Sign, Sign, Everywhere a Sign
By: JOHN C. PICKERILL
Municipalities have become more and more aggressive in restricting the rights of business owners in displaying outdoor signage. While these “Rainbow” zoning ordinances are purportedly designed to promote the aesthetic beauty of the neighborhood, they also interfere with a business owner’s right and duty to use trademarks and logos in a consistent fashion. Varying the appearance of a logo not only jeopardizes trademark rights, but also could confuse consumers and negatively impact purchase decisions.
If you find yourself being bullied by a local municipality into changing the color or size of your business signage, the federal Lanham Act may provide relief. Section 1121(b) of the Lanham Act states:
“No State or other jurisdiction of the United States or any political subdivision or any agency thereof may require alteration of a registered mark, or require that additional trademarks, service marks, trade names, or corporate names that may be associated with or incorporated into the registered mark be displayed in the mark in a manner differing from the display of such additional trademarks, service marks, trade names, or corporate names contemplated by the registered mark as exhibited in the certificate of registration issued by the United States Patent and Trademark Office.” 15 U.S.C. §1121(b).
Unfortunately, courts have not been consistent in interpreting 15 U.S.C. §1121(b).
In Blockbuster v. City of Tempe, the Ninth Circuit found the municipality violated Lanham Act §1121(b) in requiring Blockbuster and Video Update to alter signage to reflect logos in colors that varied from the colors in federal registrations. However, New York courts have found that the Lanham Act was not meant to prevent local zoning ordinances. In Payless Shoesource v. Town of Penfield, the court found no violation because the government did not mandate that the mark be permanently changed. Rather, the municipality merely required a few signs to comply with local ordinances.
The split in the courts seems to hinge on what constitutes an “alteration” of the mark. New York appears to indicate that the “alteration” must be permanent and formal, while the Ninth Circuit appears to embrace the plain meaning of the term “alteration.” There is no indication from Congress to indicate that the language “alteration of a registered mark” requires something formal or permanent, making it likely that many restrictive “Rainbow” ordinances violate §1121(b).
For the best chance to avoid forced alteration of your logo on signage, make sure to file for a federal trademark registration that claims color as a protectable element.