Welcome back, in today's session, we're going to be talking about Trademark Trolls. And how companies can fight against Trademark Trolls or deal with Trademark Trolls. What is a trademark troll is probably the first question you're asking. Well, this is somebody that has taken a mark that you view as yours, and they've registered it someplace else that you may want to go. For example, they've registered it in India, China, New Zealand, Germany. And you're not in those countries, but you're thinking about starting up more international sales, and they're already there. They've registered the mark ahead of you and or the e-commerce site ahead of you and they're saying, would you like your company's name back? And that's a trademark troll. Their business is getting you to pay a lot of money. They demand payment in order to transfer to you the rights and maybe even threaten litigation or threaten to misuse your trademark in ways that are harmful to your company or your reputation. And first to file a countries like China, trademark trolls particularly powerful. Because it's not so much the first to news, is the first to file and so they can file a name and just sit on it. And hold it for a while, maybe use it in a trivial way or something, but not much and they still are protected because they're the mark that's registered. In first in used countries like the United States, the government may say, you're not really using that mark. So we're going to cancel it, because you weren't really serious About giving that mark or protecting it. And so first in used countries you got better defense or better ability to sue and say let's get that mark cancelled. But in first to file countries it's particularly difficult to find a trademark troll. For example, TESLA started to sell in China in 2014, but the TESLA name, the registered brand name was already registered in 2006, eight years earlier by a Chinese businessman, and he waited. And he said, eventually this company, this brand, is going to come Asia, eventually they're going to want to sell their electric cars in China. They're not there yet, but they'll come. So I will register it, and I will patiently wait for them to come to me or I will sue them when they come to China. So what happened with that trademark? Well, Tesla had setup showrooms, and charging centers, and services and this trademark troll are individual who had before thought to register the Tesla name way ahead of Tesla's entry to China. Sued and got want the courts to agree that he was the registered trade marker owner of Tesla and Tesla had to shut down those showrooms. They had to shut down their service centers. They had to shut down their charging stations because they couldn't use the Tesla name. They couldn't sell Tesla products in China. And they had to pay this trademark toll, $3.9 million in compensation for trademark infringement. They had used his name inappropriately. So then I have to pay him a lot of money for doing nothing. Now that may sound unfair to you, and in some ways it certainly is but Tesla also was foolish to not have thought ahead, to not have asked. Are we ever going to be a global company? Are we ever going to be in other markets? If so, we probably should care about our brand, our reputation, our trademark. Now eventually, TESLA reached a settlement with a troll. We don't know how much money, it's a confidential agreement, Tesla won't tell, the company won't tell. But they reached a settlement and Tesla agreed, in addition to the lawsuit damages awarded by a judge to pay money to this troll. In order to get the trademark owner to cancel the Tesla trademark in China, so that TESLA could then register it and own it with the government. They also released the names tesla.cn and teslamotors.cn, so web names as well as brand names. And so they've reached this settlement, but that's expensive. And so when you have to settle after you're famous, after you're big, you're talking big money. When you settle before you're famous, when you're small, like Apple when buying the name iPad. They were able to pay a very low price to buy the iPad rights throughout Asia. When they did it through a small shell company and they hadn't introduced the iPad yet. They were looking to buy their international rights. They were looking ahead and being smart way before they needed them. And Tesla missed that, they waited too long. Now in Apple's case they had to pay a big judgement later because they made a mistake and they didn't buy the rights in mainland China. They bought the rights in Taiwan. And they thought that was enough, but they didn't realize you're talking about two separate companies. Apple's not perfect either, they made a mistake as well. But at least they were thinking ahead of time about the value of international markets and their brand in those markets. Now, what are you going to do? We're going to give you this assignment. And the assignment is, I'm asking you to come up with a strategy for your brand, for your trademark, for your right to fight troll. I'm saying, you are in the role of a start up company in Europe. Let's pick a European country it doesn't matter which. Your start up, you're based out of Europe, and you're looking to expand in the US and into China. US at first in use, China is first to file. And you need to come up with a strategy for how to protect yourself against trolls. And you're going to do that in two contexts. One, is to write up a scenario where nobody's registered anything and so it's a clean slate, you're trying to protect yourself preemptively, if you will or in advance. And second is, somebody's registered the name. They've got your domain name on the internet or they've got your brand registered as a mark. And now you have to deal with that fact, that a troll is there, they've beaten you. What do you do? So two scenarios, the troll is not there yet. How do you defend against the possible future troll? Scenario B, the troll has beaten you. There and they're first to register the mark. What do you do now? What are your options? What should you consider, and does that differ between US and China because they have some different legal protection for trademarks in the two countries. That's it, thank you. I look forward to seeing your responses, and you'll get to see other people's responses as you look through and grade this peer graded assignment for other people as well as submitting it for yourself. Thank you. [MUSIC]
