As Etsy’s in-house attorney, Sarah loves reading up on legal disputes, particularly those regarding copyright and patents, given her day job. In the You Be the Judge series, Sarah offers the case up to you — how would your gavel swing?
Before a business launches a line, product, or service, the business must choose a name. Name your new venture a made-up creative word, and you may need to educate the public. Name it something too basic, and you may not be able to prohibit the competition from using that same moniker. So as good ol’ Shakespeare asked many moons ago, “What’s in a name?” In the case of a thin salty snack, You Be the Judge!
In 2004, Snack Factory, run by Warren and Sara Wilson, started selling a flat pretzel snack called Pretzel Crisps. Retail sales of Pretzel Crisps exceeded $100 million last year. Snack Factory filed a trademark registration for “Pretzel Crisps.”
Frito-Lay, owned by PepsiCo, manufactures, markets and sells snack foods like Rold Gold pretzel products. As of 2009, PepsiCo’s product lines resulted in annual net revenues of $43.3 billion. Frito-Lay opposes Snack Factory’s trademark registration claiming the term “Pretzel Crisp” is generic.
As we’ve discussed previously, in the U.S. a trademark is a word, logo, symbol or a design that identifies the creator of a product. A trademark must be distinctive to receive protection. A fanciful word (like Xerox and Kodak) or an arbitrary name that has no relation to the goods or services (like Apple for computers) are stronger marks than a mark suggesting a quality or characteristic (like Microsoft for software). A descriptive mark that describes a characteristic (like Holiday Inn for a hotel) ordinarily does not qualify for protection unless it attains secondary meaning becoming distinctive through long-term use or large amounts of advertising and publicity.
On the other hand, generic marks are open to all to use, and are not protectable. The rationale is that no business should have the exclusive rights to a basic word that generally identifies a product.
Frito-Lay argues that the term “Pretzel Crisps” is generic. They issued a statement saying, “generic product descriptors like ‘pretzel crisp’ should be available for any food manufacturer to use. We have no objection to Snack Factory using the term on their product; we object to Snack Factory’s attempt to register the term and prohibit everyone else from describing products as pretzel crisps.”
Snack Factory will likely argue that they used the term “Pretzel Crisps” since 2004, the term is distinctive, and it has achieved secondary meaning. Snack Factory may claim that consumers recognize the mark “Pretzel Crisps” as having a source indicating thoughts of thin pretzels.
Should the term “Pretzel Crisps” be protected as a trademark? In the case of the flat pretzel snacks, You Be the Judge!