Wednesday, February 01, 2006

Stumptown Showdown: Specialized ™ Threatens Mountain Cycle with Lawsuit

Portland, OR—Specialized Bicycle Components is threatening legal action against Mountain Cycle, claiming the Portland, Oregon, manufacturer’s Stumptown cyclocross bike, now in it’s third year of production, infringes on the trademark Specialized holds on its Stumpjumper mountain bike.

The Stumpjumper was one of the earliest bona fide production mountain bikes—a fact Specialized is trumpeting as the Stumpjumper turns 25 years old this year. The company even commissioned a coffee table book to commemorate the Stumpjumper’s legacy.

But in the rush to reap the well-earned publicity from its golden child's silver anniversary, Specialized, courtesy of its hyperactive legal department, has come off less like a proud parent and more like a crazed hockey dad.

The saber rattling was first picked up by local bike blog BikePortland.org and has left some denizens of Bicycling Magazine’s recently-named “Best Overall Cycling City” howling in protest.

At stake, after all, is hometown pride. The origins of “Stumptown” as a nickname for Portland go back some-150 years—after most of the old growth trees had been cleared out and before the town was renamed after Portland, Maine, by a transplanted Downeaster.

“It’s kind of beyond us,” said Mark Ontiveros, co-owner of River City Bicycles, Specialized’s biggest dealer in Portland. “You have to protect you name, but maybe this might not be good for them in the long run.”

Ontiveros said he’s carried Mountain Cycle in the past and hopes everything will work itself out amiably.

“Specialized has done a great job. I wish there were more Specializeds out there,” Ontiveros added. “[The bike industry] is just so small compared to the auto industry, we really need to stick together.”

Specialized fired the first shot across Mountain Cycle’s bow on Oct. 24, when its legal dept sent a letter to Mountain Cycle asking them to cease and desist in the use of the Stumptown name.

In an e-mail response dated Dec. 12, Mountain Cycle Director Rob Lindburg tried reasoning with the Big Red S:

“We are in this industry because we love to ride and believe in the sport. America is already the most litigious society in the world and there are plenty of industries, governments and companies rife with legal bickering. We believe our industry is above that, don’t you?”

Kim Arca, Specialized’s legal director, responded a week later, writing, in part: “Mountain Cycle’s failure to respect the intellectual property of Specialized has put Specialized in this position. You have given us no choice but to defend our rights.”

Specialized is no stranger to litigation. The company has vigorously defended its four-bar linkage suspension patent. In 2003 it settled with Jamis and just last month it successfully prevented Scott USA from distributing its Genius full-suspension design the U.S., ending 18 months of legal wrangling.

Specialized also has defended its trademarks. In 2004 the Vancouver, British Columbia, titanium frame manufacturer previously known as Epic Bicycles was forced to change its name to Evereti Biycles in the face of legal pressure from Specialized, which has another full suspension model called Epic.

Michael Nover, chief operating officer of Kinesis USA, the parent company of Mountain Cycle, is no stranger to trademark disputes, either. Kinesis USA, the Portland based manufacturer of frames for Mountain Cycle and others in the industry, was originally called Prologue, but was forced to change because Schwinn had a model of the same name.

“That’s how trademarks work,” Nover said, adding he doesn’t believe the made-in-Stumptown Stumptown violates Specialized’s Stumpjumper trademark.

“By that argument, no bicycle company can use the word “rock” or “hard,” in a name,” Nover said, referring to Specialized’s Hard Rock model. “If it’s just the word stump that is confusing them, then what about Rock Lobster or Rocky Mountain?”

Nover wasn’t the only one to doubt the credibility of Specialized’s latest foray into trademark law.

Responding to a the posting at bikeportland.com, member’s of Portland’s cycling community have shared letters they have written to Specialized’s customer service department.

Some of the letters posted are courteous and respectful:

“Hey guys! This is Etta Janoushek from Portland, OR and I am a bike-loving pedal pusher around these parts (and other parts when I get the chance!)… Although I have never personally owned a Specialized bike, I have long respected your brand for the quality of your products. As a consumer I would be very hesitant to support, with my own dollars or with recommendations to friends with dollars, a company that would pick a fight like this one.”

Other readers simply took the opportunity to root for the hometown underdog and needle the Big Red S. Almost universally though, the readers show they are a savvy, if emotional, bunch of enthusiasts, the kind that companies are usually loathe to alienate.

