[1/20/2022 Zoom Meeting] Ethical Traps for the Unwary

Ethical Traps for the Unwary

Jonathan Arons will cover various California rules of professional conduct and related statutes, including:

  • Rule 1.2 – Scope of Representation and Allocation of Authority
  • Rule 1.4.2 – Disclosure of Professional Liability Insurance
  • Rule 1.8.5 – Payment of Personal or Business Expenses Incurred by or for a Client
  • Rule 5.5 – Unauthorized Practice of Law, Multijurisdictional Practice of Law
  • Rule 8.5 – Disciplinary Authority, Choice of Law

Please note this video is not offered for MCLE credit. We are only authorized to give credit to those who attend at the time of the presentation.

The Most Important Things Lawyers Can Do in the Wake of COVID-19

The COVID-19 pandemic has exacerbated the already terrible inequality we have in the United States. Prior to the outbreak, income inequality was the highest it had been in fifty years. Now, with more than 30 million people unemployed, it’s likely to get even higher for the foreseeable future.

This inequality is not only an economic problem, but it’s also a legal one. The bigger the disparity in resources, the more the wealthy will be able to consolidate power. The more power they have, the more they are able to influence the law to work in their favor. And the more the law works in their favor, the greater inequality becomes. I consider myself an optimist, but I worry that if we don’t do something major to stop this trend soon, we will end up living in a feudal society.

Lawyers will have a huge role in determining how this plays out.

On a micro-scale, the rich are better able to afford legal services, which means they have an advantage in negotiating contracts, handling lawsuits, or exploiting the law to work in their favor. As someone who has been party to a handful of lawsuits over the course of my career, I know exactly how much value a good lawyer can provide. And while the other parties in these situations usually had more resources than me, I know that, as a successful business owner, I have an advantage over most other people who find themselves in these situations.

At the most sophisticated levels, we see wealthy individuals and corporations donating money to influence elections, appointments, and our education system so that those in charge of setting law and policy will do so in a way that favors their personal interests. This imbalance has been playing out for decades but is likely to get worse if we don’t intervene.

What you can do to reverse inequality

As lawyers, you have the power to help reverse this course. Here’s how.

Educate the public

As lawyers, you understand the gravity of your role in interpreting the law. And your beliefs about how the law is supposed to work will naturally influence this interpretation. People naturally want to work with lawyers who interpret the law in a way that favors their interests. And since the wealthy have inherently more access to legal services, we end up with a legal–and by extension an economic and justice–system that heavily favors them.

Over time, people can begin to misconstrue these interpretations as truths so that those who are less educated in the law will assume that the way things are is the way they’re supposed to be. For example, the law in Washington State does not explicitly say that a corporation must act in the best interest of shareholders, but many people assume that is the case. As such we have a society in which business leaders are taught this is the only right way to do business and have created a system in which those who choose to do business otherwise are at a disadvantage.

The best way to combat this is through education. What do people tend to misunderstand about your practice area? What is fact and what is opinion? What does the law actually state and how does that differ from how people discuss it? Education creates empowerment, and only when everyone is empowered can we create a truly just society.

Strive for sustainability, not profitability

As mentioned above, we as a society have been led to believe that a business’s number one priority is to make as much money as possible. But if you’re not legally required to do so, what is the purpose of maximizing profit? Of course, a business needs to make money in order to survive, and the more money it makes, the more it can invest back into providing the products, services, and innovations that help consumers.

But at a certain point, a business simply doesn’t need to make any more money in order to fulfill its function. And the more it focuses on making money at all costs, the more it neglects other considerations. How often do executives choose to harm customers, employees, communities, or the environment in the name of profit?

It’s no secret that the law can be an extremely lucrative profession. But in order to maximize your profits, you have to ally yourselves with those who have the most money. Of course, in certain cases, this may be the right thing to do (the wealthy are not inherently less worth defending than the poor), but when you make decisions based on money, you will inevitably be forced to make decisions that make our society less equal and more unjust.

