UP trademark objection

[tdetmer]

I'm an S gauge fan and just received the new S Gaugian magazine. It contains an article about the UP railroad objecting to some of the vendors in the S gauge market selling products with the UP name and logo. The article maintains that this usage is commonly made without a license and this has been so for decades. It implies that even Lionel and Flyer have used the logo without a license.

So my question is whether UP has generally started objecting to the use of its logo across the board for all makes and all gauges? Or did Lionel and Flyer and MTH and other vendors get licenses?

On the one hand, I understand the need of a railroad to protect its trademark but it seems that if it has allowed toy train manufacturers to use the logo and name for decades without objection and without a license that there ought to be some equity favoring the toy train makers. Anyone know anything about this topic?

Tom

[hugoroundhouse]

I don't know the history of it, Tom. But if you're like me and watch the prices Flyer things go for on e-bay, that UP logo usually means extra money for the "privilege" of buying it. Probably due to the scarcity of it on Flyer stuff, maybe. It sure doesn't help when you were brought up a block away from a UP line and roundhouse. I've been trying to collect UP items, but as usual, "the heart is willing, but the wallet just won't allow it!'[:(]

Jim E.

[Dr. John]

Union Pacific decided to enforce licensing of all of its logos (UP and all of the fallen flags it has absorbed over the years). It is true of all model trains, regardless of scale. The companies that manufacture model trains must pay the license fee to use any of those road's logos. Of course, the fee is passed along to the consumer.

It is true that UP has the right to do this, but it was not their brightest public relations move, in my opinion.

[Anonymous]

I have investigated the price UP charges for licensing. Charging $20 bucks more for a UP $300 locomotive is silly. Since UP charged less than $5 dollars, so the model company is making a little extra and claiming it as licensing. Many other railroads have licensing requirements, but don't charge any money. Union Pacific charges a minimal amount, to raise money for safety advertising. It is not as if licensing laws existed in 1870, so how could UP always have been charging for licensing?

[Big_Boy_4005]

QUOTE: Originally posted by Lotus098

I have investigated the price UP charges for licensing. Charging $20 bucks more for a UP $300 locomotive is silly. Since UP charged less than $5 dollars, so the model company is making a little extra and claiming it as licensing. Many other railroads have licensing requirements, but don't charge any money. Union Pacific charges a minimal amount, to raise money for safety advertising. It is not as if licensing laws existed in 1870, so how could UP always have been charging for licensing?

Very good James, you make a couple of excellent points. The first is that the fee itself isn't really that much when UP collects it from the manufacturer. The problem becomes magnified as it moves through the retail mark up process.

Second, the actual trademark laws have been around for quite some time. The sudden move to enforce them is what bothers a lot of people. This change in position may be a direct result of changes made to the laws, that were intended to prevent foreign knock off goods, especially clothes, from being sold in this country.

I never noticed this until now, because last year when all this was being argued about so heatedly, but the sudden change in attitude about enforcement seems to coincide with the train manufacturers move to China. It wasn't really a problem when the stuff was made in the US.

[Anonymous]

"So my question is whether UP has generally started objecting to the use of its logo across the board for all makes and all gauges? Or did Lionel and Flyer and MTH and other vendors get licenses?"
--------------------------

Answer to question #1: Yes.

Answer to question #2: To the best of my knowledge, Lionel has not signed-on with their agreement. Some other manufacturers did, and most are charging extra for items bearing UP livery (and properly so, in my opinion).

Yes, the added costs often exceed the actual per-item royalty being paid. And why is that? Simply because the reporting requirements UP requires adds significantly to a small manufacturer's (and all model train companies are small manufacturers) administrative costs. You have to look beyond the actual per-item royalty fee and include ALL of the related/associated costs to the manufacturer. That's why in many cases you are paying--and should be paying--more for UP items in the marketplace.

[Anonymous]

Seems to me the Union Pacific, and others, should be paying Lionel, MTH, Athearn, etc. for advertising thier product ! (I know I'm dreaming but......)
I personally have started my own boycott of products with the UP roadname. (A roadname I don't model.) I wonder if the NS or CSX will start the same requirement for it's TM's. I don't like the thought of giving up buying equipment with the N&W B&O C&O etc. roadnames. [:)]

[Anonymous]

QUOTE: Originally posted by dtpowell

Seems to me the Union Pacific, and others, should be paying Lionel, MTH, Athearn, etc. for advertising thier product ! (I know I'm dreaming but......)
I personally have started my own boycott of products with the UP roadname. (A roadname I don't model.) I wonder if the NS or CSX will start the same requirement for it's TM's. I don't like the thought of giving up buying equipment with the N&W B&O C&O etc. roadnames. [:)]

A couple of points I would like to bring to mind. It is called goodwill, since it will have no beneficial effect for UP. It might if they still ran passenger trains, but a shipper isn't going to ship UP just because he saw a model. Why aren’t Star Wars toy manufacturers being paid by George Lucas since they advertise his movie?

