#Trademarks: Not As Easy as Pie

#Trademarks: Not As Easy as Pie

Love ’em or hate ’em, hashtags are here to stay. The pound sign has become an ever-present feature of social media and has begun to creep into brand identities. Hashtags are also creeping into the Trademark Office as requests for trademark registration. A quick search of the PTO database reveals more than 600 applications for marks containing or based on hashtags. Can a hashtag be a trademark? Well, yes it can so long as the trademarked term does not combine the # or the term HASHTAG to a merely descriptive or generic term. So the hashtagged trademark has to meet the other requirements of a good trademark.

Okay, so what does that mean in the real world of marketing and particularly social media marketing? It is perfectly fin to trademark a hashtag phrase so long as the phrase serves as a source identifier. So something like #justdoit and #Nike will work for Nike. But #basketballshoes probably won’t because the hashtag does not serve as a source or brand identifier.

So what about the problem of trademarks that may have generic elements to their terms or use textual elements in a mixed text/design or unitary design? Well that is where the limitation of a hashtag may come into play. Using generic or descriptive terms could result in an improper trademark and rejection by the PTO or a court if there is a dispute. A recent court ruling out of the U.S. District Court for the Central District of California in Eksouzian v. Albanese, No. CV 13-00728-PSG-MAN could have some far reaching consequences for companies looking to register hashtagged marks.

The facts of the case are pretty straightforward. Both parties manufactored and sold e-cigarettes or vaporizer pens. The parties reached a settlement to resolve a previous trademark dispute. Under that settlement, Eksouzian was prohibited from using the terms “cloud,” “cloud v” or “cloud vapes” in “close association” with the words “pen” and “penz” as a unitary trademark. A second dispute arose in which Eksouzian sued Albanese to enforce the agreement, Albanese countersued, saying Eksouzian materially breached the agreement through the use of hashtags that combined the terms in a prohibited way, specifically the use of #couldpen and #cloudpenz. Albanese owned a trademark for CLOUD PENZ and had a pending application for Cloud Pen covering  “[e]lectronic cigarettes; [s]mokers’ articles in the nature of vaporizers, namely, electronic handheld vaporizers for personal inhalation of dry herbs and oils, and smokeless cigarette vaporizer pipes.”

So Albanese claimed that Eksouzian violated the settlement agreement by using the prohibited words together in a hashtag. The court did some pretty fine hairsplitting when it held that the use of #cloudpen did not violate the settlement agreement “because hashtags are merely descriptive devices, not trademarks, unitary or otherwise, in and of themselves.”  The court held that pen was a generic term for e-cigarette vaporizors and therefore cannot be trademarked. Ultimately the court ruled that Eksouzian’s use of #cloudpen did not violate the settlement because the agreement prohibited the use of “cloud” and “pen” in close association in a trademark. Because #cloudpen could not be used as a trademark, its use did not violate the agreement.

Returning to our Nike hypothetical above, if Nike was asserting a trademark on #basketballshoes, another company could still use the hashtag because #basketballshoes is too generic and can’t be used as a trademark.

The Big Takeaway

The settlement agreement at the heart of the Eksouzian ruling said that Eksouzian was not permitted to use the terms Cloud and Pen or Penz as a unitary trademark. Unitary trademarks often combine words or words and graphic elements to create a single unit. For example, the Oscar Mayer trademark consists of the words Oscar Mayer on an angle with the specific color scheme and the border.

So returning to our #basketballshoes example, let’s assume that a new shoe manufacturer decides they was to create a unitary trademark with colorful stylized represetantation of basketball shoes along with the terms basketball and shoes used in the logo. It is quite possible that the entire unitary mark would pass muster with the Trademark exmanining attorney and be granted a trademark registration. But this fictional company would still not be able to trademark #basketballshoes because the term as it stands is too generic and cannot be easily linked in a consumer’s mind with a particular brand source.

The Eksouzian ruling highlights the challenge companies face when looking to trademark hashtag items. Many hashtag trademarks that could be created include things like #Starbucks or #Wal-Mart. If hashtags are found to be simply generic categorizations for social media purposes (remember the Eksouzian case has not been heard in appellate court yet), companies could risk a dilution of their goodwill.

So an interesting case would be something like #Apple. Apple Computers relies on their apple image logo as a trademark. But as a hashtag, #apple would not likely be sufficient enough a source identifier to be trademarked considering the possibility of confusion with the actual fruit. On the other hand, hashtags such as #iPad, #iPod, or #thinkdifferent could be trademarked if Apple chose to do so. The reason is that the individual terms iPad and iPod are already trademarked. Adding a hashtag of those marks would likely be found to be acceptable.

To develop strong hashtag trademarks, companies will likely need to focus on words or tag lines. Companies should look to develop hashtag trademarks that are separate from the company name, website, or even current branding efforts. Creation of social media specific trademarks may be key to a unified marketing strategy that fully incorporates the unique characteristics of social media.

In another vein, registering a tag line or phrase without the hashtag that operates as a source identifier as in a traditional trademark will make the use of the hashtag a bit easier. The registration of a tag line or phrase would be broader and would then be protected if a hashtag is just simply added on social media uses.

Ultimately, companies, marketing agencies and designers will all need to consider whether a social media hashtag can be or should be trademarked. For more information, please give me a call and we can talk about the efficacy of a proposed hashtag trademark.