[Update, March 5: on February 26, the Department of the Interior filed a consolidated cancellation action against 7 DNC marks.]
A few years ago I wrote a blog post in which I explained how a family trip provided an opportunity to illustrate various aspects of IP law. A recent trip that included two days in Yosemite National Park, one of my favorite places on the planet, provided a similar opportunity. That’s because Yosemite is now at the center of a legal spat that can only be termed ridiculous, and then only charitably. But the legal machinations are useful for illustrating what’s supposed to be protectable and what’s not. And for illustrating why people hate lawyers.
As has been covered in various media outlets, the National Parks Service contracts with third parties to operate concessions, such as hotels and retail stores, at various parks. Thus while the NPS itself manages the campgrounds at Yosemite, since 1993 it has been a company called Delaware North (DNC) that operated Yosemite Lodge, the Ahwahnee Hotel and Curry Village in Yosemite Valley, as well as the Badger Pass Ski Area and the Wawona Hotel to the south of the valley, and several stores, such as the stores at Yosemite Village, Crane Flat, and Tuolomne Meadows, in the park. But last year the NPS decided to go with a different concessionaire, Aramark, beginning in March 2016, i.e. tomorrow. This wasn’t a small contract: it’s reportedly worth up to two billion dollars over 15 years.
During the contract negotiations, it came out that DNC had itself registered or otherwise acquired trademarks on the names of several of the places it operated, with respect to both the establishments themselves (like The Ahwahnee Hotel), as well as merchandise such as T-shirts bearing the name “Yosemite National Park”. As part of its negotiating strategy, DNC said that it would be a more cost-effective supplier of services, because any other concessionaire would have to pay tens of millions of dollars for the rights to use DNC’s registered trademarks. If you think that sounds like a thinly-veiled threat, you’re right: in September, DNC filed suit against the US government in the Federal Court of Claims, asserting breach of contract since the government didn’t require Aramark to buy DNC’s “other property” associated with its operations in Yosemite, including trademarks, which it claims is worth $61 million. You can read a copy of the complaint here, and a copy of the government’s response, filed in early January, here. DNC filed a revised complaint in late January. For a discussion of the specific legal issues, intertwined with narrative in more journalistic than legalistic style, there’s this piece written by a lawyer who lives near Yosemite.
As a result – so report the stories that came out in the first half of January, and so says the NPS itself on the Yosemite site – the names on the various hotels will change beginning March 1, and the NPS is even changing the signage in the park to reflect the new names. Interestingly, as of last week, the signs in the park still reflected the well-known names of the places. And I’ll be shocked if there’s a single park ranger who will refer to any of these places by a name other than their long-standing, historic names. It’s kind of like changing the spelling of the Sears Tower to “W-i-l-l-i-s”. That may be how it’s spelled, but it’s still pronounced “Sears”.
Now, perhaps DNC has a good legal case and perhaps it doesn’t; I don’t profess particular expertise in US trademark law. But I did learn a little about trademark basics, and you don’t have to be a lawyer to sense, as some non-Jewish friends where I grew up might have said, that “something’s not kosher” here. What’s not quite right with this picture? I can think of at least two things.
First, trademarks are meant to distinguish the source of goods and services. You buy a Coke rather than a generic version because you want The Real Thing, and you know that the Coca-Cola company provides it. You buy a particular make of automobile because you know that company has a reputation for quality. You buy a particular brand of clothing because clothing made by that company signifies (or confers) a particular status.
In the case of Yosemite, though, no one gives a crap who runs the concessions. It could be DNC, it could be Aramark, it could be Ivan the Terrible or his modern counterparts, Donald the Demonic and Hillary the Hideous. Park visitors just care that they when they stay in one of the park’s hotels they have clean sheets and working showers, and that they come home with a “Yosemite National Park” t-shirt that they bought in the park. It’s the location itself that matters, not the company running the business. And consequently, trademark rights shouldn’t apply here, or at least the way in which they are valued needs to account for this crucial distinction from the normal situation. In its reply brief, filed in early January, the US government said precisely that: that DNC’s estimate that the marks it says it “acquired” were worth $61 is fundamentally flawed because in this case the value stems not from the “marks” but from the location.
Second, and even more basically, the names in question don’t belong to DNC, and the USPTO should never have registered these marks in the first place. The Ahwahnee Hotel was so named when it was built in 1937. There’s been a Yosemite Lodge in roughly the same location – near where Yosemite Falls crashes into Yosemite Valley – since 1915. (See this 1956 USGS map.) For years and years, long before DNC was in the picture, people referred to these places by the names that DNC now says are its own. And of course, the park name is the park name. Trademark attorneys may view it differently, but to the rest of us, when you take something that belongs to the public, it’s called stealing. That’s what's got all of us Yosemite fans so vexed: the brazen attempt to steal from the public.
