Dan Lust - Hello, and welcome to the Cleveland Guardians' disastrous name change presentation. My name is Dan Lust. I am one of the hosts of "Conduct Detrimental." I am a practicing attorney in New York. I'm a sports and entertainment lawyer for the law firm of Geragos & Geragos. I'm also the sports law professor at New York Law School. Alongside me today is Mike Lawson. Mike, you wanna give a little bit of a brief intro?

 

Mike Lawson - Yeah. Thanks, Dan, so my name is Mike Lawson. I'm a producer and cohost of "Conduct Detrimental" as well. I'm an associate attorney for O'Connell & Aronowitz in Albany, New York, and I'm in their litigation and criminal defense practice. I've been with O'Connell & Aronowitz for approximately 16 months, mainly working in personal injury matters, but I've been with "Conduct Detrimental" for over two years now.

 

Dan Lust - Yeah, so this story today is one that I think that practitioners should know and that most sports fans know. I actually think that it's maybe a little bit underserved, but the fine folks over at Quimbee reached out to us, and they said that this was one of our favorite topics that we had covered, and as Mike and I will get into, it's a story that "Conduct Detrimental," for better or for worse, we helped kind of create, and I think we are part of the narrative. When the story of the Cleveland Guardians roller derby baseball saga is written, I think we at least deserve a footnote in here, as we'll explain. So at a really high level, and I guess we should take one step back.

 

Mike and I host a show called, and we have Dan Wallach, a colleague of ours. We have a number of hosts that kinda come through, but we are a team of lawyers that work in this sports law space. Mike and I happen to do it for our real jobs. I have sports and entertainment clientele. Mike works on the sports betting side, on the legislation side, so we have, in this intersection of sports and law, we cover, on our show, "Conduct Detrimental," all stories that hit at this intersection. It could be the Major League Baseball lockout. It could be name, image, and likeness, and I have a feeling, for Quimbee, we're gonna be touching on a lot of these stories in subsequent presentations, but this story was one that uniquely came across our radar.

 

Just a brief background, and then we'll get into it, but Cleveland Indians. People have known them for nearly a century as Cleveland's baseball team. As we've seen in sports, some teams are starting to change the names, which we'll get into. The Washington Redskins changed their name to the Washington Commanders, and the Indians happened around the same time, so they announced that they were changing their name, which we'll get into the whole time line. Eventually, they settled on the name the Cleveland Guardians. That name, as fate would have it, was already in use by another Guardians. In fact, another Guardians within the state of Cleveland. Yes, there was already the Cleveland Guardians, which, as you can might imagine, has some IP issues that that were raised, so we'll just say this is probably a how-to on how not to change your name, and that's why we settled on the title for this presentation, "The Disastrous Name Change of the Cleveland Guardians," so Mike, I'm gonna hand it to you. Can you give our listeners kind of a overview on what we're gonna cover today?

 

Mike Lawson - Yeah. Let's dive into a little bit of a roadmap here. This video is gonna cover the Cleveland Guardians roller derby lawsuit against the Cleveland Guardians Baseball Company and the trademark implications, as we'll dive into the specific natures of their lawsuit. Trademark lawsuits are typically brought by the owner of a mark to protect and prevent others from using their marks, and that's damaging their brand. The Lanham Act is the federal law that provides trademark registration and protects the owners of their marks. The main issue we'll be focusing on here is what we'll discuss a numerous amount of times is the likelihood of consumer confusion and the remedy being an injunction, which prevents a secondary user from using the primary owner's mark. This video is gonna cover the registration process under the Lanham Act and one's ability to sue to protect a mark from trademark infringement, and obviously, as Dan said, how the Cleveland Indians bungled their name change.

 

Dan Lust - I like it, Mike. I like it, and I especially like that we're talking about a billion-dollar organization bungling their name change, so sometimes, even those fancy lawyers, you know, the ones, the big baseball teams, those guys can make mistakes too, so we'll unpack it, but this is certainly a how-to in how not to do certain things. Okay, so let's get into it, right? The Cleveland Indians were tasked with changing their name, so it sounds like it's a simple process. We're gonna get a little bit into the dates and whatnot, but certainly, there were obstacles, and certainly, I think something as simple as Google, right?

 

A Google search probably would've been helpful here, as crazy as that sounds, but from our research, really, one of two things happened: either that they failed to do their due diligence, and they didn't realize there was another Cleveland Guardians, which we'll speak about today, or maybe, worse yet, they knew there was another Cleveland Guardians and just didn't think that this roller derby team, again, as crazy as this sounds, yes, a roller derby team went head-to-head with a baseball team. Maybe baseball didn't think roller derby team would do it, but that's certainly what we had, so yeah, at a really high level, the roller derby team had used the name for in a handful of years. Some dispute as to whether it was a decade, but it was at least five years, so we're gonna talk about the factors that go into someone having a trademark, be it a common-law trademark or actual registration with the USPTO, and what other type of state filings will go into an entity's common-law trademark filing. Common-law trademark, we have a special segment of this presentation just for that. Common-law trademark is the concept that you don't necessarily have to file a trademark. If everybody knows that that's your name, and you put it into commerce, you can just sometimes get the rights to that just by use, in the commercial sense, so that's a little bit what happened here.

 

Okay, so Mike, you kinda laid into it. We got a lot of things we wanna cover today. Our main three, we wanna break down the trademark dispute and the overarching importance of owning rights to a name. Here, it's gonna be a team name, but it's really just a name in general. We're not gonna talk about it today, but certainly, Facebook had their own bit of a PR bungle with changing their name to Meta, and they had to pay off a number of other companies, so it happens. It's not unique to sports. The second learning objective today is to identify the key arguments from both sides of the Guardians, the baseball Guardians and the roller derby Guardians, and keep in mind this resulted in a federal lawsuit. This wasn't just something fun that I talk to my law students about in New York Law School. This resulted in a federal lawsuit, so if it wasn't embarrassing enough that people were questioning whether the Cleveland Indians forgot to check Google, they were actually sued, okay? So resulted in a settlement, which I think was probably equally as embarrassing, but we'll get into that, and last, but not least, it's understanding how that settlement uniquely allowed both baseball and roller derby to remain the Cleveland Guardians. Yes, we now have two Cleveland Guardians moving forward. You'll hear us talk about it. I think that is probably another embarrassing story for the baseball team, but be that as it may, that is where we are. Mike, I will hand it to you.

 

Mike Lawson - Yeah, let's set this up a little bit, so if we state back to the history of the baseball organization here. Cleveland's Major League Baseball team took the name the Indians in 1915. However, amidst recent social justice movements and pressure from Native American organizations resulted in the Cleveland baseball organization deciding to rebrand their name, and especially their Chief Wahoo logo, so we're gonna discuss the analysis of the trademark infringement from changing the Cleveland Indians to the Cleveland Guardians, but one factor, when it comes into trademark infringement here, is the defendant or the infringer, and in this case, it's the Cleveland Indians changing their name to the Guardians, it's their intent to use the mark. We'll see, from case law, that courts determine whether the defendant or the infringer was careless when they conducted their initial trademark search, when they're going to rebrand. In this case, maybe lack thereof trademark search, and if they consider the fact that there is a likelihood of confusion with other companies that are using that mark already. Here, as Dan has already referenced, and we're gonna keep referencing, the Cleveland baseball team clearly couldn't even make a Google search.

