Tim Lince

Over six months after our original reporting into the vast trademark and domain portfolio of entertainment magnate Michael Gleissner, his attorneys are continuing their prolific filing activity. While industry experts speculate that the mysterious filings could be linked to acquiring lucrative domain names, a source related to one of Gleissner’s companies tells World Trademark Review that this claim is “far-fetched” and “gross” – and reveals an unusual business strategy involving the ‘farming’ of brands.

In August last year, World Trademark Review conducted an investigation into legal activities being conducted by entities linked to entrepreneur Michael Gleissner, founder of companies including Bigfoot Entertainment and Fashion One. Our research revealed a massive operation involving thousands of registered company names, trademarks and domains across the world (which we compiled into a vast PDF document). The trademarks were being filed in the US, Europe and Asia, and included terms related to established brands (eg, BAIDU, TESLA, THE HOME DEPOT), common names (eg, ALAN, RICHARD, SARAH, WANG), well-known fictional and real-life individuals (eg, BOND, MADOFF, SHERLOCK) and domain names related to cities (eg, HONGKONG.COM, ROME.COM, TOKYO.COM). Each of the US trademarks appeared to be based on prior tights from marks filed in other jurisdictions – most often in Benelux, Latvia and the UK – highlighting the global nature of the portfolio being built.

Commentators at the time speculated that the costly exercise could have the acquisition of lucrative domain names as its end game. IP lawyer John Berryhill suggested “the filings could be intended to impair the value of existing domains” or, alternatively, “to exploit the gaming opportunities provided by the Trademark Clearinghouse (TMCH) and sunrise procedures in new gTLDs”. However, the latter theory seemed unlikely due to the multiple applications being filed for identical terms, with Berryhill noting: “There is no reason to premise US applications on foreign filings to accomplish the normal sunrise gaming.”

Since August, entities linked to Gleissner have been involved in numerous UDRP disputes (seemingly reaffirming the speculation around domain name acquisition) and also continued the filing spree at the USPTO. The total number of marks filed by Bigfoot Entertainment general counsel Jonathan Grant Morton appears to have doubled, from 350 to 730, in the last 8 months. Most continue to be for commonly-used single words (eg, ANGEL, GALAXY, GORILLA, PEACE) and domain names (eg, FASHION.COM, MEDIA.COM, NINJA.COM), with more filings of terms related to well-established brands (eg, PARAMOUNT, ROCKEFELLER and, as Domain Name Wire reported, recent applications for both APPLE and IPOD).

In fact, those latter applications are the latest move involving Apple brands. Just days before those applications were made, Gleissner was ordered by the UK Intellectual Property Office to pay Apple over £38,000 in costs after it found that 68 applications to revoke marks owned by the tech giant should be struck out as an abuse of process. Over on the Stobbs IP blog, Jessica Wolff notes that the company also has 120 revocation requests pending at the EUIPO, suggesting Gleissner’s face-off with the tech giant is far from over.

While the spotlight has recently been directed towards Gleissner’s legal activities, which are easily observed, the ultimate business purpose behind the filings remains unclear. However, a source related to one of Gleissner’s businesses, who preferred to remain anonymous, spoke with World Trademark Review about the logic behind the filings – and denied they are related to the acquisition of domain names. The source expanded: “That is a far-fetched and gross allegation. Just in case you're wondering whether the stuff on UDRP that you see written on blogs is true, the truth is that we were trying to see how UDRP works and learn its possibilities in-house as part of an R&D project. It would be really ambitious thinking that you can just obtain old domains by virtue of a baby-trademark filed six months ago.”

Rather, we were told that Gleissner’s “unusual business model” is based on the philosophy of “creating a brand incubator”, specifically: “Imagine farming a brand in a glasshouse; with the assumption that IP rights are assets similar to real estate, the whole thing was simply a way to invest in property. The market that [Gleissner] pictured however wasn't a seller’s market (where he resells his assets), but a non-liquid owner's market, where the value of his investments increases over time. In this case, there was not much intent for profit, but for owning. Gleissner has other active revenue methods, but this particular operation was for increasing the value of a portfolio over the mid-to-long term.”

So it appears that Gleissner is looking at each registered trademark as a brand asset that could increase in worth over time. But such a vast filing operation (spanning hundreds, possibly thousands, of marks around the world) inevitably has an impact on other parties. In this instance  other brands – often those used by small businesses – are finding that they are being challenged with trademark oppositions and other enforcement actions as Gleissner looks to protect his ‘incubator brands’. World Trademark Review has been directly contacted by business owners distressed at being drawn into unexpected legal fights, with a number considering changing their brand name to avoid the financial burden of a lengthy legal battle. But our anonymous source responds that protecting the marks is just a necessary component of the business plan: “I understand that people complained to you, but that's just part of the business, and I can tell you that was only the minority. When ‘incubated brands’ overlap with someone else's brand, instances of coexistent agreements or non-competition agreements are far more [prevalent] than a fight. Fighting with adverse actions is much more time and labor consuming than just settling any dispute. Most times, however, nobody has disputed our new brands – and other times we got rid of our brand by selling it to somebody who was investing behind their own brand.”

We have reached out to a spokesperson representing Gleissner’s primary business, Bigfoot Entertainment, to offer response to the information given to us by the anonymous source and expand on the business strategy behind the filings. They have not yet responded, and we will update this blog if they do.

The strategy behind Gleissner’s filing spree has been the subject of intense scrutiny in trademark circles, and may now be becoming a little clearer. In the immediate term, rights owners need to be mindful of the hundreds of marks being filed by Gleissner-related entities and the ways their own brands may overlap. In the longer term, the focus will be on how the investment in so-called ‘incubated brands’ pays off in a tangible way. 

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