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Is “Realtor” just another word for a real estate agent? In a recent decision, the Trademark Trial and Appeal Board said no. The board held that “Realtor” and “Realtors” are not simply generic terms referring to all real estate agents, but rather identify only agents who are members of the National Association of Realtors (NAR) and have agreed to abide by its code of ethics. The case, which raised the vexing issue of whether a trademark has become generic, was brought by Jacob Zimmerman, a former Cornell University student. Zimmerman developed a business plan directed to real estate agents and brokers that included the registration of nearly 2,000 Internet domain names containing the Realtor marks. Zimmerman offered to sell or license the domain names to real estate agents and offices, and offered a “full package” of Web site design and hosting services. He brought two petitions to cancel the federal registrations covering the Realtor marks, alleging that the terms are generic and that their continued registration would cause injury to his business. NAR obtained federal registrations for its collective marks in 1949 (for Realtors) and 1950 (for Realtor). Indeed, the Realtor marks, which were among the first collective mark registrations in the United States, were first coined by NAR’s predecessor-in-interest in 1916. Today, NAR is the nation’s largest professional association, with members including more than 1 million individual real estate agents and brokers, 54 state and territorial associations, and more than 1,500 local associations. NAR licenses each of its members to use the Realtor marks in accordance with strict usage guidelines. NAR members are obligated to abide by a strict code of ethics, which does not apply to nonmember real estate agents and brokers. For example, under the lengthy ethics code, Realtors should “promote the interests of their client, but treat all parties to the transaction honestly,” “avoid misrepresentation or concealment of pertinent facts,” and “not knowingly or recklessly make false or misleading statements about competitors.” NAR’s member real estate brokers and agents use the marks to identify themselves as members pledged to comply with the code of ethics (e.g., John Smith, Realtor), and state, territorial, and local associations use the term, usually in their name, to identify themselves as constituent associations affiliated with NAR (e.g., Green County Association of Realtors). As petitioner, the burden was on Zimmerman to prove generic-ness by a preponderance of the evidence. This required a showing that members of the relevant public primarily use or understand the Realtor marks to refer to real estate agents generally. What constituted the relevant universe was a critical area of disagreement between the parties. Zimmerman asserted that the relevant universe should be identified as members of the general public who have used, or expect to use, the kind of assistance that requires a real estate license. It is the general public, Zimmerman argued, that uses the services of real estate agents in buying and selling real estate. NAR argued that the relevant universe consisted of real estate agents and brokers (i.e., members and prospective members of professional real estate associations). It is the real estate agents and brokers — not the general public — that are the purchasers and prospective purchasers of the services provided by real estate associations. Indeed, both NAR’s and Zimmerman’s services, marketing efforts, and revenues are all targeted to and generated from agents and brokers. The Trademark Board considered the voluminous record developed during the proceedings in determining whether the Realtor marks are generic. The board found that NAR and its member associations consistently use the Realtor marks in a proprietary manner, and not as generic terms, and that NAR has continually taken affirmative steps to emphasize the proprietary status of the marks. Also persuasive was an extensive list of dictionary definitions evidencing the proprietary nature of the Realtor marks. As a typical example, Merriam-Webster’s Collegiate Dictionary (2001) defines “Realtor” as a collective mark “used for a real estate agent who is a member of the National Association of Realtors.” The most contentious area of evidence in the record came in the form of consumer surveys proffered by each party. NAR retained Dr. Ivan Ross, president of Ross Research, to conduct a telephone survey to determine the significance of the Realtor marks. Ross determined that the relevant universe for his survey was full-time licensed real estate agents or brokers who had been licensed for at least one year. These individuals are qualified for membership in professional real estate associations and are prospective purchasers of membership in such associations. The question of primary interest in the survey was, “Does the term Realtor refer to all real estate agents or only to those who are members of the National Association of Realtors, the NAR, and one of its local or state associations?” Of 204 respondents, 86 percent recognized that “Realtor” refers only to real estate agents who are members of NAR and one of its local or state associations, while a distinct minority, about 6 percent, believed that the term refers to all real estate agents. The remainder, about 7 percent, said they didn’t know. Zimmerman relied on a survey conducted by Michael Sullivan, a principal with the consulting firm of Freeman & Sullivan. Sullivan conducted a telephone brand awareness survey targeting individuals who had consulted a real estate agent in the past year, were planning to do so in the coming year, or were planning to buy, sell, or rent real estate in the coming year. The responses of 96 individuals were included in the survey. At the beginning of the interview, the respondents were given “orienting” or “training” questions regarding the definition of a “brand name” and a “common name.” A brand name was defined by example to mean a term used to identify a physical object such as a car (e.g., a Chevrolet car) or a soda (e.g., a Pepsi soda). After receiving this orientation, respondents were then given a list of eight terms — one of which was Realtor — and asked whether each one is a “brand name” or a “common name.” Only 10 percent said that “Realtor” was a brand name. The Trademark Board found that the Ross survey demonstrated, rather convincingly, that among real estate professionals the Realtor marks are perceived as strong source indicators, not generic terms. In contrast, the board found a number of deficiencies in the Sullivan survey and accorded it little weight. Among the flaws identified: a low response rate; the small number of survey respondents (96); the misleading effect of orienting the survey respondents to the concept of a “brand name,” giving them examples of well-known brands and trade names, and then asking them to categorize a collective mark; and not providing the survey respondents with a “don’t know” option. The Trademark Board gave substantial weight to the Ross survey, and adopted NAR’s position that real estate professionals make up a significant subgroup of relevant consumers. Among this key group, an overwhelming majority recognize the Realtor marks as strong source identifiers. Ultimately, in its decision, issued March 31, the board held that the marks “Realtor” and “Realtors” continue to function as collective service marks and have not become generic terms. The evidence in the record supported the board’s decision protecting the critical interests of the users of the Realtor marks within the real estate community. Jeffery A. Handelman is a shareholder and Nicholas G. de la Torre is an associate at Brinks Hofer Gilson & Lione (www.brinkshofer.com) in Chicago. They represented the National Association of Realtors in Jacob Zimmerman v. National Association of Realtors . They can be reached at [email protected] and [email protected], respectively. If you are interested in submitting an article to law.com, please click here for our submission guidelines.

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