Trademark bullying shuts down small business – they can’t afford to pay litigation costs

Not all individuals standing in Moore's shoes would stand up to a large trademark holder to protect their product.67 The threat of prolonged litigation not only may lead to alleged infringers prematurely settling with the threatening party, it could lead to them giving up entirely. For instance, a USPTO Trademark Litigation Study found that several individuals threatened with the process of litigation withdrew their own registration for trademarks altogether, without settling, because the possibility of litigation was too expensive to be a viable option for a small businesses or individual trademark holders.68

Threatening litigation is not an uncommon tactic for multiple reasons.69 First, enforcing trademark rights, even if the claim is weak, is an effective strategy with relatively few downsides.70 Second, aggressive trademark enforcement is often effective in settling disputes without the claims ever rising to the level of litigation.7 1 Third, cases that do go to court have limited case law upon which to rely.72 This could result in excessive fees when a party would have to craft an original argument for trial, potentially costing an alleged infringer, which is usually a small business, a substantial amount of in attorney's fees.73 Small businesses may not have sufficient support from human resources, may not be able to dedicate the time to prepare for such a lawsuit, or just may not have the financial ability to defend a suit.74 Even if a small business is capable of securing free or low cost legal assistance, the time devoted to the lawsuit would take away from the operation of the business, which could bury a company in debt.75