When considering which clients to take on, ask yourself why you’re doing so. And when thinking about finances, consider only what you need to be sustainable instead of what you need to be the most well off.

Remove harmful incentives

Money is a powerful motivator, but it often motivates people to make the wrong decisions. Several years ago, we decided to stop paying commissions to our sales team. We knew that if someone was worried about how they were going to pay their mortgage, they would not be incentivized to make the best decision for our clients, which would ultimately hurt everyone involved. When considering pay or other incentive structures at your firm, ask yourself how they affect people’s decision making. Are people being rewarded for making decisions in line with your firm’s values, or are they doing so in order to make the most profit?

Go against the grain

The only way to prove there’s a better way of doing something is to prove it. In 2015, when I decided to raise the minimum wage at my company to $70,000 a year, people told me it wasn’t possible. But I believed that our business would be better off if we paid our employees a living wage than it would if we simply paid them market rates. A lot of people talk about raising the minimum wage or the problem of inequality, but few people actually take steps to do something to fix it. What problems do you wish you could fix in society? How can you take a small step in doing so through your own work?

What about your clients? What do they value and how do they want to run their business? What would be the legal ramifications of doing so? Often, the main reason people don’t act is because of fear. But knowing that they are legally protected and/or understanding the legal ramifications of a policy or program they want to enact might be enough to convince them something is worth trying.

People like to joke about lawyers, but good lawyers are essential to creating a just and prosperous society for all. There are countless ways you can use your knowledge and influence to make the world a better place. How you do so is up to you.

Dan Price is CEO of Gravity Payments. He is best known for implementing a $70k minimum salary for everyone at the company and other unorthodox business practices. Through the Gravity Legal payments platform, Dan and Gravity help law firms reduce the cost and administrative burden of accepting client payments and trust deposits.

What I Learned About Visuals While Serving On a Jury

Have you ever wondered whether the advice you give to clients is always as sound in practice as it is in theory? Recently I was selected to serve as a juror on a 3-week medical malpractice trial. I had always wanted to serve on a jury. I felt it would be a golden opportunity to see what the visual presentation of a case looks like from the perspective of a juror – as opposed to the creator. Somewhat like a doctor who suffers injury or illness might experience treatment from the point of view of a patient, instead of their usual mindset as a medical professional.

Both the plaintiff’s attorney and defense attorney were experienced trial lawyers with excellent oratory and tactical skills. Their visual presentations could have been significantly improved, however, by adhering to the basic principles we preach as visual presentation experts. These include:

LESS IS MORE
Both lawyers packed too much information into each slide. On their timelines and document slides, the text was too small, so the jury couldn’t read it. In addition to rendering these visuals useless, a number of my fellow jurors expressed irritation with the lawyers. Some wondered if they might be trying to hide something. In general, we felt burdened by information overload. Strive to include on a slide the minimum amount of information needed to convey the intended point.

CHOOSE YOUR MEDIA WISELY
One of the attorneys used a PowerPoint slide deck for all of his visuals. When experts were on the stand, he would cycle back and forth until he landed on the desired slide, sometimes taking a minute or two. While PowerPoint is sequential and appropriate for a step-by-step opening or closing, it is not nimble enough for direct or cross-examination. TrialDirector software is the way to go (if your budget allows, hire a courtroom technician to run it for you). Neither attorney used poster-boards. Key graphics should be printed on them and left displayed on an easel while the PowerPoint is also displayed. The combination can be an effective way to mix media and keep jurors’ attention.

WELL-DESIGNED GRAPHICS BEST TELL YOUR STORY
During the trial, we were inundated with documents, with just a few images from anatomy books sprinkled in between. A handful of well-conceived, understandable graphics using icons or illustrations would have been considerably more impactful and persuasive than what we saw. Neither attorney was effectively able to focus and communicate his case themes. Both sides would have benefitted from using use text callout graphics – aka “text pulls” – where the key language is enlarged, instead of highlighted document pages, whenever possible.