All sports items are licensed at much higher prices than the UP models. Do you realize that more money is made on licensing from Star Wars toys than is made on the movie?
Other railroads such as BNSF will sue if you use their name without getting permission, I believe NS and CSX do the same, but I am not sure. Attempting to boycott everything that is licensed is silly, if not impossible.

[Big_Boy_4005]

Actually, I think CSX has been doing licensing, but much more quietly. UP has been much more "in your face", especially with their heritage paint jobs. BNSF, NS, CP, CN, and KCS have all been silent on this so far.

The thing is railroads don't need railfans, it's the other way around.

By the way, I know Athearn had settled with UP, but I thought Lionel did too, after the bahkruptcy.

[Anonymous]

i object to the manufacturers "in your face attitude" that the evil union pacific railroad is causing certain items to cost $20.00 more and has become a consumer problem. it seems to me this is just part of the cost of doing business, and they should stop whinning and simply bury that cost in the overall price of the product as they do with their other administrative costs. what will be next, a surcharge to offset advertizing costs?

it appears the manufacturers would rather raise prices to the consumer rather than deal with the railroads legal department concerning adverse possession, prescription, estoppel, or any of the other avenues available to them. can't quite blame them, with legal costs being the backbreaker they are.

i see this as a case of "might makes right"; the bigger company can hire more and better lawyers because they are subsidized by the government and just plain bigger. with the legal example provided by our two main manufacturers, and the loser bankrupting the next largest, it's no wonder they're getting tired of the fight and are willing to pass the costs onto us the consumer who happens to be individually weak but collectively strong. however we vote with our pocketbooks, will ultimately settle the issue.

right now, i'm inclined to stay away from any manufacturer that tells me i must pay extra for a product because of the way they do business. but then, i don't model the union pacific, so it's easy for me to say that.

[Buckeye Riveter]

QUOTE: Originally posted by Big_Boy_4005


The thing is railroads don't need railfans, it's the other way around.

Amen to that! The railroads want shippers. [:)]

[Anonymous]

"right now, i'm inclined to stay away from any manufacturer that tells me i must pay extra for a product because of the way they do business. but then, i don't model the union pacific, so it's easy for me to say that."
--------------------------
Well, that's certainly your right, but I, for one, am perfectly content to see the manufacturers pass their licensing costs along to consumers. Doesn't matter to me if it's UP (which I don't model and never will), or some other entity, although the others in railroading have far less restrictive licensing arrangements.

My hope is that the increased cost for UP items will dimini***he potential market for such items (not necessarily the established market among UP enthusiasts) and eventually dissuade the manufacturers from producing nearly as many UP and UP-related items. That's about the only way the hobby market can send a message--even if it's a small one with little overt impact--to a corporation that obviously doesn't give a darn about its public image. Eventually--and it may take some time--that kind of thing can come back to haunt a firm.

The model railroad industry is far too small and fragmented, or so it would appear, to take on a monolith like UP in the legal process. That being the case, the best they can do is make the UP fans foot the bill for UP items. Seems entirely fair to me, and I will not only NOT boycott such manufacturers, I'll do all I can to actively support them. Others can, and will, do as they please.

[tdetmer]

Hi everyone,

I appreciate all of the information and thoughts. I particularly agree with the comments that the UP has the right to enforce its trademark but its just that it has come along so late and now its doing it as an "in your face type of move." It just seems sort of hardnosed on their part even if they have the legal right.

I know that the article I mentioned comments that years ago the UP begged the toy manufacturers to use their logo and even supplied the paint to them. So that's gratitude for you by the UP to turn around and stand on principle at this point.

Also, one of the S Gauge manufacturers affected is S Helper Service, which produces excellent products. Its my understanding that the UP wanted more than a direct monetary royalty for the license. In addition to a royalty, they wanted other concessions including the right to obtain all molds and related manufacturing equipment used to make the UP cars if the model is discontinued. SHS makes limited run train equipment so that can add up in a hurry. It just seems so heavy handed on the UP's part. SHS attempted to negotiate a license but I gather at this point they may have given up because of all of the demands made by the UP.

