“Backcountry.com’s actions clearly demonstrate how small businesses can be at a disadvantage at the threat of IP disputes. And because they often have a lack of resources and legal advice, in cases like these, smaller companies regularly find themselves with no choice but to cease trading or dramatically change their practices.”
U.S.-based online outdoor goods retailer, Backcountry.com, has faced a significant social media backlash over the past month, with both customers and competitors publicly reacting to its aggressive trademark enforcement campaign.
It all started when news broke that the brand had taken action against a huge number of smaller companies that happened to use the term “backcountry” in their names. Public documents revealed that Backcountry.com had been attempting to cancel trademarks against businesses using the term, filing lawsuits against a multitude of smaller companies over the past two years.
The impact was far ranging, with disputed trademarks, product and business names including American Backcountry, Backcountry Babes, Marquette Backcountry Skis, Backcountry Denim Co., Backcountry Nitro, Cripple Creek Backcountry and many more.
The effect of this was devastating for many small businesses. Several affected businesses reported feeling “threatened, bullied, and forced into certain results by Backcountry and its legal counsel.”
A number of brands were forced to halt trading, changed their names, or underwent a complete rebrand as a result. Even still, some owners and managers of these businesses faced hefty bills for legal representation and were affected professionally and personally by the legal battles in which they found themselves.
Why Does It Matter?
This action is a prime example of the IP threat that small businesses can face. While many business owners may feel that their existing trademarks offer immunity from the threat of legal action, this often isn’t the case. Many of the companies targeted by Backcountry.com did own their own trademark due diligence, but this didn’t stop them from being targeted.
Backcountry.com’s actions clearly demonstrate how small businesses can be at a disadvantage at the threat of IP disputes. And because they often have a lack of resources and legal advice, in cases like these, smaller companies regularly find themselves with no choice but to cease trading or dramatically change their practices.
IP infringement allegations tend to catch such businesses off-guard, as smaller organizations are often completely unaware that this is a risk for which they need to prepare. If a company doesn’t have the resources to defend itself against litigation, the costs of legal advice can quickly mount, leaving business owners struggling to reach the right decisions.
The Backcountry Backlash
Interestingly, in the Backcountry.com case, mounting public pressure resulted in a U-turn from the outdoor retailer. The plight of the small businesses was evident, and consumers were incensed by the brand’s actions, even launching a Facebook group calling for a complete boycott of the company. Twitter became swamped with hashtags including #boycottbackcountry, #backcountryboycott and #scrapethegoat, and consumers were quick to share their distaste via the brand’s official social channels.
As a result of the global outcry, Backcountry.com issued a public apology. The company cut ties with its legal partners at IPLA Legal Advisors and started to reach out to businesses affected by litigation to make amends. But what might have happened to the organizations affected by its trademark enforcement if the matter hadn’t caught the attention of the online community?
Whether an allegation of infringement is valid or not, the threat of this type of action is very real. Any company that finds themselves challenged by a bigger business with deeper pockets needs to have access to professional advice. There is no doubt that sometimes a company has infringed another’s IP and this needs to be addressed. In other instances, it may be right to challenge allegations of infringement, but doing so could require professional advisors, a good legal strategy and the financial position to be able to argue the case if necessary. This is where insurance coverage comes into its own.
The reality is, small to medium sized businesses don’t usually have their own legal departments ready and waiting to advise on IP litigation and trademark cancellation threats. But this doesn’t mean that they’re powerless to protect themselves from these very real risks.
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