An Apple by Any Other Name

Morgan O'Rourke


March 1, 2010

After all the usual hype that accompanies an Apple product launch, the iPad is expected to finally go on sale later this month. But before eager consumers place their orders, they might want to double-check that the new Apple tablet computer is what they are buying. Because since 2002, Fujitsu has manufactured its own iPad, a $2,000 device used by retail stores to keep track of inventory and sales, and has claimed that the iPad name is its intellectual property. Fujitsu contends that although the U.S. Patent and Trademark Office declared the trademark abandoned in early 2009, the company revived its claim to the name in June.

For Apple, this is not the first time it has had to deal with a trademark dispute pertaining to a new gadget. The tech giant fought with Cisco Systems over the iPhone name before reaching an agreement in 2007. Apple also had to do some maneuvering to obtain the iPod trademark from a New Jersey-based developer of internet kiosks in 2005. It even endured an 18-year legal battle with Apple Corps, the owner of the Beatles? record label Apple Records, over the Apple name itself. After paying more than $26 million in settlements to Apple Corps over the years, the dispute was finally put to rest in 2007 when Apple Inc. bought out the "Apple" name for an undisclosed sum.

Now it is Fujitsu's turn, and I have to wonder why it would even bother given Apple's successful history of trademark acquisition. On top of that, Apple and Fujitsu aren't the only companies that have laid claim to the iPad name. A company called Mag-Tek has an IPAD line of PIN-entry keypads, while Siemens makes iPad engines and motors and Coconut Grove, a Canadian lingerie company, sells iPad bra inserts and shoulder pads. And in the European Union, the iPad name belongs to electronics manufacturer STMicroelectronics. While Apple's deep pockets should smooth over any legal difficulty it may have in retaining the iPad name, it is the sort of problem that probably could have been averted with a little more research. (This assumes that Apple didn't just decide to pick the name it wanted and litigate later if necessary.)

The controversy underscores an important component of trademark law--namely that if you don't use it, you can lose it. Basically if Fujitsu had intended to keep the name it shouldn't have abandoned its trademark claim in the first place. This is one of the reasons why so many companies aggressively fight instances of possible trademark infringement no matter how frivolous. If a company is fighting infringement it certainly is not guilty of abandoning its trademark.

But even if Fujitsu only ends up with some settlement money, that is not the worst thing that could happen to a company's trademark. After all, it is one thing to have your trademark declared abandoned. More than likely, that trademark was not all that important to you anyway. It is another thing, however, to lose trademark protection because the brand name ends up describing a class of products rather than a specific thing and is subsequently "genericized." For example, aspirin, escalator, thermos, zipper and yo-yo all became such generic terms that their trademarks were eventually cancelled in the United States. Even heroin was once trademarked, although I'm sure the Bayer company is not too broken up about losing that one.

On the surface, it might seem that having a product that is so popular that it defines its class is a good thing. As the saying goes, "All publicity is good publicity." But having a generic trademark really doesn't help a company's bottom line. If consumers refer to any adhesive bandage as a band-aid, for instance, then what is their incentive to buy Band-Aid brand bandages? As a result, Johnson & Johnson must aggressively police how its Band-Aid trademark is used in order to ensure that its revenue stream remains intact.

Some enforcement efforts are more successful than others though. Rollerblade, for instance, has been able to popularize the term "inline skating" over "rollerblading" while Xerox employs an ongoing advertising and media campaign to discourage the use of "xerox" as a synonym for "photocopy." On the other hand, no one refers to trampolines as "rebound tumblers" anymore, regardless of what their inventors would have preferred.

Of course, the name iPad has a long way to go before it can be considered the generic term for anything, whether we are talking about tablet computers, retail scanners or even padded bra inserts. But if Apple has its way--and it usually does--the discussion will soon be moot. Because if the product is a hit, no one, except possibly Steve Jobs, will care what they end up naming it.

Morgan O’Rourke is editor in chief of Risk Management and director of publications for the Risk & Insurance Management Society, Inc. (RIMS)