IP Law Daily Preliminary injunction granted in trademark scrum
Friday, July 17, 2020

Preliminary injunction granted in trademark scrum

By Randall Holbrook, J.D.

Use of LICENSED SCRUM MASTER and similar terms was likely to cause confusion with prior mark CERTIFIED SCRUMMASTER for very similar project management training programs advertised to identical audiences.

The developer of a project management training system known as the Scrum Framework has been granted a preliminary injunction barring another company from using "SCRUM"-formative marks for similar training services that were marketed to the same customers. The federal district court in Sherman, Texas, determined that plaintiff Scrum Alliance, Inc., was likely to succeed on the merits of its trademark infringement claims against Scrum Inc. and would sustain irreparable harm in the form of lost goodwill if injunctive relief were not granted (Scrum Alliance, Inc. v Scrum, Inc., July 16, 2020, Mazzant, A.).

Plaintiff Scrum Alliance, Inc., was the developer of the Scrum Framework, a project management training system. Scrum Alliance was founded in 2001 and had registered three core trademarks for its services: CERTIFIED SCRUMMASTER®, CERTIFIED SCRUM TRAINER®, and CERTIFIED SCRUM PRODUCT OWNER®" These marks had obtained incontestable status pursuant to 15 U.S.C. § 1065. In 2019, defendant Scrum Inc. began offering what allegedly was a copy of Scrum Alliance’s program, using the marks LICENSED SCRUM MASTER, LICENSED SCRUM TRAINER, and LICENSED SCRUM PRODUCT OWNER, which Scrum Alliance asserted were chosen in order to create confusion between the parties’ respective services.

Likelihood of success on the merits. The court held that it had personal jurisdiction over the defendants because Scrum, Inc. had conducted training seminars for its clients within Texas, keeping several employees within the state for "three to four days a week, two to three weeks a month" in order to provide those services. It was undisputed that Scrum Alliance was the owner of its claimed marks and that it was the senior user of those marks. The court further found that Scrum Inc. had created a likelihood of confusion because the marks were extraordinarily similar. The two companies provided similar services to identical buyers reached through the same advertising media, and there was testimony suggesting the use of confusing marks was intentional. Scrum Alliance also provided both anecdotal and survey-based evidence of actual confusion by customers, including reports of customers who had contacted Scrum Alliance to complain about not receiving certificates after completing Scrum Inc.’s courses.

Irreparable harm. Scrum Alliance established irreparable harm by showing that it had lost costumers to Scrum, Inc. and that the evidence of confusion in the marketplace showed it was no longer able to control its reputation and place in the market. Such goodwill in the marketplace is impossible to quantify, so it amounts to irreparable harm.

Balance of hardships. The balance of hardships favored issuance of the injunction. Scrum Alliance had spent millions of dollars and nearly twenty years establishing the value of its marks, while Scrum, Inc. would suffer very little from being prevented from using its recently created marks.

Public interest. The court held that the public interest is always served by compliance with trademark law, and granted the injunction with little discussion of this factor.

This case is No. 4:20-cv-00227-ALM.

Attorneys: Brian Harrison Oates (Jackson Walker LLP) for Scrum Alliance Inc. Andrew Baxter Ryan (Ryan Law Partners LLP) for Scrum Inc, Jeff Sutherland, and JJ Sutherland.

Companies: Scrum Alliance Inc.; Scrum Inc.

MainStory: TopStory Trademark TexasNews GCNNews

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