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First, I want to say that I'm a bigger fan of Valve than I am Blizzard. Mainly, my favorite place to buy games is Steam. Plus, I don't care for Activision.
Having said that, Blizzard should -and probaby will- win the trademark battle over Dota 2. Why? Well, Blizzard actually does have more claim to Dota, due to Defense of the Ancients (DoTA) being built with Blizzard's tools and Blizzard's technology. Since Valve is using Dota 'and' 2, they are actually capitalizing on a successful name that was built and ran on Blizzard's technology. Why should Valve be able to monetize on Blizzard's goodwill of allowing the community to continue to develop and own the DotA mark? It's a community mark, not Valve's.
Valve's pursuit of the Dota 2 trademark is purely meant to capitalize on the DotA name. In actuality, it'd be like Blizzard trying to trademark MMORPG or FPS. DoTA is not only an acronym for Defense of the Ancients, but also a well recognized symbol for DoTA style games. It's on par with MMORPG and FPS.
Blizzard, on this issue, is definitely on the moral, high ground. They are the good guys. They're preventing Valve from trademarking a name that is owned by the DoTA community; which Valve is trying to 'steal' from.