iPhone Trademarks: the Real Issues

by Mark Rasch

Apple's iPhone announcement and Cisco's iPhone trademark lawsuit has brought the iPhone moniker into the spotlight. But other companies also own and use iPhone trademarks, and market and sell their iPhone products. Mark Rasch explains how U.S. trademark law works and the real issues at play in this highly publicized trademark dispute.

“ This is sort of 'reverse trademark confusion.' Even though the iPod, iPhoto, iMovie, iDVD, iTunes, iSync, iWeb, iWork and iLife (but not iDefense, iLink or some other i-marks) monikers did not exist in 1996 when Infogear registered its trademark, I can bet you that, by 2007, even before Steve Jobs took the stage at MacWorld in San Francisco, if you asked people who made a product called 'iPhone' they would invariably think Apple, not Cisco. ”

Mark Rasch Earlier this month Apple Computer, now known as just “Apple,” became embroiled in a trademark lawsuit with Cisco Systems, Inc. over Apple’s proposed use of the term “iPhone” in connection with its new smart-phone. Cisco claims that Apple’s use of the term infringes its trademark and creates a “substantial likelihood of confusion” with Cisco’s iPhone product. Apple claims that Cisco’s claim to trademark protection is tenuous. In this case, it is quite possible that both trademarks can peacefully coexist. In the words of Rodney King, “can't we all just get along?”

Primer on trademark law

There is much confusion in non-academic circles about just what is a trademark, a service mark, and exactly how you get one, lose one, or protect one. Put simply, a trademark is nothing more than something that is associated with the provider of goods, and a service mark is something that is associated with a provider of services. Thus, company names like “General Motors” or “Cisco” are trademarks, just as particular product lines like “Mustang” or “Big Gulp.” Trademarks can include colors (yellow and red for Kodak film), logos, typefaces, tag lines (“good to the last drop”) and may also include what is called “trade dress” – how the product or packaging looks (anyone see the new LG “Prada” phone?). The idea is, when you see the trademark, you think of the particular item or company, and not something else.

One myth about trademarks is that you have to do something to get one. In fact, all you have to do, really, is to just use the trademark. Open a pet spa in Topeka, Kansas called “Dog Day Afternoon” and you have a trademark. You could stop someone else from opening a competing store with the same name. If you want additional legal protection, and you want to put people on notice about not only the identity but also the scope of your trademark, you can register your trademark. In the United States, this is done through a filing with the United States Patent and Trademark Office, www.uspto.gov. You can also protect trademarks that you intend to use later on.

Now, not everything can be trademarked. I couldn’t trademark the phrase “Law Office” for the provision of legal services because the term is descriptive rather than identifying. But the phrase “1-800-LAWYERS” or lawyers.com might be subject to trademark. If something merely describes what it is, or if the description is or becomes generic, then trademark protection may either not be grated or may be lost. Thus, companies have had to fight to keep their trademarks from becoming generic – think “Kleenex” or “Jello” or in earlier times “Sanka,” “Radarange,” or “Frigidare.”

Another common myth is that two people cannot have the same trademark. Not true. Kelly Tires, Kelly Furniture, Kelly Temporary Employment services are all registered trademarks. Two trademarks can peacefully coexist if, for example, they describe substantially different products or services, exist in different geographic areas, or are otherwise sufficiently distinct or are made so. (Another example: Burlington Coat Factory is not associated with Burlington Industries...)

The key to whether or not two trademarks can peacefully coexist is whether there exists a “substantial likelihood of confusion” between the marks. Thus, McDonald’s hamburgers would not likely be confused with Old McDonald’s Farm, or McDonald’s Shoes (home of the golden arches?). The problem with this is that there is frequent overlap in the products or services offered by companies with pre-existing trademarks. Coca Cola is a provider of carbonated beverages, but also T-shirts, clothing, and a host of related accessories. Thus, trademarks that don’t infringe now may infringe later on. Okay. Law School lesson over. Let's look at how this impacts something called the iPhone.

iPhoney iPhone

On March 20, 1996, a small California company called Infogear registered the mark “iPhone” with the USPTO. The company made products to allow people to connect to the Internet without a computer, but apparently never made or marketed a product that they called iPhone. Infogear was aquired in 2000 by Cisco Systems, who obtained, among other things, the rights to the iPhone trademark. This points out the importance of actually registering a trademark in increasing the value of your company.

