Beware Of Using Trademarks As Hashtags
This area of the law is continuing to evolve. It is risky business to use another party's trademark as a hashtag. There are few cases that have ruled on this issue. Those cases that have addressed this issue are not necessarily consistent in results, but more or less consistent with the approach, and how to analyze these matters. To learn more about the basics of trademarks and hashtags, see our firm page entitled, Hashtags Have No Trademark Significance.
The courts seem to be focusing on the specific facts of each case, rather than relying on general rules for making determinations. For example, courts look to determine if the nature of the use is likely to cause confusion, likely to deceive or cause mistake, see 15 USC §1114. Even though different courts and jurisdictions vary on the test for "likelihood of confusion" many of the factors are the same. Most jurisdictions focus on the similarities and dissimilarities of the marks, the relatedness of the goods and services, the similarities of trade channels, conditions under which sales are made, impulse vs. sophisticated purchasing, strength of the mark, both conceptual and commercial strength, evidence of marketplace confusion, and any evidence that the defendant adopted the mark in bad faith.
The courts make a distinction when a third party uses another's trademark as a hashtag to promote their own goods and services, and when its used for other purposes such as referring to the other party's goods or services. See 3 Ratones Ciegos v. Mucha Lucha Liebre Taco Shop 1 LLC, 16 CV-04538 (D. Ariz. Sept. 27, 2017). See also, a recent California case, Align Technology, Inc. Strauss Diamond Instruments, Inc., No. 18-cv-06663 (D. Cal. April, 12, 2019), where the court held that the defendant's use of hashtags did not qualify for protection. The court further held that the defendant's use was not reasonably necessary to identify its product. Defendant's use of the plaintiff's mark as a hashtag, instead created an association with the plaintiff's products. In Align Technology, Inc., the defendant claimed nominative fair use as a defense, but the court determined that such use did not constitute fair use.
The test for nominative fair use is as follows: (1) the product or service in question must be one not readily identifiable without use of the trademark (2) only so much of the mark or marks may be used as is reasonably necessary to identify the product or service; and (3) the user must do nothing that would, in conjunction with the mark, suggest sponsorship, association or endorsement by the trademark holder. See Playboy Enterprises, Inc. v. Welles, 279 F.3d 796, 801 (9th Cir. 2002). It is important to point out that with nominative fair use, the defendant uses the plaintiff's trademark to describe plaintiff's goods or services, and not their own.
These two cases are at odds with Eksouzian v. Albanese, No. CV 13-00728-PSG-MAN, 2015 WL 4220478 (C.D. Cal. Aug. 7, 2015). In Eksouzian, a contractual dispute, the court determined that hashtags were descriptive devices and not trademarks. The court further stated in this case that hashtags are functional tools used to direct consumers to particular promotions, and not likely to cause confusion. The courts have also pointed out that e-commerce consumers and consumers using social media tend to be sophisticated, which will be taken into consideration when analyzing these matters for trademark infringement.
At the current time, it would be prudent to avoid using another party's mark as a hashtag. In addition, as a trademark owner, you want to police the marketplace for others using your trademark as a hashtag. This type of use could dilute the value of the mark, and the goodwill associated with the mark.
Moreover, trademark owners should carefully consider the pros and cons of using their own marks as hashtags in social media. This could open the door for others to use your mark as a hashtag as well, which could ultimately impair your mark's ability to function as a source indicator. These hashtag cases will continue to evolve as more and more companies utilize social media. If you have questions regarding trademark use on the Internet or in social media, please feel free to contact the firm for a courtesy consultation.