USE HIGHLIGHTING JUDICIOUSLY
On a typical document page shown by the plaintiff’s attorney, he had highlighted in yellow numerous lines. On top of that, he had underlined in red some of that already highlighted text, presumably to add additional emphasis. The result was that we didn’t know where to direct our attention. Ask yourself what the key point of an excerpt is and highlight only the text that is truly necessary to make the point. Consider using red bold text instead of yellow highlighting. Avoid using both at the same time.

COLOR CHOICE IS IMPORTANT
The plaintiff’s attorney used a style template with a black and red background. While black can be associated with power and strength, more often than not it carries a negative connotation (fear, death, the unknown). Similarly, while red may be used to attract attention, it is often associated with bad, evil, or danger. A better choice might have been the use of blue tones, which project trust, strength, and confidence. Color subconsciously influences our thinking and is a subtle yet powerful thing. Either rely on a professional designer for appropriate color choices or familiarize yourself with basic color psychology.

DON’T FORGET ABOUT CLOSING
One of the lawyers used no demonstratives during his lengthy closing, and the other had a standard bullet point PowerPoint presentation. As good as their arguments may have been, it was difficult to focus without having visuals. Closing arguments are the perfect time to illustrate analogies, use comparison charts, summary graphics, etc. In your last opportunity to sell your case to the jury, why not place it in an attractive package that jurors will want to buy?

Seeing visuals through the eyes of a juror was a valuable opportunity. As expected, I learned that the core principles that guide trial graphics experts are as true in practice as they are in theory.

Staying On The Right Side Of The Legal Advice Line

As a paralegal, it’s not unusual for me to find myself in a tricky situation with clients of the attorney. What often happens is the client asks me directly for legal advice or shares information about a case that I know requires immediate legal advice. If you have any non-lawyer staff in your practice, this is likely happening to them too. What are you doing to ensure that your paralegal is giving good customer service and being responsive without crossing the line into legal advice?

Once when I was working for a family law attorney, I called a client to schedule a meeting because the client had not been in touch with the attorney for a while. The client mentioned that she was angry with the opposing party for not paying child support and therefore was not allowing him visitation with their child as retaliation. Because I am an experienced family law paralegal, I knew that nonpayment of child support is not good cause for failing to follow a custody order and the client was jeopardizing the case by withholding visitation. However, because I am a paralegal and not an attorney, I could not give the client that legal advice.

Typically, I would have had the client speak with the attorney right away, but in this situation the attorney was out of town and I didn’t know how quickly the attorney might be able to give the client legal advice. I explained to the client that I am not an attorney and could not give her legal advice. I further explained that I believed the attorney would likely advise her not to withhold visitation because of non-payment of child support. I set up a time for her to talk to the attorney as soon as she was back in the office and advised the client I would be emailing the attorney about the situation. The attorney promptly followed up with the client by email and gave legal advice.

The attorney I was working for had prepared me for how she wanted me to handle these types of inevitable situations. A different family law attorney may have preferred I handled it differently. It is important to train your paralegal and administrative staff on how you want them to respond when these conversations come up. You want your clients to feel like your staff is responsive, knowledgeable and customer service oriented without crossing the line into giving legal advice.

It may be tempting to tell your paralegal to never answer any questions from clients, no matter how innocuous they may seem because it’s possible the answer might be legal advice. This approach can make your staff feel you do not have trust or confidence in them as a professional. It can also lead to your clients to feel like they aren’t getting good customer service and that you are trying to rack up billable hours unnecessarily by scheduling calls and meetings. A better approach that allows your staff a bit of autonomy but ensures clear boundaries can make for a happier employees and clients.

Regularly check in with your staff and ask them about the conversations they are having with your clients when they contact them for scheduling meetings and other administrative issues. Find out what kinds of questions your clients are usually asking and what your staff is saying in response. Role play with them and offer suggestions on how they can make the client feel heard while still deflecting the questions that can only be answered with legal advice. Coach them on how to describe a typical process or procedure while still making it clear that they are not setting an expectation for a case outcome. Discuss the types of things that a client may share that you want brought to your attention immediately and the topics that are always off limits with clients.

