Saturday, July 28, 2012

"Lost Dog Cafe" in Arlington VA goes after smaller coffee shop with similar name in West Virginia; important case for locally-owned small businesses nationwide?

An Arlington VA restaurant has fired off a salvo in a trademark battle that could have far reaching implications for small businesses, especially retail and food service, all over the country.

The Lost Dog Coffee shop in Sheperdstown, W VA (in the Potomac Highlands area, about 75 miles from Washington DC) has received a “cease and desist” letter from attorneys representing the Lost Dog Café in Arlington VA (an immediate suburb of Washington DC), to stop using the “Lost Dog” wordmark.  The Sheperdstown business has used the name without incident for about sixteen years.  The shop is owned by Garth Jannsen.

The Martinsburg, W VA Journal-News (owned by Ogden Newspapers) has a detailed story by Tpni Milbourne,  July 27, 2012, link here.  

There is another story in “Daily Coffee News” here
  
Arlington VA ABC affiliate WJLA has a story on the matter here

The West Virginia store has a petition site here.

The store is located at 134 E German St, right in the center of town, and has a main website here

The Arlington Lost Dog Café is located on Washington Boulevard, in the Westover neighborhood of North Arlington.  In the immediate area there are many medium income garden apartments, but not far away, there are many blocks of upper income homes, mostly valued over $500000 or so.  (I grew up near this area and know it inside out.)   Across the street from it, the Westover Market has recently expanded, adding a restaurant/sports bar and outdoor jazz music venue of its own which has become quite popular in the neighborhood.  But the Lost Dog business itself is quite expansive, with two marked entrances wrapping around a Lost Dog Pizza Deli.  And a couple doors down, the same company owns a similar “Stray Cat” café.  I have eaten at both places and found the basic American fare quite tasty.  There is an issue with sufficient legal parking on the same side of the street.

The Arlington Business has an Internet domain with a similar but still differently-ending root name, here

Today, I drove to Sheperdstown and visited the Lost Dog Coffee, and talked to one customer outside and to the owner.  The controversy is well known on the street in Sheperdstown.  I bought coffee and dessert there, but had to go to a nearby establishment, Betty's (below) , for a full hot lunch.




Is the Arlington business planning to expand in other cities, at least inside Virginia (like to Richmond, Williamsburg, etc.), or other states?  Is it planning a franchise operation?

Had the Arlington business registered its mark with the USTPO?   I did find a LIVE “TESS” record there for “LOST DOG CAFÉ”, filed Sept. 12, 2000, with registration number 2963574, serial 76131160, giving an address of 5876 Washington Blvd, Arlington VA 22205, first use in 1994. I was unable to find a TESS record for “LOST DOG COFFEE”.

Generally, the USPTO will allow entities in different business areas to register the same or similar names, as long as the USPTO does not believe consumers would become confused. 

On the surface, this would sound as though a locally successful restaurant (or retail establishment, boutique, etc.) could decide to expand to other cities, and take legal action against all other similarly named businesses in the nation.  It could even try to set up a McDonalds-style franchise.  There are many popular upscale restaurant chains with franchise names, like Friday’s, Ruby Tuesday, Applebees, Outback, Chili, etc.  

So could this litigation portend the Arlington business going after other “LD”-named businesses across the country.  A look at USPTO shows that there are many.  And I didn’t even look up “Stray Cat”.  (By the way, I’m a cat person.)

On the other hand, in the small business end of the food business, it has been common for there to be many shops with similar names, like various “Tony’s Pizza” shops around NYC that are unrelated.

A judge (state or federal) looking at this case will have to go by the existing statutes and case law. They might have to decide whether elements of the Trademark Dilution Revision Act of 2005 applies.

As someone who subscribes generally to conservative-to-libertarian economic beliefs, I find this case a tough one on the policy level.  The GOP has constantly ranted that any tax increases would hurt small business; but it’s obvious that in many circumstances, the legal environment (often supported by the GOP), as written, would encourage bigger businesses, with economies of scale, to bully the smaller ones out of business (or else to selling out and being run as franchisees rather than locally owned businesses).

And now the Internet complicates the issue, because people generally will expect domain names to match trademarked names, and recent ICANN activity regarding new TLD’s (which the “bullies” could monopolize) complicates things further.

Of course, with this dispute, “I” am not confused by the similar names, but I am an I.T. person with some background in business and law.  I think an “average person” living near one of these businesses would not be confused.  On the Internet, it seems as though the possibility of confusion is greater, as people generally don’t know how to apply context to things the look up by search engines.

I’m afraid that Congress will have to revisit the whole trademark dilution issue again at a policy level, prove to us that it is really serious about protecting small business.


I recall, when living in Minneapolis (1997-2003), there was a trademark fight between Amazon.com and a local bookstore called Amazon. I don't recall how it turned out. 


By the way, a bulletin board inside the Lost Dog Coffee store has some cute sayings, like "Compassion is revolution" and "Politicians and babies both need to change diapers". 


Should "common words" be available for new national trademarks under these circumstances?  Can common words become a legitimate source of brand identity for a previously local business?
    
Outside the Lost Dog Coffee business today, someone from the West Virginia Libertarian Party was performing ballot access petitioning, another process familiar to me from my days in Minnesota.  How ironic!


In the gay community, bars have sometimes used workmarks for national identity, like "JR's", which started in Dallas and spread to many cities.  But other names (like "Saloon") have tended to remain just local. 






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