 

However, as we'll see in the complaint, apparently, they were well aware of the Cleveland Guardians roller derby team. Now, let's set it back to the roller derby team, so a local roller derby team in Cleveland, the Cleveland Guardians, they've been using their mark since 2013, as further evidenced by their merchandise sales, their production, their competitions, and, as you will see, they had a registration in the State of Ohio. The Cleveland Guardians registered their trademark on January 4th, 2017. The State of Ohio certificate shows the first date of use being October 10th, 2013, so as Dan mentioned before, the common-law trademark protection. They didn't have a federally registered trademark. It was state registered in the State of Ohio, but under the common-law protection, which, for the United States trademark law typically will give preference to the first to use over first to file, which we'll get into as well, but one issue that we have here is everything that comes with that mark, and one of the aspects is website and social media presence, so Dan, I know you had a field day with the social media aspect of this, so why don't you discuss that a bit?

 

Dan Lust - I mean, so, I guess, let's unpack it, right? I guess we can also talk about how "Conduct Detrimental" kinda sniffed this out probably early the most and how we kinda found ourself at the heart of the story. The Cleveland Indians, as I guess we can call them Indians, Guardians. For purpose of today, it's probably easier to call them the Indians, but the way that this story got legs is that the Indians announced that they were changing their name, and we're gonna explain. They filed a secret trademark in a different country that nobody knew about, so the name was kind of in progress maybe for, I don't know, three, four months before they actually announced the name change, but when they did finally announce that they were gonna become the Cleveland Guardians, we got word. Mike, as you know, we've done a lot of work in Big 10 country, in college football, middle of America, Ohio State. We have a lot of fans over there, and when Cleveland announced that they were changing their name to the Guardians, I got a couple messages from people in Cleveland that said, "Hey, by the way, "our local roller derby team is called the Guardians. "Is that an issue? Is that a trademark issue?" And I'm like, "Okay, is there actually a Guardians team, "or you guys trolling us?" And they sent me the Facebook page, and I go, "Wow, facebook.com/clevelandguardians," and if you go on Facebook, and you use the handle @clevelandguardians, it went to this roller derby team. I'm like, "That's interesting," so I went over to Instagram, and I checked @, like the handle, @clevelandguardians. Went to the roller derby team, so I'm like, "That's interesting," so the Cleveland Indians have announced they're changing their name to the Cleveland Guardians, yet that there is another entity that owns the Facebook page and the Instagram page, so Mike, you mentioned at the top of this consumer confusion. That's certainly a little bit confusing that Cleveland Guardians goes to another team.

 

I'd say that that's out there, but here's where it got really interesting. In the aftermath of the announcement of the name change, there was activity on both accounts. The accounts, maybe, had been a little inactive, and let's remember the time frame here. This announcement was made in 2021. The year prior, really, still at that time, we had shutdowns across our country, particularly in sports because of the pandemic, so my understanding is that the roller derby season didn't occur in 2020, so you'd think, right? A roller derby team that's not competing, there's less of a need to post on social media, but that said, both accounts, the Instagram account and the Facebook account, post name change, right? I think in the 48 hours after the Indians announcement, you saw a little bit of activity on the Facebook account and the Instagram account, so I said to myself, I go, "Well, I've settled my fair share of cases. "I would think if the Indians "had an agreement with the roller derby team, "part of the terms of that agreement would be, perhaps, "you guys are not allowed to post anymore." I would actually think that's the most important thing in the agreement, and the fact that I saw both accounts posting, I'm like, "Either the roller derby team "is violating the terms of that settlement agreement, "or, Mike, maybe the more obvious one: "there was no settlement agreement," so we posted it online. We put out a story, and we laid out our analysis on our website, conductdetrimental.com, and we said exactly what we said. One of two things is occurring here: either this roller... There had to have been a settlement agreement, so either they're violating it, or, I guess, in the off chance the baseball team didn't put that in settlement agreement, but I would think they had to. The other one is there was no settlement agreement, so we rolled with our gut here, and we said, "There was no settlement agreement." Guess what, Mike? Guess what? The big brains over at "Conduct Detrimental" nailed it, and the real hint here was the social media presence. That's what tipped us off, so, I guess, here, right?

 

That brings us to a larger question. Why, and we pulled this up, why is it that the roller derby team and the baseball team can't coexist together, right? Is it inherently a problem that the Cleveland Guardians roller derby team has the Facebook account and the Instagram account? But, I dunno, can't there just be two Guardians? So that's where an interesting question is raised, this question of consumer confusion. If you look at the logos, right? One is green. One has a picture of a guy wearing a roller derby helmet with wings on his head. The other one is a flying G on a baseball with wings on the G. The logos are somewhat similar, obviously, different color schemes. The script is different, but if you said, "Hey, I'm going to a roller, "I'm going to a Cleveland Guardians game," There's some level of confusion, and a main one, which we'll get into, the roller derby Guardians said, "Hey, we used to be number one on the Google hits. "Now, we're on page 10. "No one can find us anymore, "so we've now been banished to oblivion. "You can't do that," so if you were looking for the roller derby, for roller derby content or roller derby merchandise, you can't find it, and I think there was some comments from roller derby that there were merchandise stores that refused to sell their goods because of a fear of intellectual property concerns because of the baseball team, so how crazy is that, Mike? The roller derby team has existed for years prior, yet merchandise and vendors are saying, "We're afraid to sell your goods "because of the baseball team," so that was the issue with consumer confusion, and really, I guess, vendor confusion. I think that was part of it, but overall, confusion within the marketplace is, I think, where we got to.

 

Mike Lawson - And that's, and we're gonna get into this later, too, as we dive into the trademark issues here, but that cause of action is called reverse infringement, and we'll talk about that later, but it's basically this David versus Goliath where you have the smaller company that owns the trademark, but this larger company comes in as the actual infringer, but because of their resources, because of their marketing, they become number one on the Google hits even though they're infringing, or the owner of the mark falls to the side because of this infringement, so we'll get into the specifics on what that means, exactly, but when we look at it on a surface level, just trademark issues in general, right? What is a trademark, right?

 

Dan, you were just describing the mark, the logo of both of the teams, right? That is exactly what it is. It's a symbol or words that represent a company or product which have been legally registered, which, again, we're gonna talk about the Lanham Act, or have been established by using commerce, and that was what the Cleveland Guardians roller derby team did here. They used their product, as you saw on the Ohio State registration. Their first to use was in 2013 where they didn't register in the State of Ohio until 2017, and they didn't federally register until after the Cleveland Indians registered their Cleveland Guardians name, which we'll talk about, too, with the offshore registration, but, again, I keep going back to this. We're gonna be discussing the Lanham Act here, and the Lanham Act is federal law that protects owners from, that protects owners of their marks from infringement through use of similar marks, which is likely to result in customer confusion or dilution of a famous mark. We see this example with Nike all the time where there are subsequent sellers of Nikes who are changing Nike but advertising it as if it's a Nike, and then Nike sues them because they're diluting that.

