Toymaking giant LEGO is suing a small Minneapolis nonprofit, saying it benefits from the high-profile name.
The LEGO Group, one of the world's largest toymakers, has sued a small Minneapolis nonprofit called Project Legos, claiming it is violating trademark restrictions and "cybersquatting'' its name online.
News of the lawsuit, filed Friday in U.S. District Court in Minneapolis, came as a surprise to Project Legos, a youth empowerment organization with a total of six full- and part-time employees.
"We're like --what?'' said Project Legos Executive Director Kyle Rucker, who founded the nonprofit in 2005.
Rucker said the LEGO Group had sent a letter to his office late last year, asking him to change the name of his nonprofit. He said he wrote back, explaining that Legos stood for Leadership, Empowerment, Growth, Opportunity and Sustainability. "It's on our articles of incorporation,'' he said.
But an article on the front page of the Star Tribune, featuring Project Legos, apparently cranked up interest in the name change, Rucker said. The lawsuit was filed the same day the article appeared.
The lawsuit claims that Project Legos is benefiting from name recognition associated with the toymaking giant. Sales of LEGO toys in the United States alone were more than $1 billion in the past 10 years, the complaint said, in part because of the nearly $50 million spent in advertising.
LEGO spokesman Mike McNally said his company recognized and appreciated the work of Project Legos. But the company must "take reasonable measures to protect our trademark,'' he said.
"LEGO is a word that has no other meaning in the English language,'' McNally said.
But Projects Legos has consumers, too, said Rucker, and changing the organization's name could undermine its growth. The organization, which started out with a $6,000 annual budget, now has a $235,000 annual budget and expects to work with 2,500 youth this year, he said.
Tuesday, Rucker sent e-mails to Project Legos supporters, asking for their advice. He also began hunting for a rare breed of volunteer -- a pro bono attorney specializing in trademark issues.
Specifically, the lawsuit charges Project Legos with unfair competition, trademark dilution, deceptive trade practices and cybersquatting -- using domain names that are "confusingly similar'' to LEGO toy company. The suit asks that Project Legos stop using its name and Web domains, and that it pay LEGO attorney fees and other damages.
Rucker, who runs his nonprofit out of a former house carved into offices, said he was "overwhelmed'' at the terms.
The suit was filed by Minneapolis attorneys Thomas Boyd and Bradley Walz of the law firm Winthrop and Weinstine.
Dean Karau, a trademark expert at the Minneapolis law firm Fredrikson & Byron, said the lawsuit may not be so much a David and Goliath story. "If LEGO doesn't take steps to enforce its trademark rights when it learns about a possible infringement,'' Karau said, "that fact could be used against them in a future litigation with a larger, more well-heeled entity.''
Jean Hopfensperger • 612-673-4511