I know I don't collect or run UP or related lines so my decision is easy. I'm not going to start buying any now!

Tom

[csxt30]

I'd just like to say , that if I wanted UP stuff, I might be inclined to look for the non decorated engines and try to decal & paint them myself. Just a thought, as not too many people will want to do that, I know. Thanks, John

[Warburton]

I'm not an attorney and I don't even play one on TV, but I suspect that a manufacturer of toy trains may have a possibly valid legal argument against UP in saying that since UP has known about manufacturers using the UP name and logo for many decades and never raised a problem with it (or asked for compensation) before, UP has relinquished its right to do so now. Any laywers out there to comment on this?

[Anonymous]

UP get licensing form decal manufacturers too, you could print your own. About UP heavy handedness; UP needs to be consentient about enforcing it policy, or manufactures would walk all over them. UP can't go around granting Lionel free licensing, other companies could probably sue UP if they did that. Some organizations, such as museums, do get free licensing. As to UP making unusual demands here is the form for applying for licensing. http://www.uprr.com/aboutup/licensing/up_licensee_model.pdf

[Anonymous]

I'm not a lawyer either, but we talked about this kind of stuff when I was working on my MBA.

I think you are probably right. Lionel has been making trains with the UP name on them for nearly 100 years, without a peep out of the UP. From what I understand of the applicable law, the key to defending trademarks and copyrights is to constantly and actively shut down anyone who is using them without permission. It seems to me that the horse left the barn decades ago, and it's too late to shut that particular door.

However, since the UP can afford more and better lawyers than model train makers and calendar publishers, they will eventually bully everyone until they get their way.

(OTOH, I would agree that UP has every right to agressively defend any new marks or liveries they might come up with.)

QUOTE: Originally posted by Warburton

I'm not an attorney and I don't even play one on TV, but I suspect that a manufacturer of toy trains may have a possibly valid legal argument against UP in saying that since UP has known about manufacturers using the UP name and logo for many decades and never raised a problem with it (or asked for compensation) before, UP has relinquished its right to do so now. Any laywers out there to comment on this?

[Anonymous]

When did copyright laws come into effect, long after Lionel and UP I am sure. How soon after the effect of the law would UP have to have acted to be considered legal, well since it is legal, right in you eyes? My point is the Barn didn't use to have a door. Part of the way UP gets around this with the fallen flags, is the heritage locomotives, which serve a dual purpose.

QUOTE: However, since the UP can afford more and better lawyers than model train makers and calendar publishers, they will eventually bully everyone until they get their way.

Is it wrong to bully a thief? Just try and make a Nascar calendar, then you will find out what bullying means.

[Big_Boy_4005]

No James, the copyright and trademark laws are older than Lionel and UP. They have been updated from time to time, and it was the last update that may have started all of this.

[Anonymous]

They had licensing laws in 1870? If you say so*.

*not sarcastic

[Big_Boy_4005]

QUOTE: Originally posted by Lotus098

They had licensing laws in 1870? If you say so*.

*not sarcastic

No not licencing laws, trademark and copyright protection. Licensing is more of a 20th century phenomanon, and an outgrowth from trademark and copyright. The distinction here is, once you create and use a mark or other original material and register it, it belongs to you. You gain sole control of its use. The thing is this whole merchandising angle, where a company's registered mark is placed on an object that they didn't manufacture is the new part. The rules didn't need to change to allow for this, it's just a clever use of the existing rules.

A perfect example is Disney. Uncle Walt started out in the movie business creating animated characters. The funny thing is, not too long after that Lionel was in bankruptcy. I'm not sure who contacted who, but the Mickey Mouse hand car saved Lionel's butt, and showed the marketing potential of the Mouse. A big chunk of Disney's money comes from licensing their intelectual property.

You see? The laws have always been there, it's the way they are used that has changed.

[tdetmer]

I think Elliot makes a lot of good points. I just wi***he UP would cooperate with the train manufacturers in allowing a licensed use of the various marks on a reasonable basis. That way the UP could protect its mark, it could get some goodwill out of working with the train manufacturers reasonably and we all could continue to enjoy this hobby. I don't know about the rest of you, but I worry that the royalties for this could add to the costs to make it prohibitive to allow the use of the UP and related marks. None of us want to be pirates. And we don't want to see cars and engines priced out range by the cost of licenses. There ought to be a middle ground where licenses could be granted for a nominal amount. This is not the UP's core business and other than protecting the mark, why make this big an issue out of it? I doubt the UP is going to manufacture toy trains but maybe I'm wrong. Even if the UP made 50 cents or a dollar a car, it protects it's mark and the cost to the consumer isn't extraordinary.

