Trademark Bullying & the Streisand Effect

by Erik M. Pelton

Trademark bullying continues to be a topic of great interest and controversy. The media has covered more cases of alleged bullying in trademark disputes. And the USPTOs 2011 study of the issue left many questions unanswered. This paper explores several trademark bullying topics, including the Streisand effect and how it relates to trademark bullying situations, practical tips for trademark owners to reduce the risks of being labeled a bully, and a summary of the USPTOs 2011 study and the major comments that contributed to it.

I.

The Streisand Effect

What is the Streisand effect and how does it relate to trademark claims? The Streisand effect refers to the common dilemma that efforts to quietly deal with a problem often end up backfiring by drawing much more attention to it. The phenomenon is named after Barbra Streisand, who attempted to suppress photos of her residence in 2003 citing privacy concerns, but she inadvertently generated greater publicity for the pictures as a result.1 The phrase is frequently used in the context of intellectual property cease and desist letters that generate a backlash of negative attention for the sender as well as a groundswell of public support for sympathetic recipients. The Streisand effect is often fueled by social media and the
1

http://en.wikipedia.org/wiki/The_Streisand_effect 2012 Erik M. Pelton & Associates, PLLC. All Rights Reserved.

ability of the alleged infringer to post the demand letter on social networks and to generate media attention. Proliferating networks along with sites dedicating to collecting and posting demand letters, such as chillingeffects.org, make it easier than ever for the accused to find an audience.

Why is the Streisand effect growing? Brand owners are becoming victims of the Streisand effect more frequently. Social media networks continue to grow. The playbook for alleged infringers has grown as more past examples are available for anyone online to see and mimic. Perhaps there are also more tenuous claims being made against small businesses that have few or no other options to defend infringement allegations.

Examples of the Streisand effect in trademark enforcement: Louis Vuitton and Penn Law School o In the spring of 2012, counsel for Louis Vuitton sent a cease and desist to Penn Law School regarding a poster for an intellectual property symposium that demanded the school change the background for the poster, which was a parody of the Louis Vuitton toile monogram pattern featuring the TM and symbols. See image below.

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o In response, counsel for Penn posted the demand letter and Penns response online. Demand letter: https://www.law.upenn.edu/fac/pwagner/DropBox/lv_letter.pdf Response: https://www.law.upenn.edu/fac/pwagner/DropBox/penn_ogc_letter.pdf o Many criticized Louis Vuitton for being overly aggressive in the way it handled the matter, since the design was a form of parody and the use in a law school seminar posed no clear threat to the Louis Vuitton brand. The North Face and The South Butt o The South Butt was a parody apparel line started by a high school student. In its first year, revenue was reportedly $4,900. o North Face filed suit against The South Butt. The South Butt reacted online, creating a Facebook page dedicated to its defense and generating a lot of media attention

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o Because of the suit and surrounding publicity, sales multiplied for The South Butt and many more people heard the name than otherwise would have. o The case was settled on undisclosed terms; approximately one year later The South Butt website was no longer operating. Chick-fil-As Eat Mor Chiken and EAT MORE KALE o Chick-fil-A sent a cease and desist letter to Bo Muller-Moore, the owner of Eat More Kale, a silk-screening business selling shirts and stickers that say EAT MORE KALE via eatmorekale.com. Muller-More had applied to register its mark with the USPTO; the application has been refused based on the Chick-fil-A registration for EAT MOR CHIKEN.

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Muller-More and his supporters created Facebook pages that attracted thousands of fans in a short period of time.

o Muller-More then began a Kickstarter campaign that raised more than $80,000 to fund a documentary movie. [Disclosure: I have been interviewed for the documentary.] Facebook page: http://www.facebook.com/pages/EatMoreKalecom/101747780074?ref=ts Kickstarter Page: http://www.kickstarter.com/projects/1674889308/a-defiant-dude Movie trailer: http://www.youtube.com/watch?v=dW9z8feaVgM o The dispute was recently featured in the Economist magazine, and has been mentioned by the Governor of Vermont. http://www.economist.com/node/21551090 National Pork Board and Unicorn: The New White Meat o On April Fools day in 2010, the site ThinkGeek posted an ad for a unicorn meat product as a hoax. The fictional product used the slogan The New White Meat