In about 2004, Cisco’s Linksys division began to actually make an iPhone product – essentially a phone connected to its router to allow for easier VoIP telephony. The Cisco/Linksys iPhone apparently stood for “Internet Phone.”

Now Cisco wasn’t the only one to use or register the mark iPhone for VoIP products. In March of 1995, a California company called Teledex registered the iPhone mark to describe a, “Telephone that integrates a display and interactive abilities with an IP-based network to deliver both voice communication and graphic-based content and services to hotel guestrooms.”

A British company called Orate Telecommunications Services also offers a VoIP phone called an iPhone. Other companies have applied for US trademarks using iPhone, but later abandoned them, including the NY-based XTreme Mobile in March 2005, the California-based SFMobile in October of 2003, a guy named Ravi Lahote in February of 2000, and a guy named Stephen Page in Pleasanton, California in April of 1994.

In fact, in May of 1997, a California company called Cidco applied for a trademark in iPhone for “communications terminals comprising computer hardware and software providing integrated telephone, data communications and personal computer functions” Sounds a bit like the Apple product, but not much. Confused?

As a general rule, the company that either first uses a trademark, or first registers it, has the presumptive rights to use the mark. In this case however, the product that Cisco/Linksys made and marketed may be substantially different than the product proposed by Apple.

Or is it? Sure, the Apple phone is a “smart phone” – a cell phone, a music and video player, and Internet access device, whereas the Cisco/Linksys product appears to be just a network-based VoIP phone. Of course, the Apple iPhone may also have the capability of making VoIP calls, piggybacking on its WiFi connection.

Now the question is, would anyone seeing one of these products think of the other, or would the use of one trademark in some way “dilute” the other? Lawsuit aside, Apple will no doubt spend boatloads of money promoting its iPhone. In the wake of this publicity onslaught, it is unlikely that Cisco will be able to make people think “Cisco” when they think “iPhone” – thus weakening their trademark.

This may, however, be a circumstance where Apple’s “i-Everything” strategy has already impacted the previously registered trademark. The mere prefix “I” may already serve to identify Apple computer, just as the “Mc” in “Mc[AnyFood]” identifies a certain hamburger company in Oak Brook, Illinois. It may be a circumstance like that in Mel Brooks’ “Blazing Saddles” where the 19th century character “Hedley Lamarr” is concerned about infringing the name of the 20th century actress of the similar moniker. Mel Brooks’ character Governor William J. Le Petomane explains, “What the hell are you worried about? This is 1874. You'll be able to sue her.”

This is sort of “reverse trademark confusion.” Even though the iPod, iPhoto, iMovie, iDVD, iTunes, iSync, iWeb, iWork and iLife (but not iDefense, iLink or some other i-marks) monikers did not exist in 1996 when Infogear registered its trademark, I can bet you that, by 2007, even before Steve Jobs took the stage at MacWorld in San Francisco, if you asked people who made a product called “iPhone” they would invariably think Apple, not Cisco.

So let's look at Cisco’s corner: they own the registered trademark. They got it first. They make a product called iPhone. They have marketed and sold it in commerce. The phone has something to do with the Internet and talking to people. And up until the moment of the MacWorld announcement they were in negotiations with Cisco to buy or license the trademark.

According to Cisco’s lawsuit, Apple set up a Delaware Corporation called “Ocean Telecom” in September of 2006 to apply for a trademark in the iPhone mark, and Ocean Telecom also claims to have used the iPhone mark starting in March of 2006 in Trinidad and Tobago. Apple also applied for the iPhone trademark in Australia in September of 2006.

Now in Apple’s corner. They already own trademarks to the iEverything line, and most people already associate the prefix with them – possibly preempting the field (hmmm... should I register iLawyer?) They may argue that iPhone is descriptive or generic – although that argument is weakened by their efforts to protect their own iPod franchise.

The ultimate issue will come down to this: is there a substantial likelihood that people looking for the Cisco product – or a product with capabilities like the Cisco product – would be confused by the Apple entry into the market?

I think that, to answer the question, I will personally need to examine in detail the capabilities of the various products, their look, their feel, their interface. Are you listening Mr. Jobs? Just e-mail me for the address to mail my iPhone – or whatever you want to call it.