GM wins trademark fight over toy Hummer 'knock-off' (Longish)

May 13, 2005 9 Replies

GM wins trademark fight over toy Hummer 'knock-off'



Lanard Toys Inc. ordered to stop selling its vehicle, pay $3.1 million after four-year battle.



By David Shepardson / The Detroit News



DETROIT - General Motors Corp. and AM General Corp. won a four-year federal battle to keep a toy military vehicle off the shelves that the companies called a "knock-off" of the Hummer.



U.S. District Judge Arthur Tarnow issued a permanent injunction ordering Lanard Toys Inc. to stop selling its CORPS! ATK Vehicle because it infringed on Hummer's trademark design.



Following a three-day trial in March, a jury ordered Lanard Toys to pay $1.3 million because the company "used the trademark intentionally knowing that it was an infringement." During the trial, Lanard's chief designer said in a video deposition that he had copied aspects of the Hummer. In one model sold previously at Kmart, the box identified the product as a "Corps Hummer." Toys "R" Us advertised it as a "Humvee."



GM, which has exclusive ownership of the Hummer brand name worldwide, filed suit in March 2001 in Detroit. It has spent $680,000 in legal fees prosecuting the case. AMG joined the case in 2003 and spent $145,000.



GM went to great lengths to win the case -- even dispatching an accountant to Hong Kong, where Lanard is based, to track down computer sales records of the toy. Tarnow ordered Lanard to repay GM the $13,000 the automaker spent to send the accountant to Hong Kong because he found the company had misled the court about its records.



Following the jury's verdict, Tarnow said last month that GM and AMG are entitled to attorneys' fees, interest on the award and other costs.



The Detroit automaker said in a court filing that it and AMG should be awarded $2.3 million, plus $825,000 in legal fees.



Lanard Toys earned $6 million in revenue from sales of the ATK command vehicle and had used the Hummer design since 1998, the jury found.



Stephen Wasinger, a lawyer for Lanard, didn't return calls seeking comment. The company said in a court filing Thursday that GM had made exorbitant claims for legal fees, often sending two or three lawyers to every court meeting.



"Another party should not be obliged to pay GM for Cadillac representation where a Chevrolet will do," Wasinger wrote.



Lanard Toys has asked the court to reverse the jury's award, saying it was excessive.



GM and AMG has licensed the Hummer to many toy manufacturers in the last decade.



You can reach David Shepardson at (313) 222-2028 or snipped-for-privacy@detnews.com.



Given GM's current financial situation, I guess they will be after every cent.

This might be a good time to interject with news of a relevant congressional letter passed around various IPMS/USA clubs by from IPMS/USA president John Noack. Action is required if you want to have influence involving model manufacturers being required to pay licensing fees on certain models and decals. The following is a message from an aide in a Congressman's office who is willing to take action.

Time to put our words written about the democratic process in action and still be on topic to this board... It's a battle we as modelers literally cannot afford to lose.

Kaliste Saloom IPMS/USA #30703 Lafayette, LA

Please make the phone call and remember its D.C. time (U. S. Eastern Time or GMT -4), email or write.

"Mr. Noack-

My name is Paul Bauer, and I serve on Congressman Andrews' staff. As you may be aware, Congressman Andrews has been working in support of the modeling industry in an effort to prevent contractors from requiring licensing and fees for the use of military designs and likenesses. He is planning to offer the attached amendment to the Defense Authorization bill during a markup next week, Wednesday, May 18th, to address this issue.

Again, this amendment would require the Department of Defense to include a provision in their contracts with all defense contractors prohibiting them from requiring licenses and fees from model manufacturers, distributors, or sellers. Since these vehicles are manufactured at taxpayer expense, and the designations are assigned by the US military, we do not feel that the contractors should be able to require payment for their use, especially in instances such as these where it has an adverse effect on domestic small businesses.

Mr. Andrews would very much appreciate your assistance in gaining support for this amendment. It would be most helpful if The International Plastic Modelers Society could reach out to Armed Services Cmte Members this week and next week to urge their support, and possibly send out a fax to all cmte Members detailing the importance of this initiative. You can find a list of the cmte Members at

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Thank you so much for your interest and support. I would appreciate it if you could follow up with me and let me know what, if anything, you can do to help.