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o Attorneys for the National Pork Board clearly did not get the joke, they sent a standard cease and desist letter. o The letter received a significant amount of online media coverage, including a write up in The New York Times blog. http://bits.blogs.nytimes.com/2010/06/22/unicorns-theyre-not-the-other-whitemeat/

Why should brand owners be aware of the Streisand effect? As the examples above demonstrate, a brand owner who sends a trademark cease and desist letter or files a complaint in court may face an accused infringer who is media savvy. When a brand owner is shamed online, there is potential damage to its brands good will and reputation, potentially alienating customers. Equally important, there is also the potential that the attention generated by the accused will lead to increased sales of the allegedly infringing products or services. Once mired in such a situation, the brand owner faces an even greater need to bring a swift end to the conflict, but its leverage may be dampened by a public backlash. Savvy brand owners and their counsel should prepare for the possibility that their demands will be made public and attract attention. When preparing a demand letter or a complaint, brand owners would be prudent to consider the reactions if the recipient posts the letter online, and how the brand owners clients will react to the publicity. Claims that are tenuous and demands that are heavy-handed are the most ripe for a social shaming reaction by the accused. Reasonable people and attorneys can certainly disagree in many instances as to whether a letter or complaint is appropriate; but the tactics and the demands often speak for themselves. Particularly when sending a borderline demand, brand owners and their counsel

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must consider what responses the accused could make, and whether the message of the demand should be toned down or altered. In these and other Streisand effect situations, brand owners have taken a perceived problem and not only made it the subject of more attention than it ever received prior to the complaint, they made the problem more protracted, the subject of negative publicity, and/or more expensive. Perhaps different tactics could have achieved better results at a lower price, both in dollars and good will. For example, had counsel for Louis Vuitton asked to have a voice at the IP forum to explain why such uses make its client uneasy and could affect claims of dilution, it may have been very well received by the next generation of IP attorneys. Or if Chick-fil-A had requested that Muller-More sign a simple agreement stating that he will never sell chicken or use images of cows or chickens in connection with his merchandise, perhaps there would be no forthcoming documentary to worry about.

II.

Tips for avoiding the Streisand effect in trademark enforcement Before drafting a demand letter, discuss with the client what their enforcement objectives

are. How much vigilance is necessary? Is a small local user of a non-exact mark really a threat to the strength of the trademark? Weigh the pros and cons of sending the letter and possibly being labeled a bully. Some suggest that in 2012, it may not be necessary to squash every single use, online and elsewhere, of every similar mark. Given the ease of creating content, it may not be practical to go after every use. If a particular use is not harmful and is not popular, perhaps it is best left alone with monitoring instead of risking a Streisand effect backlash. Of course, even more care is required when dealing with uses that could be considered fair use.

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When it is worth taking action against another partys use, brand owners would be wise to heed the following tips: Before sending a letter, remember the audience. Are they tech savvy? Are they attorneys or entrepreneurs? When drafting a letter, remember that the recipient may share it with the entire world via social media. Is there anything that could be perceived as over the top that is not necessary to the letters intent? Is there anything that could make your client look bad or foolish if the letter went viral? Prepare the client for publicity issues that could ensue if the recipient attempts a social shaming campaign. Seek solutions not threats. Instead of making only demands that negatively impact the recipient, consider suggesting solutions that would achieve the necessary results without seeming overbearing or inviting a scorched earth defense. Perhaps coexistence with restrictions in writing is sufficient and cessation of use may not be required. Consider whether a phone call might be a better way to begin, or whether a communication directly from the client, not counsel, to the accused may be appropriate. Once the letter is drafted and ready to send, reconsider once more whether anything really needs to be done, whether the letter is necessary, and whether it reflects an appropriate tone.

III.

