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The "slovenly" faux-Best Buy employee is pictured in Newegg's latest commercial; a real Best Buy employee is pictured in a separate image. Can you tell which is which?  (Source: M-Live, YouTube)

Best Buy is also upset about Newegg's new "Geek On" Logo, which it says violates its Geek Squad-related trademarks.
Commercial depicts clueless blue-shirted employee struggling to explain products to customers

Is it illegal to show a video of a blue polo-wearing employee in a computer store?  Best Buy's legal staff appear to think so.

I. Best Buy Upset About "Slovenly", "Uninformed" Employee Depiction

They sent a legal threat to City of Industry, California-based online retailer Newegg.com for a new commercial that found its way onto TV and on YouTube, the world's most used video sharing site.  Best Buy writes:
We... recently learned that Newegg is running a commercial on television and YouTube (http://www.youtube.com/watch?v=nYk0dQrz3uc&feature=youtu.be" rel="nofollow) depicting a blue-shirted salesperson in a store with a similar layout/color scheme to a Best Buy store, so as to represent a Best Buy employee.  The fake Best Buy employee is depicted as slovenly and uninformed about computer products, in contrast to your employees who are portrayed as "experts."

Your... negative portrayal of our employees violates trademark rights and misleads customers about our services, in violation of federal and state law.  While we welcome fair competition, we cannot tolerate unfair competition that disparages our employess, confuses our customers and damages our valuable trademarks and goodwill associated with those marks.  We take great pride in our employees and the high quality of customer service they offer and find your company's focus on our employees in this advertising campaign particularly offensive.  We expect that you would be equally offended if the tables were turned and a competitor launched an advertising campaign portraying your employees as slovenly and uninformed.
To be fair, the employee pictured doesn't appear particularly "slovenly" -- a trip to your local Best Buy store will reveal he in fact is pretty much the norm -- the store is home to the world's most well-coiffed employees in our experience.

In reality, Best Buy may be getting a little uncomfortable as the ad hits a bit too close to home.  One YouTube commenter (uprated 125 times) remarks:
Sadly, this IS what best buy is.

There's a reason knowledgeable people don't shop at best buy, and poor consumers get ripped off without even knowing it.
Another comments, "oh man this commercial is giving best buy employees? too much credit."

The encounter depicted is in line with our staff's personal interactions with Best Buy sales staff across the country, as well.  For example, when shopping for a laptop in 2008, floor sales staff at two separate local Best Buy stores were unable to properly assess laptop graphics performance and were unaware of current mobile graphics card offerings.  

In both cases it took several employees in the computer department to find one that could compared and contrast offered processors in a technically sound manner.  And in both cases, the employees suggested that the DailyTech staffer "apply for the Geek Squad" as they "seem to know a lot about computers."

Of course, these experiences are limited, but based on feedback on YouTube and Facebook it seems we're not the only ones who have encountered this.

The broader question is whether depicting a company in an unfavorable manner -- without using specific logos or brand names -- is illegal.  In this regard Best Buy's legal chances seem poor, given that Verizon Communications, Inc.'s (VZ) successfully defended in court its right to air far more flagrant commercials attacking AT&T, Inc. (T); and the fact that Deutsche Telekom AG's (DTE) T-Mobile USA and Apple, Inc. (AAPL) have both [1][2] aired similar commercials attacking their competitors' products or brands by name.

II. Logo Abuse?

Best Buy also alleges that Newegg.com is abusing its trademarks pertaining to the Geek Squad -- namely, the use of the colors black and/or orange in relation to the terms "geek" or a power button logo.

Newegg.com has recently started a new services campaign [GIF] dubbed "Geek On", which shows an orange power button as the 'O' in "ON", next to black or white "GEEK" text (depending on the color of the backdrop).  The campaign pitches Newegg.com support and sales, and the company has been distributing promotional T-shirts as a part of the campaign.

Best Buy's lawyers write:
We recently learn that Newegg is using a stylized GEEK ON design in orange-and-black font with the "O" in "ON" depicted as a power button (the "Geek on Logo") with a new marketing campaign for Newegg's consumer electronics retail services.  We understand Newegg is using this design on its website, its Facebook site, and in connection with promotional items for Newegg's services such as t-shirts.  An illustrative use of the Geek On Logo is attached as Exhibit B.

Given Best Buy's long-standing prior use of the GEEK SQUAD mark, Geek Squad Trade Dress, and Tie and Power Button Design, Best Buy is concerned that Newegg's use of the Geek On Logo is likely to create confusion among consumers and to dilute the distinctive quality of the GEEK SQUAD mark in violation of Best Buy's trademark rights.  Best Buy is particularly concerned because the Geek On Logo features the GEEK-component of Best Buy's GEEK SQUAD mark, is depicted in the same orange-and-black color scheme as Best Buy's Geek Squad Trade Dress, features a power button design that is very similar to the Geek Squad Tie and Power Button Design, and is used to promote Newegg's competing consumer electronics retail services.
Whether anyone would actually "confuse" Best Buy and Newegg, is debatable, but Best Buy may have a bit more of a leg to stand on here.  Apple has in the past brought several similar lawsuits claiming violation of its logo [1][2][3].  Similarly, George Lucas has successfully brought several Star Wars related trademark lawsuits against small firms [1][2].

