Just read the April issue, and saw that MTH electric trains is being sued by Union Pacific! I am a bit confused… It also stated that Lionel was issed a suite as well.
While I fully believe that a corporation has a right to maintain use of it’s corporate logos etc, it seems a bit out of place with regard to model railroading for a company to go after produsers to get an extra buck.
I would like to know if any other rail companies do this, or is this something new?
It just seems like they are shooting themselves in the foot, if no one else does this, and from the sounds of it they want the manufaturers to open their books on everything they plan on doing which seems out of place.
I find it sad that companies have resorted to this since I am sure that MTH as well as Lionel trains would do nothing to ever mis represent Union Pacific or any of their absorbed subsidiaries.
Can anyone shed some light on what is causing them to take this action?
I haven’t review the specific complaints, but the general climate is simple: corporations want to protect there property and brands from being used by individuals or other entities for financial gain. In many cases UP, and many other companies across the United States, and rightly so, continues to vigorously protect its brand from unauthorized or unlicensed users.
In my mind, using other folks stuff without their permission or paying a licensing fee to use it is tantamount to stealing.
I can understand them wanting control over who uses their corporate logos. What I don’t understand is them demanding licensing fees for the fallen flags that have been absorbed by them. SP, MP, WP etc. The only reason I can see for this is to squeeze a few bucks out the model railroad industry. While they certainly have that right, it seems like bad PR to me but probably not something they are going to lose sleep over.
The UP is a publically owned corporation that is in business to make a profit. The logos of the past roads are assets of the corporation. It is the duty and responsibility of the management to maximize profits for its shareholders. The shareholders, who are in fact the public and institutional investors, will be the first to complain when they don’t make a profit.
So why not leverage those assets and bring the company a return by licensing their use for a fee? It all makes good business sense to me.
I have to agree with jacobrett. Even though I agree with the principle I think it is bad PR. I mean unless everyone else does this I can’t see there being enough revinue to warent the licensing, and on top of that it may cause our products to increase in price.
Bad PR? What does UP care about it’s public image? Are you gonna stop buying stuff hauled by UP or what? LOL. Halliburton don’t care what you think of them either. I don’t even really think even Walmart cares anymore. Fred
dsilver, If you were a shareholder in the UP (or any other company) wouldn’t you want the management maximizing their returns? Although I cannot provide the specific data to prove otherwise, I have to ask you how you arrived at the conclusion that there isn’t enough revenue to warrant licensing of their brands?
Based on the past and pending litigation, I would assume that the revenues generated through licensing are significant.
The notion of our pricing for model products rising as a result of charging licensing fees is a fact of life. No one is putting a gun to anyone’s head to buy the models that reflect a higher price due to the incorporation of a licensing fee.
Exactly. If anyone thinks it’s bad PR and will ultimately have a negative effect on the earnings or overall health of the company, you can always bet on that belief in the marketplace by shorting the stock.
I have freight and passenger cars that literally go back to the 1920’s, 1930’s, 1940’s, 1950’s, and so on, you get the picture. Each piece of rolling stock has a logo of some sort, representing railroads gone by, and railroads of today. The memories are fantastic and phenominal. I have rolling stock in just about every guage except S and 1" scale. For fifty years I have purchased stock for my railroads that represent the names of many railroads, you all know the names, and not one over the years, that I am aware of has sought through law suits; fees to use their logos until recently. I am sorry, for it is the changing times, and the new up and coming attorney that seeks this, all out of greed and nothing else. One says protection, but for the most part it is greed and nothing else.
I miss the days when railroads were proud when Lionel, Mantua, Varney would simply ask permission and it was granted, because the roads got as big a kick out of the small railroads across America running their freight as I did, and products were delivered every day on small pikes that gave you the feeling that you were the engineer and it was fun. And the railroad companies thought it is fun to.
Except for UP, anyone else doing, or has done it. Did Southern, N+W, Pennsylvania, B+O, Santa Fe, IC+G, Great Northern, Southern Pacific, the list goes on with those that didn"t or haven’t, but the list is very short for the one that did.
WTRR
CEO
DIDN’T THIS appear on the ‘April Fools’ page in MR?
The only thing funnier would have been “MTH Sues U.P. For Copyright Infringement”. That I would have cut out and posted on my layout.
Why would anyone want to model a railroad with such a relatively poor operating margin anyway! Pick a railroad worth modeling…like NS. (obvious bias)
Companies spend small fortunes on PR, so I’m not buying that “they don’t care about their public image” nonsense. And I know a little on the subject since my wife is a PR executive whose specialty is bailing companies and organizations out when they have “crisis communications” needs. Believe me, her business is good. And a lot of her clients are organizations who started with their chests pumped out high. And then they screw up and the enemies come out of the woodwork to pile on, including the Government.
It just happens in this particular case that they are poking somebody in the eye who has been busily trying to poke others in the eyes, as well.
Union Pacific recently had a positive story posted about them a couple of months back. Involved a trip for the Boy Scouts.
UP does care about PR, but remember the corporate attitude that we see is typical of many modern corporations today.
- Profit, profit, profit…
- Protection from from frivilous lawsuits…
- Cut expenses wherever possible… ( They’re pushing hard for 1 man locomotive crews!)
- Protect trademarks. Collect any income derived from the “agreed upon” use of said trademarks. (just like the NFL, UPS, NASCAR, Disney, etc, etc, etc, and etc,. )
Actually the income that they derive from us averages out to nickels and dimes on the dollar.
This is the harsh world that we live in crew. That’s reality.
Though I don’t like UP’s way of going about it, I’m not going to stop buying UP freight cars either. UP has way too much rich history that I’ve grown to appreciate. The current management will eventually be replaced as members get other jobs, retire, or are fired. The next generation may be friendlier or more hostile.
BTW: Ebay is often loaded with cars and locos decorated in UP. Prices are not usually inflated. So for those that are looking for UP stuff, that’s an option to check out.
as they say
In Hollywood, all publicity’s good …
I can see U.P.'s side of things having worked in the sports industry, I can relate to people snagging your logo and not asking permission for it.
Perhaps we don’t know the whole story and now U.P. is left looking like the bad guy…Maybe MTH and Lionel fumbled by not asking permission in the first place.
Why is it when the other guy wants more money in his pocket by selling something, he’s greedy, but when we want more money in our pocket by spending less it’s being thrifty?
“As the world turns”,years ago Santa Fe PAID Lionel to use their logo, go figure.
Willy,
I think it was because back then they were working on getting the general public to make the choice to choose them for passenger travel. So in that sense, Santa Fe was paying for advertising by getting Lionel to use their logo. Being that passenger service is dead, most railroads today don’t really need to advertise to the general public, hence the change. I think the advertising to its current customers is important, but as their customers are commercial in nature, they are more interested in price, speed and lack of damage to goods. A totally different audience.
Just my thoughts.
Dave
So if A Railroad Magazine publishes pictures with any UP related liveries or logos in them will they be the next to be sued? How about newspapers?
Then again bio research companies want to patent things they discover about genes… I figure that the churches should challenge that on behalf of God.
Actually David, magazines like TRAINS already have agreements/permission from the railroads to display photos. Has been so for some years now.