Trademark lawyer groups weigh in on litigation tactics study

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In 2011, while preparing its report to Congress, the USPTO sought public comments about trademark litigation tactics (a.k.a trademark bullies study). The four main associations of attorneys in the field of trademarks and intellectual property each submitted comments. IPO (Intellectual Property Owners Association):
http://www.ipo.org/AM/Template.cfm?Section=Home&CONTENTID=28192&TEMPLATE=/CM/Conten tDisplay.cfm

IPO does not believe that trademark bullies are a problem for trademark owners. The IPO actually tries to indicate that the opposite may be the problem, namely, that small businesses are unfairly causing problems for others. Indeed, several IPO members noted a trend towards more aggressive assertion and defense of trademark claims by individuals and small organizations, particularly where they represent themselves or have obtained legal representation on a contingency basis. The IPO comments cite Leo Stoller to support its claims, even though he appears to be a clear outlier in every respect. IPO notes that in trademark case law, one can find examples of both plaintiffs and defendants engaging in objectionable behavior. Summary: Problem, what problem? If anything, defendants might be pestering or causing problems with tactics for plaintiffs. ABA-IPL (American Bar Association Intellectual Property Law Section)
http://meetings.abanet.org/webupload/commupload/PT020100/otherlinks_files/Ltr-Survey_Resp-TMBullying.pdf

Overall, however, curbing abusive trademark litigation practices should be left to the judiciary on a case-by-case basis. A one size fits all approach does not appear to be warranted. There is no consensus about many of these issues, lending further support to the conclusion that determining litigation misconduct in a trademark case or otherwise requires a fact-intensive analysis that cannot be addressed by a single, catch-all legislative solution. [I]t 2012 Erik M. Pelton & Associates, PLLC. All Rights Reserved.

appears that the existing regimes to handle abusive conduct are sufficient to address concerns of abusive trademark litigation conduct. Summary: Even if there is a problem, why should anyone try to fix it as a whole when case by case courts could potentially do something. INTA (International Trademark Association)
http://www.inta.org/Advocacy/Documents/January42011TMLitigationTactics.pdf:

INTA believes that the interests of trademark owners both large and small are well served by the established practices and rules in litigation. INTA suggests that a greater emphasis on education would assist small businesses and the general public in understanding trademark law and the obligations of rights holders. INTA believes that the courts currently have sufficient tools that are balanced and adequate to discourage unfair litigation practices. INTA recommends additional public education and outreach to raise awareness among the pubic and small business owners of legal protections in the system. Summary: There is no problem and the system should not be changed in any manner. If anything small businesses and the public just need to be better educated about the issues. AIPLA (American Intellectual Property Lawyers Association)
http://brandgeek.net/wp-content/uploads/2011/02/AIPLAs-comments.pdf

AIPLA advises against regulation aimed at trademark abuse in favor of existing remedies. Legislative or other action addressing the topics in the study would restrict or chill the trademark enforcement process. AIPLA is not aware of significant abusive enforcement tactics. Summary: The status quo is just fine, and enacting any changes would seek to address a problem that does not exist.

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In sum, these groups believe there is no bullying problem and even if there were one the existing remedies would suffice for addressing it. I disagree strongly with these conclusions. While the problem may not be drastic or easy to define, I believe that changes to the system, increased education, and additional remedies available to defendants to address egregious problems would improve the system. Perhaps additional defenses or causes of action would be a proper remedy. If there is no problem, as the major IP law associations suggest, then such defenses or causes of action would never be successful, and the net change to the trademark law and practice would be minimal. However, if the associations and others who see no problem are wrong, recognizing defenses and causes of action dealing with abusive tactics or over-zealous enforcement would go a long way toward making the system more just for all trademark stakeholders. My biggest objection to the comments of the four groups I have cited is not the position they have taken I expected them to protect their own and their clients interests but that they believe that no further study or discussion of the issue is needed or worthwhile. While drastic reform may not be necessary, a few smaller reforms including better education regarding the issues to both small businesses and trademark owners would certainly help minimize the overenforcement of trademarks and the stifling effect it has on the economy, on jobs, and on American innovation.

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IV.

