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David Bellamy wasn’t looking for trouble when he tried to register the “McBaby” trademark for his children’s clothing line in Australia. But when the McDonald’s Corp. caught wind of it back in Oak Brook, Ill., this small Tasmanian businessman suddenly had a supersize problem. McBaby was far too similar to McDonald’s long line of McProducts, including about 50 meal items — from chicken McNuggets to the McFlurry ice cream sundae — to McKids, a line of clothing sold by Wal-Mart with a license from McDonald’s. The Australian trademark registrar agreed that “McBaby” was likely to confuse consumers, leaving McDonald’s the undisputed owner of Mac and Mc prefix trademarks — at least in Australia. Like many companies, McDonald’s relies on trademark watch services to scour trademark offices around the world and keep the company apprised of potentially infringing registrations. Still, it’s not easy to control the use of such a ubiquitous name — or the famous golden arches, Ronald McDonald’s image, and other McDonald’s symbols now found in 119 countries around the world. With 30,000 restaurants serving 46 million customers a day, McDonald’s now faces what the Australian trademark delegate hearing the McBaby case called “the McDonaldization of the English language.” McDonald’s can’t stop every McEnterprise around the world. In September 2004, it lost a major case against Singapore-based Future Enterprises, which sells MacNoodles, MacTea, and MacChocolate at supermarkets and convenience stores. The judge ruled that Future Enterprises’ “Mac” products, which display an eagle insignia, bore no similarity to those of McDonald’s. Sheila Lehr, McDonald’s managing counsel and lead trademark lawyer, says she strongly disagreed with that decision. “The standard is set by McDonald’s as to what we deem appropriate. We’re not always upheld by the court, but more times than not we are. We need to be the watchdog,” she says. Before joining McDonald’s seven years ago, Lehr specialized in legal issues concerning marketing and advertising at Sears Roebuck. Since 2001 she’s been in charge of McDonald’s IP practice worldwide, overseeing two lawyers and two paralegals who make up the in-house IP team. McDonald’s has succeeded in a range of cases in the United States, preventing the use of McSleep, McDental, and McBagel. Lehr says the company resolves most infringements without litigation. “Often it’s an innocent infringer, someone who doesn’t realize they’re violating our mark. Or, they can be convinced that litigation would not be a good investment for them.” (It’s not too surprising that most mom-and-pop burger shacks that casually pick up the McName are willing, upon confrontation with the $10-billion-a-year fast food giant, to drop it.) If a case proceeds to litigation, McDonald’s typically brings in Sughrue Mion, a Washington, D.C.-based boutique. Unlike other companies, McDonald’s doesn’t need to hire an army of investigators to snoop out infringement around the world. The company relies on an informal network of employees, customers, local franchise owners, and suppliers to report infringements to their headquarters in Oak Brook, where brand protection strategy is centralized. “I think we’re better placed than many brands to know of infringements because of our retail presence on the ground,” says Lehr. It wasn’t hard to realize, for example, that McDonald’s had a trademark infringement claim when a Philippine company, L.D. Big Mak Burger Inc., opened burger stands around Manila, sporting bright red arches that looked strikingly like McDonald’s golden ones. Still, it took McDonald’s 16 years to win the case. In August, a Philippine court ordered the local burger chain to pay McDonald’s damages — but only about $7,139, and only after several lower courts had ruled against the American company. Part of the company’s strategy, says Lehr, is to develop close ties with local franchise owners and food suppliers in each country where McDonald’s operates, which naturally creates a team of people watching out for the company’s interests. McDonald’s also tries to curry favor by adapting to the local palate — offering a Maharaja Mac made of lamb in India, for example, and its version of a beef gyro called a Greek Mac in Greece. The effect, of course, is also to make the brand more ubiquitous. That, in turn, reinforces the company’s argument that the ever-expanding McDonald’s trademark deserves strong protection under every country’s intellectual property laws. Given the challenges of working in foreign legal systems, McDonald’s hires law firms around the world to handle its IP and litigation work, including Marks and Clerk in the U.K.; Bardehle Pagenberg in Germany; Sprusons and Ferguson in Australia; and Drew and Napier in Singapore. Lehr says working with local firms is more efficient than dealing with a large, global firm and wading through layers of firm management. Still, having one of the most famous brands in the world does have its downsides. Critics of the company have started a Web site called McSpotlight, aimed at spreading negative information about the company. This form of “McDonaldization of the English language” isn’t actionable under the trademark laws, as McSpotlight — which deems itself an alternative to McDonald’s glossy propaganda — isn’t selling anything. McDonald’s has come a long way since it was publicly humiliated in Wired magazine ten years ago when Joshua Quittner, now editor of Business 2.0 magazine, revealed that the hamburger giant, apparently oblivious to the Internet, had failed to secure its own domain name. Quittner registered McDonalds.com for himself. He’s since handed over the site, and today McDonalds.com is up and running. Lehr insists the company has an eye for potential infringers in both the real and virtual worlds. She declined to comment on the company’s past oversight.

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