A recent ruling has set the stage for a protracted fight between Tiffany & Co. and Costco Wholesale Corp. over whether the terms “Tiffany” and “Tiffany setting” have become generic for a type of engagement ring setting. The case serves as a reminder that brand owners should take proactive steps to protect against the threat of genericide from the outset; the alternative is that brand owners may lose control of their marks entirely.
In February 2013, Tiffany sued Costco in the Southern District of New York for trademark infringement, among other claims, over Costco’s use of the terms “Tiffany” and “Tiffany setting” in connection with the marketing and sale of diamond rings that were not manufactured by Tiffany.1 Costco counterclaimed on the ground that those terms are generic for a type of ring setting or engagement ring style. In denying Tiffany’s motion for summary judgment on Costco’s counterclaim, the court found that Costco’s evidence was sufficient to create a genuine factual dispute as to whether “Tiffany” and “Tiffany setting” have a primarily generic meaning in the minds of consumers.
Marks are classified, in order of descending strength, as (i) arbitrary or fanciful; (ii) suggestive; (iii) descriptive; or (iv) generic terms. A term will be deemed generic – and therefore unprotectable as a trademark – if the relevant public understands the term to describe an item’s nature or class, rather than indicate the item’s origin. As a policy matter, generic names are regarded by the law as free for all to use; to grant someone an exclusive right to use a generic name as a trademark would be functionally equivalent to creating a monopoly in that particular product.2
In an easy case, the term “beer” is generic and can never function as someone’s exclusive trademark when used in connection with beer products; all brewers need to use the term to describe their offerings.
In other cases, terms that were once protectable can become generic over time due to misuse. Notable examples include “thermos,” “escalator,” and “Pilates;” these were once legally protectable trademarks indicating source, but were later deemed to have become the common names for a vacuum-insulated bottle, a moving stairway, and a system of exercise, respectively.3 This loss of distinctiveness is often referred to as “genericide” of a trademark.
Brand owners know that losing the exclusive right to use a mark, particularly when that mark has gained significant market share and consumer recognition, can have devastating financial consequences. For Tiffany, a finding of genericness would mean it can no longer stop other jewelers and retailers from marketing a certain style of engagement ring as “Tiffany.”
Fortunately, there are a number of steps brand owners can take to protect against the potential for genericide from the outset. These steps should become a routine part of brand management.
- Select a distinctive, non-generic name for your product or service. If a company is introducing a new product for which a generic name does not exist, two names should be coined: the trademark and the generic name of the product or service.
- Monitor your own use of your mark. Brand owners should use marks as adjectives rather than nouns or verbs and, whenever possible, the mark should be used along with the item’s generic name. For example: “Ask for KLEENEX brand tissue” is preferred over “Ask for KLEENEX.” Simple measures such as emphasizing the mark in written or visual materials and including a trademark notice symbol or trademark statement (e.g., “BUDWEISER is a trademark of Anheuser-Busch, Inc.”) should be taken for all advertising and labeling. Brand owners should also ensure correct trademark usage by its licensees.
- Monitor others’ use of your mark. Competitors’ generic use of a mark which has gone uncontested can be evidence that the mark has become generic; brand owners therefore have strong incentive to police its competitors’ use. As in the Tiffany case, a mark’s use as a generic term in media and dictionaries can also constitute evidence of genericness. Thus, brand owners should closely monitor such usage and, as necessary, request that the publication cease the generic use or issue a correction. Some brand owners have successfully engaged in educational advertising. For example, Xerox waged an effective campaign to stem genericide by encouraging the public to refer to “photocopying” documents rather than “Xeroxing” documents. In a more recent example, Chanel placed advertisements in trade publications requesting that the industry cease using variations of CHANEL (“Chanel-esque,” “Chanel-ized”) to describe other designers’ collections; only Chanel could use its mark in reference to its own products. Such measures might show a court that a brand owner is actively policing others’ use of its mark.
The Tiffany case underscores the irony that, when a brand enjoys high visibility and marketplace domination, that very success can lead to genericide. But by applying the above strategies, brand owners can effectively protect against the loss of their valuable rights.