Osram's new owner ams might have found some fresh value in the brand name Sylvania, as Osram in the US has gone to court to protect the moniker against alleged trademark violations by bulb and smart lighting vendor LEDvance, and is seeking damages.
The dispute centers around LEDvance's use of “Sylvania” on the Amazon retail website. As such, it draws attention to laws governing online commerce when entities from different countries — in this case China, Germany, the US, and Austria — are involved selling to consumers around the globe.
To be clear, Premstaetten, Austria-based ams itself did not file the suit.
Rather, Munich-based Osram's US group, formally called Osram Sylvania Inc., did. It accuses Chinese-owned LEDvance of “breach of contract, unfair competition and infringement of Sylvania’s registered and unregistered rights in federal trademarks and related wrongs.”
Osram filed the action against LEDvance's US group — LEDvance LLC — in federal court in New York on Nov. 23, a few weeks after ams won approval to fully “dominate” Osram and began dismissing executives, including Osram CEO Olaf Berlien. Domination status followed ams' more rudimentary acquisition of Osram last July.
According to the suit, Osram first noticed violations on Aug. 14. On that date, it would have been newly under ams governance. The suit implies that violations had been ongoing well before that point.
Osram took ownership of the Sylvania name in 1993 when it acquired the Sylvania business from GTE in the US. It has licensed the name to LEDvance for use in the US and Canada since before 2017, when it sold LEDvance to a consortium of three Chinese companies. Osram's licensing to LEDvance dates back to July 1, 2016, when Osram had carved out LEDvance and operated it as a separate entity in a phased exit from the bulb business.
While using “Sylvania” on products in North America, LEDvance uses the Osram name on bulbs and home smart lighting products it sells in Europe and elsewhere, where Osram licenses the Sylvania name to other entities. LEDvance is headquartered in Garching, Germany, and is owned by MLS Co. Ltd, based in Zhongshan, Guangdong. MLS is one the three Chinese groups that purchased LEDvance in 2017. It has since bought out the other two. Both Osram Sylvania and LEDvance LLC are incorporated in Delaware and headquartered in Wilmington, MA.
LEDvance LLC — the US group — also has rights to the Sylvania.com web address and indeed it uses Sylvania.com as the address for its website.
With the two companies thus sharing brands and domiciles, they had managed to maintain seemingly cordial relations over the four years. Surely some consumer confusion has arisen from both outfits using the Sylvania and Osram names in one manner or another. Punctuating that point, while LEDvance LLC uses “Sylvania” as its web address, Osram Sylvania shortens its own name to “Sylvania” in the lawsuit. Both companies also use a similar orange color in their signage and branding.
Coincidence or not, cordiality has turned to acrimony in Osram's new ams era. Osram Sylvania is now accusing LEDvance LLC of trademark infringement in online commerce, namely on Amazon and “perhaps other e-commerce platforms,” as Osram states in its suit in US District Court for the Southern District of New York. The charges are based on the Trademark Act of 1946, also known as the Lanham Act.
Osram's filing notes that LEDvance has established what's known as a “brand store” on Amazon under the Sylvania brand. This is is prohibited under the terms of the Osram/LEDvance 2016 licensing accord, Osram claims.
The company states that online commerce has grown significantly since 2016, and because it has become an even more prominent sales vehicle during the coronavirus pandemic, LEDvance's Sylvania brand store has damaged Osram.
“Because the Amazon Platform attracts so many internet consumers, control of the brand store on the Amazon Platform is therefore highly important to the owner of a particular brand, because consumers are likely to become confused if there are several different brand stores associated with the same brand within the same platform,” Osram Sylvania notes.
“Defendant’s unauthorized use of a Brand Shop results in promotion and use of the Sylvania Marks that Sylvania had reserved for itself and those it authorized, confusing customers, and diverting sales away from Sylvania and to Defendant,” Osram claims, referring to itself as Sylvania.
“In this way, Defendant’s unauthorized and infringing uses of Sylvania’s Marks deprives Sylvania of the profit it could derive from use of its Marks. By creating a separate Brand Shop using the Sylvania Marks, devoted to only Defendant’s own products, Defendant is willfully making infringing use of Sylvania’s Marks. Such infringements have caused and are continuously causing damage to Sylvania.”
The suit further describes LEDvance's Amazon brand store as causing “irreparable harm to Sylvania.”
Osram seeks an unspecified award of damages and other remedies, including an order for LEDvance “to abandon its use of a Brand Shop on Amazon or any other e-commerce shop,” and an order for LEDvance to “ to cease any unauthorized use of the Quick Marks on its licensed website, on any product marketing materials, and on any other online retailer.” Osram also requests a jury trial.
Further dropping the gloves, Osram essentially accuses LEDvance of lying, stating that LEDvance falsely told Osram that Amazon had deactivated the brand store after Osram alerted LEDvance of concerns on Aug. 14. Osram implies that LEDvance had been operating the store prior to that date, which is when Osram says it first became aware of the store.
“Defendant’s unauthorized sale of the Products and operation of the Brand Shop on the Amazon Platform (and perhaps other e-commerce platforms) were without Sylvania’s knowledge prior to August 2020, and were from the outset and continue to be without Sylvania’s consent.,” Osram states.
LEDs Magazine asked LEDvance LLC for a comment.
“We greatly appreciate our long-standing relationship with Osram and are working to resolve this matter.” a spokesperson said. “The Sylvania product brand has stood for quality and reliable lighting for over 100 years, and we continue to hold it in high regard.”
The court filing that LEDs Magazine has seen first appeared on Edison Report and was redacted. (Editor's note: The link opens a PDF from the Edison Report website, although suits such as this are a matter of public record.)
It's not clear how much Osram might receive if it wins. Now that Osram is part of ams, any awarded damages could help ams pay for Osram, a process that has been challenging all along with Osram being considerably larger than ams.
Ams has strongly hinted that it might sell off portions of Osram such as the Internet of Things (IoT) lighting operations, while focusing on the optics side of Osram which is a good fit with ams' photonics' business.
MARK HALPER is a contributing editor for LEDs Magazine, and an energy, technology, and business journalist ([email protected]).
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