Kromer Investments Inc

Liz Goodgold is Director of Marketing & Branding at Nevada-based Kromer Investments, Inc. As a brand strategist with more than 20 years of naming experience across industries, she has created WateringWinds, LiquidSketch, Silenor, Sugi Psychiatry, ElectraLime, SeraBella, Phi Beta Kapital, UnlockLegal and many more.

A Better Partnership between Marketing and Legal

Most of us marketers round the bases in celebration when we hit upon a winning formula: it meets the strategic objective, delivers it in an innovative way and lands as a marketing home run. But then legal enters the ballgame, and suddenly our home run gets ruled a foul.

We collectively grumble as we hear counsel’s point of view and realize our entire strategy must change. Consulting with legal counsel is a game-changer; it helps prevent liability, reduces financial risk and keeps our companies out of legal hot water.

In my years as both an employee and an entrepreneur, these are the times when it pays to bring in your legal team as a pinch hitter:

Knowing the Difference Between Sweepstakes, Raffles, & Lotteries

Sweepstakes vs. Raffles vs. Lotteries-Most marketers use these terms interchangeably, and in Nevada, that mistake can end your season.

A promotion generally becomes a lottery when it combines three elements: a prize, chance and consideration. Nevada’s Constitution prohibits private lotteries.

To be clear: A sweepstakes is free to enter. That’s why you so often see the phrase: No purchase or tour necessary. By contrast, a raffle is generally considered a form of lottery because participants provide consideration in exchange for a chance to win a prize.

The Hidden Risk in Promotional Requirements

Money is the most obvious example of consideration, but it isn’t the only one. A required donation, a mandatory purchase or even a required property tour may create legal risk because regulators could view the significant time and effort required to participate as consideration.

When a promotion requires participants to provide consideration, it may become an illegal lottery unless an exception applies. In Nevada, charitable organizations are permitted to conduct certain raffles under specific legal requirements.

The legal consequences can be significant, so involving counsel before launching a promotion is far easier than defending one after the fact.

Creating a Brand Name Without Regard to Trademark Law

In my branding career, I’ve seen too many companies fall in love with a new name, build the launch around it, and only meet trademark law when the infringement suit arrives. The issue? They assumed that because the domain was available, the name was legally available too.

 "Consulting with legal counsel is a gamechanger; it helps prevent liability, reduces financial risk and keeps our companies out of legal hot water. "

Although there’s a high correlation between domain registration and trademark filing, they play in two different leagues. A domain is an address; a trademark is a legal right.

Registering a domain means no one else has purchased that exact web address first. It’s internet real estate sold on a firstcome, first-served basis. A trademark gives its owner exclusive rights to use a mark in connection with particular goods or services and to prevent confusingly similar uses. Those rights may exist whether or not the owner registered the matching domain.

GoDaddy checks domain availability. It doesn’t search the USPTO (United States Patent and Trademark Office) database, state trademark registrations or common-law trademark rights established through use in commerce. In short, an available domain tells you nothing about whether the name is legally available for your business. The two systems operate under entirely different rules.

Buying yourbrand.com while another company owns trademark rights doesn’t give you ownership of the brand. It gives you a domain that may become the subject of a trademark dispute.

Buried in every domain registration agreement is ICANN’s Uniform Domain Name Dispute Resolution Policy (UDRP), which provides a process through which a trademark owner may obtain transfer of a domain through mandatory arbitration rather than traditional litigation. To prevail, the trademark owner must prove three things: the domain name is identical or confusingly similar to its trademark, you have no legitimate rights or interests in the domain name and the domain was registered and is being used in bad faith.

Check all three boxes, and the domain can be transferred.

Turning Legal into a Competitive Advantage

The early internet is littered with examples. A cybersquatter registered panavision.com and attempted to sell it back to Panavision for 13,000 dollars. The courts ultimately ordered the transfer of the domain, and the dispute helped inspire the federal Anti-Cybersquatting Consumer Protection Act, which authorizes statutory damages of up to 100,000 dollars per domain.

The scoreboard reads the same way every time: the domain is the field you’re renting, and the trademark owner holds the deed.

Yes, as marketers, we will still grumble when legal counsel weighs in. But there’s a difference between playing it safe and getting sued.

My advice? Invite legal into the game early and keep hitting home runs.