To be (a dick) or not to be (a dick)

[LateStarter]

Hey everyone!

tl;dr at the bottom

I'll preface this by saying it's a semi-rhetorical post so please bear that in mind. I also wanted to have a little fun with this, so I included a poll. Please answer it honestly. It won't dictate my actions. I just want to know what you would do.

I've got a business that I've been working on for just over a year now. We launched in March and things have been going fairly well considering we're only selling through our online store and local shows while we are refining our products/processes and waiting for our trademarks to come in for Amazon Brand Registration. The Trademarks aren't stopping us from proceeding, we just wanted to get everything sorted a bit more to ensure we are ready to scale. (Yeah, we've been ungated blah blah blah... And as an FYI the Canadian trademark office is backed up over 10 months and counting ...yeesh).

Anyway, we were changing our product line up a bit and timed some inventory overlap with the first run of the new line for the BFCM period. There's one other competitor with a similar product in Canada and one in the US. That's about it. So I ran AdWords campaigns against each of their business names... as most good marketers would. Neither was running ads at the time so I came up #1 on the results page every time. The ads ran something like this.

"Why settle for (competitor's limited product feature) - Buy (My Brand) Today!
(Explained my value-added benefits)"

I included the usual site extensions and an offer extension for 20% off your first order when you use promo code "Sorry(Competitor)"​

Those have been running for about a month and my Canadian competitor finally took notice (In their defense they aren't getting that much traffic this time of year).

How do I know they caught on?

Today I got a call from them. I know the business is run by women but it was a man who called and identified that he was calling on behalf of them. I was a little surprised at first. The purpose of his call was to talk "man-to-man" with me to see if he could "avoid litigation" and save me "a lot of money on legal bills".

I said, "What litigation?" He said, "Well, the owners here are threatening to sue you for slander because of your ads. They don't even want to bother with a cease and desist order."

I played dumb.

"Slander? Wow...that sound serious. Can you explain more about these ads and what is so offensive?"

He went on to say "I don't know if you have someone else running them or a marketing company or what but..." and went on to read the ad verbatim. He said "You can't use another company's name in our ads. It's illegal. It's our name."

I admit that I mentally chuckled when he said it's illegal. Again I played dumb rather than escalating it with him and simply told him I'd look into it.

I know I'm in the clear for slander. Everything I said was factual. The only time I even mentioned the competitor's name was in the promo code. So I'm not worried about that. I just don't like it when someone tries to intimidate me. I'm the type that wants to give them the big

F*ck YOU!
...and dial it up a few more notches.
I can be a dick like that.​

My wife told me to change the ad and let it go. I know she's right. They're too small to worry about.

But I mentioned that I can be a dick, right?

So for fun, I checked out their site. Immediately I noticed that they have a 'TM' next to their wordmark. They've been in business about 6 months longer than we have. I was surprised that they had their trademarks but we are still waiting. So I searched the trademark application database to see when they got it. Wouldn't you know it, the search came up empty. Hmmm...

They use 'International' in the company name so I thought maybe they decided to register in the US instead of Canada. Another quick search and... nothing again.

Now that, 'F*ck You' part of my brain started to kick in.

I remember reading that @AllenCrawley (?) had an issue before where his contract manufacturer trademarked his company's name right out from under him. Hmmm.... *evil laugh* If I have the trademark to their name, surely they can't bitch about me using it slanderously, can they?

Trademark registration in Canada is about $450. Not as much as US registration so it could be done relatively inexpensively. It just takes time.

Anyone know the going rate for IP held ransome?

I won't do it. It's a dick move. But damn it's tempting.

----
tl;dr

Competitor threatened to sue because I used their name in an ad.
I found out their company names aren't trademarked.
Half-tempted to trademark it out from under them.

 

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[racyred09]

Hey everyone!

tl;dr at the bottom

I'll preface this by saying it's a semi-rhetorical post so please bear that in mind. I also wanted to have a little fun with this, so I included a poll. Please answer it honestly. It won't dictate my actions. I just want to know what you would do.