Paralegals are legal professionals and they can be a huge asset in making your clients have a positive experience with your practice. They can step in and handle many things when you are not available for your clients, but there are many things they cannot handle for you. Empowering your paralegal to do the things that they can while having clear boundaries for the things they can’t do could be an important part of making your practice a success.

Your Cheatin’ Heart – Needs an Estate Plan! 

Lawyers owe clients a duty of confidentiality. This means that when I have a couple as an estate planning client, I must keep all secrets shared with me from third parties, but I must also expose the secrets shared with me by one spouse to the other. All of my clients have heard my talk about “secret babies” and “the money under the floorboards” and to date no one has accidentally spilled any beans that I had to later disclose.

Given the upsurge in the use of common law and corporate law to force asset distributions among unmarried couples, it is not unlikely that a “third party” love interest might come forward and make financial demands, either during or after the lifetime of their lover.

This recent article by Forbes writer Russ Alan Prince, Yes, Advisors, You Must Plan for Your Clients’ Extramarital Affairs, reminded me that an estate planning attorney’s job is to build trust with their client in order to help them mitigate all of life’s risks. Your attorney should ask you about your family, about who you love and trust and who or what makes you nervous. You might not want to answer fully in front of your partner or spouse, but that does not mean that those issues will disappear.

If you have issues that you do not want to discuss with your spouse, from the distribution of separate property assets to extramarital affairs or children outside the union, please contact an estate planning attorney to address these issue and mitigate the risks, both financial and to family harmony, associated with them.

Do It Now: Name a Guardian for Your Minor Child(ren)

I know it’s hard. Thinking about someone else raising your children can stop you in your tracks. It feels crushing and too horrific to consider. But you must. If you don’t, a stranger will determine who raises your children if something happens to you – your children’s guardian could be a relative you despise or even a stranger you’ve never met.

No one will ever be you or parent exactly like you, but more than likely, there is someone you know that could do a decent job providing for your children’s general welfare, education, and medical needs if you are no longer available to do so. Parents with minor children need to name someone to raise them (a guardian) in the event both parents should die before the child becomes an adult. While the likelihood of that actually happening is slim, the consequences of not naming a guardian are more than intense.

If no guardian is named in your will, a judge – a stranger who does not know you, your child, or your relatives and friends – will decide who will raise your child. Anyone can ask to be considered, and the judge will select the person he or she deems most appropriate. Families tend to fight over children, especially if there’s money involved.  And worse, no one may be willing to take your child. If that happens, the judge will place your child in foster care. On the other hand, if you do name a guardian, the judge will likely support your choice.

How to Choose a Guardian

Your children’s guardian can be a relative or friend. Here are the factors my clients have considered when selecting guardians (and backup guardians):

-How well the children and potential guardian know and enjoy each other

-Parenting style, moral values, educational level, health practices, religious/spiritual beliefs

-Location – if the guardian lives far away, your children would have to move from a familiar school, friends, and neighborhood

-The age and health of the guardian-candidates: Grandparents may have the time, but they may or may not have the energy to keep up with a toddler or teenager.  An older guardian may become ill and/or even die before a child is grown, so there would be a double loss.  A younger guardian, especially a sibling, may be concentrating on finishing college or starting a career.

Emotional preparedness – Someone who is single or who doesn’t want children may resent having to care for your children. Someone with a houseful of their own children may or may not want more around

WARNING: Serving as guardian and raising your children is a big deal; don’t spring such a responsibility on anyone. Ask your top candidates if they would be willing to serve, and name at least one alternate in case the first choice becomes unable to serve.

