Macy's Settles With Strategic Marks, Gives Up The Brands It Killed Off Through Acquisition

from the zombie-brands dept

About a year ago, we wrote about a somewhat strange trademark dispute between Macy’s and a company called Strategic Marks. The issue in the case was that Strategic Marks was attempting to sell merchandise and create popup stores for brands that had been dissolved through acquisition into larger companies, such as Macy’s. These brands were once staples of the storefront experience, including names like Marshall Field’s, Bullock’s, and Foley’s. All were once well-known regional department stores that Macy’s bought and rebranded as Macy’s stores. Macy’s, despite all of this, claimed it retained trademark ownership over those, despite their being generally unused.

To the surprise of some, a recent court ruling resulted in a win for Macy’s, with the company claiming it was still selling some merchandise with the old brand names. The judge in that case ruled:

“Simply because a store has ceased operations does not mean that its proprietor or owner does not maintain a valid interest in the registered trademark of the business. A trademark can still exist and be owned even after a store closes.”

Which is certainly true, but it doesn’t really address the question of whether someone shopping online through Strategic Marks would think that buying a shirt emblazoned with a brand that Macy’s has on its trophy wall was a purchase through Macy’s itself. Regardless, the whole thing smacked of protectionism in the name of profiting off of dead brands. Per the link above, we learn that Macy’s, despite the recent ruling, has decided to settle the case with Strategic Marks and relinquish the trademarks over the brands.

Macy’s Inc. has settled a five-year-old trademark dispute by giving up rights to Jordan Marsh and five other dormant department store names. The settlement allows a California company to build a “virtual mall” with retail banners that were once owned Macy’s and its predecessor companies.

Further details of the settlement don’t appear to be available, but I assume that Macy’s was compensated monetarily for relinquishing the trademarks. In other words, that would mean that it held the brands it had killed off hostage not over concerns of customer confusion, but simply for money. And, even if we all stipulate that all of this appears to be legally proper, it only highlights just how far modern trademark law has devolved from its original purpose.

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Companies: macy's, strategic marks

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Comments on “Macy's Settles With Strategic Marks, Gives Up The Brands It Killed Off Through Acquisition”

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Dark Helmet (profile) says:

Re: Re:

No, Strategic Marks is trying to meet the production of a customer demand for retro brands that don’t exist any longer because Macy’s bought them out and rebranded the stores as Macy’s. Marshall Fields, for instance, is a name that carries a great deal of weight and memory here in Chicago, even though Macy’s bought them out a decade ago and turned the store into a Macy’s.

I’m not sure how you go through the entire post I wrote without understanding that….

tonylurker says:

Re: Re: Re:

I understand that. What I don’t understand is how cashing in on somebody else’s reputation, without having any connection to that person/organization is any better than buying a business and it’s associated trademarks and getting upset when someone attempts to compete against you using those trademarks.

At least Macy’s has a legitimate connection to the Marshall Fields brand. And, as you say, the Brand carries a great deal of weight and memory in the Chicago region, giving Macy’s a valid reason to fear a competitor using that name.

I say this as an old Bamburger’s loyalist; so I understand the sentiment.

StrategicMarks (profile) says:

Re: Macy's Settlement

Actually the article is factually wrong. Macy’s used to be Federated and decided when they bought Macy’s out of bankruptcy to close all the regional stores they had and turn some of them into Macy’s, trying to create a national chain like JCPenny and Sears. After closing, there was a major backlash by local consumers in these markets because they felt Macy’s/Federated ripped the heart out of their local markets by taking away the regional stores they loved. Strategic Marks wants to bring these stores back. Most of the trademarks in-question had not been used for 5-12 years and according to US trademark law they go back into the public domain. Macy’s claim was they were still using the marks but they weren’t until we started our on-line store. They then freaked out and placed a page on their Macy’ website to fool consumers into thinking they were being used. There was a second group of marks which were part of the lawsuit that “technically” they started re-using again which is what the Summary Judgement is about. They did not win the first Summary Judgement for the first group of marks. And the judgement was only for t-shirts and handbags, not retail store services which was the focus of our lawsuit.

StrategicMarks (profile) says:

Re: Strategic Marks settlement

Macy’s closed down the regional stores in-question to re-brand them as Macy’s, leaving a huge hole in retail for these communities. People wanted their old stores back and Macy’s said they will never happen even when 100,000 Chicago consumers signed a petition to bring back Marshall Fields. They don’t care about the consumers. We just wanted to bring those experiences back to the public and US trademark law says after three years of non-use, the mark can go back to the public domain.

Whatever (profile) says:

” In other words, that would mean that it held the brands it had killed off hostage not over concerns of customer confusion, but simply for money.”

Actually, it looks like a simple transaction really SM wants the use the names and is willing to pay for it, and Macy’s is willing to give up any future use of the brands. Avoiding consumer confusion is important if you intent to keep them, a pot of money is important if you are not.

Strikes me that you have never run a business.

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