Despite J&J’s ownership and use of the mark since the 1880’s, the American National Red Cross has the right to use the red cross by a 1900 Congressional decree in connection with the agency’s founding charter. The red cross has peacefully co-existed on Band-Aid boxes and rescue vans pretty much ever since. However, in a lawsuit brought this week by Johnson & Johnson against The American National Red Cross, J&J claims that the Red Cross is overstepping its bounds and infringing upon the J&J trademark by marketing a range of first aid related products that carry the red cross.
In my mind, J&J is 100% right.
News articles have quoted the president of the Red Cross as calling the lawsuit “obscene…simply so that J&J can make more money.” The American National Red Cross is playing the helpless victim here bullied by Big Business. Please. The Red Cross is a behemoth, with nearly $4 Billion in annual revenues. The Red Cross and its licensing agency and its licensing partners (the companies actually conceiving, making and selling these products) saw the financial opportunity presented by a universally recognized and respected symbol. Greed blinded them to the little Registered mark at the base of Johnson & Johnson’s red cross. To claim the high road here under cloak of the hallowed American National Red Cross is, in a word, shameful.
The Red Cross is a wonderful organization that continues to perform its heroic and selfless mission on a global basis. But that does not give them the right to sell something that isn’t theirs and to (purposefully?) create confusion in the market by placing the American National Red Cross logo on products that compete directly with J&J first aid products that carry their proprietary (and identical) red cross. There is plenty of blame to go around here, from the licensing agency that made these deals (Campbell Associates LLC) to the companies manufacturing these products (like Learning Curve and Steps Ahead) to the American National Red Cross lawyers who let these deals go forward.
And the fallout here may be significant, even for those not involved. Yes J&J will take a hit for going after the Red Cross, even if they are in the right. I would hope that the Red Cross takes a hit for their brazen disregard (in my layman’s view) of US trademark law; ditto for the licensing agency and the licensees that conveniently turned a blind eye to the same. Yet this could also be a setback for other non-profits that could legitimately benefit by the increased visibility and revenues enabled by licensing, if these events give their own leaders and partners pause about the feasibility of building a licensing program. And this could hurt other agencies that may rely on the American National Red Cross for funding, if funds, management and energies become embroiled in and distracted by litigation.
More and more non-profits have woken up to the opportunities presented by licensing, particularly the ability to create funding streams other than charitable donations. In other words, the profit motive. And however noble the charter, non-profits can’t venture into the commercial arena and then insist that the rules defining this arena don’t apply to them.
Kudos to J&J. It could not have been an easy decision to bring the American National Red Cross to court over the iconic symbol. But in addition to everything else it represents, this symbol is an incredibly valuable asset. The Red Cross knows well the value of the red cross, that is why they put it on absolutely everything that carries their name. I still can’t figure out if they were simply being brash or just plain clueless in pretending that this valuable asset was really theirs. Probably a bit of both.
UPDATE 5.16.08: This continues to be a pretty messy debate in the courts, but so far the Red Cross has won two decisions in this case and is all but declaring victory.