 

We see this with designer clothes as well, Louis Vuitton and Gucci and things like that, when there are fakes, quote-unquote, so here, we have the Guardians, the Cleveland Guardians roller derby team, and their mark now being adopted and used by the Cleveland Indians baseball team. Now, how do we establish infringement here, right? So to establish trademark infringement under the Lanham Act, the plaintiff, and in our case here, this is the Cleveland Guardians roller derby team, they must show three things. The plaintiff has to have a valid and legally protectable mark. In this case, that's typically shown by registration. You federally register with the United States Patent and Trademark Office, USPTO, if you will. However, unregistered marks also have preference, but that's through the courts, and they have to have inherent distinction or secondary meaning, and now what does that mean?

 

I'm sure if you've ever taken some sort of trademark class or trademark course, you have these four descriptive, these four types of marks here. You have a generic mark, a descriptive mark, a suggestive mark, and then an arbitrary fanciful mark. Typically, generic and descriptive marks are not inherently distinctive because a generic mark is just something that's used by everyone, so it wouldn't have a distinct... You wouldn't know the origin of the mark just by using it, right? That's like a common expression of what it is, right? You can't call a candle company Candle because everyone's gonna be like, "Well, where's it coming from?" Descriptive mark, I guess, would be in the same sense that you would be describing what that is, so I guess that would also be the example I just used. A suggestive mark and a arbitrary fanciful mark is something that you wanna lead into because it is something that isn't so generic or descriptive, but it gives the key factor of going to where the origin is. I used the Nike example, right? What it is a Nike? But everyone knows that. That's an arbitrary, and that's a fanciful mark, the Nike swoosh, but everyone knows that the origin of that is the Nike shoe, so here we had the Cleveland Guardians as an unregistered mark. They would be probably in the suggestive or arbitrary or fanciful type of, even though, I guess, a roller derby player would be a guardian of sorts, but it's not enough to become descriptive or, I guess, generic, so-

 

Dan Lust - Can we say one thing that's interesting that we're leaving out here? Why are both teams picking Guardians, Mike? Do you know he answer to this? 'Cause I did some digging on this.

 

Mike Lawson - Well, that's the Cleveland history of the guardians.

 

Dan Lust - Well, the bridge guardians. There's these giant bridge statues that look like guardians, so there was some basis for this term guardians. I think a lot of people outside of Cleveland had said, "Why is the name Guardians so important?" And I think that's important here. They were both relying on some imagery that it existed within Cleveland, so yes, the name Guardians just doesn't mean just like defenders, some amorphous term. It actually refers to some imagery within Cleveland. I think that's important.

 

Mike Lawson - Yeah, definitely, and that goes exactly to what I was saying with a suggestive mark being the Cleveland Guardians. This is a sports franchise, sports team. Guardians has history with the giant guardians on their bridges within Cleveland, so it would give rise to that. This is a sports franchise located in Cleveland. The second element here is that the plaintiff owns the mark, and that's, again, first to file versus first to use. I'm gonna talk about that in just a second, and the third is the defendant or the infringer's use of the mark causes likelihood of confusion. We keep saying that because that's the key kinda element here. Now, for first to use versus first to file, again, I said this before. Our trademark laws in the United States give preference to first to use over first to file. Use in commerce is a big deal, and that's through sales of merchandise, and you can show that through examples of actually having merchandise, and in the Guardian sense, also going to competitions and using the name as a competitive roller derby team, so the Cleveland Guardians roller derby team did not file with the United States Patent and Trademark Office. They did after the Cleveland Indians did. However, the Guardians were first to use in commerce, as I said before, it was 2013, and that is the common-law protection under which trademark law gives preference to: first to use. In the effort of secrecy, though, I'm gonna go to the Cleveland Indians here. They filed offshore, and they filed their trademark on the island of Mauritius on April 8th, 2021.

 

Dan Lust - Good. Good. Good pronunciation there, Mike. I think it's Mauritius, but it's a country that I will be first admit I had never heard of, so you call it secretness. I'll call it shystiness. I think that's a legal term for our listeners out there.

 

Mike Lawson - And everybody, everybody jumped right online once they heard that this filing happened in Mauritius or Mauritius. Now, Dan, why would they file there? What is the purpose of filing on this little island? And how is that allowed under U.S. trademark law?

 

Dan Lust - Well, here's the thing. It is allowed, and it's maybe a concept that was from foreign to some, but there is a concept called, or it's under the Paris Convention, essentially, and I'll give everybody a high level, and then we can kind of break into it, and we've seen Washington, the NFL team, follow a similar path here, so let's go over some dates, right? I think at the end of 2020 is when the Indians announced that they were gonna change their name, so they were doing a lot of research, focus groups. I'm not exactly sure what they were doing, but in April, on April 8th, the Cleveland Indians file a trademark for, quote, Cleveland Guardians in this country of Mauritius under the Paris Convention. It's an understanding that you can file a trademark out of the country, and then you have six months from that date to then file it in America to be able to get kind of look-back privileges, so why would one do it here? Which is your question, Mike. To not let anybody know about the name, right? To be able to have that lead-up time to kinda get a head start on everybody.

 

 You know, what was funny, Mike, and I think it's important, once the Indians announced that they were changing their name, there were a number of trademark squatters that tried to guess the name, so they were guessing everything from Cleveland Spiders, which is a name that has some significance in baseball, to Cleveland Rockers because of the Rock and Roll Hall of Fame, but people were guessing. Somebody, and I'm not, I don't wanna give them any credit, but one of the trademark squatters domestically actually guessed Cleveland Guardians and filed with the USPTO at the end of 2020 for the name Cleveland Guardians, so Mike, you had mentioned that there were a couple trademark filings here, right? The Cleveland Indians filed a trademark filing with the USPTO. This was after Mauritius, which I think if you're just going by dates, and actually, this is kind of important to the story, but the Indians filed with the USPTO. The Cleveland roller derby team filed with the USPTO after the Indians, but the first person to file for Cleveland Guardians was was actually a trademark squatter at the end of 2020, so this was before Mauritius, Mike. This was, so we're talking about first to use versus first to file. Cleveland Guardians roller derby team was the first to use.

 

The Cleveland baseball team was actually not the first to file. That's actually very relevant here, so as we were digging through the USPTO office, what we saw is that it looks like the individual, well, we'll call him a trademark squatter. We don't wanna give them their name. We don't wanna give them some pub here. Looks like they settled up with the Cleveland Indians. They had some type of settlement because that mark was basically removed and withdrawn from the USPTO office within days of the Indians filing, so they weren't the first to file, but it looks like they resolved that, so they, according to the Indians, they got rid of their, the only real person they were worried about because somebody else had filed before them, so yeah, that's really the case here, and I wanna just mention thing on dates, which is why we had a lot of fun on our show for a couple months. We asked the question, would it have made sense, right? If you guys are this billion-dollar conglomerate baseball team, to have placed a phone call to the roller derby team, right? It looks like you guys settled up with the squatter, so clearly, you weren't averse to potentially settling, and obviously, as we're gonna fast forward, this case ends up getting settled, so you're not averse to settling in general, but why wouldn't you have had a conversation with the roller derby team before you announced the name change?

