LyndaOH

This is a really interesting topic, and I agree, can be really confusing. I started a bean bag teddy bear company in the 90s and was sent a "cease and desist" letter from Ty, the makers of Beanie Babies, contending that I could not make any bean bag teddy bear as it would infringe on Beanie Babies. The lawyer asserted that even though my bears (Stately Bears - a line of 50 state bears with an embroidered design for each state) were larger and of a different design I was infringing.

Most companies that were sent these letters just stopped making their original products, but I chose to go ahead with my line of bears and consulted a trademark/copyright lawyer. The bottom line is that anyone can have their lawyer send you a letter about anything, but it doesn't mean they are correct. In many cases they are overzealously protecting their client's rights, which is what they are paid to do.

Many of the Major League Baseball teams and some college teams have chosen not to license fabric any longer because they want to hold on to their rights to license and/or sell finished products. It seems to me they realize they can't have it both ways, that they can't both license the logo for fabric and then expect that craftsmen won't use that fabric for resale items.

There are other issues with using a licensed fabric for resale. First, whether the licenser is right or wrong, they have enough influence with ebay, Etsy, and other similar sales outlets that they can get your products pulled off those sites. I don't blame the sites because why should they risk getting involved in a legal mess. Second, what would you do if you did find yourself in a legal mess, even if you were right? Are you going to fight a large company at a great cost to make a small profit?

In my case I had several thousand dollars invested in Stately Bears and I wasn't willing to drop my idea. The bears were educational in nature and that part of the product was important to me. I went ahead with it, produced all 50 states over about three years time, and never heard from Ty again. Eventually they came out with Beanie Babies named after cities and states. I gave them a break and didn't sue!