Trademark dispute unleashes dual claims
No one can accuse the pet waste cleanup industry of taking itself too seriously. Dallas-based Pet Butler, the 80-unit franchise system, has a "turdometer" on its Web site that keeps track of the number of poops its pooper-scoopers scoop. It also proclaims itself "No. 1 in the No. 2 business."
Dog Butler, a much smaller Oregon-based service, has a more buttoned-up site. But callers must still dial "P-O-O-P" to get the company.
Yet neither service is laughing about the similarity of their names. And both say the others' actions stink.
The two companies are embroiled in a trademark dispute. The U.S. Patent and Trademark Office last year denied Pet Butler's trademark application, saying it was too similar to that of Dog Butler, which had registered the trademark first.
Pet Butler is appealing the decision, and discovery in the case is due to be finished this month. In the meantime, it is challenging Dog Butler's trademark, and the two sides are trying to work out a settlement in which they could each keep their current names. Officials with both companies say that is their primary goal.
Yet neither company sounds like they're close to an agreement. "They're trying to extort money from us," said Matt Boswell, Pet Butler's chief executive officer. His counterpart at Dog Butler, Tom Arndt, says that the two sides are "miles apart" and that Pet Butler is trying to get him to become a franchisee—something he won't do.
While Pet Butler is much larger—with more than 80 units compared to Dog Butler's two—it also has much more to lose because, at worst, it could be forced to change its name. And that could stick franchisees with at least part of the bill for a rebranding.
Franchisees reached for the story said they're not concerned about the issue, and Boswell is confident that his company won't lose its name. "I don't see a chance in the world of that happening," he said.
Lessons in trademark law
Experts in trademark law say it's rare that a franchisor has to change its name. But trademark disputes like this one are not so rare. "This is unfortunately very common," said Marisa Faunce, a trademark and franchise attorney with Plave Koch. "I'll get calls from emerging franchisors who've been operating wherever they've been. They've been happy. No one's been bothering them. But when they start a franchising program they run into problems."
Mark Blumenthal, a trademark and franchise attorney in Chicago said burgeoning franchisors should always make sure their trademark is clear before selling franchises. "Good franchisor lawyers get their franchisor either before or very close to selling their first few franchises," he said.
Faunce said the earlier a company searches for trademarks of names similar to its own, the easier and less costly it is for them to change the name and avoid possible problems—which, at the very least, involve a costly battle over the trademark. Yet Faunce says many companies don't change their name, even when they discover another company with a similar moniker. "I can't tell you how many startup franchisors have refused to change their mark even though they're aware of a conflict, because they like their marks," she said.
As for Pet Butler and Dog Butler, both owners say the air can be cleared with simple negotiation, and the two poop scoopers can live with one another. "When we clearly show our rights, their mark will be overturned," Boswell said. "We could force them to change their name. We're not going to. I never had any ill intention. I simply want to use the name that's rightly ours."
Arndt says he will likely come to an agreement with Pet Butler. "Even if I win, financially I lose if I bite him," he said. "I would consent to him having his own mark and me having my own mark and we compete. We'll take our chances."