Nominative fair use allows a business to refer to another company’s goods or services by using their trademarks without needing permission. This principle is essential for businesses that provide services related to products from other companies. For example, auto repair shops, tech support services or medical providers. A recent discussion sheds light on how this doctrine applies, specifically regarding the use of another company’s logo.

The Scenario

A medical services provider put on its website a logo of an insurance company alongside other insurance companies’ logos noting that the facility accepts those insurance policies. However, one company sent a notice requesting the removal of its logo, without specifying whether the usage violated trademark laws or any other legal provisions.

Nominative Fair Use Explained

Nominative fair use permits the use of another’s trademark to identify the trademark owner’s products or services, especially when:

• There is no other practical way to refer to the product or service without using the trademark.
• The use does not suggest sponsorship or endorsement by the trademark owner.
• Only so much of the mark is used as is necessary to identify the product or service.

In this case, the business used the logos to indicate the insurance policies they accept. This is akin to a car repair shop advertising the brands of cars they repair. A reasonable consumer would not assume the business is owned by any of the companies whose logos are displayed but would understand that the business is qualified to offer services related to those brands of cars.

Evaluating Consumer Confusion

Consumer confusion is a critical factor in determining the legitimacy of trademark use. Using multiple company logos reduces the likelihood of confusion. Displaying several logos together under a clear message that the business offers services for those products does not imply ownership or endorsement by any of the companies. Instead, it accurately conveys the range of services provided.

Addressing the Company’s Request

The company’s request to remove its logo could stem from concerns over the manner of use. Without specifics, several possibilities arise:

• Deceptive Use: If the logo was used deceptively or too prominently compared to the business’s own trademark, it might imply a false association.
• Logo Preference: The company might prefer the use of its word mark instead of the logo.
• Disclaimer Requirement: The company might want a disclaimer clarifying ownership, such as a statement indicating that the logo is a trademark of the company.

The business should seek clarification from the company about the specific concerns. Understanding whether the issue is the prominence of the logo, a need for a disclaimer, or a preference for using the word mark instead of the logo can help address the company’s concerns appropriately.

Consequences of Non-Compliance

Ignoring the notice from the company can have several repercussions:

• Legal Action: The company could pursue legal action, claiming trademark infringement or dilution.
• Reputational Damage: Non-compliance might harm the business’s reputation, particularly with partners and customers.

Therefore, it is prudent for the business to engage with the company to resolve the issue amicably. Compliance with reasonable requests, such as adding a disclaimer or adjusting the logo’s prominence, can avoid potential legal disputes and maintain good business relationships.

Conclusion

The use of another company’s logos by a business to indicate services related to those companies’ products is generally considered nominative fair use. However, it is crucial to avoid any implication of endorsement or ownership by those companies. Addressing specific concerns from companies promptly and respectfully ensures legal compliance and preserves professional relationships.

Navigating the complexities of trademark law and ensuring proper use of another company’s logos can be challenging. To safeguard your business and maintain strong relationships with partners, it’s essential to handle these matters correctly. If you have any questions or need assistance with your trademark use policies, contact Chase Law Group at 310.545.7700. We can help you stay compliant, avoid legal disputes, and focus on growing your business confidently.

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_{Please note that this article is for informational purposes only and should not be considered legal advice nor constitute an attorney-client relationship. It is recommended to consult with an attorney directly for specific legal guidance pertaining to your business and its practices.}