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Apple's Story: Trademark Indiscretion, Branding Success

Posted by: Karla Aspiras on October 15, 2012


Apple recently commemorated the first anniversary of the passing of its former CEO. On their website was a video of Steve Jobs’ memorable speeches, beginning with a classic photo of him with an old Macintosh computer. Now a year later without their visionary leader, many are wondering how the company has done and will do.

Apple is one of the top risers in Interbrand's Best Global Brands 2012. The brand saw a 129% rise in brand value and now ranked #2 from #8 in 2011.

Steve Jobs left us with an impressive array of iDevices, which are arguably his biggest contribution to this generation and the next. But products cannot exist without the brands that represent them. So let us look at Apple’s primary offerings and their trademarks. Everyone is aware that the first leg of Apple’s patent battle against Samsung is behind them, but how many trademark disputes has Apple had to endure?

First, Apple unveiled the iPod® in October 2001. Steve Jobs called it a hard drive that could put a thousand songs in your pocket. Mr. Joseph Grasso, sole proprietor of a company called Web Pods, Inc., for “public internet kiosk containing computer hardware,” initially owned the iPod mark. Mr. Grasso assigned the mark, for an undisclosed amount, to Apple in March 2005.

Six years later, Apple launched the iPhone®. Jobs said that with the iPhone, Apple is going to reinvent the phone. Apple sought to obtain a trademark for their iPhone, but the US trademark office refused their application because of possible confusion because of an existing registration for the same name.

The existing registration belonged to Cisco Technology, Inc., for “computer hardware and software for providing integrated telephone communication with computerized global information networks.” Cisco’s iPhone is a line of VoIP telephone handsets. Cisco’s use of their iPhone mark before Apple launched its iPhone was sporadic. They did file a Section 8 affidavit meaning they still want to keep the registration, but did not file a Section 15 affidavit, meaning they cannot show continuous use for five years.

Some called Apple a “trademark bully” as ownership of the mark remained unsure. Sometime in 2008, Cisco and Apple “contracted” out the confusion issue raised by the trademark office. Through a consent agreement signed in June 2009, Apple overcame the potential confusion with Cisco’s iPhone.

They agreed that their “respective uses of the mark IPHONE are not likely to cause confusion, mistake or deception.” This consent agreement was approved by the trademark office, which led to successful registration of “iPhone” by Apple. To date, the amount Apple paid Cisco remains undisclosed, and other terms of the agreement remain confidential. Both companies’ websites state that either can freely use the iPhone mark on their products throughout the world.

Before he died, Steve Jobs announced the iPad®. There was a pending application for registration of the iPad mark by Fujitsu Transaction Solutions, Inc. for a “handheld computing device for wireless networking in a retail environment.” Fujitsu failed to respond to the trademark office’s office action within six months, and it was considered abandoned, thus making it free for Apple’s registration.

Let’s not forget the infamous trademark battle Apple went through two decades before the first iPhone. Apple Computer (Apple Corporation’s former name) battled with Apple Corps (parent company of Apple Records, the Beatles’ recording company) for the Apple mark until they settled with the condition that Apple Computer cannot enter the music business while Apple Corps cannot enter the computer business. Apple Corps sued Apple Computer again in 2003 when iTunes was launched for breach of that settlement agreement, but the Court ruled in Apple Computer’s favor.

Icloud Communications sued Apple when Apple launched the iCloud service in June 2011, but the former voluntarily dropped the lawsuit and renamed its company Clear Digital Communications. The dispute between Apple and Amazon over use of “Appstore” is still pending, as is the application for registration of the Appstore mark by Apple, which in turn was opposed by Microsoft that claimed the term is “generic.”

Indeed, Apple has a very colorful trademark prosecution and litigation history and that might strike some as a habit of “name now, worry about trademarks later.” But perhaps the underlying thrust by Apple here is that when creating such iconic, innovative products, you also want the perfect name and brand for it: one that embodies the passion in its creation; the genius in its design and development; and the enjoyment and awe that every user experiences with the iDevices.

Interbrand's Best Global Brands 2012 report said it best: “Jobs understood that a brand is more than a logo…He also recognized that a brand is what connects a business with the hearts and minds of consumers. Simply put, Steve Jobs understood that a brand is uniquely capable of humanizing a business — and that is precisely why so many of us are Apple ambassadors today.”

Karla Aspiras is a Trademark Analyst at Interbrand NY.

Category: Trademarks

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