It was December 30, 1988. I was at home when Jim Perkins called. We had lost! The judge had ruled against us, and Yuki wanted to meet in the board room the next morning, New Year’s Eve. I hung up the phone in disbelief. How could we have lost? Now what do we do? I was in a fog.

 

Reading the judge’s ruling added to my frustration. It seemed so unfair and biased. Judge Edelstein wrote he was “not persuaded” by John French’s testimony that he offered the spelling change without prompting from Toyota attorneys. The judge was also critical of Toyota, writing “its personnel failed to resolve” the issue with LexisNexis after a number of meetings. The judge wrote that, “Although Toyota may not have intended to trade on the Lexis mark, it certainly acted in disregard of it.” He went on to write, “In the context of likelihood of confusion, Toyota’s bad faith can be said to mitigate in favor of likelihood of confusion.”

 

The judge’s ruling was forceful and devastating.

 

The ruling read, “It is hereby ordered that the defendant’s Toyota Motor Sales, U.S.A Inc. and Toyota Motor Corporation, their officers, agents, servants, employees, attorneys, and those persons in active concert or participation with them who receive actual notice of this order by personal service or otherwise, are permanently enjoined from any and all use, display, advertising, or promotion of the name Lexus either in connection with a division of the defendant’s companies or as a name for products or services. Within 10 days of the entry of this order, defendants shall serve a copy of it to each of their Lexus dealers and shall instruct its dealers to comply with it.” SO ORDERED.

 

“As a dog returns to his vomit, so a fool repeats his foolishness.” Proverbs 26:11 (NLT)

 

The morning of New Year’s Eve, December 31, 1988, we all gathered in the board room at TMS headquarters: Bill Plourde and several other Toyota attorneys, Jim Perkins, Bob McCurry, the Lexus Japan Staff Coordinator, Jim Olson from Public Relations, and myself. Yuki Togo walked in. I had no clue what would happen next.

 

(To be continued in “Lexis vs. Lexis Round 8: Leadership and Guts)