Who’s in Charge of the Money

Raising your children should not be a financial burden for the guardian, and a candidate’s lack of finances should not be the deciding factor. You will need to provide enough money (from assets and/or life insurance) to provide for your children. Some parents also earmark funds to help the guardian buy a larger car or add to their existing home, so there’s plenty of room for extra children.

Factors to Consider

Naming a separate person to handle the money can be a good idea. That person would be the trustee in charge of the assets, but not guardian of the children, responsible for the day-to-day raising of the children.

However, having the same person raise the children and handle the money can make things simpler because the guardian would not have to ask someone else for money.

But the best person to raise the children may not be the best person to handle the money and it may be tempting for them to use this money for their own purposes.

Let’s Continue this Conversation

I know it’s not easy, but don’t let that stop you. I’m happy to talk this through with you and legally document your wishes. Know that you can change your mind and select a different guardian anytime you’d like. The chances of needing the guardian to actually step in are usually slim (I always hope this is the one nomination that’s never actually needed); but, you’re a parent and your job is to provide for and protect your children, so let’s do this. Call my office now for an appointment and we’ll get your children protected.

Don’t “Should” on Me

The above statement is one of my favorite bumper stickers. It is a reminder of one of the ways in which we both allow others to tyrannize us and tyrannize ourselves. When partners, whether business or personal,  try to “should” on each other, intense conflict almost always results. “Shoulds” come from cultural, parental and peer expectations and we accept them because we need to feel loved, to belong, and to feel safe and good about ourselves.

We act on “shoulds” because we believe that they are true, and that’s how we give them power over us. If we don’t live up to our “shoulds” or to someone else’s “shoulds,” we feel that we are unworthy or a bad person. Our self-esteem is impacted and we torture ourselves with self-blame and guilt.

Look over the following list of “shoulds” and notice which impact on your feelings about yourself:

~ I should be strong or you should be strong,

~ I should always be kind or you should always be kind.

~ I should never make a mistake or you should never make a mistake.

~ I should be perfect (a particular curse) or you should be perfect.

~ I should never feel angry or you shouldn’t be angry.

~ I should always be helpful or you should always be helpful.

~ I should never feel sexually attracted to_______or you should never feel sexually attracted to anyone else.

~ I should never be afraid or you should never be afraid.

~ I should always be happy or you should always be happy.

~ I should always help others or you should always help others.

~I should never say “NO” or you should never say NO.

I would guess that you probably have some additional “shoulds” that I haven’t thought about.   If these or any other “shoulds” are keeping you from living your life to the fullest in the way that you want to live it, I invite you to explore healthy ways of dealing with them.  Some of these “shoulds” can feel really abusive.    It isn’t necessary to carry these burdens alone–and I definitely do not mean that you should get rid of them. It’s your choice.

You might use the word “want. 

Doing so might make you feel less stressed and overwhelmed.

The Attorney Action Club’s Growth and Shaping the Future

The Attorney Action Club (AAC) is a community of legal professionals that exists to help lawyers succeed in life and business. Our membership includes both practicing lawyers and legal professionals who help lawyers succeed. The AAC helps shine a light on the importance of taking care of yourself and learning to create commercial profitable legal enterprise.

How are we doing? Please take this brief survey to help shape our future.

The AAC began in 2009.  The idea of a monthly meeting of attorneys in diverse practice areas came from my observation, after practicing law for 15 years, that a good percentage of our law firm’s best cases were being referred to us by lawyers in different practice areas.  When I discussed this point with other lawyers, my observation was confirmed. Lawyers are a fantastic source of referral business for each other. AAC’s monthly lunch meeting is designed to increase each member’s referral base and that is what has happened year in and year out since 2009.  Once attorneys get to know each other, like each other, and build trust with one another by watching each other present on their chosen topics of legal expertise, the referrals simply begin to flow.

We have had a great year with excellent, informative speakers that translate into knowledge and networking opportunities to improve our business and well-being. Nothing gives me more satisfaction than having a member come to me after a speaker presents weeks maybe even months later and ask for that particular person’s information, because they remember what key points they spoke about at our meeting.  We are about connecting and improving not only our law practices but our work/life balance.