 

So then, we were trying to figure out what was the rush on announcing the name change in July of 2021? I couldn't figure it out 'cause certainly, Mike, the Paris Convention gives you six months from the date of filing in their overseas countries, so here, that was Mauritius. That, in theory, right? April 8th gives you six months, so my rough math. I was not a math major. I was a philosophy major, but it takes you, right? Approximately to October, so why on Earth did you need to announce that you were changing the name in July? Maybe you could have given yourself another 90 days to have made some type of settlement with the roller derby team. It didn't happen here, and it turns out, which we'll look at the complaint in a few minutes here, but there were conversations happening between the roller derby team and the baseball team, but baseball just decided to, by all indications, artificially shorten that time frame, that six-month window that they had, and they announced it. Why, Mike? And maybe, as baseball fans, we know this. Cleveland Guardians were not having the, or the Cleveland Indians, at the time, were not having the best season, so if you're trying to just find a reason, it was maybe because they wanted their fans or something to look forward to, something to look ahead to, but certainly, there was no legal reason, no legal strategic advantage to announcing your name change that quickly, Mike, even the opposite. I think you lost, which we'll get into, a lot of settlement leverage to settle this case appropriately, so that's really the essence of the Paris Convention. The time line of events that we've been over.

 

Again, the Indians announced their name change on December 13th of 2020. They're gonna announce that they're gonna change their name to something. We don't know what. On April 8th of 2021, the Cleveland Indians can take a trip over to the lovely country of Mauritius and they file for the, quote, Cleveland Guardians, and then, three months after that, 3 1/2 months, on July 23rd, 2021, the Cleveland Indians announce their new name: the Cleveland Guardians, so as we've kind of hinted, in this period of time, there's some critical missteps on the baseball team, and at this point, I think on July 23rd, 2021, I think, Mike, that the baseball team, I think they thought that the roller derby team was gonna fade into the background, maybe not put up a fight here, but I'll hand it to you. Why don't you tell everybody what happens here?

 

Mike Lawson - Well, that's just exactly it. The Cleveland Indians thought that this roller derby team was just gonna roll over, and they were not.

 

Dan Lust - Oh, I see what you did there, Mike. I see what you did there.

 

Mike Lawson - They attempted to do the secrecy of filing in Mauritius, right? That's in an effort to protect their release of this, right? Because as soon as they say they're gonna name-change something and they don't actually have the filing to protect them, and you have these trademark squatters who filed before them, then they lose their protection, and you're right: As soon as they announce the name change, they lose their settlement leverage because the other person who has the ownership to this mark is gonna be like, "You already said you were gonna change the name, "so now you gotta pay me "a lot more money than you would have "because you might have used this name. "Now you already, "you're saying you're using this name," right? And on July 23rd, 2021, I remember it. As soon as the video came out, it's Tom Hanks as the voiceover, a nice landscape of a drone flying through Cleveland and the guardian statue. It's like it was a very... Statues, I should say. It was a very pomp and circumstance of this name change, right? And we'll talk about the Washington Football Team and what happened there.

 

There was even more trademark squatters there and how Washington has used this, but Washington also filed offshore. They filed in Trinidad and Tobago, and it's a way for... Because unless you're looking at all these offshore countries and their trademark filings, you have no idea what this name is gonna be, right? So let's get to the lawsuit here, so on October 27th, the Cleveland Guardians roller derby team, they filed their trademark lawsuit. It's in Ohio's federal court, and they allege trademark infringement, misappropriation, deceptive practices, among a lot others. Their relief that they were seeking was an injunction to prevent the Cleveland Indians from using their name, their mark, the Cleveland Guardians logo, and brand here. Again, just some of the causes of action here, right? We have the Lanham Act. We're talking about that, that the likelihood of consumer confusion. They had some state law claims of trademark infringement, unfair competition under Ohio state law, as well as Ohio's Deceptive Trade Practices Act, which is confusing or misunderstanding to the source of the goods here, so Dan, why don't you dive into a little bit more of the details of the allegations of this lawsuit?

 

Dan Lust - Yeah, so let's unpack it, and we have the complaint. It was publicly filed. We certainly had a lot of fun, and let's just, I guess, from our perspective, we were banging the drum that something was going wrong here, that something did not make sense because the Cleveland Guardians, up until this lawsuit, right? October 27th, continued to file to their social media accounts, so we had some pretty big people drop in our replies and warn us. They said, "Do you really think? "Do you guys really think that the Cleveland Indians "were this careless with their name change? "Do you think they would be this stupid?" And I said, "I do. "I do think they were that dumb," so sometimes, you gotta trust your gut. I don't, not to offend anybody, but sometimes, people will have gone to better and bigger law schools. Sometimes, people are at better and bigger firms, but at the end of the day, all we have is our gut, and if you do your research and you feel confident in something, stick to your guns because us, this sports law podcast, I think we had a bead on the competition here, and we just felt pretty confident the whole time that that was not how a settlement agreement would be done, and it's not... 99 times out of 100, how a small roller derby team would be standing up to a Goliath unless they really felt confident in their position. It would not be poking the bear, so to speak, by posting on social media, putting shirts up.

 

The complaint, which is publicly available, gives a wonderful history, and in very embarrassing fashion, of all the mistakes that were made by the baseball team, so let's get into it. I think that's certainly important here, so first and foremost, this is a federal lawsuit filed in the Northern District of Ohio. The complaint opens up on a very strong note, right? The same laws that protect baseball's team owners' trademark rights, though, also work in reverse. A major league club cannot simply take a smaller team's name and use it for itself. Confusion would still arise, yet that is precisely what defendant Cleveland Guardians Baseball Company, and they write parentheses, Mike, I think this is so funny: formerly known as Cleveland Indians Baseball Company seeks to do despite knowing of plaintiff's established rights, defendant wants to call its team the Cleveland Guardians too, so let's start there, Mike.

 

I find this so funny. The Cleveland roller derby Guardians, they've been sitting on this name for years, and now they have to sue an entity, not only change its name, they've changed their legal operating name. They have a new LLC that's called the Cleveland Guardians Baseball Company. That's a slap in the face, right? Number one. Obviously, why this lawsuit's filed in Ohio, that's where both teams are based. It makes a lot of sense, but this is a heavy lawsuit, which... I only joke, Mike, because we were having fun with this lawsuit. We assumed that the baseball team, after all the publicity that we were giving to this lawsuit and how viral it was going with sites like Barstool picking it up and really big players in the sports media space picking up the story. We kinda figured, Mike, that the Indians would just pony up and pay the roller derby Guardians to make them go away, that this lawsuit was never gonna happen, yet it did. Mike, I have a funny question for you, Are you ready for this one?

 

Mike Lawson - I'm ready.

 

Dan Lust - How much money do you think that the Cleveland baseball team spent on Tom Hanks to record that beautiful montage, that picturesque montage?

 

Mike Lawson - Tom Hanks is a desirable-

 

Dan Lust - He is.

 

Mike Lawson - Award-winning actor.

 

Dan Lust - Pretty big.

 

Mike Lawson - I would, I would, I would have to put his time, and now, granted, this was a two-minute clip?

 

Dan Lust - Two minute-

 

Mike Lawson - Two minutes.

 

Dan Lust - How much for an hour's worth of time? And then you break that down. I would say, I would put it in the probably the six figures.

 

Mike Lawson - Six figures.

 

Dan Lust - Okay, maybe 100, maybe 100,000. So six figures for about two minutes of work. Mike, those are some pretty good billable rates if I've ever seen them. I don't think you and I are quite at that level, but-

 

Mike Lawson - No. Right.

 

Dan Lust - You know, 50,000, 50,000 per minute is pretty solid, right?

