The importance of protecting trademarks was emphasized recently when a lawsuit was filed in federal court regarding ownership of the Craftsman tool line. Sears previously sold Craftsman tools and owned the rights to its iconic name. However, that all changed when Sears began to struggle financially prior to its bankruptcy filing. According to a recent news report, Stanley Black & Decker acquired the Craftsman brand in March 2017, for which it paid Sears approximately $900 million.
As part of a contract between Stanley and Sears, Stanley gave Sears a limited license to market certain Craftsman products. However, the lawsuit alleges that Sears began to sell a new line of tools based on the Craftsman name once Sears emerged from bankruptcy protection. The suit further alleges that Sears marketed the new tools in such a way as to make it appear that the Sears tools were superior to the Stanley tools and casting doubt on the legitimacy of the Stanley line.
Sears emerged from bankruptcy protection in February 2019 under the direction of its previous chairman. According to the news report, the Craftsman licensing rights were included in a $5.2 billion court-approved takeover by the chairman. Although Sears had as many as 3,500 stores in 2005, it is expected that the reorganized company will have about 425 stores, which includes both the Sears and Kmart brands.
The dispute between Sears and Stanley points out the importance of properly protecting a company's trademarks as part of its intellectual property. Failure to do so opens the door to possible litigation and trademark infringement. However, the process of protecting a trademark is complex and can be intimidating. Therefore, it might be necessary to obtain the services of a law firm with experience in trademark law.