American Dynamics vs Dedicated Micros Lawsuit

Published Apr 10, 2011 00:00 AM
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Sensormatic Electronics, the parent company of American Dynamics, has filed a lawsuit against Dedicated Micros for trademark infringement. Specifically, Sensormatic is objecting to Dedicated Micros's use of the 'AD Network Video [link no longer available]' brand.

Let's examine the particulars of the 14 page claim submitted by Sensormatic Electronics [link no longer available]:

  • Sensormatic cites 2 Trademarks that cover the use of the terms 'AD' and 'American Dynamics' in video surveillance applications - 3365472 and 3365452
  • Sensormatic cites use of these terms since 1986
  • Sensormatic cites our reporting as evidence that the term 'AD' is commonly used to refer to American Dynamics; In January 2010, we commented on DM's new brand, saying, "selecting the name AD in America will undoubtedly cause confusion. American Dynamics, a similarly large video surveillance manufacturer, is broadly known in the US market under the acronym AD." That noted, we are speaking practically and not on the legal implications or issues.
  • Sensormatic cites an IMS 2009 report on the size and prominence of AD in the surveillance market. Specifically, the Exhibit cites 2008 DVR market statistics [link no longer available], claiming Tyco/AD has the largest DVR share in America with 7.1% of the $1.1 Billion market (approximately $78 Million) while Dedicated Micros was 6th in American DVR sales with 4.2% share (approximately $46 Million). Note: since 2008, UK public statistics show overall DM revenue is down about 30%. We suspect American Dynamics has suffered similar declines in DVR sales as we hear reports frequently of major accounts switching away from Intellex.

Ultimately, even if Dedicated Micros is allowed to continue to use the AD brand in America, we doubt it will help. First, their major challenge remains evolving into a modern IP video company. Secondly, despite Dedicated Micros having a poor reputation, choosing AD as a brand will simply associate themselves with another company with a declining reputation (i.e., American Dynamics).

[Update: the lawsuit has been resolved and, to the best of our knowledge, DM has stopped using the term AD Network Video.