In a sense, the C&D letter & copyright lawsuit filing is just a warning shot. They don't want anyone using that term for any reason.
Just to clarify something: so far, I have not heard of any suit being filed. Lucas has send the C+D letter threatening suit, but has not followed through.
My understanding is that C+D letters are a cheap and easy way to test the water and sometimes bully people into submission. For example, even if the laser company in question knows they could win the case if taken to court, if they can't afford the legal costs to fight Lucasfilm in court they may acquiesce to the demands anyway.
Of course, its also possible that Wicked Lasers is banking on the fact that they are based in China, where filing charges against them will be much more difficult, to deter Lucas from actually pressing charges. In some ways, we are witnessing an interesting game of poker.