Dispute Over Bicycle Trademark Shows Need for Common-Sense Lawyering

In today’s internet-based global economy, trademark disputes between businesses have increased, as it is easier to locate other businesses and products with similar-sounding names and logos. Businesses on both sides of a trademark dispute can run into trouble either by waiting too long to hire an attorney or taking an overly aggressive approach to a dispute that could be resolved amicably. A recent dispute between a multinational bicycle manufacturer and a small bike shop illustrates this point.

Advanced Sports International (ASI) owns the worldwide rights to the trademark “Roubaix” for bicycle-related products. The name “Roubaix” comes from a famous bicycle race in France—the Paris-Roubaix—which is known for treacherous cobblestone pavement sections. ASI uses the name “Roubaix” on a line of road bicycles. It also licensed the trademark to another bicycle manufacturer, Specialized Bicycle, which registered the “Roubaix” trademark in Canada for use on “Bicycles, bicycle frames, and bicycle components, namely bicycle handlebars, bicycle front fork, and bicycle tires.”

Specialized recently sent an aggressive cease-and-desist letter to a small, brick-and-mortar retail bike shop in Calgary, named the Roubaix Café, claiming its name violated Specialized’s trademark. The owner of the Roubaix Café also made handmade bicycle wheels that he sold using the “Roubaix” name, which Specialized claimed violated its trademark rights. Specialized demanded the owner of the bike shop change its name and transfer his website domain to Specialized or face a lawsuit.

The story of this dispute “went viral” on social media and in the bicycle community, generating mass support for the bike shop owner and angry letters and Facebook posts to Specialized from its customers, condemning what was seen as a heavy-handed attempt to shut down a local business. As a result of this, ASI intervened and contacted the owner of the Roubaix Café to tell him ASI had no problem with him using the name “Roubaix,” so long as he entered into a licensing agreement. Although the terms of the license have not been disclosed, it is likely ASI granted the owner of the Roubaix Café the right to use “Roubaix” in his business’ name, in exchange for a promise not to market his own bicycles or products under the “Roubaix” name.

There are several lessons to this story. First, this dispute could have been avoided if the owner of the bike shop had hired a trademark attorney before he decided to name his business and products after a well-known bicycle brand. Had he done so, he could have negotiated a licensing agreement with Specialized up-front, and/or would have understood the risk he was taking by choosing the name he did. While many small business owners try to save a few dollars by taking a do-it-yourself approach to trademarks, consulting a trademark attorney can save a business tens of thousands of dollars in attorney fees and litigation costs in the future.

Second, Specialized’s attorneys took an overly aggressive approach and overreached by demanding the bike shop owner change its name. Generally, a business’ use of a similar-sounding name or logo violates a trademark owner’s rights only if it is likely to cause confusion among customers as to the source of the goods and services being sold. While Specialized may have had a legitimate basis to demand the bike shop owner stop marketing his bicycle wheels with the “Roubaix” name, it seems very unlikely that the public would confuse a small bicycle shop named “Roubaix Café” with an international bicycle brand—particularly in light of the history behind the name “Roubaix” in the bicycling community.

Third, Specialized could have avoided the public relations nightmare it created had it broached the topic of a licensing agreement with the owner of the Roubaix Café to begin with, rather than threatening to sue. While businesses may understandably be reluctant to allow a competitor to use a similar name, in this case, there was no real danger that a neighborhood bike shop would take business away from a multinational bicycle manufacturer. By granting the owner of the Roubaix Café a limited license to use the word “Roubaix” in its name in exchange for a reasonable fee, Specialized would have protected its trademark and made money from the arrangement.

In short, common-sense lawyering on both sides could have avoided this dispute. If you are thinking of registering a trademark, are concerned someone is violating your trademark, or have been accused of violating someone else’s trademark, it makes good business sense to contact a knowledgeable, local trademark attorney rather than trying to go-it-alone.

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