The AAC is different than other lawyer organizations in that we specialize in networking and bring value to your San Francisco Bay Area firm. We are comprised of a San Francisco team of lawyers in diverse practice areas who have gained respect in the legal field in Northern California and the San Francisco Bay Area.

I recognize that lawyers face many challenges. The AAC can help you meet those challenges. If you are in the process of growing your firm, you can find yourself in the feast or famine cycle. You face challenges with growing, hiring and mission. In addition, you need to figure out the money issues like how to earn when you are absent and retirement.

As attorneys and law professionals, we are not alone. We are a great resource for each other. What better way to learn and network than meeting monthly with a diverse group of law professionals at AAC? You do not have to reinvent the wheel. Our community supports itself and is made up of attorneys new and experienced as well as a diverse group of professionals that can help along the way.

And the added bonus to it all is the lunch and CLE credit you earn along the way….

Since its inception, the AAC has been growing. The attendance at our monthly meetings ranges between 30 and 40 local San Francisco Bay Area attorneys and legal professionals.  Our invitation list is comprised of over 750 lawyers and legal professionals. We also have a website which will help you further your law firm’s goals. Current and upcoming features for the site are the following:

  • An SEO optimized platform to promote your business
  • Review our schedule of upcoming speakers
  • Connect with Attorney Action Club members you have met at the monthly meetings
  • RSVP for each “Third Thursday” MCLE presentations
  • Showcase your businesses within our SEO optimized WordPress platform by posting and promoting your articles and blogs
  • Archives of audio and video MCLE presentations

With this growth, we invite you to be part of AAC’s future. Please take this brief survey to let us know how we are doing and what could be improved. We look forward to 2019 and what we can learn and who we can meet that will make our law practices and lives stronger.

 

No, Practice Management Software Is Not A Requirement

We all want to become more organized. It would be great if there were some sort of magic software that would allow us to organize our work and thoughts simply. Practice management software claims to be that magic.

There must be hundreds of software solutions on the market for law firms. Developers see that we have a definite need to become more efficient and they are all jumping in to try and create the perfect software.

But, it isn’t the all-in-one, easy to install, easy to learn, practice management software.

We have had a barrage of out-of-the box legal management software hit the market. They have excellent marketing and sales teams. They bombard us with information and tell us how efficient we will become because we put information in only one time and it flows from contact management to matter management to calendaring, etc.

What we aren’t told is:

– What they can’t do – print out a client/matter list by attorney, print out a conflicts report . . .

– What we will never use – the document management piece that requires us to upload our documents . . .

– How hard it is to get our information out of them if we decide we’ve made a mistake.

– What accommodations we will have to make to use their software — reports that aren’t useful, calling our clients contacts, using QuickBooks for AP and financial reporting, limiting how many parties can be involved in a case or how we bill them . . .

They essentially tell us what information is necessary, how we should communicate, how we should create our workflows, and more.

They are easy to implement. They have features that seem great. They provide quick training. Many integrate with other programs, but the majority don’t. They talk about being agile and responsive to customer needs, but make continuous changes to keep up with the competition or limiting us to only what they want us to use, not what we need.

When we demo the products, we see what they do well. When we begin to use them, we find out they lack many capabilities we assumed they would offer.

Have you tried to print a client/matter list or run a conflict check report? Have you seen their productivity reports?

No matter what size firm we are – the basic software needed is:

– Google Docs or Microsoft Suite.

– Time and billing software that allows us to track time anywhere we work, allows us to handle things like split billing, create a budget, print management reports that give us useable information, generates conflict reports, provides our accountant information that we need and is secure.

– Document and email management software that allows us to work anywhere and is secure.

– Workflow and/or project management software.

– Macro and/or template software.

– Legal research software.

– PDF software.

– Contact management software.

For some practice areas there are other things like litigation calendaring software that may be needed.

