Don Park says he had never heard of In-N-Out Burgers when he named his La Mirada video store nine years ago. But he wishes he had.
Given what he knows now, the 30-year-old Yorba Linda man said, he would have steered clear of the moniker In-N-Out Video & Games and avoided more than a year of hassles with the fast-food chain, which has been pressing him to change his shop’s name on grounds it unfairly taps into the restaurant’s popularity and muddles consumer identification with its trademark.
“I’m tired of all the headache and stress,” Park said of the letters, phone calls and legal actions the dispute has touched off.
Park is one of at least five business owners to become entangled in the burger chain’s vigorous trademark protection efforts in the last year. Three agreed to change their names at the company’s behest, and a fourth consented only after it was named in a trademark infringement lawsuit. Park has been named in a similar suit, but he and Arnold Wensinger, counsel for In-N-Out Burgers, said they hope to settle the matter without going to trial.
The company’s efforts are part of a growing nationwide trend toward more aggressive trademark policing, said Betty Jo Toccoli, president of the California Small Business Assn.
Many companies have used Internet search engines to locate small businesses using similar names. “With global communications and the world economy, it’s easier to catch someone using your name,” Toccoli said.
In Park’s case, attorneys for In-N-Out Burgers needed to look no further than the telephone book.
Although the name of Park’s business differs from the restaurant’s--he uses a backward “N” on all signs, paperwork and labels--Michael Smith, the attorney who filed the lawsuit against Park, said the hamburger chain believes the name is close enough to warrant action.
“There’s no way I would have picked that name if I had known about all this,” Park said from his Imperial Highway store. “It’s not worth it.”
Park wants any settlement to include money to help cover the cost of wiping out all mention of the business name he said was inspired by the “In” and “Out” signs on the doors of his store.
Wensinger wouldn’t discuss the specifics of Park’s case but said the chain sympathizes with the plight of small-business owners who have to spend sometimes thousands of dollars to change signs, invoices and even uniforms at the restaurant company’s insistence.
“We don’t want to be known as a bully, especially in the legal field,” Wensinger said from the chain’s Irvine headquarters. “We’re just trying to protect the rights to our name.”
The family-owned fast-food chain, which has held a trademark on its name since 1950, claims that outside commercial use of the name, even by a business not in food service, constitutes encroachment on the company’s rights because most people associate the words “In-N-Out” with the chain.
Businesses using the name, Wensinger said, benefit gratis from the company’s widespread popularity and multimillion-dollar marketing campaign. The chain operates 115 restaurants in California and Nevada.
“They think they can ride on the coattails of an existing company,” he said. “Why should somebody be able to use the name at our expense?”
Wensinger also said the company has no choice but to guard what it considers exclusive rights to its name. Past case law, he said, has stripped trademark protection from businesses that have not policed outside use of their names and logos.
“The law requires you to go and ask people to cease and desist from using the name,” he said.
Bill Steffin, who specializes in intellectual property law for Los Angeles-based Lyon & Lyon, agrees. He said failure to actively protect trademarks has had such high-profile consequences as the introduction of “aspirin” as a generic term for tablets of acetylsalicylic acid and the proliferation of “R Us” at the end of many business names.
“If you allow others to use your trademark,” he said, “you lose the rights to that trademark.”
An example closer to the restaurant company’s heart is Tommy’s Original World Famous Hamburgers, which has so many spinoffs that much of its marketing strategy is aimed at reminding consumers it serves the authentic Tommy’s burger.
“We definitely don’t want to wind up like another Tommy’s,” Wensinger said.
But attorney Bernard Gans, who represents Burbank-based In & Out Paint & Body Centers, said the restaurant company has overstepped its bounds and is claiming broader rights than it is entitled to.
“No one owns a trademark per se,” he said. “What you own is the right to do business in your field of use with that name. Different companies can use the same trademark as long they’re used for different goods and services.”
Gans said his client has twice rebuffed name-change efforts by the restaurant company in the last five years. Wensinger declined to comment on that case.
But legal rights aside, the effort has hit some small businesses square in the wallet.
Vaik Zargarian spent $8,000 removing the “N” from his formerly named In-N-Out Service Centers in Burbank. He said his carwash and tune-up business had used the name for at least 18 years before the restaurant chain first voiced its opposition 2 1/2 years ago. He changed the name after In-N-Out Burgers sued him last March.
“I didn’t want to go through the big hassle to go through the courts and pay the attorney,” the 44-year-old Northridge man said. “That’s why whatever they said, I did. They’re a big company.”
In the last several years, dozens of businesses have filed with Los Angeles County using names that incorporate “In N Out” in their titles. Wensinger, however, would not say if any of those businesses would be the target of future protection efforts. “It would have to be taken on a case-by-case basis,” he said.
For his part, Park doesn’t anticipate any lingering bad feelings against the burger chain once the dispute is resolved.
“Me and my whole family have been boycotting In-N-Out since this thing started, and we’re all dying for this thing to settle so we can go get more hamburgers from them,” he said. “I’m probably their biggest fan. I love their food.”
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Before naming a business, proprietors should search federal and state trademark databases for names that have already been registered or for which applications are pending. Federal trademark records can be found at Los Angeles Central Library, 630 W. 5th St. Information: (213) 228-7220. State records can be searched by phone, up to two names per call: (916) 653-4984.
Proprietors should also search telephone books, chambers of commerce registries and Internet listings of businesses that have not trademarked their names but may have common law rights to them.
Professional searches can be arranged through patent and trademark attorneys. Check the yellow pages under “Attorneys--Patent, Trademark and Copyright Law”
Generally, proprietors should avoid business names specifically inspired by or spun off from existing businesses.
More information: U.S. Patent and Trademark Office, (800) 786-9199 or https://www.uspto.gov
Source: U.S. Patent and Trademark Office
Los Angeles Times