Have you seen that new Sony Netbook? The one small enough to fit in your purse? The term netbook is typically used to describe ultra-portable network-enabled laptop computers that are used primarily for low intensity wireless activities like emailing and surfing the web. The typical size of a netbook screen ranges from seven inches to eleven inches and the keyboard is about 85% of a normal laptop keyboard. Psion was the first company to coin the term netbook and bring such ultra-portable devices to the market in 1999. Later on, starting with Asus, who released their Eee PC netbook in 2007, many other industry leaders began to follow suit by introducing their own line of netbooks to the market. Some examples include Sony’s P Series Netbook, the Hewlett Packard Mini 1000 Netbook and the Dell Inspiron Mini 9 Netbook.
It turns out that Psion Teklogix – a company created by merger of Psion and Teklogix – has held the trademark for the term netbook since 2000. In an effort to defend the Psion netbook trademark, the company began issuing cease and desist letters to everyone in the industry that has been using the term netbook. Those who have received these letters, including retailers, manufacturers, bloggers and netbook enthusiast websites have until March 2009 to stop using the term.
Both giant industry players and individual users alike are fighting to have the trademark overturned. A grassroots Save the Netbooks Campaign has been launched and both Intel and Dell have filed a request for declaratory judgment against Psion with the US Patent and Trademark Office (USPTO). Intel, Dell and others who support the overturning of the netbook trademark claim that the term has become generic. Typically, terms that have become generic are those that are associated with products and services that have acquired substantial market dominance or mind share. Examples of generic terms are kerosene and bandaid. Legally, when a term becomes generic, the intellectual property rights in the trademark may be lost.
One certainly has to wonder: what took Psion so long to defend its trademark? The first netbook that appeared after Psion’s own line was the Asus Eee PC netbook (launched in fall of 2007). Why did Psion not take any action then? Why did they wait more than one year? Psion’s inaction with respect to the Eee PC netbook was almost like a signal to other companies that the use of the term netbook was acceptable. It seems as though the widespread use of the term is Psion’s own doing and that the company is scrambling to do now what it failed to do a year ago.
It has also been alleged that Psion no longer has any use for the term. Psion’s netbook line was discontinued in 2003, and while the company still sells accessories for netbooks, it no longer markets any other netbook-type products. Even if those who received the cease and desist letters complied to Psion’s request, how would this benefit the company? Perhaps Psion believes that the reason why current netbooks on the market are so successful is because of their jump onto the netbook bandwagon. Or perhaps it is all a publicity ploy; in this cutting-edge industry, Psion wants to remind the world of its innovative prowess, foresight and ability to be way ahead of its time.
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I can see why some would not want to allow legal recognition for Psion’s trademark rights in the word “netbook,” although there are compelling counterarguments on this point. In a statement addressing the trademark issue, (http://www.savethenetbooks.com/static/docs/Psion_Netbook_Trademark_Statement.pdf – through a link cited above by Adrienne), Psion states that they are still “actively supplying accessories… and also providing maintenance and support to existing users…” In Psion’s defence, I can see the argument being made that a manufacturer who is still using the trademark term in one form or another for their product (even if the manufacturer has not produced a “current” version of that product in a few years) still deserves protection – they coined the phrase for their product and are (apparently) consistently using the trademark with reference to that product. The argument would be that trademark protection does not exist to protect only manufacturers who put out a new product every season – protection exists for manufacturers who consistently use the trademark to distinguish their product in the market.
With respect to the allegation that Psion should have acted sooner, the company states that it was not until very recently (third quarter of 2008) that there was a possibility that ordinary buyers might begin to view “netbook” as a generic term. The demand for “ultra-portable computers” appears to be an emerging market, so I can see an argument here as well. In an area where demand is just beginning to emerge, maybe we should not be so quick to pin a burden onto trademark-holders to canvass large markets and obtain legal advice as to potential misuses of their IP rights. Of course, if the Asus Eee PC computer was being described as a “netbook” in Fall 2007, that would seem to go beyond “potential” misuse.
Thanks for this topical and intriguing post, Adrienne. What strikes me is: (a) The descriptive-bordering-on-generic nature of the trade mark to begin with. What sort of acquired distinctiveness evidence did Psion initially submit? (b) Was there any prior generic use of this term before they applied? (c) How quickly can a sign become generic in a fast moving technology sector (parallels with the ‘cloud computing’ TM controversy?) (d) Possible estoppel or acquiescence defences (e) Or just modulating the scope of the right depending on the degree of distinctiveness – if famous/highly distinctive marks can benefit from enhanced protection, why shouldn’t the inverse be true? (f) Finally, the ‘use as a TM’ precondition for infringement – does it apply where bloggers or commentators use it descriptively or nominatively?
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