Salesforce.com's Service Cloud sparks legal storm

A Georgia company has filed suit in federal court against Salesforce.com, saying the on-demand CRM (customer relationship management) vendor's use of the phrase "Service Cloud" violates its trademark.

Salesforce.com's Service Cloud strategy and application family, launched early this year, expands on traditional call-center and customer-service technologies by tying in other sources, such as social-networking sites.

ServiceCloud, an IT services provider in Atlanta, began using "SERVICECLOUD" as a trade name and service mark in 2006, and the word was registered with federal authorities as of Oct. 6 of this year, according to the complaint filed Oct. 15 in U.S. District Court for the Northern District of Georgia.

Over time, "SERVICECLOUD" has become "an asset of substantial value as a symbol of ServiceCloud, its quality name, its quality services and goodwill," the complaint adds.

Meanwhile, Salesforce.com knew that ServiceCloud had owned and been using "SERVICECLOUD" as a trade name, according to the complaint. The vendor continued to use the phrase "to trade upon ServiceCloud's well-established reputation and goodwill" in "a willful attempt to confuse the public."

ServiceCloud, which helps companies adopt cloud-computing services, is seeking unspecified financial damages. It also wants to bar Salesforce.com from using the phrase and demands the vendor "deliver up for destruction" all documents and materials used to disseminate it, according to the filing.

ServiceCloud declined to comment.

A Salesforce.com spokeswoman said the company is aware of the lawsuit, but doesn't typically comment on pending litigation.

Salesforce.com nearly ran into a similar dilemma some time ago, when it initially planned to introduce a number of development tools under the moniker "DevForce," said 451 Group analyst China Martens. The company changed tacks when it turned out that vendor IdeaBlade was already using that name on products it sells for building .NET-based applications, she said.

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