Disparaging trademarks are no longer off-limits for registration.
In 2017, the U.S. Supreme Court ruled that the Trademark Office’s long-standing prohibition against registering disparaging trademarks was unconstitutional under the First Amendment.
There were many eyes on the court’s ruling because of the name of a certain professional football team, but the ruling first allowed the lead singer of an Asian-American band to register the trademark “The Slants” for his band name. Although the Trademark Office has not seen the opening of the floodgates that some predicted in terms of applications for disparaging marks, there are at least several dozen noteworthy applications that would have been automatically refused by the Trademark Office that may now proceed to registration. As of now, the Trademark Office has not examined any of these applications despite some being filed more than six months ago, but examination will likely be forthcoming in 2018.
… and neither are vulgar trademarks.
The Supreme Court left open the question of whether immoral and scandalous terms—vulgar words that do not refer to a group of people—were subject to the same First Amendment protection as disparaging terms. In late 2017, the U.S. Court of Appeals for the Federal Circuit dispositively answered that question—the bar on registering immoral or scandalous marks is an unconstitutional restriction of free speech. Consequently, the Trademark Office’s refusal to register the mark FUCT was reversed. The aftereffects of this decision will become clearer in 2018, as the limited number of previously unregisterable popular vulgar terms are snapped up as brand names. Likewise, trademark practitioners will keep a close eye on whether other trademark rules become fallen dominoes.
The internet loves trademark cease-and-desist letters again.
For many years, the recipients of trademark cease-and-desist letters would take to the internet to portray the senders of these letters as bullies. For example, in 2011, Chick-fil-A famously sent a cease-and-desist letter to a Vermont artist selling “Eat More Kale” T-shirts. The artist retaliated on social media and Change.org, garnering over 42,000 signatures on a petition titled “Chick-fil-A: Stop Bullying Small Business Owners.”
In 2017, several brand owners saw their trademark enforcement efforts go viral in a positive way, by delivering friendly, albeit kitschy, cease-and-desist letters. First, Netflix sent a pun-filled letter to a Chicago Stranger Things-themed pop-up bar, asking that the bar limit its run to six weeks. The letter was lauded as “super classy,” “funny,” “the best,” “cool,” “lighthearted” and “hilarious”—terms rarely extended to any legal document, much less a cease-and-desist letter. Next, Velcro published a video titled “Don’t Say Velcro” in which it pleaded with the public to use the term “hook and loop” instead of Velcro when referring to generic fastener products. With self-deprecating lyrics like “We know this seems ridiculous, this is a first-world situation. And we made half of a billion last year. I went to Turks on my last vacation,” Velcro enjoyed overwhelmingly positive coverage of its video from various popular news outlets.
Then, TGI Fridays sent a letter to a Chicago pop-up bar planning to “dress up” as a TGI Fridays for Halloween. The restaurant chain’s in-house counsel noted “It’s certainly a rite of passage to dress up as your personal hero for Halloween. … Unfortunately (for you—not us), trademark law requires us to protect our brands … [so] we must ask that you avoid using TGI Fridays’ trademarks, logos and other property at your event.” This letter too was lauded as “exceedingly friendly,” “charming” and “funny.”
Finally, Anheuser-Busch company sent a town crier to Minneapolis brewery Modist Brewery Co. to request that the brewery discontinue its “Dilly Dilly”-named beer. Anheuser-Busch softened the blow of its demand by offering the brewery “two thrones” at Super Bowl 52.
While, notwithstanding the hyperbole-loving internet, only one letter can truly be the funniest cease-and-desist letter ever written, for the time being, brand-owning Goliaths (with creative PR departments) have found a way to be lauded, rather than ridiculed, for necessary enforcement efforts. Accordingly, the trend of tongue-in-cheek cease-and-desist letters—sent by in-house counsel and not outside counsel—is likely to continue into 2018.
Cross-border trademark issues cause headaches.
In Mexico, Bayer’s Aleve headache medicine is sold under the brand name “Flanax.” Seeing an opportunity, small drugmaker Belmora began selling Flanax in the U.S. and registered the trademark. Belmora promoted Flanax in the U.S. with statements such as “Flanax is now made in the U.S. and continues to show record sales growth everywhere it is sold” and used the same fonts and colors as Bayer’s Mexican product.
From 2007 to 2014, Bayer and Belmora litigated in the U.S. Trademark Office’s Trademark Trial and Appeal Board over whether Belmora’s trademark registration was valid. In 2014, the board canceled Belmora’s Flanax registration, concluding that Belmora’s use of Flanax misrepresented to consumers that its product came from Bayer. The Eastern District of Virginia reversed the board, ruling that, because Bayer did not use and had not registered the Flanax brand in the United States, it did not have standing to bring a claim of misrepresentation of source in the U.S. under the Trademark Act. The Fourth Circuit reversed the Eastern District of Virginia, holding that the Trademark Act does not require Bayer to use the Flanax mark in the United States in order to prevent others from doing so. The Supreme Court denied certiorari. In 2018, the trademark world will be focused on the aftermath of the Fourth Circuit’s ruling, especially with respect to well-known Cuban cigar brands and well-known international cannabis brands, both of which previously had very uncertain rights in the U.S.
Joel Feldman, a shareholder at Greenberg Traurig in Atlanta, counsels companies, organizations and individuals on the protection of their intellectual property rights. He focuses his practice on establishing effective domestic and international brand management best practices, and resolving intellectual property controversies between his clients and third parties, including trademark, copyright, domain-name and right-of-publicity disputes.