BNSF had sought to charge model railroad manufacturers a licensing fee to use the company’s trademarks on scale products, and had contacted individual companies to that end. Wolf, having successfully spearheaded the effort for a similar agreement with Union Pacific Railroad several years ago, has been tapped to represent the model railroad manufacturers in the talks.
Wolf said discussions with BNSF began in December 2008 and continued into this year, but there’s been no contact from the railroad for about a month.
BNSF had offered the industry a deal where manufacturers would pay the railroad $1 for the next five years, then licensing fees after that. But model railroad makers would rather see a deal similar to the one hammered out with Union Pacific, where use of the railroad trademarks – including merged and predecessor railroads’ logos – is free in perpetuity, provided the companies show artwork to the UP and send a sample a year for quality verification. It must also be noted in advertising that products are licensed by UP. Any company producing UP-related model railroad products is eligible to for the agreement.
As part of the deal, UP even provides color verification and paint scheme diagrams for the cost of having them reproduced.
Wolf thinks the legal onus is on the BNSF right now, not the manufacturers. He points out BNSF predecessor Atchison, Topeka & Santa Fe used to pay toy train manufacturer Lionel to produce Santa Fe-decorated products. Further, where Union Pacific has protected the trademarks of predecessor railroads by painting modern locomotives in “heritage” paint schemes, BNSF – whose component roads also include Burlington Northern; St. Louis & San Francisco; Spokane, Portland & Seattle; and Chicago, Burlington & Quincy – have failed to do so.
I like the UP deal meaning accurate paint schemes, but lets be real. Some of the models, once on the layout, will never see the light of day again. If you open your layout to the open public, you are advertising the railroad. I agree with Maynard here. Who is to say that the BNSF wouldn't get more bussiness? In this day and age, who couldn't use more bussiness?
ROBERT BYCK is missing the point.
BNSF is asking so much money that none of the manufactures will be able to afford the cost. (none of them are getting rich as it is)
It costs BNSF nothing if a model is built of some Santa Fe locomotive. The cost of the trademark design was paid for more then thirty years ago.
This is clearly a runaway legal department. Sooner or later the Marketing people will notice how much bad press it is getting them and things will get fixed.
Or the products will just not be produced.
In the ole days, the manufactures, and railroads alike were never involved in lawsuits, and such. It is somehow different now, everyone wants to sue each other, or get their finger in the pie to have a taste of the money. Why can't these greed monsters just leave the model toy, railroading industry alone. Just let us buy what models we choose to, and model the railroad of our choice. What the heck ever happened to the ole days, and freedom of expression, and the fun of model railroading.
Responding specifically to Raymond Haggemans comments:
1. The $1 fee is the "bait" to get the modeling industry to "bite" on some unspecified future fee structure. If you want a precedent in law of how these things proceed a
to eventually crush an industry look at the history of how fees were implimented on juke boxes by the recording industry (which already received payment and a performance licensing fee for every record sold). You used to see a juke box in every cafe and soda fountain. When was the last time you saw one?
2. There is a history of more than 100 years of the railroad industry allowing the use of their artwork on models, either without an express license or, payment to the model manufacturer by the railroad. The BNSF is attempting to turn this upside down – after the fact. They have made no attempt to "protect" their artwork for model use from the companies inception. The cows are already out of the barn and now they want everybody else to round them up and pay them for the "privledge". In addition, what efforts has the railroad made to protect their equipment from the public eyesore of blatant graffitti defacement?
If the modeling industry falls for this "lawyer cheap shot" then the precedent is set for every railroad in the country to demand a similar payment on every model produced after the increased fees go into effect in 5 years.
How many fewer models do you think will be produced when there is an extra $2 to $3 of unproductive overhead attached to each item? This burden will put a lot of the short run items off the market, forever.
3. With this prescedent set how long will it be before the legal department (or some shark lawyer looking for easy commissions) start watching the model press and tracking down the modeler of specific prototype roads for an individual licence fee for every single piece of rolling stock, structure, or sign related to that prototype road?
I have to say that I agree with Don, when he points out that it is a matter of greed on BNSF's part. They should be happy to have a free,positive form of media to project their corporate identity and image. Surely they could look at the agreement which has been made with UP and come up with something similar.
Down here in OZ, rail companies have these sorts of agreements with model manufacturers and are quite happy with the free publicity. Mr. Mike Wolf should be commended for his efforts as well. If he had'nt done what he has,we would all be paying for it with every model that we purchased.
