Hashtags using trademarks deemed to be promotion, not infringement

A hashtag is a form of metadata containing a keyword or phrase prefixed with the ‘#’ symbol. By placing a hashtag followed by a word or phrase on social media, such as Instagram or Meta, it turns into a hyperlink directing consumers to other related posts on the platform containing the same word or phrase. Since use of a hashtag may strengthen brand awareness and boost consumer engagement, it has become increasingly popular in e-commerce marketing. 

This begs the question, when promoting products on social media, can use of a trademark as a hashtag constitute trademark infringement? A recent decision in Case 2021-Ming Shan Tzu-18 issued by the Taiwan Intellectual Property and Commercial Court (IPC Court) has ruled on this issue.

The #lightweight case

The plaintiff, OP Bicycle Co Ltd, asserted claims of trademark infringement and false advertising against the defendant, Marechal Asia, for its use of various hashtags on social media, including ‘#lightweight’. The plaintiff owns a trademark registration for “LT and device” and is the exclusive distributor of the lightweight wheels for racing bikes manufactured by the German company Carbovation GmbH. 

The defendant is a distributor of bikes under Italian brand 3T and offers the 3T bikes on its website and social media. OP Bicycle alleged that Marechal tagged photos of 3T bikes with various hashtags, such as: ‘#lightweight’, ‘#lightweightwheels’, ‘#Marechal Taiwan exclusive distributor’ and ‘#Asia exclusive’ on its Facebook groups, and that Marechal’s use of said hashtags misled consumers into believing that Marechal is affiliated with the Lightweight (LT) brand for lightweight wheels, or is an exclusive distributor of LT brand lightweight wheels, thus infringing the trademark “LT and device”. Marechal, however, argued that the use of these hashtags was permissible since it was nominative fair use.

Does hashtagging a trademark qualify as use?

The IPC Court held that, where another’s trademark is used merely as a hashtag for promotional purposes, it is not being used to identify the source of the goods or services, and therefore does not constitute trademark infringement since the defendant is not using the hashtag as a trademark. Moreover, the court pointed out that e-commerce consumers tend to be sophisticated about the fact that hashtags are merely marketing or commercial tools used to direct consumers to particular promotions, and are therefore not likely to cause confusion.

Further, the IPC Court determined that, considering the fact that 3T bikes sold by Marechal were indeed equipped with genuine LT brand lightweight wheels manufactured by Carbovation GmbH, Marechal’s use of the hashtag ‘#lightweight’ should be permissible since its intent was to promote 3T bikes, rather than suggesting sponsorship or endorsement from OP Bicycle.

Besides, the court held that given the first-sale doctrine, OP Bicycle’s trademark rights should be considered exhausted because the genuine lightweight wheels bearing the registered trademark “LT and Device” have been placed in the foreign market by the trademark owner or with its consent. Therefore, OP Bicycle is not entitled to prevent others from reselling or using the “LT and Device” branded lightweight wheels.

Takeaways

This area of law is continuing to evolve. While under current practice, there is no consensus among the courts regarding the hashtag issue, a critical factor that the courts would generally consider in trademark infringement analysis is whether the defendants’ use is likely to cause consumer confusion.  

As a general rule, if use of another’s trademark in a hashtag suggests sponsorship, association or endorsement by the trademark owner, thereby creating a likelihood of confusion, the use would be at risk of trademark infringement. However, if the use merely promotes the user’s own goods or services, such as suggesting the user’s product is compatible with another’s, or originates from the same source, it may be deemed as fair use and permissible. 

At the current stage, it would be prudent to seek legal advice before using another’s trademark as a hashtag.