I've got a business that I've been working on for just over a year now. We launched in March and things have been going fairly well considering we're only selling through our online store and local shows while we are refining our products/processes and waiting for our trademarks to come in for Amazon Brand Registration. The Trademarks aren't stopping us from proceeding, we just wanted to get everything sorted a bit more to ensure we are ready to scale. (Yeah, we've been ungated blah blah blah... And as an FYI the Canadian trademark office is backed up over 10 months and counting ...yeesh).

Anyway, we were changing our product line up a bit and timed some inventory overlap with the first run of the new line for the BFCM period. There's one other competitor with a similar product in Canada and one in the US. That's about it. So I ran AdWords campaigns against each of their business names... as most good marketers would. Neither was running ads at the time so I came up #1 on the results page every time. The ads ran something like this.

"Why settle for (competitor's limited product feature) - Buy (My Brand) Today!
(Explained my value-added benefits)"

I included the usual site extensions and an offer extension for 20% off your first order when you use promo code "Sorry(Competitor)"​

Those have been running for about a month and my Canadian competitor finally took notice (In their defense they aren't getting that much traffic this time of year).

How do I know they caught on?

Today I got a call from them. I know the business is run by women but it was a man who called and identified that he was calling on behalf of them. I was a little surprised at first. The purpose of his call was to talk "man-to-man" with me to see if he could "avoid litigation" and save me "a lot of money on legal bills".

I said, "What litigation?" He said, "Well, the owners here are threatening to sue you for slander because of your ads. They don't even want to bother with a cease and desist order."

I played dumb.

"Slander? Wow...that sound serious. Can you explain more about these ads and what is so offensive?"

He went on to say "I don't know if you have someone else running them or a marketing company or what but..." and went on to read the ad verbatim. He said "You can't use another company's name in our ads. It's illegal. It's our name."

I admit that I mentally chuckled when he said it's illegal. Again I played dumb rather than escalating it with him and simply told him I'd look into it.

I know I'm in the clear for slander. Everything I said was factual. The only time I even mentioned the competitor's name was in the promo code. So I'm not worried about that. I just don't like it when someone tries to intimidate me. I'm the type that wants to give them the big

F*ck YOU!
...and dial it up a few more notches.
I can be a dick like that.​

My wife told me to change the ad and let it go. I know she's right. They're too small to worry about.

But I mentioned that I can be a dick, right?

So for fun, I checked out their site. Immediately I noticed that they have a 'TM' next to their wordmark. They've been in business about 6 months longer than we have. I was surprised that they had their trademarks but we are still waiting. So I searched the trademark application database to see when they got it. Wouldn't you know it, the search came up empty. Hmmm...

They use 'International' in the company name so I thought maybe they decided to register in the US instead of Canada. Another quick search and... nothing again.

Now that, 'F*ck You' part of my brain started to kick in.

I remember reading that @AllenCrawley (?) had an issue before where his contract manufacturer trademarked his company's name right out from under him. Hmmm.... *evil laugh* If I have the trademark to their name, surely they can't bitch about me using it slanderously, can they?

Trademark registration in Canada is about $450. Not as much as US registration so it could be done relatively inexpensively. It just takes time.

Anyone know the going rate for IP held ransome?

I won't do it. It's a dick move. But damn it's tempting.

----
tl;dr

Competitor threatened to sue because I used their name in an ad.
I found out their company names aren't trademarked.
Half-tempted to trademark it out from under them.

Did you know that it's perfectly legal (and common!) to use the TM without actually registering a trademark? It's when they use the "R" that it's been registered. I see why you'd be tempted and know you wouldn't really do it but I agree with your wife that you should just change the ad and let it go. You're obviously affecting their sales! Keep your karma intact

 

[LateStarter]

You're right! Sorry for any confusion.

I know that it's legal to use an unregistered mark, but I thought (wrongly?) that most companies would the TM while they're in the filing process. I didn't think that it was common to not register at all. It would seem worth the effort to register and protect it, no?

