I haven't scrolled through this entire thread, but there is some definite confusion of concepts going on in a lot of the posts.
A trademark, like "Monster Cable", designates the origin of goods or services. In order to win a trademark suit, the trademark owner has to prove either (1) possibility of confusion, or (2) dilution (more or less the same thing as denigration of the mark by association with things unsavory).
"Monster" would seem to be only a semi-strong mark: in connection with audio cables, it is arbitrary, but it is also an ordinary English word. I haven't researched Monster Cable's record of success, but I strongly doubt they could actually win a lawsuit against any company using "Monster" to designate non-audio goods or services. A quick check of the USPTO website shows that many, many other companies have successfully registered trademarks with the word "Monster" in the name.
Copyright, by contrast, is the right to prevent the copying of a work of authorship. A song, movie, book, or poem can be copyrighted. A name of a business cannot be.
In the world of patents, there is a doctrine called "patent misuse." The basic idea is that if the owner of a patent misuses the monopoly power the patent legally affords, the patent can be declared unenforceable. There is a movement afoot, started by Prof. Lessing of Stanford, to extend this doctrine to copyright, so that, e.g., a recording company that took too aggressive a view to its right to royalties could find its copyright unenforceable in any circumstances. I imagine a similar defense could be tried against companies trying nuisance-suit shakedowns in trademark cases.
It's certainly true that paying a nuisance settlement may make more economic sense than fighting a legal battle. But our system actually has good protections in place. E.g., when a lawsuit really is frivolous, there is a basic rule ("Rule 11") that allows both the frivolous party, and its lawyers, to be financially penalized -- courts definitely do impose these penalties, and they are often huge.