“Lucky they didn’t name it the ‘StumpStrong,’” one reader chimed in, referring to the Lance Armstrong Foundation’s recent similar threatened legal action against SkidStrong, a bike brand started to benefit a bicycle messenger advocacy group that was forced to change its name. “They’d get their pants sued off by Lance LegStrong, too.”

But what’s in a name, really? Even the irreverent and often-profane web-based Urban Dictionary weighs in with its definition of Stumptown. (It has a less savory definition for Stumpjumper.)

All joking aside, Specialized takes this name game seriously, and the knife cuts both ways.

Tim Wilder, who works for another of Stumptown’s Specialized dealers, The Fat Tire Farm, pointed out that Specialized itself recently had to stop distributing it’s Adrenaline mountain bike tire because the Adrenaline name infringed on another company’s trademark—a company not even involved in the bike industry.

“Pesonally, I think it’s ridiculous,” he said. “But I guess they have to do what they have to do.”

Mountain Cycle’s Nover said he’s waiting to see what Specialized’s next move will be. Specialized’s legal director did not return a phone call in time to comment on this story at its original posting.

-------------UPDATE---------------

BikePortland.org reported last week that the Stumptown controversy was given front-page business section treatment by The Oregonian.


Posted by Chris Lesser at 10:14 PM

5 Comments

  1. Blogger James posted at 9:56 AM  
    Like most people, I found this news quite disappointing when I first heard it. I am a pretty big fan of the products that Specialized makes and I own several of them, including an S-works road bike. I just can’t understand why they want to subject themselves to the negative PR that is sure to stem from their actions so far. In many ways the damage is already done, but maybe if they choose not to file the lawsuit the public will forget all about this. This story really is a great example of the power of the web, especially in a industry that sells to such passionate, involved consumers. Cyclists tend get emotional about bikes and companies can choose to use that to their advantage or have it used against them.

    The facts of this particular case don’t really matter. What matters is how potential customers feel about the two companies involved. Even if Specialized is right, they are probably hurting themselves by choosing to proceed. Perception is reality in marketing and right now a lot of people seem to be viewing Specialized in a negative light. If people see this disagreement as an example of a big corporation bullying the smaller guy, that is exactly the message that is going to spread like wildfire. I would think that is the kind of viral marketing that Specialized would make every effort to avoid.
  2. Anonymous Graham posted at 12:17 PM  
    This kind of thing really is a dilemma for most companies. The problem is that if you don't protect your intellectual property then the law says that you lose your future rights to it. As a result, companies must weigh the potential negative PR against the potential loss of itellectual property. A lose-lose situation. Don't know all the nuances of the law, but I wonder if there would be some way for a company to note with the court that another company may be violating a trademark or copyright, but that they have chosen to grant that company a type of "amnesty."
  3. Blogger Guitar Ted posted at 8:39 PM  
    Hmm.....big company vs. small, relatively unknown one. Issue of names being similar, but not the same, and the bikes are two completely different animals. People are going to look at this in a negative way, all right. I cannot see how you couldn't. America is the "Land of the Underdog" anyway, so this just fits that like a glove!

    Wouldn't it be interesting to see how consumers would view the issue of "intellectual property" as it relates to this case from the standpoint of sales. That's what is the bottom line here, isn't it? Does Mountain Cycle adversely affect the sales of Stumpjumpers by selling a cyclo-cross bike named "Stumptown"? It's a rediculus proposition, and this lawsuit cannot be seen as anything other than frivolous by the average bike riding American.

    Adding the "Horst Link" lawsuit to this and Specialized looks more and more like the bully in the cycling neighborhood. Sad!
  4. Blogger mg posted at 6:19 AM  
    As a former shop rat at a long-time Specialized dealer, I have to say this development doesn't surprise me.

    The funniest thing I find is that, up to the point where I read about the "infringement," I'd never thought of the fact that Stumptown and Stumpjumper both contained the word stump. The relationship didn't exist in my head until they put it there.

    I don't think this will really do much to help or harm Specialized in the marketplace however -- those (like myself) who would be offended by this have already been terminally put-off by similar "business moves" they've made over the fifteen-plus years I've been in it. I think they make some really nice bikes, but as a company they need to step back and see the forest through the trees, as it were.
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