Hashtags Can to Lead to Trademark Liability

While the contours of trademark liability are still being litigated, anyone involved in social media or marketing should be aware that using a competitor’s trademark as a “hashtag” has the potential to communicate a false endorsement or association with the competitor and potentially lead to trademark liability.

What is a hashtag?

The hashtag sits at the intersection of social media and comparative advertising. A hashtag, for the uninitiated, is a single word or a phrase (written as a single word) preceded by the “#” character. Hashtags have become quite useful in organizing online content. Using hashtags allows social media users to search for and retrieve information related to a single topic. For example, twitter posts which relate to episodes of a favorite show may include the “#GOT” hash tag. Or, if McDonald’s wanted to promote its BigMac, it might add the “#BigMac” hash tag to its related social media posts. Hashtags are applied to posts concerning trending topics or debates.

Marketers want their hashtags to start trending (to “go viral”) because this increases the spread of the marketing campaign. One potential way to increase the spread of a marketing campaign would be to include the hashtags of more well-known competitors. For example, a fledgling shoe company could start tagging its posts with the hashtag “#nike” in order to attract attention from shoe lovers who follow the Nike brand.

What are the trademark implications of such practices?

One court considered the trademark implications of such practices in Align Technology, Inc. v. Strauss Diamond Instruments, Inc., 2019 WL 1586776 (N.D. Cal. April 12, 2019). In Align, the plaintiff, Align, owned multiple U.S. Trademark registrations for “iTero”, “iTero Element” and “Invisalign”, all generally for use in connection with dental services, dental and oral healthcare devices, and computer-aided modeling. The defendant, Strauss, sells dental instruments and related goods, including the MagicSleeve which is similar to the iTero Element. One of Strauss’ social media posts showed the following and included the “#invisalign” hashtag (yellow highlighting added):

Social media post using competitor's trademark.Strauss argued that it was free to use Align’s trademarks under the doctrine of “nominative fair use”. The nominative fair use doctrine protects the use of a trademarked term solely to the extent it is necessary to describe the trademark owner’s own products (and not the infringer’s products). “[N]ominative use of a mark–where the only word reasonably available to describe a particular thing is pressed into service–lies outside the strictures of trademark law . . . such use is fair because it does not imply sponsorship or endorsement by the trademark holder.” New Kids on the Block v. News Am. Pub., Inc., 971 F.2d 302, 308 (9th Cir. 1992). (Nominative fair use, for example, protects journalists ability to use trademarked terms in their reporting, and protects comparative advertising, e.g, “Our new razor cuts 20% faster than competitor’s SmoothPro-X.”)

In Align the court said, depending on the particular advertisement at issue, it was debatable as to whether the marks were intended to describe the trademark owner’s products or the infringer’s products, but at the end of the day that didn’t matter because, the hashtags are still a use of Align’s marks beyond what is reasonably necessary to identify Strauss’s product.

To see why, imagine this ad in two versions, one with the challenged hashtags and one without them. Does the version with the hashtags better identify Strauss’s product? No. The identification of the product comes from the picture of it being used and the textual sentences quoted above. A global problem in all of Strauss’s ads that have hashtags that include Align’s marks is that in none of the ads do the hashtags serve any identification function; the use of the marks in the hashtags is never reasonably necessary to identify the MagicSleeve.

Id. at *6.

Strauss also argued that hashtags were the same as the metatags addressed by the Ninth Circuit in Playboy Enterprises, Inc. v. Welles, 279 F.3d 796, 803-804 (9th Cir. 2002), and found to constitute nominative fair use. The court rejected this argument as well, and in doing so differentiated between metatags and hashtags: “Metatags function behind the scenes to direct an internet searcher to a webpage, but hashtags are visible to consumers in advertising. . . [this] confirms that the intended audience of the hashtags is, at least in part, the viewer of the ad, implying association between the MagicSleeve and the terms in the hashtags.” (The Ninth Circuit in Welles, however, did not focus on the audience of the metatags to reach its nominative fair use determination. Thus, it is likely the court in Align would be on firmer ground by distinguishing Welles based on the fact that the Welles decision relied on the predicate finding that the use of the trademarks by Wells was necessary, “[i]n the context of metatags, we conclude that she has no practical way of identifying the content of her website without referring to PEI’s trademarks.” Id.

In light of Align, anyone involved in social media or marketing should be aware that using a competitor’s trademark as a hashtag could communicate a false endorsement or association by the competitor and fall outside what is protected under the fair use doctrine.

When it comes to intellectual property matters—be they simple trademark applications, reviews of established intellectual property protection plans, or expansive federal litigation—Rusing Lopez & Lizardi can help. Give us a call or email and find out how.

Isaac S. Crum (icrum@rllaz.com // 480-744-3053) is a Partner in Rusing Lopez & Lizardi’s Scottsdale, AZ office whose practice focuses on intellectual property counseling and litigation. Isaac specializes in trademark, trade dress, domain name, unfair competition, trade secret, and patent law. He has been named a Southwest Super Lawyer “Rising Star” from 2015 to 2020, is a member and on the Executive Committee of the Arizona State Bar Intellectual Property Section and a member of the American Intellectual Property Law Association’s Patent Litigation, Trademark Litigation, Electronic and Computer Law, and Diversity in IP Law committees.

Disclaimer: The foregoing is not legal advice and does not create an attorney-client relationship. If you have any questions or require any assistance, please contact Mr. Isaac S. Crum at icrum@rllaz.com or (520) 529-4274.