In Canada, unlike the US, the TM and R marks have no legal significance; they aren't a part of any official Canadian trademark law. So there are no repercussions to using either of these marks. In the US, I'm told that misuse (particularly of the R mark) can prohibit you from every becoming registered. True?

My (limited) understanding of Canadian unregistered trademarks is that you have to use them for a 'substantial amount of time' before you can inherit the trademark. If you use an unregistered mark you could be looking at a long, expensive legal battle over usage rights. But once it's registered, the burden of proof is on the challenger, not the owner.

Since they've been in business for about a year and a half, I would think I could be easy to file the registration and to become the owner.

 

[NewManRising]

At first I was thinking be a dick. But you know, if you do this it is REALLY gonna get him/her pissed. And they may try to take you down afterwards with dirty tactics. You could get a lifelong enemy out of it. Instead, just apologize and let them know what you could have done but you will not be an a**hole to them.

 

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[Nova]

As a spectator I would love to see what would happen if you turned the screw, but to be honest it probably isn’t worth the aggro at this stage. Kudos to you though, you’ve obviously caused enough of a stir in the marketplace for them to take notice.

 

[minivanman]

I'm always quick to be a dick but then after a few minutes I usually just let it go. Kind of like driving in traffic when you want to pull a pick-maneuver on someone but you just let it go and after a couple of minutes you forget about it. Focus on your business and let them worry about theirs.... and they MUST be worried about theirs or else they wouldn't have contacted you.

 

[DavidK]

I think @NewManRising makes a good point, is it worth potentially creating a determined enemy?

 

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[CareCPA]

I think I'm a little more vindictive. Right now they think you're naive, or worse, stupid (since you played that part on the phone).

I would register their trademark. Then I would sell it to them for just the cost of filing, and not a penny more. It shows you know how to play the game, but doesn't (in my opinion) escalate it.

 

[Kid]

Stop wasting time and do something for your customers.

 

[Eisenstein]

Hey everyone!
The ads ran something like this.

"Why settle for (competitor's limited product feature) - Buy (My Brand) Today!
(Explained my value-added benefits)"

I included the usual site extensions and an offer extension for 20% off your first order when you use promo code "Sorry(Competitor)"​

Those have been running for about a month and my Canadian competitor finally took notice (In their defense they aren't getting that much traffic this time of year).

I'm really surprised that this is possible in Canada. In Germany, comparative advertising is prohibited and the victims are entitled to injunctive relief and damages. There have been countless legal disputes on that topic and an expensive lawsuit is what happens normally. So be aware of your lucky situation and let it go.

 

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[MJ DeMarco]

Are you sure they don't have a legal case? I think there are some rules pertaining the use of trademarks in advertising (Registered or Not).

 

[GuestUser4aMPs1]

@LateStarter I ran into the same issue.
Just reading this story stirred up some anger from a month ago haha.

I also had a competitor threaten litigation as a scare tactic to take down my ads.
I KNOW it's not illegal because they have no registered trademark.

BUT if you wanna be a dick, I think it's predicated on a few things.
Does running ads on your competitor lead to significantly more sales?
If the payoff is negligible, I wouldn't fight it. That's why I stopped.

Next time, IP exclude the physical location of your competitor. If they're in Toronto, IP exclude Toronto.
That way it mitigates the chance of them finding out you're running those ads.

Or, send a fake inquiry to your competitor.
Something in the body of the email where they can click and it'll log their IP.
Then blacklist the IP.

Also, don't give this more mental space than it deserves. I was fuming for a few days after it happened. That energy could have been spent on making my current customers happy so there's no need for dirty tactics.

Just my 2 cents.

edit: Better yet...if there's any doubt you may need a lawyer. Is THAT worth it?
Just a thought.

 

[Azure]

Not entire sure, but using your competitors name in the promo code may violate AdWords policy - potentially more harmful than a slander lawsuit would be.

