The 10 Commandments of trademark commentary: a community resource

WTR has written extensively about the importance of enhancing trademark knowledge in a bid to ensure that media coverage and online discussion of trademark issues accurately reflect the legal nuances. This week’s opinion piece offers a free-to-view rundown of the 10 golden rules to follow, which we encourage the community to share with media contacts, students, marketing organisations and any other colleagues that would find it a useful reference source.

Guest analysis

Now more than ever, trademarks are embedded into the fabric of popular culture. Nearly every celebrity and reality TV star has had their name attached to a high-profile trademark application or trademark controversy. Namings and renamings, from sports teams to social media platforms, have been particularly embroiled in trademark controversy. Trademark stories are in the news daily. While some simplification is necessary to bring trademark stories to the masses, there are many unforced errors that are amplified through social media reposting and reply. This article explores the most-common trademark commentary mistakes in the “court of public opinion” – traditional media and social media – and how to avoid them.

1. Know thy IP type. Trademarks are typically words, short phrases (taglines) and logos. In contrast, copyrights are artistic, literary or intellectually created works (but not words or short phrases) and patents are technical inventions, mechanical processes or machine designs (but not words or short phrases). Although some assets, like creative logos and product designs, can be protected as more than one type of intellectual property, many trademark stories are just trademark stories. And there is no easier way to eviscerate one’s credibility telling or discussing a trademark story than to misidentify a trademark as a copyright or patent.
    
2. Thou shalt not mistake letters for lawsuits. Cease-and-desist or demand letters, often referred to ‘C&Ds’, have become strongly associated with the enforcement of intellectual property. Setting aside the reasonableness or unreasonableness of a particular demand, a cease-and-desist letter is not a lawsuit. Rather, it is almost always an effort to avoid a lawsuit by starting a conversation and seeking an out-of-court resolution that is less expensive for both sides of the dispute. Of course, a demand letter must set forth the brand owner’s demand, which will necessarily be unwelcome by the letter’s recipient. But the general disdain for cease-and-desist letters is misplaced. Brand owners should typically be commended for sending a letter as an alternative to rushing into a lawsuit. And, in any event, it is critical to distinguish between a request made by letter and a lawsuit filed in a court.
    
3. Thou shalt not mistake trademark oppositions for federal court lawsuits. After a trademark application is examined and approved by the US Trademark Office, it is published for opposition. For a 30-day period, any person that believes it is or will be damaged by registration of the mark is entitled to file a notice opposing the application’s maturation into a registration. While, technically, the term ‘lawsuit’ may apply to a trademark opposition before the US Trademark Office’s specialised Trademark Trial and Appeal Board, ‘lawsuit’ is often misleading because this Board has no authority to order that a trademark use be stopped or award monetary damages. Rather, the Board is only empowered to determine issues related to the nuanced legal question of entitlement to registration of a particular applied-for mark for a particular applied-for good or service. Although federal registration has many benefits and is typically a best practice, a trademark opposition does not necessarily mean that the opposer is trying to (or will, if successful) put the applicant out of business.
    
4. Thou shalt not mistake extensions of time to oppose for oppositions. In lieu of immediately filing a notice of opposition, a potential opposer may request an extension of the opposition deadline. During this extended period, many potential opposers attempt to resolve their concerns with the applicants directly. Other times, potential opposers simply decide not to take any action. Accordingly, many extensions of time to oppose do not lead to oppositions. So, when a trademark applicant posted a social media video exclaiming that the filer of an extension of time to oppose was “coming after me” and “opposing my trademark”, the ensuing maelstrom of media and social media commentary (mostly criticism) was understandably based on misinformation.
    
5. Honor thy declaratory judgment actions. Sometimes a cease-and-desist letter asserts a meritorious position and sometimes it is just overreaching. The counterbalance to a frivolous demand is the recipient’s legal entitlement, under certain circumstances, to file a declaratory judgment action asking a court to declare non-infringement. When a declaratory judgment action is filed, the alleged infringer becomes the plaintiff, and the accuser becomes the defendant. In such instances, it is often misleading to summarily claim that the declaratory plaintiff sued the declaratory defendant without proper context because the plaintiff is not seeking to enjoin the defendant from doing anything; the plaintiff simply wants to be left alone. For example, when a blogger posted a story that “a multibillion dollar… company – filed a lawsuit against my company… seeking to cancel our trademarks, bully us into submission, and make us pay for the entire legal proceeding” but failed to disclose that the lawsuit was a declaratory judgment action responding to his recently filed trademark opposition and recently sent cease-and-desist letter, he was clearly cherry-picking facts to sway the court of public opinion.
    