 

Mike Lawson - Pretty solid.

 

Dan Lust - Pretty, pretty solid, so we'll get into it, but there was money that was offered up by the Cleveland roller, or Cleveland baseball team to settle this lawsuit. It's an embarrassingly low number. It is, quite literally, maybe pennies on the pennies on the pennies to the dollar with respect to what the baseball team paid to Tom Hanks, so congrats. You had Tom Hanks narrate your big announcement. That money was certainly better served spending it on the roller derby team to have made this lawsuit go away, so once this lawsuit is filed, it certainly cheapens the name. It makes a lot of people think twice about why they went with this. It makes a lot of people question the organization, but let's not kid ourself. The fact that this lawsuit was filed speaks to a really big problem with the baseball team. There certainly there was amount of money that they could have gone away with, could have resolved this case for much sooner. OK, so Mike, you had mentioned earlier, it's not just looking up on Google. If you looked up the Cleveland Guardians on Facebook, on Instagram, you would've found them, the roller derby team. If you would've looked them up on Google, you would've found them 'cause that's what we did, but Mike, not only that. We're lawyers here, right?

 

If you would've looked with the Ohio secretary of state, the Cleveland Guardians had actually formally registered that with Ohio, within the state, so obviously, the USPTO is for federal filings, but if you're kind of trying to figure out if you have a good-faith filing, which is one of the elements for filing with USPTO, you have to believe you have a good-faith basis and there's no objectors to the claim, it was almost as if the baseball team was caught in a lie, right? Did you not check Google? Doubtful. You probably checked Google. Did you not check Facebook and Instagram? Also doubtful. Now, did you also not check with the Ohio secretary of state? I mean, come on. At what point do we just not believe what's going on here?

 

Mike, an important part of this story that we have not mentioned in the history of roller derby teams, as crazy as this sounds, this was not the first time another professional league was alleged to have stealen a roller, stolen a roller derby team's name. Two teams claim that they had their name stolen by women's professional soccer, the North Women's Soccer League. That's a team by the name of Gotham and a team by the name of Angel City, so what's more likely, Mike? That the Cleveland Indians did absolutely no due diligence whatsoever and just landed on a name? Or, Mike, with these very high-powered, highly educated lawyers, that they did all their due diligence and they realized, "Hey, these roller derby teams exist, "but none of those prior roller derby teams, "Gotham or Angel City, were given a dime of compensation "for the team that stole their names." If you ask me, Mike, just my gut, I think that the Indians knew that those other teams existed and decided to save some money, save a couple thousand bucks, and decided to just say, "Hey, we're gonna move forward. "We're actually gonna save that money "for the Tom Hanks budget. "Let's just, let's get another 20 seconds outta Tom Hanks." What do you think, Mike?

 

Mike Lawson - Well, they probably had already paid Tom Hanks at that point because they were in the midst of their trademark search. You're right. I think that's the questions we got initially when this happened was there's no way they could have screwed this up. There's no way that they didn't know. They have high-powered lawyers. They have general counsel office. They had outside counsel do a trademark search, so there's no way that they didn't know about this, so it had to have been the latter and that they knew about it and that they were just saving a couple of bucks, billionaire owner that just tried to save some money.

 

Dan Lust - Okay, so here's the... We're gonna talk about a little bit of the arguments here, but the Guardians essentially say, as we mentioned earlier, that they had to put a pause on their games because of the pandemic, so Paragraph 10 of the complaint says that, unfortunately, due to the pandemic, the Summer Affair 2020 event was canceled, and no event was held that year. The Cleveland Guardians team, however, was competing in matches right up until early 2020, for example, traveling to Pittsburgh in January to take on the Pittsburgh Undead, so what they speak to is that, yes, there was a cancellation, but this was the main point that we kept talking about in our legal circles: Did the Cleveland Guardians abandoned that name because they didn't have any social media and they weren't playing in games in that year, year or so period? I think the Cleveland Guardians, the roller derby team, was saying, "Listen, we might not have been competing, "but a year of inactivity during a pandemic "is certainly explainable. "Doesn't show a clear intent to abandon the name. "Quite the contrary. "We would've been playing but for unprecedented pandemic "that overtook the country," so I think that was maybe the best argument that baseball had. I don't think it's a necessarily good argument, but the best one is that, yeah, they were first to use it, but they abandoned the mark, but that time period was so short.

 

It was about a year and change, right? They announced the name change in July of 2021, so the pandemic had been going on for at most, right? A year and a couple months. That's not usually enough to evince a clear intent absent some type of note or some type of press release that they're abandoning it, which they obviously didn't have here, so as we make our way through, we certainly had a lot of fun with this. The roller derby team starts posting on social media, "Hey, we have new merchandise. "You come and buy our merchandise," so what the Guardians did, it's a very, I would think, a masterclass in applying leverage. What they were, there was so much attention being paid to the Cleveland Guardians' new name, right? And the baseball team changing their name. We didn't, we haven't mentioned it, Mike. In addition to the Facebook page, the Instagram page, the secretary of state filing, the Google hits, Mike, do you know what else the roller derby team had?

 

Mike Lawson - clevelandguardians.com.

 

Dan Lust - clevelandguardians.com. You cannot tell me that the baseball team didn't know that. It's not possible, so you know what they did, Mike? They came up with some new merch, and they said, the roller derby team said, "You know what?" "There's all this attention, "and we're getting exponentially more traffic "to clevelandguardians.com. "You know what we're gonna do? "You know what we're gonna do, Indians? "We're gonna make your life miserable. "We're gonna put our merch on clevelandguardians.com. "We're gonna make money off of your continued use," so, essentially, what they said, I imagine, behind the scenes is, right? "You're gonna keep putting more attention "on the name Cleveland Guardians? "Sounds good. We'll make some more money off of it. "clevelandguardians.com is ours. "The Facebook page is ours. "The facebook.com, Instagram, Facebook. "We have the social media. "We're gonna continue to make money off this "until you pay to make us go away."

 

Mike Lawson - And that's the key point on reverse infringement that I mentioned earlier, right? You said they were getting more hits on their website because everyone else, consumer confusion, thought that, of course, they're changing their name to the Cleveland Guardians. Why wouldn't they own clevelandguardians.com? So they go to Cleveland-

 

Dan Lust - Let's check out the new, let's check out the new website.

 

Mike Lawson - They crashed the site on the first day of this announcement. There was over 180,000 website hits.

 

Dan Lust - Wait, wait, remember the? Remember that thought, Mike. What did you just say? They did what to the website?

 

Mike Lawson - Crashed the site.

 

Dan Lust - Our listeners, pay attention. They crashed the site. There's some symbolism here, but keep going.

 

Mike Lawson - So, like I said, over 180,000 hits immediately after this announcement, so yeah, of course, they're gonna post their new merch because now they have a whole new audience that's looking at their Cleveland Guardians merch. Their social media was directed at the baseball team, right? The @clevelandguardians is their Instagram page, right? So if you... Most of the younger generation is using Instagram, so any young fans of the Cleveland baseball team or any baseball fan's gonna go to Instagram and go Cleveland Guardians, and what pops up? The roller derby team, so this is a clear issue, and, again, reverse infringement at its finest, where you have a larger company with a larger audience and a larger marketing value that comes in and dominates the marketing, dominates and crashes a site, and there's examples of that too where we'll talk about with case law as well.

