Hoofbeats - Ford Protecting Mustang Trademark
How does Ford pursuing legal action to protect their Mustang trademark affect the aftermarket industry and the hobby as a whole?
Little did Donald know when he wrote this edtiorial that it would be stirring up the Mustang world the way it has. To alleviate any questions people may have about the editorial, we now post it as it appears in the June 2006 issue of Mustang Monthly.
Some of your favorite Mustang parts companies are facing serious legal action, serious enough to possibly put some of them out of business, and it's coming from the most unlikely of sources: Ford Motor Company.
Over the past few months, a number of major Mustang parts companies have received a letter from Howard, Phillips, and Andersen, a Salt Lake City law office that represents Ford on trademark and anticybersquatting enforcement matters. Loaded with legalese, the four-page document boiled down to a couple of important demands: transfer to Ford any Internet domain name containing the word Mustang and, worse, discontinue using Mustang in the company name. In other words, many of the companies that you and I purchase Mustang parts from are being told to change their names or face a Ford-powered lawsuit seeking $100,000 in damages.
The letter also demands that the companies turn over for destruction all signs, banners, business cards, stationary, and so on, that use Mustang in the company name, along with a cashier's check for $5,000 in damages. One company was given less than two weeks to comply, and another has discontinued its advertising, a potentially devastating move for a mail-order company, until the situation is resolved.
Upon further research, it appears the matter will only be resolved when everyone--parts companies, Web sites, even magazines--stops using the Mustang name, primarily because Ford fears the usage might be construed as an affiliation with Ford. A source at Ford, who asked to remain anonymous, explained that Ford has decided to "reclaim its legacy" by protecting its trademarks and logos. "The intent is to eliminate the use of trademark names," including Mustang and Thunderbird, among others. Apparently, Ford went after companies using Ford in their name first; now it's time to clean up Mustang.
Because so many companies use Mustang as part of their names, the enforcement is being rolled out gradually to prevent overwhelming the lawyers. According to our source, companies contacted first were either high-profile, or they were not participating in or complying with Ford licensing agreements. He went on to state that every company with Mustang in its name will eventually be contacted.
We also talked to Scott Ryther, a lawyer at Howard, Phillips, and Andersen, who confirmed that companies without a current Ford trademark licensing agreement are likely to be contacted first. He declined to comment on how the trademark enforcement will proceed, but when asked if a gas station called Mustang Mart would fall into the gunsights, he replied, "If Ford finds out about it, they'll eventually be contacted."
About 10 years ago, Ford started making noise about the use of the Mustang name. As a result, some companies modified their name to include a descriptive word, such as Classic. When asked if those companies would still be targeted, our source at Ford said, "At the time, that was deemed acceptable. Ford has changed its mind."
So now companies are faced with making a name change, and it won't be as easy as replacing Mustang with Pony or Stang. According to Ryther, Ford is protecting those trademarks too. His suggestion is for companies to change their names to something generic like "Classic Car Parts," then add a tagline about specializing in Mustangs. Sounds confusing to me.
While some companies are breathing a sigh of relief because they decided early on not to use Mustang in their name, others are staring at financial, if not total, devastation. Many of these companies have 25-30 years invested in their name, and any marketing guru will tell you that a name change can hurt company recognition for decades. Whether or not a company decides to fight Ford in the courts or simply decides to comply with the demands, it's going to be expensive, and you can bet that the expense will be passed along to you and me in the form of higher prices for parts.
I understand that Ford has every right to protect its trademarks. But it bothers me that there is no distinction between legitimate companies, many of which have doing business with Mustang in their name for decades, and companies that might be looking to deceive or defraud by using the word. In this case, Ford is going after the very people who support Ford and its products. One of the reasons the Mustang hobby remains strong is because parts are readily available for restoration, maintenance, and performance. I have to wonder how successful the '05-'06 Mustang would be without the strong Mustang hobby that feeds off the parts supplied by manufacturers and vendors.
It's a great time to be involved in Mustangs. The new Mustang is a whopping success, prices for vintage Mustangs are strong, and restomodding has strengthened the hobby with most of the companies we talked to reporting increased sales this year. But if Ford follows through on its path for Mustang trademark enforcement, many of the people who manufacture and sell parts may be forced to find another line of work. And if they go away, then our entire hobby may be headed down the tubes.
I can only hope that Ford comes to its senses and sends this whole Mustang trademark thing down the tubes first.