Does it make sense that one software program can do all of this well? Each firm works a bit differently. We have to have flexibility in how we do our work. An out-of-the box solution doesn’t offer us what we need, how we need it and when we need it.

We are better off getting what we need in each of the areas above and connecting those programs that need to be connected. We can have flexibility in customization to meet our individual styles.

We have been clicking on Word or WordPerfect to create our documents, WestLaw or Lexis for legal research, and a time program for our time entry since the beginning of the computer. Our computer homepage has been the dashboard. Why do we need to settle for substandard products just to put them in one dashboard?

The beauty of the Internet is that programs can talk to each other. Using programs that allow you to work efficiently while also incorporating your preferences and allowing you to connect to other programs. Even Microsoft is now letting software into their back-end to integrate.

Stop allowing software companies direct how you manage your information and service your clients. Outline your specific needs and find software that specifically handles them whether it is one solution, two or several. You’ll be less frustrated.

Diane L. Camacho, CLM
diane@dlccs.com 

Be Original in Choosing a Trademark

“Why can’t I use this name as a trademark? The words in the name are practically generic and there are dozens of trademarks that use them!”

I frequently hear those words from clients who want to use words or terms in their trademarks and the words are already in use for similar goods and are also common words or phrases. Often, those words or terms convey ideas or images the business wants to project as part of their brand. Often, I have to advise that they can’t use them.

A recent case before the Trademark Trial and Appeal Board (“TTAB”) illustrates this issue. The TTAB handles appeals of refusals to register trademarks by the U.S. Patent and Trademark Office (“USPTO”). USPTO refused to register the trademark NONSTOP KNIGHT for a computer game software. The trademark examining attorney found a likelihood of confusion between NONSTOP KNIGHT and NONSTOP GAMES – also in use for computer game software. NONSTOP GAMES was already registered. The applicant/owner of NONSTOP KNIGHT appealed to the TTAB.

The owner of NONSTOP KNIGHT had several arguments:

1. The word NONSTOP is used in dozens of computers software applications.

2. The word GAMES is completely generic and can’t be the basis for protecting a trademark.

3. NONSTOP is at best suggestive of a feature of computer games and could be considered descriptive

4. The word KNIGHT differentiates the two trademarks.

The TTAB upheld the refusal. The above arguments were logical and well taken, but they missed the point.

The real point in this case and any case of trademark infringement is consumer confusion. The legal standard is whether or not there is a likelihood that consumers will be confused by the two trademarks. The courts, and the TTAB, first review the similarity of the goods and found them to be identical. Both were used with video games.

The TTAB next looked at the marks. The TTAB held that despite the use of the word KNIGHT, the main focus of both trademarks is NONSTOP. The court stated:

“In this case, both two-word marks begin with the term NONSTOP and hence have similarities in appearance and sound. Consumers are generally more inclined to focus on the first word, prefix, or syllable in any trademark or service mark, which in this case, are identical.”

The TTAB explained that the first word in a trademark gives the greatest impression and the predominate word in both marks was NONSTOP.

The TTAB dismissed the arguments of the applicant that there were many Nonstops in use and many registered, and that the word NONSTOP is suggestive.

“While we find NONSTOP in registrant’s mark to be suggestive of a feature of registrant’s goods and services, on this record, it is not so weak as to permit the registration of a similar mark for essentially the same goods and services.”

The TTAB upheld the denial. Again, the major focus is not on whether NONSTOP is a weak trademark or that there are other nonstops in use. The real issue was whether the trademarks were so close in their impression on consumer and that their goods were identical. Given those two factors, it was likely that consumers would think that NONSTOP KNIGHT was made by the same company that made NONSTOP GAMES.

In branding, stay away from existing trademarks even if they are weak.

Eric D. Morton is the principal attorney with Clear Sky Law Group. One of his major practice focuses is trademark law – which he taught for three years as an adjunct professor at California Western School of Law. He can be reached at 760-722-6582, 510-556-0367, or emorton@clearskylaw.com.