In other words, regardless of whether its fair or not, legal precedent has shown that marginally related logos and text can be grounds for a successful court case by the trademark originator against the late adopter.

III. What's Next?

Newegg.com does not appear to be backing down from either campaign and defiantly posted Best Buy's letter on its Facebook page.

A cease and desist letter is a legal tactic in which one party sends the other a letter formally warning them not to repeat certain actions like stalking.  If they violate the terms, they can face criminal and civil penalties under U.S. law.


Typically, a cease and desist letter is followed by a lawsuit if the addressed party does not comply.  It's now just a waiting game to see if Best Buy backs up its threats with legal muscle.

In the meantime all Best Buy's fuss is generating loads of free publicity for Newegg.com's commercial, which has already gathered 413,000+ views.

Best Buy sent a similar threat last year to a priest who used the slogan "God Squad" and drove a Volkswagen Beetle painted similar to those used by the Geek Squad.  The company does not appear to have followed up on that threat with any substantial legal action, perhaps because of the backlash that stories about the threat caused. 


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RE: wow
By icemansims on 6/10/2011 4:21:32 PM , Rating: 3
No...dead beats is what I meant, as they do not contribute to the income of the credit card company but are using their services.

http://credit.about.com/od/usingcreditcards/a/dead...

I CAN tell the difference. I rarely buy things from Best Buy because they're selling overpriced, outdated junk.

Most people who shop there DON'T know the difference. My mother is a good example. She's a bit of a technophobe, but recognizes the need for a computer. So, she would be the type to walk in and buy it off the shelf from such a big box computer store and get ripped off if I didn't do the research for her.
A good example would be a video card: an HD6450 vs an HD5970. To a lay person, they're not going to know the difference. In fact, they're more likely to choose the 6450 because it's a higher number, but they just don't know any better. How about the Pentium 4 vs the Athlon 64 back in the day? The Pentium 4 boasted a hell of a clock speed (3.2 GHz), but the Athlon 64 (2.4 GHZ) beat the pants off of it consistently AND was cheaper. A lay person at the time wouldn't have known that if they didn't do their homework.

Ignorance is the source of a lot of income at Best Buy.


RE: wow
By steven975 on 6/13/2011 10:11:20 AM , Rating: 3
Actually, those that reliably pay their balances each and every month are great customers.

They don't have the margin of those that rack up interest and penalties, but a CC company could run a successful business with ONLY those that pay their balances each month and still do quite well.

For example, let's say a person pays on-time, every time, and charges $2K per month. Each and every month, the CC company nets around 2% in transaction fees, or $40. Over the course of a year, that is $480, and at any given time, the maximum investment from the CC company's perspective is $2K or so. Add in that the collections and customer service costs are relatively low (it's the people up against the limit and paying through the nose in fees hogging those resources) along with the almost risk-free profiles of these customers, and you have a formula for good profits.

Many of these customers are also on good Rewards programs, so the "take" for the CC company may be ~1.5% instead, but it's still a good return given the low risks involved.

Counter this with someone with a $10K balance and 30% rate, and the return looks smaller...BUT these types also spend an hour a month with customer service whining, too. They also happen to delay payment, tying up investment, too. These are HIGH RISK customers, but with a lot of them you can make money, just like you can make money with low-risk customers.

Still, there's way more overall in the risky people, but most good CC companies don't ignore the low-risk people, either.


RE: wow
By Just Tom on 6/14/2011 10:27:34 AM , Rating: 2
Um, a rate of return on investment of 1.5% is terrible. And in your scenario it would be even less since you assume there are no costs to the credit card company when it issues and maintains a credit card account. 1.5% is below the normal inflation rate and significantly below the rate one could get investing in Treasury bills.

Credit card companies call people who pay their bills on time and in full every month deadbeats because they lose money on every such customer.


RE: wow
By steven975 on 6/15/2011 11:36:01 AM , Rating: 2
Ummm...that's 1.5% per month, 18% annualized.

$2K invested over the course of a year, at low risk, returning a dependable $360 is a pretty good deal.


RE: wow
By Argon18 on 6/16/2011 5:35:45 PM , Rating: 2
That's not a good deal, that's a great deal. In your example, $2k invested with $360 return per year = double your money every 6 years. That's a very very good investment from the CC's perspective.


"The whole principle [of censorship] is wrong. It's like demanding that grown men live on skim milk because the baby can't have steak." -- Robert Heinlein














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