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A trademark duel

By   /   Monday, September 21st, 2009  /   Comments Off on A trademark duel

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Two high-end gun makers are dueling across the Atlantic over the rights to use one of the oldest names in the trade.

Paso Robles-based John Rigby & Co. (Gunmakers) Inc. is suing London-based newcomer John Rigby & Co. (Gunmakers) Ltd. for trademark infringement. In a complaint filed Aug. 24 in a federal court in Los Angeles, the Paso Robles company alleges the British firm improperly took up the Rigby name “to sell competing knock-off products.”

Mark Neal, who founded the London Rigby company in 2008 and named as a defendant in the lawsuit, told the Business Times his young business wants to produce quality firearms on British soil. He said he is simply using the firm’s legal name.

“I’ve not used any of their [California Rigby’s] trademarks,” Neal told the Business Times in an interview. “I’m perfectly in compliance with U.K. law.”

What neither side disputes is the value of the Rigby name. Tracing its roots to Ireland in the 1700s, Rigby has presented elaborately engraved firearms to British monarchs and U.S. presidents. Chambered for powerful cartridges, its rifles are most often used to hunt dangerous African game such as elephant and cape buffalo.
The guns aren’t cheap. Top models from the Paso Robles Rigby sell for as much as $85,000, and London Rigby advertises a price of more than $100,000 for its top rifle.

The Paso Robles Rigby company came to California in 1997, initially splitting production between the U.S. and U.K. But it now makes its firearms at its headquarters and factory in Paso Robles, employing 14 at its 5,500-square-foot facility.

Geoff Miller, managing director of the Paso Robles firm, said that the market for luxury safari rifles is so small that having two companies with the Rigby name misleads customers and hurts his company.

“It’s terribly confusing to the gun market,” Miller said. “We still have people who don’t know we’re here in California. This is a very small business – the entire world market for these guns doesn’t exceed 500 guns a year.”
But Neal said he’s a shooting enthusiast and entrepreneurial engineer who wanted to bring firearm production under the Rigby name back to England, which long held the title of the world’s top producer of custom rifles and shotguns. He said he has never claimed any connection to the company in California that bears a similar name.
“We’re a collection of gun makers and engineers,” Neal said. “On all the higher class of guns, we’re doing all the machining. All the parts are made in the U.K., assembled in the U.K. and finished in the U.K.”

Neal said he’s followed the law. He said – and U.K. records confirm – that he bought the name “John Rigby & Co. (Gunmakers) Ltd.” in 2008. Neal said he’s simply marketing his firearms using his company’s name.
Neal said — and U.K. records again confirm — that the trademark filed for that name wasn’t made with the British trademark office until June 2009, after Neal founded his company. Neal said he plans to challenge that trademark application.

“[Miller] has attempted to retroactively trademark my company name,” Neal said. “He’s made it appear that he has John Rigby & Co. (Gunmakers) registered as a trademark in the U.K. He has an application in, which will fail.”
Miller concedes that the Paso Robles company may have let its trademark filings lapse — U.K. trademarks must be renewed every 10 years — but said his company can pursue its claims under British common law doctrine of “passing off.”

Under that doctrine, a business can claim infringement of an unregistered trademark if it can prove that it has used the mark, built a reputation under the mark and been harmed by an infringer. Miller said California Rigby has sold firearms in the U.K. since it moved to the U.S.

But the current suit is over U.S. trademarks, and the spat brings up a wrinkle in trademark law: A company’s name and its trademarks aren’t necessarily interchangeable in the U.S. or U.K.

Even if London Rigby acquired its corporate name within the law, that doesn’t mean it can sell guns under that name, said James McDermott, a partner at Ventura-based law firm Ferguson Case Orr Paterson who is not involved in the dispute. If, for example, the name Coke Inc. became available, a business couldn’t market a cola bearing the company’s name without infringing Coca-Cola’s longstanding trademarks.

“If [California Rigby] just screwed up and had a registration lapse, that doesn’t necessarily matter,” McDermott said. “Your rights aren’t from registration. Your rights are from actually selling a product.”

But McDermott said the burden will be on Paso Robles Rigby to prove that the case should be heard in the United States. Courts have found that simply having a passive Web site up doesn’t mean that a foreign company is trying to do business in the U.S. and is therefore vulnerable to suits over U.S. trademarks. The Paso Robles company will have to show that the London Rigby explicitly tried to target U.S. customers.

Business proved tough when Paso Robles Rigby moved to the U.S. Initially, Miller said, the company had to contend with skepticism from a gun-buying public that didn’t believe U.S. guns could equal U.K. workmanship.
After overcoming that hurdle, Miller said, the company ran on hard times after 9/11.

“Everybody stopped going to Africa,” Miller said. “No one wanted to go to Muslim-controlled countries, and things slowed way down.”

Revenue dried up, some debt went unpaid, and talks with a potential investor turned sour in an acrimonious dispute over financial disclosures. The result was a Chapter 11 bankruptcy filing and a new backer for the firm.

“We’ve probably spent more than $3  million in litigation in this century so far, which is ridiculous for a little company,” Miller said. “I think that because we had to put the company in Chapter 11 to protect it from the last fiasco, the impression might be that we’re too weak to fight this [trademark dispute], which is a serious mistake.”

 

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