Trademark Protection In Our 3D-Printed World: An Early Look At A Not-New Problem
Welcome back! And to anyone tuning in for the first time, hello!
With 3D printing becoming more and more common, we have seen a response from many calling for the extension of copyright or patent law to protect companies from counterfeiters ripping–off their ideas.
I believe that, as I stated in this previous blog post, smart use of trademark law and licensing— building positive brand association and a strong community around your products — instead of extending copyright and patent protection, should be the basis for the protection against the copying and ripping-off made possible by 3D printing. Of course, this is not a new system, producers today use trademark licensing to maintain distribution channels for their goods to reach consumers.
Trademark licensing doesn’t stop people from ripping–off a company’s goods. But, it does provide a legal cause of action — trademark infringement — a company can use against infringers, and helps companies cultivate and maintain the goodwill in their brands, and ensures that companies are compensated when their goods are sold.
On the consumer side, even if they are unaware of it, consumers rely on trademark licenses whenever they make a purchase, trusting that the good they buy meets the expectations of quality the consumer has developed for the brand’s goods.
Trademark licensing is the system of protection that brands have relied on traditionally; and I believe trademark licensing is a better way to mitigate the efforts of infringers than extending copyright or patent law, or implementing costly verification systems. Simply extending the scope of copyright or patent laws would have unforeseen consequences on the ability to innovate, educate, and just create in general, and extend the monopolies big corporations already enjoy due to their copyright and patent portfolios. Trademark licensing does not offer a perfect solution to counterfeiting, ripping-off, and otherwise stealing companies’ IP, but I believe that it offers the best balance of protecting brands’ IP, and protecting consumer expectations, without the costs that would come from imposing onerous regulatory schemes, from potentially limiting personal and commercial freedoms, and certainly limiting commercial competition, and creativity and innovation.
And nothing inherent in 3D-printing changes this cost–benefit calculation; Traditional trademark licensing works just as well post-3D printing as it has pre-3D printing, and offers the same balance of protection, freedom, and competition outlined above.
Trademarks, Consistent Quality, And 3D Printed Goods
Trademarks are source identifiers; A trademark on a good signals to consumers that the good comes from a single distinct source. For example, the three stripes on the side of a shoe, or on the sleeve of a jacket, immediately signals to us consumers that Adidas is the single, distinct source of the shoe or jacket. If instead of the three stripes on a shoe we see a swoosh — fatter at the base, elongated at each point — we immediately know that swoosh-marked shoe comes from Nike, not from Adidas.
Because we form a mental connection with the marks and the goods they are on, we then come to associate a consistent standard of quality that we expect from the goods with those marks. So, if we see a shoe in a store with a swoosh on the side, we have a certain standard of quality associated with the goods Nike makes, and will expect that swoosh-ed shoe to meet our expectations. This expectation of quality is — hopefully — what makes consumers will to spend more on an Adidas or Nike show, than they would be willing to spend on a shoe from a discount brand.
Crucially, trademarks signal to the consumer that goods with the mark are of a certain consistent quality; we associate a certain, relatively high, standard of quality with the three stripes or the swoosh, which means we feel more secure paying more for Adidas or Nike shoe, expecting that they will meet that consistently good quality.
Trademarks’ capacity to signal consistent standards of quality functions for 3D printed goods, just like it has for non-3D printed goods. If one saw a swoosh or three stripes on a 3D printed shoe, that same expectation of quality would form, and would make one feel more securing paying more for that Adidas or Nike shoe, than a 3D printed shoe from a discount company.
The expectation of consistent quality helps consumers make purchases, they know what they are getting, they know the quality they can expect to get from a brand, and they can then buy a shoe at whatever their price-point, secure in the belief that the shoe’s quality will be of the quality they expect. Thus, trademarks help consumers make confident purchases, they know the standard of quality they are buying, and can decide whether that quality is worth the listed sale price.
Ripping-Off Not Just Goods, But Trademarks
Trademark law protects brands’ ability to use and cultivate a strong brand with positive brand association. It does so by making it illegal for others to use your marks on their good — without your permission — in a way that consumers would think that the goods the infringer is selling are actually your goods. This is called trademark infringement, and is codified at 15 U.S.C. § 1114.
The obvious problem is that not only can a company’s goods be copied, but its marks can be replicated too (3D printing might make this easier, but the problem has existed for years).
