General Conference Corporation Sues Pathfinder Shirts LLC

Spectrum Website
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The General Conference Corporation of Seventh-day Adventists has sued a small Florida-based company, Pathfinder Shirts, LLC, over what the General Conference says is unauthorized use of the Adventist Church’s trademarks. The General Conference is not seeking monetary damages but seeks to stop Pathfinder Shirts from selling products emblazoned with church logos.

This is a companion discussion topic for the original entry at https://spectrummagazine.org/article/2017/03/31/general-conference-corporation-sues-pathfinder-shirts-llc
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This is truly weird, and I have had some experience with intellectual property in multiple jurisdictions.

We have a situation where one part of the church has been placing orders for product which incorporates the logo and another part of the church saying that the one part, say the local conference, is not authorised to do so.

There is no evidence that the logos have been used by the purchasers in anything other than a lawful way; a way that was envisaged when the logos were created.

The logos were never created for financial purposes. They were created for missional purposes. And the sub-parts of the church have been sourcing these at arguably the cheapest possible cost.

Plenty of businesses will own logos, and get others to produce the goods. Take Nike as an example. They outsource to manufacturers in China, but all the product comes back to Nike to sell. Likewise with these pathfinder logos - different authorised parts of the church order the product from an outsourced manufacturer, and it all comes back to the church to use.

Truly weird. But then, weird begets weird.

Post thought 1: In the event that some unions break away from the GC, the GC would want to prevent them from using intellectual property. To prevent them, the GC needs to prove that it properly owns it. This may be a preemptive strike.

Post thought 2: Thanks Vandieman for your comment. I have endeavoured to do cut and paste, but am on iPad and to dense to work it out.

I have done some research on your comment, and think that where the church may be feeling exposed is in the concepts of inurement and private benefit. Have waded through 52 pages of IRS commentary. I am not yet an expert, but I may be better informed than many.

For inurement to arise, the individuals need to be benefitting from an agreement with the owner of the intellectual property. The individuals also need to be an intrinsic part of the organisation. The problems arise in that there is no agreement, and it is uncertain that the church has good ownership of the brands. Also, the individuals, having arisen no further than a position on the conference executive committee, let alone union, division or gc level, would not be intrinsic to the organisation. At the private benefit level, the supplies are being provided under normal commercial terms. (Some assumptions are being made here). I struggle to see that the gc is at risk of losing its tax exempt status.

There are any number of nuances, and we don’t know precisely on what basis the case is being fought. It will be interesting to see how this develops.

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Maybe someone in the Corporate Body doing the suing of this Mom and Pop industry [who ARE Seventh day Adventists, and Pathfinder supporters] wants to shut them down so a relative or a friend of theirs can take over the “business” and make a lot of money at Pathfinder events.
I would watch the “Money Trail” to GC headquarters offices, officials.

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It seems to me that the Lillards will lose no matter what. Even if they prevail in court, all the GC need do is to change all the badging and register the new badging with notice to the Lillards that they cannot make use of the new. There then would be little chance to prevail on the basis of the current argument that the existing badging was not defended for decades. Without access to the new badging, their Pathfinder business would go to whomever is licensed for the new. Considering those possibilities, I would think negotiating licensure and a fair percentage for that license would be a more sensible way to go. Win or lose, their attorney gets paid, so he/she has no horse in this race.

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It is impractical to change the badging design, which has been around for decades and invested in heavily by pathfinder clubs and individuals. The real question which was brushed off in the article is; Why didn’t the Lillards sign an agreement? The “but lawyers advised against it because they [the GC] could shut us down” doesn’t make sense, because a licensing agreement is exactly that, a license to use registered trademarks on merchandise. One needs to know why the lawyers advised against it and what specifically is in the licensing agreement in order to form an opinion.

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Previously the General Conference has lost lawsuits attempting to prevent use of the name “Seventh-day Adventist”. And they spent large sums of money doing so.

Certainly the GC does not manufacture Pathfinder uniforms, etc. like this. So if they shut these people down, where will these items be sold? This may sadly be a lose/lose situation. I wonder if the GC first made an attempt at a win/win outcome to this. It seems a pity that the GC has once again chosen to appear adversarial.

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Many years ago our church’s Pathfinders printed their own Pathfinder t-shirts while earning their silk-screen printing honor in the process. Luckily, nobody from the GC knew that the Brazosport Falcons even existed!

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This certainly is a tricky issue all around and well described as “lose-lose” situation which raises questions.

  1. Why is a GC that strongly supports and endorses “self-supporting ministries” even if they are highly destructive to the theological fabric of the church … suddenly so cloth sensitive?

  2. Why is a lawsuit among church members sought ? (If ever 1 Cor 6 would apply - it is here, as all involved appear to be in “good and regular standing”)

  3. How come the lawyers suggest not to sign agreements for the use of the logos? (Seems to me, the Lillards are losing business either way, the lawyers don’t)

Finally - yes, I confess that the first thing that came to my mind when I read the article are certain very “Adventist” Bible texts from Revelation that have to do with buying and selling and marks… Weird indeed.