 

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[LateStarter]

I'm really surprised that this is possible in Canada. In Germany, comparative advertising is prohibited and the victims are entitled to injunctive relief and damages. There have been countless legal disputes on that topic and an expensive lawsuit is what happens normally. So be aware of your lucky situation and let it go.

We have guidelines for comparative advertising in Canada (https://www.adstandards.com/en/ASCLibrary/guidelinesCompAdvertising-en.pdf). I was discussing product features and that part is fine. But after thinking about it further you and @MJ DeMarco could be right. They could try to dispute the word 'settle' since it can be viewed as unfairly discrediting their brand.

 

[LateStarter]

Also, don't give this more mental space than it deserves. I was fuming for a few days after it happened. That energy could have been spent on making my current customers happy so there's no need for dirty tactics.

No worries there. The only mental space I gave it was the 2 min call and about 30 mins of my time (including the original post). I stopped the ads after they phoned. As I said, the traffic wasn't enough to worry about anyway.

Actually, that's not true.

All this discussion has really made me think about these issues with respect to my own brand and how I can better protect it and represent it. So there's the positive.

 

[MJ DeMarco]

This is just me, but I usually diffuse the conflict and get onto business.

You have a goal.

This conflict (or potential conflict) is a distraction to your main goal -- to build a business, explode profit, create freedom, and Unscript.

This can be hard, I know.

I get a lot of email threats pertaining to content on this forum (posted by others) -- take down requests, deletions, etc, and instead of fighting them (they have no case and no grounds) I usually comply. Why? Not because I fear their threat, but because it is distracting to my main objectives.

You are already fighting a war. When you engage in conflict with others, you open up another battlefront. In effect, you split your army and the objective comes more difficult.

 

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[LateStarter]

Good analogy MJ.

This was all semi-rhetorical. I had already moved on (partly because I'm too busy this time of year to give it any serious attention) but I thought it could be an interesting social experiment with the poll.

I'm pleasantly surprised by the results
...and humbled by the advice and insights of forum members.

I expected the results to sway heavily to the aggressive side. I'm not sure why. Perhaps I view many of you as being more cut-throat towards competition that you are? It was great to see the opposite.

Many of you have provided unexpected and humbling value. As solo entrepreneurs, we work so hard on our businesses but for the most part, it's done in a bubble. I clearly didn't give enough attention to the ad copy. I didn't think it through enough and could have set myself up for legal action. Thank you all for your fair criticism and for causing me to rethink my actions.

That's part of what I love about this forum. It's nothing new; it happens all the time. But these insights always seem to come as a surprise and can be an epiphanic revelation. No matter if it's your thread, your post, or just something you stumble upon. Everyone here has an opportunity to affect others for the better.

 

[KLaw]

Another side effect...what if I never heard of their brand. You just provided some free advertising for them.

 

[Scot]

Another side effect...what if I never heard of their brand. You just provided some free advertising for them.

He was targeting their brand name on google. They were searching for that company already.

 

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[KLaw]

He was targeting their brand name on google. They were searching for that company already.

He said he was using their brand name in his ads. So, if I clicked on his ad I would be introduced to their brand as well.

 

[AllenCrawley]

Registered or not, if you registered it they could show first use and get the registered trademark assigned to them.

 

[HackVenture]

I voted no too.

I would ask them if they would be interested to collaborate in some way.

Something good might come out of this once they have their defences down.

Sometimes companies like these are ones with lots of money but not much know-how; worst case scenario they say no and you get slightly peeved, best case scenario they could end up buying your company?

 

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[rollerskates]

I would stop using their name and not register their name or any of that. Concentrate on YOU. You might be better but if you can't be better without smearing someone else's name, maybe you're not better after all. They also may have a legit case against you even if their trademark isn't registered. You should consult a lawyer, though.

 

[silentownage001]

I have something a little similar. There's another app that competes with mine which uses a company's name and I doubt that they have permission to use it. I thought about reporting it to that company to try and eliminate a competitor, but I decided it would be too risky as they may come after me next. Best not to kick a hornet's nest unless you know already you'll win.