Which will win out in a court of law: an ostensible first business use of a product name, or the documented first filing for that same name at the U.S. Patent Office?
At its annual EMC World conference in Las Vegas on May 2, EMC unveiled its new Unity storage array system for midrange companies. It was one of the biggest news events at the show.
Over in Campbell, Calif., ears perked up when the news arrived: Nexsan, a smaller independent storage company, already had a storage system dubbed Unity, and it had filed to copyright the names Unity and Nexsan Unity more than a month beforehand.
Lawyers were called, and Nexsan filed a court action against EMC on May 6 to protect itself against "certain trademark rights asserted by EMC Corporation. Nexsan seeks this court's intervention because EMC has threatened suit unless Nexsan abandons its Unity trademarks."
How It All Started
Here's what started this. EMC lawyer John Hurley sent a letter to Nexsan attorney Steven Abreu dated April 29, 2016, that reads, in part: "EMC first used the mark Unity for an extension of its VNX over a year ago in customer presentations. For example, on March 19, 2015, EMC presented the Unity product line to a customer and a large reseller. ... Since that time, EMC's Unity products have been presented to dozens of third parties."
However, EMC did not file for a patent or copyright on the name Unity with the U.S. Patent Office until that very day, April 29, 2016. EMC apparently had been using the name for more than a year without filing for copyright protection.
"Based on EMC's senior use of its own Unity marks, we believe Nexsan does not have the right to use Unity on similar goods and services," Hurley wrote. "Accordingly, we ask for Nexsan's immediate agreement to do the following: 1) Expressly abandon the two USPTO applications, and 2) not use the Unity mark for goods and services related to EMC's Unity goods and services.
"EMC reserves the right to commence legal action without further notice in the event those applications proceed toward registration and/or Nexsan initiates any Unity mark in connection with similar goods and services."
Nexsan Will Defend Itself Against a Fortune 200 Foe
Nexsan has no intention of following either of EMC's two suggested courses of action, CEO Bob Fernander told eWEEK.
EMC is banking on its "first use" of the name Unity to win the fight between the two companies. Nexsan has the advantage of earlier-filed paperwork with the Patent Office, which it did on March 22, 2016 (see timeline below).
"EMC has chosen to take an aggressive posture toward us, and we were going to be sued by EMC and incur litigation costs to protect ourselves," Fernander said. "It is a cost of doing business, and we will weather it. We have $61 million in the bank; we can afford to protect ourselves."
Fernander said that Nexsan had no way of knowing it was not the only storage market player working on a technology under the Unity brand. He believes that a jury will see that EMC had not used the brand in a sufficiently public or commercial way to support its defense of first use.
'We Did Everything Required'
"We did everything legally required to ensure that we were applying for a trademark that was not being applied for by others," Fernander said. "We will have our day in court. I think people understand the difference between public and private, and I think that is what this case will boil down to."
Here are some data points, according to Nexsan, on the case:
--March 22, 2016: Nexsan filed with the United States Patent and Trademark Office for the following trademark applications, based on an intent to use UNITY and NEXSAN UNITY.
--April 26, 2016: Nexsan announced in a press release "the release of Nexsan UNITY (TM), a next-generation storage platform that combines the performance, scability and value of DRAM [dynamic random access memory] and flash [flash memory] along with private cloud system synchronization and true data mobility support."
--April 29, 2016: more than a month after Nexsan filed its UNITY trademark applications with the USPTO, and days after Nexsan's public announcement of its UNITY product line, on April 29, 2016, EMC filed (according to USPTO records), trademark applications for UNITY and EMC UNITY. EMC then transmitted by email a letter to Nexsan Counsel to cease using the Unity name stating, "Nexsan does not have the right to use UNITY as a mark on similar goods and services." EMC demanded, on threat of litigation, that Nexsan abandon its trademark applications and not use any UNITY mark for goods and services related to EMC's UNITY goods and services.
--May 2, 2016, at the EMC World conference in Las Vegas, EMC introduced the EMC Unity product line. EMC's application filing for its EMC UNITY Marks occurred 38 days after Nexsan's filing date for its Nexsan UNITY Marks. EMC's public launch of its UNITY product and services occurred 41 days after the Nexsan filing date.
--May 6, 2016: Nexsan filed a lawsuit regarding EMC's use of the Unity trademark.
No date has yet been set for the first court hearing.