It is hard to beleive that the BNSF is getting any advertising value from my having a few Santa Fe locos on my layout. No one I know purchases any services from the BNSF or its related companies and I am sure that that is also the case with most/all model railroaders.
They own the rights to the logos and they have the right to charge for their commercial use — and that is what it is when companies sell a product with their logo on it. Would any manufacturer make money selling only undecorated locos/cars?
Having said that I would magine that they could then have the rights to use their logos assigned to various industries at different values depending on the inherent value given to the use of the logo.
Imagine a sports team/league which did not charge for use of their logos — or do most people think that they give away their proprietary rights to anyone who wants to sell a team-related product?
I don't know how many of you are stockholders in BNSF, either directly or through a mutual fund, but I would suggest that those of us who are should drop a nice note to their Shareholders Relations Dept. and express our concern over this issue. I would think as long as they can maintain control over their trade marks, etc. that they should be agreeable to something along the lines of the agreement with UP. I know with the economy in the shape it's in that they probably have bigger fish to fry than this issue, but on the other hand they shouldn't just ignore it either. Maybe a nice note to Warren Buffet, who owns a significant chunk of BNSF stock, might help.
Bob
Per my earlier comments, the following is the web site for BNSF Investors Contacts: http://www.bnsf.com/investors/contacts. This site will give you relevant Email addresses and 800 phone numbers to contact the BNSF Investor Relations Dept. if you want to send them a comment about this issue.
Bob
Mike Wolf should be commanded for championing in his efforts with the Union Pacific railroad in the agreement he forged. BSNF should realize that ther Logos on Hundreds of railroad models are rolling ads for them and many more people would see them in model form.. lets leave rules out of this…. This is a way to show people what real railroads look like in model form…
I am not only a model railroader, but a NASCAR modeler as well.
To show what licensing fees can do to a hobby, Revell/Monogram decide this year that they will no longer produce NASCAR models because of their extravagant fees. We just love our hobby. We are not trying to get rich on logos. If I model BNSF or Union Pacific, they should consider it a compliment.
What can be a better way to advertise your railroad than to put it in thousands of hobby shops and homes throught the world?. Submission of prototype color schemes should present no problem.
I believe that BNSF will eventually come around; after all where else can a major corporation receive so much FREE advertising? The model railroading community and railfans in general wish nothing but the best for one of their favorite railroads. Look where they were on their policy of "no steam, period" once upon a time. Now look at today. Another very positive program they have is registering railfans as "official BNSF railfans". This way we can all be on the lookout for trouble while watching trains. Remember guys & gals: No Tresspassing ! Stop, Look & Listen. Happy modeling & railfanning.
I WOULD IMAGING IF THE MANUFACTURES OF MODEL TRAINS DIDN'T MAKE ANY MODELS WITH THE BNSF LOGO, I WOULD GUESS, THEY WOULD FEEL SLIGHTED. THEN RAISE CAIN THAT THEY WERE BEING DISCRIMINATED AGAINST.I WOULD SAY THAT THEY SHOULD PAY US MODELERS FOR BUYING A MODEL WITH THEIR LOGO ON IT. WE SHOULD CHARGE THEM FOR ADVERTISING FEES.
I suspect that in this economic climate that some of these companies are just getting greedy and rather than helping our hobby they are trying to alienate the very people who actually have the knowledge to promote their logos to the world at large and help their business grow and it does not cost them anything to increase their overall growth.
I understand BNSF wanting to protect it's trademarks, but I fail to see how model railroading could possibly hurt their business in any way. After all no one is trying to infringe on their image, It's more like promotion!
Awww, c'mon, BNSF – you're making me feel what I felt for Uncle Pervert a couple years ago, until someone senior enough to exercize common sense overruled the junior lawyers and marketing majors (the sort of people who use the verb "branding" and don't mean cattle) and adopted a sensible trademark and corporate image protection policy. Not to mention once again making me recall the Bard's phrase, "The first thing we do is kill all the lawyres." Wake up! Get a life!
This is why I prefer modelling passenger service instead of freight. From the top down, they all realize that what truly matters is customer service. Whether it's about the millions of passengers who use their services, or if it's about a model railroader who buys a train so that their child could run it on a layout, and pretend that they are the engineer, a happy customer is a repeat customer. It's a simple truth that the corporate world is increasingly ignoring.
