Legal look downfield finds CFL Colts partially covered

May 03, 1994

Jim Speros' legal stare-down with the NFL over use of the Baltimore CFL Colts' name has spawned lawsuits in federal courts in Baltimore and Indianapolis.

Speros, the CFL Colts owner, contends he has taken the necessary steps to acquire trademark rights to the name. The NFL believes it retains those rights.

Ned Himmelrich has followed the case as a trademark lawyer for the Baltimore firm of Gordon, Feinblatt, Rothman, Hoffberger and Hollander. He is chairman of the Maryland Bar Association's Intellectual Property Committee, which deals with patents, trademarks and copyrights.

Yesterday, Himmelrich discussed the case in a question-and-answer session with The Sun's Ken Murray:

QUESTION: How does trademark law apply here?

ANSWER: The NFL would say that Speros' use of the name Colts is likely to be confused with the NFL's registered use of the name Colts and causes confusion among consumers regarding whether the NFL sponsors the CFL team or its merchandise.

Q: What is the effect of NFL Properties abandoning trademark rights to Baltimore Colts?

A: To have trademark rights, you do not need a federal registration. The registration helps and gets you into the pure trademark violation area. I assume the NFL has a registration on the name Colts or Indianapolis Colts. The addition of Baltimore has less weight than the more important feature of the name, which is Colts. If the NFL is selling old Baltimore Colts merchandise, they continue to have rights in the name just by using it. The abandonment of the registration for Baltimore Colts would have no great effect if the NFL always had the intent to use Baltimore with the name Colts in merchandising. If Speros can show the NFL abandoned its intent to use Baltimore with Colts for merchandise, then the Baltimore name is up for grabs.

Q: What are Speros' best arguments against a trademark violation?

A: Speros would say that the relevant universe of consumers of his entertainment and merchandising products would not confuse a CFL team with an NFL team. He uses the CFL logo to distinguish his name. He calls his team the CFL Colts. He has different colors and designs on his uniforms and merchandise. There are other teams, including college and high school teams, calling themselves Colts, so that the name is diluted, which diminishes the NFL's exclusive rights.

Q: What are the NFL's best arguments for a trademark violation?

A: There would be likelihood of confusion in the relevant universe of consumers for these products between CFL and NFL. Blue and white are Speros' dominant colors. Adding a "house mark" such as the CFL logo does not lessen the infringement and sometimes makes it worse. Speros is utilizing the goodwill built up by the NFL over the years for his own benefit. A Supreme Court case has called it "reaping where another has sown."

Q: What is the relevant universe of consumers?

A: The case may boil down to competing surveys with the NFL showing consumers are confused and Speros showing from his survey consumers are not confused. I don't think the relevant universe should be only avid Colts fans in Baltimore. I don't think the relevant universe should be someone outside of Baltimore who is not a football fan. Somewhere in between is what a judge would require.

Q: Define goodwill as it applies here.

A: It is the feeling and aura a consumer relates to the product and provider of the product.

Q: Is it significant that the name originated in Baltimore before the NFL arrived?

A: If someone in Baltimore owned the name Colts and allowed the NFL to use the name without that person's permission, the law would probably say that person has sat on his rights for so long that it would be unfair for that person to now stop the NFL from its use.

Q: Does Baltimore own the name?

A: A trademark is owned by the entity that provides the goods or services, or licenses another to provide the goods or services under that name. It seems that the NFL has been providing entertainment and merchandising, not the city. As much as a Baltimore fan would like to control the name, the law favors the business owner.

Q: How does the NFL get an injunction?

A: The NFL will get an injunction if it can show infringement. Usually in trademark cases, the "winner" is satisfied with an injunction.

Q: If the NFL wins, what kind of damages could it get?

A: If the NFL wins, it would get the permanent injunction and there is the possibility of monetary damages based on Speros' profits and damages to the NFL. There is also the possibility of punitive damages if the NFL can show bad faith and an intent to deceive. But in trademark cases, courts are hesitant to award monetary damages other than in extreme cases.

Q: Under what circumstances could Speros use the name?

A: The NFL could lose the case on the merits. The NFL could decide not to fight as long as Speros, and drop out. The parties could come to an agreement allowing Speros to use the name under a license.

Q: Is the NFL likely to challenge the British Columbia Lions' trademark because of the Detroit Lions?

A: In theory, a trademark used outside of the United States cannot be brought into the United States if there is already a similar trademark. So if the NFL fights against having two professional football teams called Colts, it should be fighting against two professional football teams called Lions. The difference may be that the B.C. Lions are commonly referred to as B.C. Lions. Another difference is, the name Colts is being used in a city where the NFL once had a team. That is not the same situation with the Lions.

Q: How do you see the case?

A: Although I haven't seen any of the papers filed in court, and as much as I would like to get the name back in Baltimore, it seems the NFL has the better argument. This is a great trademark case. There are a lot of nuances, a lot of close calls, a lot of "the right thing" vs. what case law might say. The judge is going to have a hard time.

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