Ramos was thinking about SpongeBob when he named his restaurants, he agreed with Viacom that a large chunk of patrons would associate a Krusty Krab restaurant with the Nickelodeon franchise. Judge Gray said regardless of whether Mr. IJR counters that the SpongeBob character is not as well-known as Superman, but fails to include any authority (legal or otherwise) to support its argument that fictional titles are not afforded trademark protection. Miller of Houston, who presided over the case, framed the dueling arguments in his opinion: Viacom argues that “The Krusty Krab” has been a key element of the “SpongeBob SquarePants” show, citing to its inclusion in over 150 episodes, feature films, a musical, and licensed consumer merchandise. So what about Krusty Krab, where SpongeBob toils as a frycook? If nobody has heard of it, then there's no potential for consumer confusion, a concept at the heart of trademark law. A character or element has to be memorable and, in the public imagination, inseparably linked to the fictional work in which it's contained. Krusty Krab of SpongeBob fame isn't registered with the federal trademark office, but fictional works can still acquire trademark rights under common law. Kryptonite also has trademark protection. Famous examples include the Duff Beer that Homer gulps on "The Simpsons" and the Daily Planet newspaper where Clark Kent works when he's not Superman.
On a case by case basis, courts have sometimes recognized trademark protection for fictional characters, elements and brands associated with popular entertainment.
The litigation is the latest to test the reach of intellectual property rights of popular culture's fantasy worlds.
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