6. Thou shalt not mistake a trademark for a word monopoly. Trademark law – memorialised at the federal level under the Lanham Act – exists primarily to protect consumers from being confused or misled. Accordingly, trademark rights do not generally apply to a word or short phrase itself, but to the application of a word or short phrase to specific goods or services. Although these trademark rights are generally intended to be interpreted with some flexibility (eg, the compared goods and services need not be identical, but merely similar and/or related), except for the world’s most-famous and distinctive trademarks, trademark rights do not extend to the use of the same mark on dissimilar or unrelated goods.
    
7. Thou shalt understand dilution versus confusion. The world’s most-famous and distinctive trademarks are legally entitled to protection beyond similar/related goods and services in the form of anti-dilution protection. It is critical to understand whether a brand owner is alleging likelihood of confusion, likelihood of dilution or both. When likelihood of dilution is alleged, commentary simply comparing the goods and services – “Company A is in a completely different field than Company B (plumbing versus energy drinks), and it is unlikely that consumers would be actually confused into thinking they are affiliated” – misses the point entirely. In a trademark dilution case, the operative questions are:
   • the fame of the plaintiff’s mark through sales, advertising and media attention;
   • the degree of similarity between the plaintiff’s and defendant’s marks; and
   • the uniqueness of the plaintiff’s famous mark, both inherently and in relation to third parties.

Applying ‘confusion’ analysis to dilution cases reflects the proverbial apples versus oranges comparison.

8. Know thy trademark record. In any story involving a trademark application or registration, it is inexcusable not to consult the US Trademark Office’s online public databases: the Trademark Electronic Search System (TESS) and the Trademark Status and Document Retrieval (TSDR). The trademark record will disclose:
   • who filed the trademark application;
   • when the trademark application was filed;
   • whether the applicant is claiming use;
   • whether the applicant is disclaiming exclusive rights in a particular portion of the applied-for mark; and
   • perhaps most importantly, the goods and services for which registration is sought.

In a recent news story, a small business owner defended her position on social media by cherry-picking a single good that she sold (plants) and a single good that the prior rights owner sold (shoes) and arguing that they were not related. The trademark records told a different story, revealing that the small business owner had applied to register her mark for, among other things, online retail store services featuring clothing, which directly overlapped with the prior rights holder’s trademark rights. Although many avoid letting facts get in the way of a good story, a fair and balanced evaluation of a trademark conflict requires review of the trademark record to fact-check each side’s position.

9. Thou shalt not assume every Goliath is a trademark bully. US trademark law generally requires brand owners to police their trademarks or risk losing them. And, unlike a piece of land, the boundaries of a trademark right – both with respect to how different a mark must be to no longer be confusingly similar and how different or unrelated a good or service must be to not cause source confusion – are neither obvious nor permanent. Likewise, the law does not allow brand owners to selectively enforce their trademarks by turning a blind eye to well-meaning infringers and only pursuing bad actors. Although those on the receiving end of enforcement efforts are often quick to label the sophisticated enforcers as ‘trademark bullies’ to elicit sympathy, divorcing this pejorative term from the merits of the trademark infringement or dilution claim and affixing it only to the resources of the enforcer constitutes an illogical ad hominem attack, not a credible evaluation of the legal merits. Many, if not most, large businesses are quite principled and restrained in their trademark enforcement efforts.
    
10. Thou shalt not equate small business to harmless. Cease-and-desist letters, oppositions and lawsuits are commonly criticised when the target of the enforcement effort is “just a small business without the money to fight something like this”. Most large businesses began as small businesses. And many, if not most, small businesses aspire to become bigger businesses. When a small widget business files a federal trademark application, it does not apply to use the trademark solely as a small business selling widgets and surrender any resulting registration after reaching a certain size. It applies for the nationwide exclusive right to use the applied-for mark for widgets at any scale of its choosing. And its resulting registration is freely licensable or assignable to a business of any size or sophistication. Therefore, a brand owner must essentially evaluate a trademark application as if it was filed by its largest competitor, not a static small business. Likewise, so-called selective enforcement, as opposed to uniform enforcement, can result in a loss of trademark rights for failure to police. Accordingly, while an individual’s or business’s size and sophistication is a relevant data point in a brand owner’s trademark enforcement strategy, expecting brand owners to turn a blind eye to the trademark applications and trademark uses of currently small businesses contravenes the duties of a brand owner, as they currently exist under US trademark law.

The author has asked that we make clear that this article is presented for informational purposes only and it is not intended to be construed or used as general legal advice nor as a solicitation of any type.