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| To respond to this month's Editorial, send comments to: Editorial@modelrailroadnews.com |
Trademark Infringement? |
| You should know the law. It says that if someone has registered a trademark, logo, slogan or other representation of their company, you cannot use it for commercial purposes unless you license it from them. Union Pacific is well within its rights to license the use of all and any logos and other trademarks it either developed or inherited through merger. There is no question about that. You, as a private individual, can create and own model railroad items with likenesses of their trademarks. You can also take photographs of their trains and facilities so long as you don't trespass to get them. You can even market your photographs, but you can't market the models with the logos on them. There is no question about that. If you go to UP’s web site, you'll find a large collection of images to be enjoyed (but not used without permission) and lots of interesting information. Of all the railroad web sites, www.uprr.com is easily one of the nicest and most interesting for a non-customer, though others also are very nice. But the UP web site has something the others don't: a Union Pacific Licensee Application, downloadable as a PDF file. I downloaded it, all six pages, and found that if I wished to submit it, I could fill it out and mail it to Brenda Mainwaring, Director, Corporate Relations, Union Pacific, 1416 Dodge Street, Room 101, Omaha, NE 68179. The application begins on the first page asking such routine things as Company Name, Parent Company, Address and so on. It wants to know your company's primary business and what product mix you currently offer. Next, they want your annual gross sales volume in dollars for the last three years, along with the annual net profits for the same period of time. On page two, they want to know if you carry product liability insurance, who your carrier is, and how much coverage you have. They want to know what other businesses your owner has owned or operated in the last five years, and if this person/organization has fallen into bankruptcy. This page also starts the inquiry into your product line beginning with the product you propose and how this product fits within your business strategy. Page three breaks with a request for how this product will portray the Union Pacific brand and if a prototype or sample is available for review. They want you to send a sample and explain the type of packing, proposed wholesale and retail prices and material to be used in the product. They want to know if the paint used is lead/chrome free and if you will make the product yourself. If not, they want to know who will, along with the production capacity for the product and what quality controls are in place. They also want to know if they can visit the manufacturing facility. Then UP wants to know how you plan to manage the inventory and give them a timeline for product development right up to when the product is available for purchase. Page three opens with product marketing and sales, asking how many units you project to sell, if the product will be sold only by your own sales force, the size of that force, and your distribution capacity. Not only do they want to know what distribution channels you plan to use, they also want to know what channels you are currently using for up to ten of your current products, taking us midway down page four. What customer service capabilities do you have? How will you promote the product, listing specific publications, web sites, etc.? And what is your promotional budget for this product for the first year? They want copies of advertising materials for either this product or similar units. They also want to know who else you have licensed from. Finally, we get down to checking off one of the trademarks of Union Pacific or the logo of a constituent railroad. For those not up on their legalese, this would be all those roadnames soaked up by UP over the years, including SP, D&RGW, WP, C&NW, MP and the list goes on. They don't list them on the application, but you'd better know them and write them down yourself. Is this legal to ask all of this in the name of product licensing? Yeah, I'm afraid so. Is it reasonable? No. What does this all mean? I'm going to be looking further into this as time goes by, and I'll get back with some periodic reports. For now, you should know that the Model Railroad Industry Association (MRIA) is conducting quiet diplomacy as you are reading this. As a retired fourth grade teacher, I could tell UP that they are making a big mistake. I have known teachers who have assigned so much work that when it came in, they could not possibly process it all. If the model railroad industry indeed complied with this application, UP would be buried in information. Worse, in the process of managing all of it, large numbers of knock-offs could slide by in the confusion. Simply because they can run their legal department at Notch Eight doesn’t mean they should. If they want a high level of compliance, they should make compliance easy, for both the railroad and the licensee. I've talked to some members of the model railroad industry, and they have independently suggested that some organization be created which would represent all railroads at the same time, allowing manufacturers to go to one spot, file one application, and receive licenses for most or all railroads across the board. After all, if people liked filling out all these papers, they'd start a tax preparation service instead of making model trains. Many of the manufacturers in model railroading are small, mom & pop businesses, and for them, this application is just plain ridiculous. What does this new licensing program from UP mean to our industry? It's too soon to tell, but the prognosis is not promising. After all, after watching its merger record, organizations tend to join Union Pacific, not the other way around. |
John Sipple, Editor |
| To respond to this month's Editorial, send comments to: Editorial@modelrailroadnews.com |
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