And yes, I do support the church in protecting its own interest. It should do so more often - and on issues where it does matter…

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This whole situation is a bit sad, but it reminds me of an excellent joke I once read.

Question: What happens when an irresistible force meets an immovable object?

Answer: An unethical lawyer will immediately appear.

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nothing my church does anymore suprises me. When the NAD changed their retirement plan from a defined benefit to a defined contribution plan, suddenly ALL the principals in the retirement office felt the urge to become securities licensed. NOW, IF they were simply using a brokerage firm to invest the proceeds for the employees, there would be no need to be licensed. According to the SEC, the only reason someone involved in a retirement plan would be licensed would be if they were to receive commissions from the investing of the employees retirement funds. REALLY? now, not only are they abandoning the folks that served the church faithfully (actually i understand the why for the move) but now they feel compelled to profit on the transaction. i would invite the church to try to explain why they would go to the trouble of licensing (cost 600$ in 1987). if it were not for the money coming back to the NAD in the form of commissions.

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Jared, in reporting on this lawsuit you really should have found out from the Lillard’s what was objectionable about the license agreement. The Lillard’s lawyer seems to be pursuing a course of action that will not be helpful to the Lillard’s . What the Lillard’s were originally doing is reasonable. The offer of the license agreement on the surface seems reasonable. Why don’t they simply ask for license terms that will allow the Adventist church to maintain their intellectual property rights and allow the Lillard’s to sell pathfinder items in perpetuity?

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This is like the United States trademarking the flag. The flag is only purchased for the most part by those wishing to use it for appropriate reasons. The unlicensed producers of these flags know that the flag has to be produced to match the original design. The United States is raised up the more flags you see flying.

Perhaps the GC should just start producing these products in house and see if they can be cost competitive or if people are willing to pay more to purchase directly from the church. Surely with the churches resources they could put Pathfinder Shirts out of business by undercutting their prices.

Such wasted effort on the part of the GC. But is anyone surprised? I am starting to see similarities between the GC President and the current US President. Moving from one hot button issue to another but not actually getting anything accomplished.

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Brethren, Let us pray for our Church. The Courts will show that the property ,(Trade Marks ) , belongs to the Church. We need to get to the truth ,. The interest of lawyers is to just keep the fight going. If the Lillard’s see that they are in the wrong, make peace with the church and work something out . There is a enemy that is fighting against all of us , let’s not let him win. Let us pray for this situation .

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The Church has spent untold MILLIONS of tithe dollars in the courts. Those in the know who happen to read this comment will cringe because they recognize it for what it is: a shame. The gospel commission is not to “go ye into all the world having the everlasting litigation.”

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after reading this disappointing story, and feeling quite uncharitable towards the GC, i decided to do a little google research…i came across a GC statement that i believe explains the GC’s interest in pursuing a lawsuit against the lillard’s:

“Church trademarks shall not be used in any manner that will jeopardize the Church’s tax-exempt status.”

(from https://www.adventist.org/en/copyright/trademark-and-logo-usage/ )

clearly, the unauthorized profiting from the logos and trademarks of a 501©3 corporation must be putting that corporation in jeopardy of losing its tax-exempt status, which in the adventist church’s case would not be good…worldwide tithe was $2.43 billion in 2014, and worldwide offerings were $89 million in 2014…america’s 2014 corporate tax rate was 39.1%…applying that to just NAD 2016 tithe income of over $1 billion would mean the loss of more than $400 million…

i don’t think it takes a PhD in math to see that this kind of loss would bankrupt the church, and in fact toss its thousands of workers and retirees onto the streets, not to mention what it would do to institutions like loma linda and andrews university…something tells me that if the GC invited the lillard’s to washington and explained these facts of life over a friendly, informal dinner, the lillard’s would get it, and fire their lawyers, who’ve obviously been giving them goofy advice…no doubt these lawyers are inviting litigation in hopes of a huge court mandated settlement, and a sizable take, knowing that the lillard’s are not skilled enough to perceive these motives…

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Thanks Vandieman. There is a tendency among some of us to bash Administrations of whatever stripe or colour, without making the necessary effort to understand why they acted as they did. Perhaps it is in our genes. I see it everywhere.

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On the contrary, it is not clear that the sale of the Pathfinder shirts would in any way jeopardize the tax exempt status of the denomination. However, let us say that it would. In this case, so also would the license to produce those shirts would also jeopardize the denominational tax exempt status.

A similar situation exists with the Boy Scouts. Like the Pathfinders the Boy Scouts has a uniform. It is a tax exempt organization. It has trade marked logos which are a part of the uniform. Its tax exemption has never been challenged on the basis that the items that the individual Boy Scouts purchase to wear on their uniforms include trade marked logos.

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But did you sell them for profit… :wink:

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The is no claim of abuse, certainly the GC gets a tithe. Why the heavy hand?

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Any one remember when GC spent millions of tithe $$ under Neals leadership trying to put Proctor out of business,his only crime to put SDA pubications into the hands of people for considerable less $ than the church was willing to do, Books and other materials for sharing the Gospel should NOT be a for profit business

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