Would You Like Your Crab With or Without a Registered Trademark?
Joe’s Crab restaurants are all across the United States; some are casual seaside shacks and others are high-end establishments. But how can so many restaurants share the same or similar name? Under U.S. trademark law, if there is no federal registration, the rights to a mark are local and depend on who first used the mark in good faith. That means that multiple restaurants with the same name can exist, so long as each operates in its own area.
Consequences of federal registration
However, if a Joe’s Crab restaurant federally registers its name with the U.S. Patent and Trademark Office (USPTO), the federal registration gives nationwide rights prospectively. Notwithstanding, any local business that used the same name before the third party registration can continue to operate, provided it does not expand into new locations where the federal registrant holds priority.
Consumer confusion and legal action
Trademark law aims to reduce consumer confusion. With restaurants like Joe’s Stone Crab, Joe’s Seafood, Prime Steak & Stone Crab, Crab Shack II, Joe’s Crab Shack and Joe’s Seafood, consumer confusion is inevitable. However, not all consumer confusion is legally actionable. For instance, “Charleston Crab House” sued “The Crab House” in Charleston for likelihood of consumer confusion. The court found no likelihood of confusion, reasoning that “crab house” was generic because it described a restaurant that sold crab and therefore the owners had no protectable interest in the phrase. Hunt Masters, Inc. v. Landry’s Seafood Rest., Inc., 240 F.3d 251 (4th Cir. 2001). On the other hand, “The Boiling Crab” successfully sued the “Boiling Crawfish,” with the court finding likelihood of confusion in part because of the similarity of the marks and some evidence of actual consumer confusion between the restaurants. Boiling Crab Franchise Co. LLC v. KL Boiling Crawfish Corp., 2022 U.S. Dist. LEXIS 97104, *12 (W.D. Wash. 2022).
Strategic implications
Choosing a business name is a strategic decision with legal implications. All businesses, large and small, should protect their tradenames early, as trademark rights are based on priority. Early protection also supports expansion, secures rights to the domain name and helps avoid costly rebranding. It is essential to confirm via a trademark search that the mark is not already federally registered or confusingly similar to another trademark and that it is capable of being trademarked. Choosing an arbitrary mark (a mark unrelated to the goods, such as “Apple” for computers), a fanciful mark (a mark with no prior meaning, such as “Google” for a search engine), or a suggestive mark (a mark that hints at a quality of the product but needs imagination to connect, such as “Coppertone” for sunscreen) is advantageous because it means that it can be registered without proving “secondary meaning.” Secondary meaning is established when enough consumers associate an otherwise descriptive word or phrase with a single source or brand, so that the mark functions as an identifier of that brand. In contrast, descriptive marks may only be registered if they have acquired secondary meaning.
The word “crab” is generic for crabs and descriptive for restaurants that serve seafood and therefore cannot be trademarked by itself, so proof of secondary meaning is required to obtain trademark rights in a business name that incorporates the term CRAB. This may explain the number of restaurants operating under variations of the Joe’s Crab name. In the USPTO federal registry, there are two Joe’s Stone Crab marks, one in international class (IC) 042 for restaurant services and one in IC 043 for restaurant services, catering and bar services. There are four federal registrations for Joe’s Crab Shack; two are owned by Joe’s’ Crab Shack, LLC in IC 042 and two are owned by Landry’s MCGA, Inc. in IC 043. Interestingly, Joe’s Crab Shack has registered Joe’s Crab Shack No Vacancy, and Landry’s MCGA has registered Vacancy Joe’s Crab Shack. There are even more similar trademarks registered at the state level providing statewide rights such as Crab Addison Inc.’s registration for Joe’s Crab Shack in IC 035 for advertising and business services. (Note that if a mark references a real person, the USPTO will require a signed statement from the individual giving their permission for the use.)
Lutzker & Lutzker is available to help you with your trademark selection, maintenance and enforcement. For further reading from our website on the topics discussed here, see the following insights and IP Bits & Pieces®: OpenAI Trademark Clash, Trademark Scams, Transferred Trademarks: Assignment in Gross Explained, Trademarks and Co-Ownership, USPTO Files for Trademark Protection of Its Own Name and our Trademark FAQs.