 

Dan Lust - Yeah, so let's unpack it. I don't think the exact numbers are out there, but there was, well, I guess, let's stick to the time frame. I think this is helpful for some, so on April 21st, we, or April 2021, we talked about the fact that the Indians went over to Mauritius, so the title of this chapter in the complaints, Paragraph 19, it says, "The Indians knew all along "about the Cleveland Guardians "before deciding to adapt the identical team name," so again, the roller derby team is pointing out that the Indians essentially filed in bad faith, that they knew this other team existed and really didn't do anything about it, so as we go through, right?

 

Two months later. This is my favorite part. We didn't know this until the complaint was filed, but says: Two months later, on June 10th, the Indians, working through lawyers, finally contacted the Cleveland Guardians, informing them that, quote, "Cleveland Guardians was one of the names "the team was considering," even though the Cleveland Guardians objectively had superior trademark rights. Then, a week later, the Indians' lawyer sent an e-mail asking Gary Sweatt, the Cleveland Guardians' principal, to send some pictures of the logos, which he did, and they, I guess the auspice swank was that they would discuss with club management how they were gonna, if the baseball team was gonna acquire the Indians, collect intellectual property at this point, so I think the Guardians, acting in good faith, sent those materials over, so this is June of 2021, so let's take a stop for a second. We've been saying this, and this is why the time line is so key, Mike. April is when the Indians go to Mauritius and file this trademark filing, right? And now, June, two months later, "Hey, we're considering the Cleveland... "We're considering Cleveland Guardians."

 

I have not heard that the Indians filed any other trademarks in any other random countries like Mauritius or Trinidad and Tobago. As far as I'm concerned, they only filed one, and so they wait two months, and now they contact the Cleveland Guardians, so I probably would've done it the opposite way, maybe. I think that would've been the move, but certainly, you have not announced to the public, as of June 2021, that you're announcing the name change, so this is your window, right? Nobody really knows that you filed in Mauritius. You have until October. This is your window to settle the case.

 

Mike Lawson - And this is where they clearly bungled it because if there's any sort of incompetence, obviously, they knew that the Cleveland Guardians roller derby existed. However, they were only looking on the federal level. They might not have looked at the Ohio Copyright, Trademark Office, right? Because we clearly saw that they paid off somebody who filed before them, that filed the federally, the registered Cleveland Guardians. They contacted them, and they paid them off to get the filing, right? They filed in Mauritius, and then, two months after they filed in Mauritius, they then contact the Cleveland Guardians because like, "Hey, we see that they have "some sort of ownership on the first to use of this mark, "but they're not federally registered, "so they're probably not gonna be that much of an issue. "Maybe we can just quickly pay them off." Guardians, it comes to kind of screeching halt. They make a nominal offer for their trademark property and intellectual property, and then, a month after that, we see July 23rd, the announcement of the Cleveland Guardians name change, so if there's gonna be any sort of incompetence, I think they didn't give enough credit to the fact that this Cleveland Guardians roller derby team was gonna give them such a difficult time.

 

Dan Lust - So there's been a lot of conflicting reports on the number, but allegedly, the Indians offered an amount in the ballpark of $10,000. I think it was maybe even a little south of that, but that's the range. There was this, my favorite line of the entire complaint. The roller derby Guardians were obviously a little offended at that number. They said, "If you wanna buy our IP, "we'll listen to an offer. "Whatever you wanna give us, we'll entertain it," so it's in that vicinity, right? I think, low five figures, high four figures, that's what's been publicly reported out there, so this is my favorite line, okay?

 

Mike Lawson - This is Paragraph 26.

 

Dan Lust - How did you know? We didn't even talk about this. How'd you? Okay.

 

Mike Lawson - Oh. Oh, I know.

 

Dan Lust - Okay, that same day, the Cleveland Indians sent their response. Even though the team had already invested an immense amount of time and money investigating and planning for a name change, including filing trademark applications on an island in the Indian Ocean, when given the opportunity to acquire all of the Cleveland Guardians roller derby team's superior rights, including the Cleveland Guardians name, clevelandguardians.com, and the social media, the Indians only offered to pay a nominal amount, quote, "Likely no more than 15 minutes "of annual team revenue," close quote. Mike, this is what I think this is the biggest bungle. You have this, right? You maybe made a mistake by not handling this the right way. Actually, I think there's a bigger mistake that's made, but you can offer low, but you can't offer embarrassingly low, right? You always wanna start low and work your way up, right? And if you're on the plaintiff side, you wanna start high and work your way down, but if you start with a number that's embarrassingly low by a billion-dollar organization, and you wanna buy, acquire another team's IP, and you've kind of stolen their name, you can't start with that low of a number, and that's what really ticked them off.

 

Mike Lawson - Yeah, it had to have been an offer that needed to be in the six-figure amount, right? Think about the retainer that they would probably pay an attorney to go to federal court to fight this lawsuit, right? Probably in the six-figures range, right? So if they're gonna save themselves legal fees, right? You have to put forth some sort of best offer, not a nominal amount, maybe in the five-figure range. It needed to be in the six-figure range, and it needed to be their first offer and then go from there.

 

Dan Lust - Yeah, so that's essentially it. A lot of the rest of this complaint, we have hit, in some way shape or form, but the main point here was that the Cleveland, the Cleveland Guardians have basically painted a picture where by July 22nd when the baseball team files with the USPTO, there is no way that they did not know about this name. It's not possible, so you've done one of two things, right? The USPTO is now gonna have to make a tough decision, even though this billion-dollar organization, right? Have all the money in the world. Still have to abide by normal trademark law, so you can be the first to file, but if you file in bad faith, that's certainly not gonna be looked upon favorably by the USPTO, so let's go to a question we asked earlier, and then we'll kinda go through the causes of action and we'll get outta here, but I think, at a certain point, the roller derby team had all the leverage because they would say, "Listen, congrats. "You wanna use the name? "We are entitled to the trademark, "so you guys can make all the shirts that you want "and all the merchandise and sell tickets. "You are using our name, "so if we pull the trademark from you, guess what, guys? "Was it really worth it?"

 

So that's why there was this window of time post July 23rd, but in the middle of this lawsuit happening, and even after lawsuit was filed, that the baseball team might have now had to change their name again because of how colossally messed this up, and as for settlement, right? You are offering $10,000, which, whatever. You wanna start embarrassingly low? Power to you. I wouldn't have done that. I don't think most people would've done that, but what you have done, right? You put an opening offer out. Okay, maybe you can leave some time for communication. That's June 20, of June 20th, right around there, of 2021. You guys announced the name change on July 23rd of 2021, so you only allowed yourself three months, but Mike, as we keep saying, under the Paris Convention, they really had until October to continue to negotiate, so the problem was they lost all leverage the second the Indians announced, they had this big press conference, the Tom Hanks stuff. They go, "We're the Guardians. Announcement. "We did it. We are the Guardians."

 

You've now lost all leverage, so let's say you probably could have settled this case, probably, I don't know what the numbers were. You probably could have settled this for an amount, maybe the high five figures or low six figures, but certainly, the optics are that you had to pay much, much more, maybe adding another zero, as crazy as that sounds, once you announce the name change without settling it, so, Mike, our intuition was correct: no settlement agreement, and the reason that the Guardians were allowed to post on Instagram and on their website and on Facebook is because there was nothing preventing them from doing it, and that was the big mistake here.