There may be conceivable legal issues, but a simple contractural agreement shouldn't be a problem. There is a certain free PR advantage for the railroad. The model industry should police its people where inaccuracies threaten a mis-representation or misuse of logos or schemes. Beyond the model industry and the agreement, logo usage would fall under
copyright laws.
I'm retired from EMD and I know they could use any revenue they can get, but I would really cringe if they started to charge for their designs. Get the product before the people. It doesn't cost anything, or minimal cost for a few outline drawings. They are the backbone of another industry (model railroading), like GE, and help the economy as a whole. This is a good corporate image builder. I'm sure UP, BNSF, NS, and others use locomotives as recognition gifts. Does it make sense to charge for the use of the logo in this instance? Does it enhance the moment?
How much revenue are we talking about here? How long will it take to payback all the lawyers' fees? I think they are going about it in the wrong way. WS was right, "Kill all the lawyers."
The thing I fear most here is that the big corporate is seeing the modeling industry as some how a threat to the integrity of their branding. To me the UP agreement is a very positive solution and one that goes a long way to ensure that the integrity of the UP and it's various mergers are maintained through close working. I also like how it's two way where UP even offer colour verification and paint schemes. As modelers it means we are getting more accurate prototypes and UPs image i being maintained by companies wanting to reproduce their products accurately. BNSF needs to consider the concept is the model makers are denied access to high quality pre-painted items then will they be happy with often less than accurate or worse home produced versions of their colour schemes on people layouts? That to me would damage their image more. Lets be honest $1 for a license, it's not quite the same as Apples CEO, Steve Jobs' annual $1 salary really is it……
As stated in the article, BNSF is only looking for $1 at first and then some sort of agreement later on. They do not appear to be looking to make money, just trying to protect their intellectual property (IP) and cover their costs. The 'free advertising' argument is weak as there is dubious value to a large railroad to advertise to the typical model railroader so there is little value to the railroad here.
Here's the deal on IP law: if you do not protect your copyright and trade mark rights in an even handed manner to ALL users, you will lose those rights. In other words, if you let a group use your IP without oversight, if another group comes in that you don't want to use the IP because it does not portray a positive image for you, you are out of luck.
So, say BNSF lets everybody use they IP to make all the trains they want and does not have them adhere to some kind of agreement. Well, an 'adult' toy manufacturer comes along and starts using the BNSF logo on their products. BNSF would be powerless to do anything about it because they failed to apply their IP rights to everyone in a consistent manner. Think this is far fetched? It already happened. The NYC MTA successfully defended their IP rights against a condom manufacturer that used the MTS subway logos on packaging. Because they defend their IP rights, they were able to confiscate the entire run of the product. Of course, the city later passed all of them out, but that is another story.
Another point of this is that all the train equipment manufacturers are business, not some kind of charity that makes stuff for us out of the goodness of their hearts. They are in it to make money and having to pay royalties cuts into their profits. They are trying to make money for their company off the backs of another company's hard work. Let's see what would happen if the model manufacturers needed to play by the same rules and allow others to use THEIR IP without some sort of agreement or compensation. Use any of MTH's IP and see how long it is before you have a meeting with Mr. Wolf across a courtroom table.
The entire field of intellectual property is one that touches and concerns everything. Railroad livery is not only a question of trademark protection but also of trade dress (nonfunctional elements which distinguish a business.) One wonders what motivates corporate lawyers to take up such crusades as the herald protection program.
The visiting railfan from Mars showing up in Denver or New Haven might well think that the D&RGW and NYNH&H are going concerns. There is a question of whether trade dress of fallen flags have become public domain.
And, of course, BNSF's lawyers may just have too much time on their hands with nothing else to do.
A long, long time ago, in a galaxy far, far away, the railroads sought passenger business and welcomed the free advertising by the model railroad industry. But that was a gentler age.
If this goes ahead how far will it go? Are we to see back royalty checks going back to the year dot? if so all I can say is watch out GI Joe the US Govt will want a slice
Having been a life long resident of Oklahoma I have many fond memories of the Santa Fe. In particular are those of my Grandmother departing/arriving at Ponca City aboard the Texas Chief. The Sunday drives with my Family as we drove along the Santa Fe mainline north of Ponca City to Newkirk. Catching up to and giving the international sign language as we passed the lead engine. And low a behold a smile, a wave and a return toot toot from the engineer. Those are times past when the corporate image was that of it's employees. Shame on you BNSF !
Of course, next ALCO, GE, and EMD wil start charging becuase they desinged the locos themselves.