Apple Sued Amazon Over App Store Trademark – Generic and Descriptive Terms

A trademark is valuable.  How valuable?  Well, in some circumstances, very valuable.  Google’s trademark, for example, is worth $44.3 billion, while Apple’s trademark is worth $98.3 billion.  Apple knows the value of a trademark and will go to great lengths to acquire and protect them, even by fighting of “app store.”

• The term “app store” is incredibly valuable.
• Generic and descriptive terms cannot be registered as trademarks.
• Apple claimed that “app” was referring to an “Apple app” and not just an “application.”
• The purpose of trademark law is to allow the public to identify the origin of goods and services and protect one’s goodwill, not give exclusive rights to generic terms.
• A trademark can become generic over time if a company is not careful.  For example, Xerox is a particular company but the term over time came to refer to all photocopies.
• Despite not prevailing in the action, the Apple v. Amazon case is an example that sometimes, valuable trademarks are worth fighting for.

Why would two giants fight over a trademark?  Because a trademark can be incredibly valuable.

What’s in a name; the battle over the term “App Store”

First Apple had a heated battle with Microsoft over the “App Store” trademark, then they sued Amazon for “improper use” of the same trademark.

Generic and descriptive terms cannot be registered as trademarks

The trademark granted Apple was for “App Store.” Under the relevant trademark law, a trademark cannot be registered if it consists solely of a generic or purely descriptive term. “Store” is generic. So too is the word “application,” which is commonly thought of as being what the word “app” refers to.  Therefore, no trademark could ever be registered for the word “store” or for the word “application” and certainly not for “application store” (no trademark can be registered when all of its constituent elements are generic). A trademark identifies the origin of goods or services and no one vendor can claim that a whole generic category of goods or services can be set out as a domain for which it and it alone is the origin. The question then was, does any of this change because Apple’s claim is for the word “app” as opposed to “application.”

Apple claimed that “app” referred to “Apple app” and not just an “application”

Apple claimed that “app” in this context is a word that refers uniquely to Apple in the public mind, that is, when a typical consumer hears of an “app,” that person immediately associates that word with an “Apple app” and not with the generic term “application.” In legal terms, then, Apple argued that the word “app” here has an “arbitrary” meaning and is therefore registrable to Apple alone. If Apple had prevailed on this claim, it would have been able to sue anyone in the future who tried to sell “apps” through any form of “app store.”

Of course, many other vendors are using the “app” designation for selling online applications and there is thus there was vigorous opposition to Apple’s application. Indeed, once the trademark examiner granted the application, Amazon immediately filed a proceeding contesting it. By continuing to push the trademark application, and by filing the lawsuit, Apple hoped to pave the way to have exclusive use going forward of “App Store” as against all competitors.

Apple was determined to be overstepping the bounds of reasonableness. If their trademark application had been granted, how would other vendors have been able to refer, even generically, to what they are offering?

Trademark law is intended to protect your goodwill, not give you exclusive rights to generic terms

Trademark law is intended to protect a company’s distinct offerings and to prevent others from pawning off a vendor’s good will by passing their goods or services off as that of their real owner. It simply is not credible that anybody would believe that what Amazon or Google or any of a number of other vendors offer was or is an attempt to trade on Apple’s goodwill.

On the other hand, trademark law is not intended to give anybody any form of exclusivity in describing generic categories of goods or services. That appears to be precisely what Apple was attempting to do.

A trademark can become generic over time if the owner isn’t careful

Apple had one more obstacle to overcome as well. A term that is at some point a distinctive identifier of a vendor’s goods or services can become generic over time (consider “Xerox,” “aspirin,” “escalator,” and many others that have suffered this fate). If “app” was at one time distinctive to Apple a many years ago, the public does not today thinks of it as anything other than a generic indicator of what you can download from a wide variety of sources.

Sometimes the value of the trademark is worth fighting for

For those wanting to closer examine the epic battle, the case was in the U.S. District Court, Northern District of California and is captioned Apple Inc. v. Amazon.com Inc., Case No. 11-1327.  Apple ultimately settled this trademark dispute with Amazon by issuing Amazon a covenant not to sue and agreeing that consumers know where to get their favorite apps.  While this might, especially in retrospect, look like much to do about nothing, it was clearly worth the fight for all involved because of the extraordinary value of the trademark involved and despite the millions of dollars spent on legal fees.

Whether you have a trademark you want to register, you have received a cease and desist or you need to send one, or whether you are on either side of a trademark infringement case, you will want to consult with a trademark attorney who can protect your rights.

Contact an attorney with Veritas Business Law, LLC for a free consultation.