 

Mike Lawson - And I think that the interesting fact here is, right? That six-month window that you're saying, and then, in October, which would've been that six months, they get hit with a federal lawsuit for trademark infringement, so they completely lost leverage. They completely lost... I mean, their whole mantra was just shattered after this.

 

Dan Lust - So we've spoke about them, but all in all, the roller derby team is saying that this amounted to unfair competition under federal law. That's count one. Count two of the complaint is trademark infringement, unfair competition, and misappropriation, all of which, I think, are at least colorably met, right? This is not a case that's gonna be kicked outta court with an immediate motion to dismiss. You'll probably get to discovery, and obviously, there's a chance that you win, which would be incredibly embarrassing.

 

The last one, a violation of Ohio's Deceptive Trade Practices Act, and that's also speaking to the bad faith that the baseball team knew about the name and decided to proceed anyway, so, from an optics standpoint, and that's really it, so the prayer for relief, which we should touch upon, they were looking, really, for an injunction to stop the baseball team from conducting these activities, and, Mike, and here's another one of my favorite aspects of this lawsuit. I think the biggest mistake, just to close the loop, was announcing the name change in July when you hadn't come to terms, but, Mike, they didn't want the name Cleveland Guardians to be used in stores, right?

 

 For the merchandise to be sold, so that was a section of this relief. Do not sell shirts, right? Do not allow them. Give them, enjoin them from doing that, so that was a portion of the relief, and obviously, financial damages were involved there as well, so that was essentially the prayer for relief money, and also, to stop the baseball team from trounching and trampling all over their IP rights, but that was it. They hired a very big law firm to help them, which I think surprised many people that this was a real claim that a big law firm took on, so, Mike, I'm gonna hand it to you. What are our big takeaways from the complaint here?

 

Mike Lawson - Big takeaways. Well, it's clear to us that the Cleveland Guardians roller derby team owned this. They showed that they had ownership. They showed that they had first use in commerce. They showed... You're right. This is their burden of proof, right? They have to show that they own the mark. They had use in commerce and they filed it in Ohio State's trademark office, right? Again, we talked about the fact that you need to show that you have the legal right and the ownership of the mark, and then, you have this consumer confusion. We keep talking about it. The likelihood of consumer confusion, and let's go back to the fact that they own clevelandguardians.com. The Cleveland Guardians baseball team announced their name change, and then, they had 180,000 hits on their website, crashed their website. That is a clear sign of consumer confusion because they're thinking that this domain is now belonging to the Cleveland Guardians baseball team, but it still was in possession and ownership of the Cleveland Guardians roller derby team.

 

Dan Lust - Okay, so let's unpack this. I wanna get to reverse infringement, but let's keep in mind. Where is this lawsuit being fought? In Ohio. You would think that the big baseball team, the big, bad baseball team would have the home field advantage, so to speak. Not necessarily. I think there was a lot of sentiment that was against the Indians: A, against this name, Cleveland Guardians, which I don't necessarily think people loved, especially because they were stealing the name of another team. I don't think that was a good look, but there were other names. We mentioned the Cleveland Rockers, Cleveland Spiders, a lot of names that fans liked, so maybe a lesson. If you do change your name, as a sports team, the Washington Commanders felt that heat as well. Fans aren't in love with it, so even though they sued in an Ohio federal court, I don't know if that venue was gonna be so favorable to the Indians.

 

You'd think, maybe, but not necessarily, so, as you mentioned, Mike, this issue was of confusion. The Indians were gonna say, "Hey, we're a massive baseball team. "We have millions in attendance every year. "No one had heard of this roller derby team "until this story," but you have to kinda look at it from the Guardians, the roller derby team's perspective. Certainly, right? If you say, "Hey, I play for the Guardians," right? And you're in Cleveland, people would think that you would mean the baseball team, so I understand the Indians' argument, but it's not seeing it, right? And as a practitioner, you have to be able to see it from both sides. In law school, you have to argue both sides of the argument, so I think the Indians' arguments were a little, I don't know, I guess the word is tone deaf or just kind of not being able to see the full picture. Again, when it comes to trademark law, it's not about how much money you have. It's about the law, so I think the Guardians, baseball Guardians, had certainly underestimated the roller derby team here. I think maybe a lesson: never underestimate a roller derby team. I think that's a life lesson that will really help us moving forward.

 

Mike Lawson - Certainly, certainly, and when you talk, again, you're talking about the magnitude, the size of the Cleveland baseball team, right? Versus the roller derby team, right? Smaller, smaller market, smaller marketing, smaller advertising, and things like that, yet they own the mark, so, again, let's go back to reverse infringement. Let's break this down. It's not your traditional trademark infringement claim, right? Trademark is typically a case that alleges the infringer takes advantage of the reputation and goodwill of the owner of a mark by adopting a similar or identical mark. Reverse infringement alleges that a larger company, here we have the Cleveland Indians at the time. They are the junior trademark user 'cause they don't own it. They adopt the mark of a smaller company. In our sense, it's the roller derby team here, but they're the trademark owner and the senior trademark user, resulting in confusion of origin due to the fact that the larger company's wealth and advertising, they overwhelm the smaller company by flooding the market with promotion of that similar mark, thus, the confusion of the origin, so what this creates is the larger company's use of this trademark, again, they're the junior user. They don't own the mark. This marketing creates confusion that the smaller company, being the senior owner, they own the mark, is the actual infringer, and that's where you lose that value in the mark. We saw this in the complaint, where they alleged that they couldn't even get merchandise suppliers to make their Cleveland Guardians roller derby merchandise anymore because they thought that they were infringing on the Cleveland Indians' new trademark, new name change because that's what they thought, so that's exactly what happened in this case.

 

 Now, let's talk about some examples of reverse infringement. We have two cases that we're gonna discuss. The first one being the Harlem Wizards Entertainment Basketball, Incorporated versus NBA Properties, Incorporated. This was in the federal court in New Jersey, and this case was about the Harlem Wizards, which I'm sure most of you have probably heard of the Harlem Globetrotters. The Harlem Wizards is a very similar gameplay, similar style to the Harlem Globetrotters. The Harlem Wizards were suing the then Washington Bullets for trademark reverse infringement for changing their team name to the Washington Wizards, which is what we know them to be now. Here, the Harlem Wizards had no home arena. They didn't have a main venue that they played. They did have a team that typically stayed in Harlem, New York, but the other side of it was a team that traveled to high schools and local gyms, and after that, they did this circus-like type of game play, right? Not competitive at all, something that you see with the Generals versus the Globetrotters all the time. Now, the court found that the Harlem Wizards mark was suggestive, and thus protectable, right? We talked about the suggestive mark. It needed to be valid and legally protectable. The court also found that the plaintiff, being the Wizard, the Harlem Wizards, they actually did own the mark, not through registration, again, same in our case here with the Guardians, but they were first to use in commerce. However, the big key here is the court ruled that even though there was a concurrent use of the Wizards mark, it was not enough, and the plaintiff actually failed to establish that there was a likelihood of confusion among consumers. When we see these cases-

 

Dan Lust - Ooh! Ooh! Mike, call on me. Call on me.

 

Mike Lawson - Yeah, Dan.