That this is an attempt by DNC to engage in extortion can be seen from its own behavior until now. For example, when we stayed at Yosemite Lodge last week, there was little to suggest that DNC really perceives itself as the rightful owner of the name “Yosemite Lodge”. The notepads next to the telephone in the room, for example, bore the legend “Yosemite Lodge At The Falls”, without even so much as a “TM” on them. The same was true of the legal notice on the back side of the door informing guests of hotel rates, and the binder with information for guests. That binder, in fact, contained a two-page document setting forth the 78-year pre-DNC history of Yosemite Lodge. Likewise, the information sheet handed to hotel guests gave no indication of any proprietary interest on the part of DNC in the name “Yosemite Lodge”. And the plaque in the reception area of Yosemite Lodge says that the hotel is “Operated by Delaware North Companies Parks and Resorts, Inc.” Not owned by, operated by – because DNC knows darn well that it’s merely a custodian, not an owner. Similarly, the paper prepared and distributed by DNC showing the Badger Pass ski runs and the cross-country ski trails evinces an intent to protect a stylized bear-paw logo, and contains a copyright notice regarding the text, drawings and layouts of the paper itself, but contains no indication that DNC regards the name “Badger Pass” or “Badger Pass Ski Area” as its own. In fact that copyright notice, like the plaque in the hotel lobby, states that DNC operates the ski area under the auspices of the NPS, once again implicitly acknowledging that it is not the owner of the names of the places.
In short, DNC never acted like it owned the “marks” it now says belong to it: real trademark owners mark their marks. DNC knows full well that it doesn’t own the marks in question. It takes a lot of gall to register a mark on something you don’t even own, then threaten litigation over your ill-gotten registrations. Unfortunately, such dishonesty is par for the course for many lawyers.
If the decision to change the names of the facilities were Aramark’s alone, I could understand Aramark’s caving on this issue, even if I don’t think it should have to: under the screwy US civil litigation model, it’s cheaper to change the names and be done with it than to go court, and there’s a non-zero risk that a court could reach the wrong decision and Aramark would lose in civil litigation (although I personally don’t think there’s a jury in the USA that would side with DNC over the NPS on this matter). But there’s no reason under the sun for the government of the USA in the form of the National Parks Service to give in to an extortionist and change the names on the signs in the park, since the NPS itself won’t be infringing any marks if its signs continue to point visitors in the direction of The Ahwahnee, Yosemite Lodge, Curry Village, Badger Pass and the Wawona Hotel.
Rather than capitulate to DNC and in so doing whitewashing part of the park’s history, I think the government should have agreed to indemnify Aramark on the trademark front. And that it should now bring its full weight down on DNC, with the threat of criminal prosecution. For example, every one of DNC’s trademark applications included a declaration from DNC’s Vice-President and General Counsel that the applicant, DNC, was “properly authorized to execute this application on behalf of the applicant” and that he believed that the applicant, DNC, “to be the owner of the trademark sought be registered”. That declaration also included the admission that willful false statement are punishable and may jeopardize the validity of the trademark registration. Why not charge that person, and DNC, with the willful making of a false statement to the PTO?
Even better, fraud is one of the predicate offenses for a prosecution under the RICO statute. Since DNC obtained the registrations in question by fraud – it never owned the marks in the first place, so it lied when it told the PTO it owned them – and these acts occurred on multiple occasions within a 10-year period, the Justice Department should bring RICO charges against DNC and its officers. Something tells me that even the whiff of such charges would be enough to cause DNC to abandon all of the marks in question.
Perhaps the government is taking a long-term view: by continuing to operate the concessions under new names, within a year or two Aramark will be able to provide evidence showing that the revenues at the concession sites are completely unrelated to the names of those sites, at which point it will be able to revert to the long-standing names, since the damage to DNC by using the names Ahwahnee, Wawona, etc., will demonstrably be zero.
The good news is that none of this smelly business will affect any of Yosemite’s iconic sites: there’s no talk of changing the name of El Capitan to El Capital One, or of renaming the Half Dome cables “Half Dome Cable and Wireless”, or of calling the firefalls (which we were fortunate enough to watch, see photo at left) the Firefox falls. And even if, Heaven forfend, that were to come to pass, the places themselves would continue to entrance, enchant and enthrall.