Redskins’ Trademark Loss Seen as Chance for New Brand

June 18 (Bloomberg) -- The Washington Redskins lost a trademark decision after a federal agency ruled the team’s name disparaged Native Americans, threatening millions of dollars in sales of everything from football jerseys to beer coolers. Ira Boudway has more on Bloomberg Television's "Taking Stock." (Source: Bloomberg)

The Washington Wizards have been there.

In 1997, with their hometown wracked by gun violence, the basketball team then known as the Washington Bullets changed its name. The move by owner Abe Pollin gave the squad a fresh start after 31 years, along with plenty of new merchandise to sell. The Wizards joined a growing list of sports teams and companies -- everyone from Taco Bell to St. John’s University -- that have abandoned names and symbols perceived as offensive.

Now it may be the Washington Redskins’ turn.

Following their loss in a trademark dispute before the U.S. Patent and Trademark Office appeals board yesterday, the Redskins face renewed pressure to find a name that isn’t disparaging to Native Americans. While switching identities would add short-term costs, the football franchise could expand its already-large fan base by handling the rebranding gracefully and landing a more palatable moniker, said Anne Bahr Thompson, founder of consulting firm Onesixtyfourth in New York.

“They could win more fans, people who think they’ve done the right thing,” Thompson said. “It’s a huge undertaking, given the history and age of the franchise.”

A name change also would be a boon for the National Football League and licensees such as Nike Inc., if previous pro-sports team switches are any indication, said Matt Powell, an analyst for researcher SportsOneSource in Scarborough, Maine.

Photographer: G Fiume/Getty Images

A Redskins flag is displayed before the game between the Dallas Cowboys and the Washington Redskins at FedExField on Dec. 22, 2013. Close

A Redskins flag is displayed before the game between the Dallas Cowboys and the... Read More

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Photographer: G Fiume/Getty Images

A Redskins flag is displayed before the game between the Dallas Cowboys and the Washington Redskins at FedExField on Dec. 22, 2013.

Restocking Jerseys

“First, you’ve got the hardcore loyal fans -- the fans that don’t see anything wrong with the name -- rushing out to buy what they think will be never-seen-again logos,” Powell said. “When that product is gone, the retailers have to completely restock, and most loyal fans will go out and buy the new jerseys to look like their favorite players.”

The Redskins plan to appeal yesterday’s ruling, the most recent clash in a 22-year fight between the franchise and American Indians. And in the meantime, the decision doesn’t legally prevent the team from continuing to use the nickname. Still, it may push Snyder to change the name, said Monica Riva Talley, a trademark lawyer with Sterne Kessler in Washington.

“It should be viewed as additional evidence that this term is disparaging and offensive, and it might help swing public opinion as to whether this should be the name of the team in the nation’s capital,” Talley said.

The more recent controversy surrounding the Redskins has yet to hurt the brand. In the past 12 months, Washington’s market share in NFL-licensed goods has held steady at 7.8 percent, the third-highest in the league, according to SportsOneSource. Merchandise sales also have only a diffuse benefit for NFL teams: Most of the league’s 32 squads share licensing revenue equally.

Photographer: Melina Mara/The Washington Post/Getty Images

Dan Snyder, owner of the Washington Redskins. Close

Dan Snyder, owner of the Washington Redskins.

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Photographer: Melina Mara/The Washington Post/Getty Images

Dan Snyder, owner of the Washington Redskins.

Taco Bell

Other brands have rebounded from offensive imagery, and not just in the sports world. Taco Bell’s original symbol -- a sleepy Mexican in a sombrero -- was replaced with a mission bell after PepsiCo Inc. bought the chain, according to the Oxford Encyclopedia of Food and Drink in America. While the old logo is largely forgotten, the business has grown to more than 6,000 locations.

In other cases, bad associations are difficult or impossible to overcome. The Sambo’s restaurant chain, which once boasted more than 1,000 locations, struggled with its racially offensive name. Though the company said the brand was based on the names of the founders -- Sam Battistone and Newell “Bo” Bohnett -- the chain used the “Little Black Sambo” character in its marketing, tying itself to a racial caricature. By 1982, all but the original Sambo’s had closed or changed names.

Brooklyn Nets

For sports franchises, name changes have been fruitful, with the National Basketball Association’s New Jersey Nets serving as a recent example. In 2011, the team had 2 percent market share in NBA-branded merchandise, according to SportsOneSource. After moving to Brooklyn, that jumped to 13 percent. Some of that increase is due moving to an area with a bigger potential fan base and the cool factor of being connected to entertainer Jay Z, who owned a minority stake in the team, Powell said.

Photographer: David Paul Morris/Bloomberg

The Washington Redskins football team logo is displayed on a cap for sale at a store in San Francisco. Close

The Washington Redskins football team logo is displayed on a cap for sale at a store in San Francisco.

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Photographer: David Paul Morris/Bloomberg

The Washington Redskins football team logo is displayed on a cap for sale at a store in San Francisco.

In 2007, the Tampa Bay Devil Rays dropped the “devil” from their name and changed their colors and uniforms -- an attempt to give the team a fresh start after 10 losing seasons. Since the change, the Rays have had winning records the past six seasons. In 1965, the Houston Colt .45s removed the gun reference from their name, becoming the Astros.

College Teams

For more than 40 years, colleges have been backing away from Native American mascots and other potentially offensive symbols. Dartmouth College and Stanford University both disavowed Indian mascots in the 1970s, while St. John’s and Miami University abandoned similar symbols in the 1990s. More recently, the University of Illinois’s board voted to eliminate Chief Illiniwek from college merchandise in 2007.

The Washington Redskins won a separate appeals court ruling in May 2009 over whether the trademarks should be canceled, ending a legal fight that began in 1992. The court ruled that the plaintiffs waited too long to complain. The new petition involved younger people.

“We are confident we will prevail once again, and that the Trademark Trial and Appeal Board’s divided ruling will be overturned on appeal,” Bob Raskopf, an attorney for the Redskins, said in a statement posted to the team’s website. “This case is no different than an earlier case, where the board canceled the Redskins’ trademark registrations, and where a federal district court disagreed and reversed the board.”

Boston Braves

The team, founded in 1932 as the Boston Braves, was renamed the Boston Redskins in 1933 in honor of its head coach, an American Indian, according to court records. The team moved to the District of Columbia in 1937.

Snyder has said repeatedly that he won’t change the name because its intent is to honor Native Americans. In March, he announced the creation of a foundation to aid Native Americans after the team visited dozens of reservations. Snyder paid a record $800 million for the franchise in 1999. It’s now worth $1.7 billion, making it the third-most valuable NFL team, according to Forbes.

Still, critics are circling. Half the U.S. Senate last month urged NFL Commissioner Roger Goodell to support a name change, noting the quick action NBA Commissioner Adam Silver took to confront racist remarks by Los Angeles Clippers owner Donald Sterling.

“If they are smart, they have to accept they are going to need to change it and start figuring out a plan,” Thompson said.

To contact the reporters on this story: Matt Townsend in New York at mtownsend9@bloomberg.net; Selina Wang in New York at swang533@bloomberg.net

To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net Kevin Orland

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