Is it legal to create Brand Name which contains another popular brand name?

When surfing on the internet I got some interesting conversation on Quora related the topic. That particular person asks question like Can I create a brand name that contains another brand name?

 

 Value of Brand Name

 

Brand Name will be the base for our business success. That’s why so many people are searching and consulting else they can have a meeting with brand naming agency to pick their perfect name.

           

Quora conversation

Below paragraph contains the great brand name conversation. Hope you will like it.

Ques: Can I create a brand name that contains another brand name?

Imagine that "Bloo" is a large and recognized brand name for a chain of apparels stores; would I be allowed to create a company with the name "UrBloo" that featured an online store of varying painting products?

What if "UrBloo" were also in the apparels industry?
What if the two companies were in different countries?

Anything else I should be wary of?

EDIT: That my brand name contains an already existing brand name would be purely coincidental. I had no previous knowledge of "Bloo"; it just happened that I found a very fitting name to my product that happens to contain a name already in use.

Ans: (by Kenneth Jennings) The "large and recognized" brand name is undoubtedly protected by a federal trademark and, even if it is not, it is protected by state or common laws regarding  both business torts and consumer protection.  Trademark law is, somewhat counterintuitively to the business person, fundamentally based on prevention of consumer confusion as to source of origin of goods or services and NOT the protection of goodwill of the established mark. 

That said, you cannot get a trademark of your own on a brand that is confusingly similar to another mark.  It is well established that one mark that contains all or a substantial portion of another mark will be denied registration.  There may be an exception if the contained portion of the other mark is a generic word that is a portion of the senior mark.

While companies sometimes "fly under the radar" for a while with a mark that is similar to a famous mark, that only works if you fail.  If you succeed (presumably your goal) the senior mark owner will inevitably become aware of your use of the confusing mark and you will receive a cease-and-desist nastygram from their lawyers.  If you ignore it, you will be sued for infringement, trademark dilution, and or various business torts.  Large companies can afford this litigation; small companies cannot.  That's why I have always advised my start-up clients to select marks that are not too close to the edge.  Even if we might win in the end, going bankrupt to win a trademark case is not good business.

Pick a unique mark.  It's hard with so many players on the field, but it can be done.  If you can afford it, there are branding experts that will help you with selection and design of a good mark.