Licensee Estoppel

[Bruce Wayne]

In a trademark dispute, does the principle of licensee estoppel apply if there was no license agreement, written or verbal, between the parties?

For more than 5 years, I was a top-performing affiliate for a small online retailer. The company has now terminated its affiliate program and they've demanded I surrender several web sites and domains I've owned claiming trademark infringement.

I've owned these domains since 2003 and 2004... I sent them millions in sales over the years, and they never had a problem with them until now. Dirty rats.

I'd like to petition to cancel the mark on the Supplemental Register that seems to be the root of all the controversy. Frankly, I never knew they had a mark until I got the first C & D. The lawyers tell me that although it could be a generic term, I'm barred from petitioning to cancel based on "licensee estoppel."

"A trademark licensee is precluded from challenging the validity of the licensed marks, or, for example, the enforceability of the agreement itself as a prohibited 'naked' transfer. The estoppel applies not only during the term of the agreement but also after it expires, unless the challenge is based on events occurring after the agreement’s expiration."

Here's what gets me: There never was any Trademark License Agreement, and the Affiliate Agreement (which remained unchanged from 2002 until they ended the program last year) doesn't mention anything at all about their ownership of a mark. Nothing. Nada.

Can I still file a petition to cancel? Isn't the lack of any License Agreement, and their failure to police their mark for more than 5 years, for that matter, a clear case of Abandonment through Naked Licensing?

[Mr. Knowitall]

In simple terms, the doctrine of promissory estoppel applies you enter into an agreement to license somebody else's intellectual property. By virtue of that agreement, you are estopped from disputing the validity of their claim to the intellectual property in future disputes based upon facts arising during the term of the license. So, for example, you can't claim that your use of the mark under license gives you any claim to the mark or invalidates their mark. Obviously, a doctrine that relies on an agreement... relies on an agreement. An agreement can be express or implied; you haven't told us if the mark owner was aware of your actions.

If you don't think that their mark is valid, for example due to its being generic, you are free to try to invalidate their mark; but you can expect it to cost you money. But if your sites are generating sales in the seven figure range by virtue of the generic terms, not by virtue of their use of the term as a mark, it seems like it would easily be worth the investment.

[Bruce Wayne]

Obviously, a doctrine that relies on an agreement... relies on an agreement. An agreement can be express or implied; you haven't told us if the mark owner was aware of your actions.

Yes, they were aware. I wasn't using typosquatting or trying to cloak the source of my clickthrough traffic. (Like in Land's End v. Remy)

I was their biggest affiliate, more than a third of their commissionable sales, and they knew EXACTLY what sites those sales were coming from. Never complained, never placed any restriction or condition on my use of the mark. Never even mentioned my use, for that matter.

However the affiliate manager did encourage me to continue doing what I was doing, commenting by email, "We certainly recognize your significant contributions over the last three years as one of our top affiliates. We have developed an excellent strategic partnership with you during this timeframe... We look forward to your continued support during this interim period. We’ve enjoyed the benefits of our strategic partnership with you over the last couple of years and obviously, want it to continue, both short and long term."

Acquiescence or laches, I'm not sure which applies, but either way would certainly indicate an implied license.

[kinesis]

delete all content from said domain sites that can be used against you. at most they can use a cease and desist. in order to evict you from the domain names, they have to have evidence you continue to infringe. there are tricks to trademarks. say you own mycompany.com right? some company called My Company Services says you are infringing, but your company is called My Company Solutions and serves a different industry - there is no confusing similarity. load content on each site that focuses on a different industry to loophole around trademark laws, avoid referring to their industry or branding in any way shape or form - and you can keep the names and sell them