consequences.

A row of lava lamps on display at Spencer Gifts
Dean Hochman, Flickr // CC BY 2.0

Returning from the war, Adler sensed a wave of relief running through the general population. Goods no longer had to be rationed, and toy factories could return to making nonessential items. The guilt of spending time or money on frivolous items was disappearing.

With his brother Harry, Adler started Spencer Gifts as a mail-order business in 1947. Their catalog, which became an immediate success, was populated with items like do-it-yourself backyard skating rinks and cotton candy makers [PDF]—items no one really needed but were inexpensive enough to indulge in. In some ways, the Spencer catalogs resembled the mail-order comic ads promising X-ray glasses and undersea fish kingdoms. Instead of kids, Adler was targeting the deeper pockets of adults.

Bolstered by that early success, Adler moved into a curious category: live animals. He had small donkeys transported from Mexico and marketed them as the new trend in domestic pets. LIFE magazine took note of the fad in 1954, observing the $85 burros, being sold at a clip of 40 a day, “except for stubbornness, are very placid.”

Burro fever foreshadowed the direction of Spencer’s in the years to come. The Adlers opened their first physical location—minus livestock—in Cherry Hill, New Jersey in 1963, expanding on their notion to peddle unique gift items like the Reduce-Eze girdle, which promised to shave inches off the wearer’s stomach. That claim caught the attention of the Federal Trade Commission, which chastised the company for advertising the device could reduce body weight without exercise [PDF]. The FTC also took them to task for implying their jewelry contained precious metals [PDF] when the items did not.

Offending the FTC aside, Spencer’s did a brisk enough business to garner the attention of California-based entertainment company Music Corporation of America, Inc. (MCA), which purchased the brand and proceeded to expand it in the rapidly growing number of malls across the country in the 1970s and 1980s. (The mail order business closed in 1990.)

Brick and mortar retail was ideal for their inventory, which encouraged perusal, store demonstrations, and roving bands of giggling teenagers. The company wanted its stores to capture foot traffic by stuffing its aisles with items that had a look-at-this factor—a novelty that invited someone to pick it up and show it to a friend. When executives saw specific categories taking off, they “Spencerized,” or amalgamated them. When there was a resurgence of interest in Rubik’s Cubes and merchandise from the 1983 Al Pacino film Scarface, visitors were soon greeted in stores by stacks of Scarface-themed Rubik’s Cubes.

Mike Mozart via Flickr

Apart from its busy aesthetic—“like the stage from an old Poison video,” as one journalist put it—Spencer's was also known for its inventory of risqué adult novelty items. Pole-dancing kits and sex-themed card games occupied a portion of the store’s layout. The toys captured a demographic that might have been too embarrassed to visit a dedicated adult store but felt that browsing in a mall was harmless.

Sometimes, the store’s blasé attitude toward stocking such items drew critical attention. In 2010, police in Rapid City, South Dakota seized hundreds of items because Spencer's had failed to register as an “adult-oriented business,” something the city ordinance required. As far back as the 1980s, parents in various locales had complained that suggestive material was viewable by minors. In 2008, ABC news affiliate WTVD in Durham, North Carolina dispatched two teenage girls with hidden cameras to see what they would be allowed to buy. While they were shooed away from a back-of-store display, they were able to purchase “two toy rabbits that vibrate, moan, and simulate sex” as well as a penis-shaped necklace.

As a possible consequence of the internet, there are fewer incidences of parental outrage directed at Spencer’s these days. And despite the general downturn of both malls and retail shopping, the company bolsters its bottom line with the seasonal arrival of Spirit Halloween, a pop-up store specializing in costumes. Despite only being open two months out of the year, their Spirit locations contribute to roughly half of Spencer's $250 million in annual revenue.

Today, the chain’s 650 stores remain a source for impulse shopping. They still occasionally court controversy over items that appear to stereotype the Irish as drunken oafs or other inflammatory merchandise. With traditional mall locations expected to shrink by as much as 25 percent over the next five years, it’s not quite clear whether their assortment of novelties will continue to have a large retail footprint. But so long as demand exists for fake poop, fart sprays, and penis ring toss kits, Spencer’s will probably have a home.


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