When in 1967 the Hootses had their suit against Burger King proceed to the Federal Court, they were nervous as they were going up against a giant fast food store. The court would decide that the Hoots was the first in Illinois to grab the name Burger King, but the cooperation they were up against had a national trademark. Although the Burger King cooperation won, Gene and Betty Hoots were not defeated entirely defeated, as the court banned Burger King from operating within 20 miles of the original Burger King. The Gene Hoots and Betty Hoots v. Burger King arguably became one of the most celebrated intellectual property laws cases of all times. The reason for the decision was that one only gets an exclusive trademark rights if they operate a business unless they get a federal registration (Burger King Florida v. Gene Hoots and Betty Hoots, 1968). Even so, a federal registration may not give cooperation the put a prior user of a name out.
An important takeaway from the decision made by the United States Court of Seventh Circuit is that a federal registration supersedes that of the State. Therefore, given the state registration only covered the Hootses’ area of operation, the court ruled that their market was limited to within a 20-mile radius (Burger King Florida v. Gene Hoots and Betty Hoots, 1968). This implies that the existence of a federally registered trademark for Hootses’ business would have negated the 20-mile radius decision. The Burger King V. Hoots trademark dispute and subsequent ruling reached beyond the original case, as it laid a foundation for major legal precedent in the US in regards to the Lanham Act. The ruling that while a senior user (Hoots in this case) of the state trademark enjoys prior usage of the common law marks, federal statues overpower the earlier state trademark, and prevents the senior user from barring the junior from using a federally registered trademark outside of the geographical reach of the states statute (Abbot 2013).
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According to Belonozhko (2015), the passing of the Federal Trademark Dilution Act by Congress in 1996 amended the Lanham Act of 1946, which was passed into law with the intent to protect “famous trademarks.” Given the definition of a ‘famous mark,’ Burger King passes as one. However, the ambiguities that blur the determination of how famous a mark is to qualify for FTDA protection, recent statutes have been amended to recognize a famous mark not as the mark is famous, but as the designation of the source of goods. Belonozhko (2015) argues that state laws that protect small businesses against trademark dilution are rarely recognized as being part of the common law, but are considered in regards to the prevailing federal intellectual property law. Even so, some states have no state laws that protect small businesses against anti-dilution statues. Therefore, the fact that federal statues contain a language that expressly pre-empts both common law and state law a small business has no chance of going after a ‘famous’ mark and getting them. This fact was demonstrated in the Burger King v. Gene and Betty Hoots.
The District Court of the Eastern District of New York in Toys “R” US, INC. V. Canarsie Kiddie Shop, Inc. deliberated on whether “Kids ‘r’ Us” infringed on the “Toys ‘R’ Us” trademark (Herron et al., 2015). The court considered some issues raised by the lawsuit and the most outstanding factor that echoes that which was considered in the Burger King v. Hosts was the proximity of the products. In this case, the court sought to establish whether both the plaintiff and the defendant were direct competitors. Under the reverse confusion infringement claim, the question of whether consumers in Illinois would have mistakenly believed that they were buying from the Hoots when in fact they were buying from Burger King. Therefore, to eliminate this confusion, the court imposed a 20-mile radius within which the Hoots could operate.
References
Abbott, F. M. (2013). On the duality of internet domain names: Propertization and its discontents. NYU J. Intell. Prop. & Ent . L ., 3 (1). pp.1-51.
Belonozhko, N. Y. (2015). Famous Trademarks in Fashion: Why federal trademark dilution law favors a monopoly over small business success. Willamette L. Rev ., 51, pp. 365-405.
BURGER KING OF FLORIDA, INC., and Burger King Restaurants, Inc., Plaintiffs- Appellees, v. Gene HOOTS and Betty Hoots, d/b/a Burger King, Defendants-Appellants. 403 F.2d 904 (1968)
Herron, D., Kubasek, N., Barkacs, L., Browne, N., & Dhooge, L. (2015). Dynamic business law: The essentials . New York, NY: McGraw-Hill Education