Commentary on Trademark Litigation Study to Congress: Hakuna Matata (it means no worries) In short, the final Trademark Litigation Study issued by the Department of Commerce (of

which the USPTO is a part) essentially says: We conducted a thorough study and there is no problem; and if there were a problem, no significant changes would be needed. Hakuna Matata! In my opinion, the studys method and analysis are both critically flawed. The study was, by law, to focus on the experiences of small businesses (the request for comments uses the phrase more than 10 times and the statute creating the study directs it to cover the extent to which small businesses may be harmed by litigation tactics). Yet very little attention was given to gathering and considering their perspectives. I will skip a lengthy summary of the Study, as there are many good summaries available, including: IP Law Alert: USPTO Issues Report to Congress on Trademark Bully Study (Fitch Even Tabin & Falnnery) BrandGeek: USPTO Reports to Congress on Trademark Bullying TechDirt: Commerce Department Releases Useless, Biased Report On Trademark Bullying Eric Goldmans Technology & Marketing Law Blog David Pardues Trade Secrets and IP Today: Whitewash: Commerce Department Issues Trifling Report On Trademark Bullying Seattle Trademark Lawyer: PTO Report Questions Whether a Problem Exists with Trademark Bullying (Michael Atkins) Managing Intellectual Property: Trade Mark Bullies Report Dubbed Disappointing (subscription required)

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Pittsburgh Trademark Lawyer: USPTO Releases Study on Trademark Bullies

Conducting the Study According to the study, it was the result of significant outreach to stakeholders and small businesses. Yes while there was a public request for comments, and it was extended several times to allow for additional comments, there was little promotion of the request by the USPTO and Department of Commerce. The request for comments was barely, if at all, even mentioned on the USPTOs Facebook page, Twitter feed, news releases, and Directors blog. More significantly, there was a lack of real outreach directed to small business groups and organizations and relevant agencies like the Small Business Administration (SBA). The Study touts a single USPTO roundtable in Detroit. The Request for Comments resulted in 79 comments, and number which seems small for a government agency with a website that has thousands of visitors and filers every week. Of the comments submitted, the Study devotes equal time on (and seemingly equal weight to) the comments from four groups of attorneys compared to the other 75 commenters. The Study also notes that there was outreach to industry via a large industry organization and consultation with the Trademark Public Advisory Committee (TPAC). TPAC is a great and very useful organization and its opinion certainly should have been sought, but TPAC does not represent the interests of small businesses. This large industry organization is not identified in the report. We cannot presume that this organization represented the views and experiences of small businesses if the USPTO has not disclosed its identity. The Studys Findings & Recommendations The Study briefly goes through each of the questions asked in the Request for Comments and notes how many commenters identified problems, stated whether changes would be useful,

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and/or suggested specific changes. Those who described or opined on trademark litigation tactics causing problems clearly outweighed those who did not. Yet the Study repeatedly concludes that there is no real problem and that no real changes are needed. The Study also includes a summary of current federal agency initiatives related to intellectual property. None of the identified federal agency IP initiatives relate specifically to abusive trademark tactics or the dangers to the economy and innovation created by overenforcement of trademarks, and none would expressly aide small businesses or those burdened by abusive litigation tactics. The Studys three recommendations are to (1) urge pro bono efforts from private sector, (2) urge more CLE (continuing legal education) programs on trademark litigation issues for attorneys, and (3) enhance outreach from several government agencies. In other words, the two most significant recommendations are for the people who said there is no problem to do something about it. While I think the Study is weak and mistaken in much of its analysis, I acknowledge that small businesses and the public are partially to blame for failing in general to submit comments or to publicize the issues. Perhaps a larger public outcry would have necessitated a different result. Seventy-nine comments does not seem like a large number. No associations focusing on small business issues commented. The National Federation of Independent Business (NFIB), US Chamber of Commerce, and other business and trade groups were silent for the most part. Only a handful of attorneys and law firms with experience working with small businesses submitted comments. The Study could have included greater outreach and should have given greater weight to all of the commenters who took the time to respond. In my opinion the Study fell woefully short of a thorough review of the issues and the possibilities of making the system better.

2012 Erik M. Pelton & Associates, PLLC. All Rights Reserved.