Stanley Black & Decker Sues Sears, Alleging Trademark Violations

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Craftsman Ultimate Collection

Craftsman Ultimate Collection

Stanley Black & Decker (SBD) is suing Sears, alleging the retailer’s recently launched Craftsman professional mechanics tools and a promotion campaign “disparage” SBD’s products.

When SBD bought the brand from Sears two years ago for $900 million; as part of the deal, it gave Sears “limited” rights to develop and sell Craftsman products, it said in the suit filed in U.S. District Court, New York. SBD also seeks a temporary restraining order barring Sears from advertising, marketing and selling the tools under the “Craftsman Ultimate Collection” sub-brand.

Under the sale agreement, Sears is limited to selling Craftsman products in Sears and Kmart stores, about 425 of which remain, as well as Sears.com and Sears Hometown locations. It also can’t sell products under a Craftsman sub-brand such as “Craftsman Ultimate Collection” without SBD’s approval, the suit said.

Since emerging from bankruptcy in February, Sears also has promoted its stores as “the real home of the broadest assortment” of Craftsman products, which SBD says further violates its license agreement, “diluting and tarnishing” the value of a trademark , which Stanley paid hundreds of millions of dollars to acquire. Sears has a perpetual royalty-free license to source and sell Craftsman products for 15 years and pay a 3% royalty thereafter.

The new slogan “falsely implies” that only Craftsman products carried by Sears “are genuine” and that those found elsewhere are “somehow illegitimate.”

SBD launched internally developed and licensed Craftsman products last year through Lowe’s, Ace Hardware and Amazon. It has introduced more than 1,200 products under the Craftsman brand and is expanding licensing this year, with about 40 licensees expected to release about 600 products.

A Sears spokesman declined to comment on the suit.

Contact:

Stanley Black & Decker, Stanley Black & Decker, Todd Snellenburg, VP Global Licensing, 443-927-5483, todd.snellenburg@sbdinc.com