Actually, the two companies may just co-exist with the similar names. Here's why:
Product names can only be trademarked. This means the protection for the name only extends insofar as potential customers may be confused by the use of the same product name by the two separate companies.
In the case of MAG-LED, it could be argued that Mag customers know that they are buying a flashlight, and not lighting fixtures (which is what Mag-Led sells). Unless Mag Instruments can show that their customers are likely to be confused by the shared name, I doubt they have a case. And since Mag-Led appears to have been using the moniker for some time, I doubt a court will order them to stop.
It would be different if both products were likely to be displayed and sold through the same channels and in the same manner. If they hung on adjoining pegs in the same aisle of major retailers, for example.
Doesn't mean that Mag Instruments can't sue Mag-Led, or that Mag-Led can't sue Mag Instrument. It only means that regardless of who sues who, they probably won't win. They may be able to force a settlement, as often happens in these cases, but that's much different than an outright court victory.
