Did you hear the one about the inventor who asked his intellectual property attorney if he could help the inventor get a patent on his new invention? The attorney said “I don’t know. What’s the invention?” The inventor said “It’s a wheel.” Well that’s how it happened in 1991 when Rolf Dietrich came to see me.
To my surprise, it turned out that we could get a patent on his new, lightweight, strong, good looking bicycle wheel. Rolf had come up with a way to remove spokes from a bicycle wheel. The result was a wheel that was lighter, of course, than previous bicycle wheels but, quite remarkably, stronger and more stable. Getting a patent was relatively easy. Making money with the invention proved to be more difficult. For two years following the issuance of his first patent, Rolf went to trade shows and courted wheel companies and bicycle companies. In 1994, Trek Bicycle Company agreed to meet with Rolf. Trek liked the wheels.
Just before signing a five year license agreement with Trek, Rolf told me that he wanted to trademark his name. I asked him “Which one?” He said “Rolf.” I explained that he needed to “use” the mark in “commerce” before he could register it, so he sold Trek some wheels bearing the mark Rolf. He filed a use based application for federal trademark registration. Registration was refused on the ground that “Rolf” was primarily merely a surname. The Trademark Act prohibits registration of a mark that is primarily merely a surname, absent evidence of acquired distinctiveness. The examining attorney submitted evidence showing that there are a lot of people with the surname Rolf. I knew that Rolf was also a given name so I did some digging and found out that there are more people with the given name Rolf than there are people with the surname Rolf. I submitted evidence showing that Rolf is not primarily merely a surname, and examining attorney approved the application for registration. All along, I strongly doubted that Rolf could get Trek to call the wheels Rolf wheels, but the license agreement that Rolf signed included a provision requiring Trek to use the Rolf trademark.
In 1994, Rolf was an empty trademark. It had absolutely no brand around it. No one knew what a Rolf wheel was. Within a few months, Trek was producing Rolf wheels. Then, Trek began a remarkable campaign to build a brand around the Rolf trademark.
The brand building campaign was extremely successful. Rolf himself was featured in splashy ads and he travelled the country to promote the wheels that bore his name. Trek even spec’d them on its own bikes, including bikes that it sold under other trademarks that it had acquired such as Fisher and Bontrager. Gary Fisher began building mountain bikes before the term was coined. He sold his mountain bike company and his Fisher trademark to Trek in 1994. Keith Bontrager built his reputation around his innovations in bicycle frame components. In 1997, Trek acquired his company and the Bontrager trademark.
In the fifth and final year of the license agreement between Rolf and Trek, they sat down to negotiate the terms of a new agreement. It did not go well. It was during these negotiations that Trek realized, for what seemed to be the first time, that it did not own the Rolf trademark. Rolf had only licensed Trek to use the mark. When negotiations broke down, a rather ugly divorce followed and Rolf walked out with his patents, his trademark and the Rolf brand that Trek built around the Rolf trademark.
Today, the patents are expired and the Rolf wheel designs are in the public domain. Anyone can copy them. No one, however, may use the Rolf trademark except for Rolf Prima, the bicycle wheel company that Rolf founded when he left Trek. The Rolf brand is well known to and respected by cyclists who don’t bat an eye at spending $1,000 or even $2,000 for a pair of bicycle wheels. The Rolf trademark and the Rolf brand are far and away the most valuable assets of Rolf Prima. They embody the outstanding reputation that was built up over two decades of selling high tech, lightweight, good looking Rolf bicycle wheels That is a testament to the growing value of trademarks and brands in the world today. The patents are history.