 

Dan Lust - Harlem Wizards, right? And watch this: Washington Wizards. There was gonna be no confusion because they play in two different geographic markets, right? It's not a question.

 

Mike Lawson - Correct. Correct, so that's one aspect that the court analyzes, right? When you see large-scale cases like this, too, they have this marketing analysis. Somebody comes in and goes through a number of factors to determine whether or not there is a likelihood of confusion, and one of them is what you just said: the marketing channels, where they actually play, their home venue, and another aspect of it was the fact that they were two different, even though they're both basketball, the court really pinned down the fact that the Wizards, the Harlem Wizards, was a skill-based kind of competitive, a noncompetitive game versus the Washington Wizards, that was a competitive game, right? So here, they found no likelihood of confusion, but that's a perfect example of reverse infringement.

 

They didn't even allege some of the things that the Guardians alleged in their case, like harm to their brand and whatnot, so second case, real quick, Playmakers LLC versus ESPN. This is a Ninth Circuit case. Playmakers LLC was a sports agency that sued ESPN for trademark reverse infringement because they created a show about a fictional pro baseball, or a pro football team called Play-Makers. The plaintiff, being the agency, alleged losing clients because they believed Playmakers LLC agency was infringing upon ESPN's show and their goodwill and their mark of the show. The Ninth Circuit here, the issue was whether the consumers doing business with a senior user might mistakenly believe that they are dealing with a junior user. Again, we talked about this before with the reverse infringement.

 

The Ninth Circuit ruled that the plaintiff failed, again, same with the Harlem Wizards case, failed to show a likelihood of confusion, "Despite the similarities," and I'm quoting from the case here, "Despite the similarities in the marks, "the commonness of the word Playmaker, "the remoteness of the lines of business, "ESPN as an entertainment company, "and the Playmakers is a sports agency, "the difference in marketing channels, "and the degree of care "that pro athletes use to pick an agent "strongly suggest that the plaintiff's clients "are not likely to be confused," so again, both these cases, good examples of reverse infringement, but court ultimately found that there was no likelihood of consumer confusion. Here, we had the same exact mark, right? Cleveland Guardians, Cleveland Guardians. It's different than than these two cases, and there was evidence of over almost 200,000 people who immediately thought that there was the same team name.

 

Dan Lust - Playmakers: a little-known fact, starring Cuba Gooding Junior's brother Omar Gooding, I think, little-known factor. Okay, so, again, Mike, not a shocker, an agency suing a, basically, a show with the same name, two different type of fields, but when you're in the business of sports and entertainment teams, that's much closer, right? So in a sense, this was, I wanna say, somewhat unprecedented and why because who would think that a baseball team, of all the names they could pick, would pick one that was already in use with the same city name. That was the real issue here, so, okay, as we are wrapping up our presentation, I think the big thing here, there was a settlement that was announced on November 16th of 2021.

 

They said they reached an amicable resolution, and the agreement allowed both parties to proceed as the Cleveland Guardians, so one note, and I mentioned it here, you said it caused the website to crash. We have a fun graphic that we had a lot of fun with on social media, but on Monday, November 15th, the baseball team had announced a couple months prior that this was going to be the big announcement of the stores widespread retail release all these retail countries around, retail stores around the country were ready to have baseball merchandise. They canceled that launch on Monday, November 15th, so we said, "Okay, this is on here," right? "There's something brewing. "Looks like the baseball team's gonna have to settle "because they're afraid to actually have this launch," so they moved the launch back to November 16th, and they reached a settlement. We don't know what the settlement was. We don't have concept of those numbers. Rest assured, it was more than $10,000, so I think we can say that. Interestingly, Mike, clevelandguardians.com, where does it take you?

 

Mike Lawson - Still takes you to the Cleveland Guardians roller derby team.

 

Dan Lust - Interestingly, Mike, if you go on Instagram, and you go @clevelandguardians, I'll tell you: it goes to the roller derby team. Same with the Facebook page. The baseball team decided on the handle @cleguardians, cleguardians, so among a number of things that are very embarrassing, the fact that the baseball team's handle is cleguardians, and the roller derby team takes you to clevelandguardians, those guys are are still gonna get some goodwill from that. Okay, so that's essentially the resolution here. The baseball team cost themself a lot more money and a lot of brand harm by the way that they handled this. Do's and don'ts, right? Due diligence, effective negotiation, PR management. I think the Indians failed in all three. Mike, give us a brief comparison with Washington, and then we'll talk about what happens moving forward.

 

Mike Lawson - Yeah, so we talked about this a little bit before. Washington Football Team had switched their names from the Washington Redskins. They were the Washington Football Team for over a season. They played a full season with the Washington Football Team name. Some people thought that that was actually gonna be their new name as well. They followed the same guidelines, but they were watching the Guardians situation very closely because they did not want to bungle it in the way that the Guardians did. Washington has a whole slew of other legal issues that they're dealing with, so their PR needed to make sure that they got this right. They also filed offshore. They filed in Trinidad and Tobago, and the area of secrecy. Funny enough, on one of our podcasts, we actually guessed that it was gonna be Trinidad and Tobago, which was pretty funny as a filing offshore to hide the new trademark. There was a number of trademark squatters in this situation too, so they had to really make sure that nobody owned this mark, so they really were forced into due diligence, which, I think, was why it was more of an effective launch, and then, here we have, now, the new name of the Washington Commanders.

 

Dan Lust - Yeah, so that's it. I think both teams had their own paths. Both teams made their mistakes. Maybe another presentation down the line on how Washington messed up their own IP name, but, Mike, we don't wanna bury the lede here. I think this is my favorite part of the whole story. I've said there's a couple favorite parts. The day that they announced, the Cleveland Guardians, their launch of the merchandise, the team store in Cleveland right outside the stadium is a big sign that says Cleveland Guardians team store, that sign, as fate would have have it, collapses, crashes, gets destroyed, so there's the Curse of the Bambino for the Red Sox history. There's the Curse of the Goat, which is in Cubs history. You guys can look that up. Now, I think, Mike, I think there's the Curse of the Roller Derby Guardians, and I think the symbolism that sign comes crashing down. Moving forward, there will be a roller derby team. Those guys are still playing games. There will be a baseball team. The coexistence agreement, we don't have the exact terms, but we know that they're operating simultaneously, so I don't know, Mike, I think we're a sports law podcast. Obviously, we had to analyze the law. I think the clear winner in this, the roller derby team. I think maybe the biggest win in sports law history.

 

Mike Lawson - I think the Cleveland Indians underestimated the roller derby team and the Cleveland Guardians roller derby team clearly rolled over the Indians in this competition, but we haven't, this isn't the first time we've ever seen this, right? New York had the New York Giants, and the St. Louis had the St. Louis Cardinals. They shared teams, too, so it can coexist, and it is possible.

 

Dan Lust - But, Mike, not in the social media era, so listen, I'm preferable. You probably have a preference to the roller derby team. I'm gonna say it's the biggest upset in sports law history, biggest win, biggest upset, whatever you way a call it. It has been our pleasure today to break down the story for you. Obviously, one of our favorite stories, again, our podcast is called "Conduct Detrimental," and yeah, we love covering these stories, so if Quimbee will have us back, we are more than happy to break down a number of these really fun sports law stories. For Mike and myself, we really appreciate you watching this presentation and have a great day.