Paul Bauer ____________________________________

Paul J. Bauer Legislative Assistant Congressman Robert E. Andrews (NJ-01)

2439 Rayburn House Office Building Washington, DC 20515 Phone (202) 225 6501 Fax (202) 225 6583"

If this fee issue actually goes forward, ideas as to how long the price increase would be felt by those who buy models?

should we start hoarding (or for those who always have), hoard more?

Craig

This brings up an interesting question. I noticed the latest issue of the 1/32 scale Hasegawa Mustang on the shelf at my local hobbyshop and it had a logo on the side with a message "Licensed by***". Is that why it is $10 more than the other version on sale with the Checker Tail Clan markings? Same kit, just different decals. But now it is licensed??

Bill Shuey

Note the last sentence:

This may serve to produce "many" toy industry allies for GM. After all, if you are Company X and you "played by the rules" and got a license, wouldn't you support the prosecution/litigation of some offshore competitor with a product that is cheaper than yours by at least the licensing fee?

The fact that there have been "many" legal toy licenses issued really undercuts Lanard's case. It frames the issue as "Other people paid for production rights - you decided to steal them." If no one had ever been allowed they could at least get sympathy. Now they just look cheap.

All in all, this isn't a good example to use in recruiting posters for the model trademark wars . . .

KL

Lots of crying here in Baltimore, Maryland. This week GM closed their Broening Highway plant after about 70 years. It was the plant making the Chevy Astro Van and it's GM labeled twin. Estimate was that the plant put a million dollars a week into the East Baltimore area economy. This was the plant that was part of the Eastern Aircraft Division during W.W.II and made parts for Grumman FM-1 and 2 and TBM aircraft. Lot of history sitting idle around here. First Bethlehem steel and now GM. We will be looking like Pittsburgh after the steel mills closed soon.

Bill Shuey

Man, they really must be hurtin' for cash at Generic Motors!

Bill Banaszak, MFE

Not that I know all the legal matters involved, (and possibly the original writer doesn't, either,) but I notice most of the time a name is used in the story, it is "Hummer," the civilianized vehicle produced by GM.

What is the deal with the "Humvee" design? Is it owned by the US government? Could they -say- take it to Honda and contract with them to produce it? Is it owned by the US taxpayers? Could taxpayers a -say- Ford get a copy of it (minus any classified material) and produce it? How about a civilianized version of it? Can model companies produce a model of it without paying royalties? Only American model companies? Could some garage kit manufacturer produce a 1:1 "model" of it and sell a motorized version?

You're kidding right? NO!

I think you were OK up to the word "sell". Once you try to sell or otherwise derive a profit from it you're in trouble. Doesn't have to take 3D form either. If I made a poster prominently featuring a Hummer (even one devoid of any GM or Hummer names and logos) in some manner - I'm probably in trouble. Likenesses can go a long way too - a few years back GM themselves had to drop a little change Chrysler's way for infringing on Jeep's trademark vertical grille slot design.

People that intend to write books discussing the venerable Willys Jeep should be careful to make sure they line Chrysler up in their corner in advance of loading the paper into the printer and penning the first line. A few years ago a book was written covering the old G.I. Joe toys of the

1960s. When the author came to the toy Jeep he referred to it as the "General Purpose Vehicle" on advice from the publisher's lawyers (or possibly Hasbro's lawyers). Likewise the publishers strategically covered the word Jeep on any G.I. Joe boxes in the accompanying photos. Nutty!

What I'm wondering about are movies. Obviously, they're made to earn a profit (sometimes they stink so bad you wonder) and in doing so, featuring the intellectual property of others would seem to me to be as much of a problem there as it would be in a book or poster. For example, did the makers of "Gone in 60 Seconds" have to do something special with Ford and Shelby to use Eleanor the GT-500 as such a prominent and distinctive prop? I'm sure they might have done something to mention them out of courtesy in the credits, but is that the same as being legally bound to seek and secure rights to use that car in an endeavor designed to generate profit?

It should be pointed out that not seeking a profit from the use of someone's else's intellectual property is not a safeguard against being sued. For instance you can run amok of the protection that parodying provides if you cause injury to the product in such a way that the owners would be well advised to shut you down. I'm struggling to come up with an example of that though.

I'm not a lawyer nor do I make it my business to produce replicas, posters, books or movies for sale or distribtution... that's just the way I heard it, more or less. ;-) Someone that does knows better and there might be one or two of them in RMS willing to clear up anything of which I might have gone astray.

WmB

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