Tom

[Big_Boy_4005]

I was in an exclusive HO train store this afternoon, and just for fun was looking at the prices of the engines. There was a $9.50 difference between paint jobs on the same model. I believe they were Athearns, with a list price in the $60 range. That's a big percentage.

I have always felt that UP is doing this for two basic reasons. First because they see Disney, Coke, John Deer, Ford, and hundreds of others doing it first. It's like the feel left out.

Second, because they can, and want the money. They know they have railfans over the barrel. In the old days they might have gotten some advertising value from letting Lionel and others use their logo when making models.

But times have changed, and UP has no use for name recognition. The entire Western US is really only served by two railroads anyway.

It really seems like there has been an attitude shift in all areas of American Business. The oil companies make UP look like regular philanthropists.

[powernailer]

Isn't this a joke. Does the UP seem to enjoy losing supporters for the American Railroads or what. I do beleive that most people who are model railroders would probably defend the actual railroads when people complaint about crossings, noise, and many other things. So wouldn't you like these modelers on you side? We all know that the UP, Amtrak, BNSF, or any of the railroads are not making that much off of nickel and dime payments for using there logos.I agree, that maybe some kind of paperwork needs to be in order, but to get paid for something that actual benefits you in the public eye, bull crap. How many modelers might buy a different roadname if they had to pay more for the UP model? Pretty soon, people who deface (grafity) the railroads cars will what to get paid for their createtivity. I love watching the trains go by at the crossing, but some people don't. Sign the papers and get this show on the road, um track. Wouldn't it be nice if the under the table law suits, stealing each others tech items, and whatever would be resolved and get back to making trains. Seems like all we want in any business is to run the other guy out, no mather how. I guess you call that capitalism, huh?

[AlanRail]

Actually trademark, copyright and patent rights go back quite a bit farther:

U.S. Constitution, Section. 8., under Clause 1.

The Congress shall have Power To . . . :

Clause 8:

To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

In England at the time this was not the law.

[lionelsoni]

Powernailer, UP is actually very interested in gaining supporters for "the American Railroads", their own in particular. Why else would they go to all this trouble?

http://www.railpictures.net/viewphoto.php?id=123121&PHPSESSID=7324cb5827395190e008e52948c19f1b

[cnw1995]

I understand all the major roads are now actively protecting their trademark claims - some, like CSX and NS, much more quietly than others.

[IRONROOSTER]

QUOTE: Originally posted by AlanRail

Actually trademark, copyright and patent rights go back quite a bit farther:

U.S. Constitution, Section. 8., under Clause 1.

The Congress shall have Power To . . . :

Clause 8:

To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;

In England at the time this was not the law.

Trademarks get lumped in with patents and copyrights, but they are not the same thing. For one thing patents and copyrights expire, second trademarks are not writings or discoveries. The original purpose of trademark laws was to protect the consumer so he would not be deceived by fraudulent businesses masquerading as the real thing. That's not really an issue here, but there were extra clauses added to the trademark law pertaining to dilution, etc. that have enabled companies to sell usage of their trademarks. What is really needed here is a fair use law for trademarks and a better definition of how trademarks expire. UP is claiming all the old trademarks even though they aren't used - I know they are doing some retro painting, but just try to call up C&NW to order a boxcar to ship your goods. Unfortunately, given the current political situation I don't expect any improvement from the Congress, hopefully someone has the money to successfully fight this in the courts.
Enjoy
Paul

[FJ and G]

My main beef with the UP trademark scandal (scandal???, whatever); is that the toy train companies (unlike some model train companies in the smaller scales), are charging the SAME price for UP stuff as for other stuff. Sooo, everyone is helping pay UP.

I think that like the smaller scales, the UP stuff should be marked up.

I'm just happy I'm done buying toy train stuff. I have enough for a lifetime and the only thing that would entice me to buy is if i find an affordable live steam toy train engine for my backyard project.

[Big_Boy_4005]

QUOTE: Originally posted by cnw1995

I understand all the major roads are now actively protecting their trademark claims - some, like CSX and NS, much more quietly than others.

Doug, there is an Atlas ad on the inside cover of the current issue of MR, and at the bottom only UP and CSX are listed as licensed products. This doesn't mean that the others won't jump on the bandwagon in the future. It just means they haven't yet.

On the inside back cover, there is a Kato ad which says that Chicago Metra is also licensed.