Yosemite National Park (the "Park") is the subject of an ongoing trade mark dispute which highlights the importance of having clear intellectual property provisions set out in all commercial contracts. A lack of certainty can lead to huge variations as to the value of a contractual agreement and any exposure to liability for the parties.
Park Visitor Services - Background
Since the Park was established in 1890, various private companies were contracted to run visitor services throughout the park (often referred to as 'outsourcing'). Between 1899 and 1993, Curry Co. operated the Park's concessions, building a number of facilities and using and registering a number of trade marks associated with its operations of the Park.
In 1993, Delaware North ("Delaware") took over the management of the Park's concessions, purchasing Curry Co.'s shares for approximately $61 million. The contract between Curry Co. and Delaware reportedly transferred Curry Co.'s interest in the improvements it had made and, additionally, "other property" – a term which crucially was not defined. Delaware continued to manage the Park's concessions until 2015.
In 2015, Aramark successfully bid against Delaware for the contract to manage the Park's concessions. However, a dispute between Delaware and the Park has built momentum since that time, founded in a contract between the two which provides that any successor of Delaware, as turned out to be Aramark, would purchase Delaware's property related to the Park for fair value.
Delaware valued its assets at approximately $50 million however the Park valued them at around $3.5 million. Delaware subsequently sued the Park for failing to require Aramark to meet Delaware's valuation of its assets. Refusing an offer of a royalty free license for the period of the litigation, the Park has applied for the cancellation of Delaware's park-related trade mark registrations.
In the meantime, the Park has changed the names of a number of iconic and historical sites throughout the park, including Badger Pass and the Ahwanhee Hotel, following claims of trade mark infringement by Delaware.
Lessons for Brand Owners
Brand owners must ensure contractual provisions are clear and completely defined. Further, where a brand owner wants to license its intellectual property, the license agreement should be expressly clear on all related issues including, for example, the right to file further trade mark registrations relating to the brand or license, or whether permission must be sought from a licensor for such registrations.
It is important to think ahead and ensure that any license or contract clearly sets out what will happen to intellectual property when a contract ends, and indeed how that will be achieved.
For further information and advice on trade marks, brand protection and commercial contracts do not hesitate to contact us on 0191 281 4000 or email firstname.lastname@example.org: News, Trade Marks