Of course, someone who sells goods with your marks on them is violating your trademark; this is trademark infringement, and the brand owner can take legal action to stop the infringer. Of course, it can be costly to monitor infringement, but this isn’t unique to 3D printing. This is something industries already have to deal with, Amazon and eBay are littered with more counterfeits than brand owners could ever hope to find.
But, the bulk of consumers do and will prefer to buy authentic goods, from a source they know and trust. And this is where trademark licensing come into play, as a way for consumers to be able to trust the sources of the 3D-printed goods they buy, that the goods are authentic, and for brand owners to be compensated when their goods are printed and sold. This system of trademark licensing will already be familiar to producers , as it is the system already used when a brand owner wants to outsource production of its goods. Consumers, while unaware of the system, already benefit from trademark licensing. Consumers can trust the distribution chains their goods come from because these trademark licenses are in place, ensuring there are authorized producers of a brand’s goods, and that brands can police the quality of these goods so they live up to consumer expectations.
Trademark Licenses and 3D Printers
The owner/operator of a printer would pay a fee to Brand X be an “Official Authorized Printer of Brand X” (or some equally silly title). Only these authorized printers would have permission to apply the brand’s trademarks to goods they print. Of course, the goods they could apply the mark to would also be limited.
The licensing fee could be a flat monthly fee, or a percentage of any of the printer’s sales of the brand’s goods. This is standard practice for any sort of trademark licensing.
Like traditional trademark licensing agreements, these licenses would likely be non-exclusive. Each printer could be authorized to print the goods and marks of not just Brand X, but Brands Y and Z, too. And each Brand X, Brand Y, and Brand Z could each have more than one authorized printer.
Under such a trademark license agreement, the brands also have quality control, over the printers that print their goods, and those who operate the printer. Indeed, under trademark law, brands are required to impose some quality control standards on producers, or risk losing their trademark right altogether. Like traditional trademark licensing agreements, with a company outsourcing production of its goods, whether domestically or internationally, these license agreements can require that printers,those who operate them, and the filaments used in the printers, all meet certain standards of quality, ensuring that the goods consumers buy from these licensed printers are of the quality that the brand’s consumers expect.
Of course, some consumers won’t care whether their goods are authentic or just cheap imitations. Again, however, this isn’t new. Some consumers already seek out cheaper alternatives, and still will, whether the goods are 3D-printed or not.
3D Printing’s Move into Local Production Hubs
I think more likely than having a printer in every home, we will see something like local production hubs in communities, businesses run to fulfill orders of local customers. A topic for another blog post, is that these production centers will either be run as small, local businesses, or will be regional or local outposts of national corporations like Amazon or UPS. 3D printing done in local hubs, rather than in every garage (very unlikely) would facilitate a useful licensing system on two fronts.
First, with production done by businesses, not only does the brand whose objects are being printer have it’s reputation on the line — to be tarnished by shoddy goods bearing its marks — but the production hub does too; the production hub has a brand to maintain just like the company whose goods it is printing. A hub would not want the bad reputation that comes from printing infringing or poor quality goods.
Second, it will be much easier to track infringers who print unlicensed goods when the bulk of printers are in these production hubs.
Neil Wilkof suggested something similar here, though he seems to believe in larger regional production centers, rather than the smaller centers I hope for. (Thanks to Pamela Chestek for showing me the article.)
3D printing adds wrinkles to, but does not disrupt, the current model of trademark licensing. There may be subtle differences and added complexities, but let’s not proclaim that 3D printing is wholly incompatible with current trademark doctrine. Furthermore, the presupposed alternatives, extending copyright or patent law, or imposing over-bearing regulatory systems on 3D printers would not simply hamstring the potential 3D-printing has to revolutionize our economy (this will be expanded on in a blog post coming soon!), and otherwise gum-up creativity, innovation, education, and competition. Trademark licensing offers the best balance of protecting brands, leaving creatives free to create, and allowing companies to compete.
If it seems that I’m not necessarily saying anything insightful, regarding a great new way of protecting IP, well that’s sort of the point, and that’s the insight.
What I mean is, I don’t see any 3D-printing–specific threats to our distribution chains, to the current way brands protect themselves and their trademarks. Instead of proclaiming that the sky is falling, and over-reacting by extending other IP protections, I want to focus on how to advise brand owners and printers on how to use the traditional trademark licensing and protection to build and cultivate brands in our post-3D printing world.
