Social media hashtags have fast become ubiquitous conversation and marketing tools that have forever transformed how companies and consumers interact. Staking boundaries in such a fluid landscape has proved quite challenging. To lay claim, many companies have sought trademark protection for hashtags. Indeed, since 2013, over 600 federal trademark applications have been submitted for hashtag marks.
Although the United States Patent and Trademark Office (USPTO) rules state that hashtags may be protected as trademarks, a federal district court recently found that hashtags may be merely descriptive devices—not source identifiers. See Trademark Manual of Examining Procedure (TMEP) §1202.18 (Oct. 2015); Eksouzian v. Albanese, No. CV 13-00728-PSG-MAN (C.D. Cal. Aug. 7, 2015). This decision could undercut investments made by brand owners in obtaining trademark protection for their hashtags and leave this new marketing territory vulnerable and untamed.
What Is a Hashtag?
A hashtag is a word or phrase preceded by the hash character or pound sign (#) that is used to categorize the content of the accompanying text. See hashtag definition, MERRIAM-WEBSTER.COM, www.merriam-webster.com/dictionary/hashtag (last visited Nov. 14, 2015). Hashtags are used in social media to facilitate searches by keywords and to group topics of interest. Hashtags allow businesses to promote products and services, share news and engage with consumers on social media.
USPTO Standard for Registration of Hashtags
In 2013, the USPTO recognized that a term containing the hash symbol or the term “hashtag” may be registered as a trademark, but “only if it functions as an identifier of the source of the applicant’s goods or services.” See TMEP §1202.18 (emphasis added). In less than two years, the USPTO has granted over 100 hashtag registrations, including:
#STEAKWORTHY for “restaurant services” (U.S. Reg. No. 4,695,901);
#MYCHASENATION for “entertainment services, namely, conducting motorsports racing events; regulating, governing and sanctioning motorsports racing” (U.S. Reg. No. 4,699,905);
#LIKEAGIRL for “providing information in the field of female empowerment, anti-gender discrimination via social media” (U.S. Reg. No. 4,785,927); and
#THESELFIE for “photography and videography equipment, namely, remote shutter releases” (U.S. Reg. No. 4,650,601).
The TMEP notes that a hashtag may be registrable as a trademark if it includes a disclaimer of the wording “hashtag” or the hash symbol “in cases where they are separable from other registrable matter.” See TMEP § 1202.18.
However, the USPTO will not allow registration of marks which consist only of the hash symbol or the term “hashtag” combined with merely descriptive or generic wording for goods or services. See id. For example, the following marks were refused registration under Section 2(e)(1) of the Trademark Act:
- #PINUPGIRLCLOTHING for “online shopping site and retail stores featuring women’s vintage inspired clothing, swimwear, footwear, cosmetics, handbags, purses, wallets, belts, jewelry, sunglasses, scarves, and headwear” (U.S. App. Ser. No. 86/496,212); and
- HASHTAGSKATE for “skateboards, skateboard decks, skateboard grip tapes, skateboard rails, skateboard riser pads, skateboard trucks, skateboard wax, skateboard wheels, bags for skateboards, ball bearings for skateboards, nuts and bolts for skateboards, harnesses specially adapted for carrying skateboards, inline skates and toy scooters; athletic supporters, athletic tape, shoulder pad elastic for athletic use, shoulder pad laces and lacelocks for athletic use, throat protectors for athletic use, elbow guards and pads for athletic use, hand pads for athletic use, knee guards and pads for athletic use, leg guards and weights for athletic use, shin guards and pads for athletic use” (U.S. App. Ser. No. 85/848,661).
In sum, the USPTO examines applications for hashtag marks in the same way as traditional marks; it will allow registration if the mark contains words or phrases that function independently as a source identifier. However, merely adding a hashtag to an otherwise descriptive word or phrase will not make it registrable as a trademark.
Eksouzian v. Albanese: CLOUD PEN vs. #cloudpen
While the USPTO has issued registrations for hashtag marks, the recent U.S. federal district court decision in Eksouzian v. Albanese has created uncertainty as to whether hashtag marks have any enforceable value. In Eksouzian, the parties, competitors that manufactured and sold compact vaporizer pens (also known as e-cigarettes), reached a settlement agreement to resolve a trademark dispute in a prior case. See No. CV 13-00728-PSG-MAN, at 1. After the plaintiffs sued to enforce the agreement, the defendants counterclaimed and accused the plaintiffs of materially breaching the agreement by their use of certain hashtags. See id. at 1‒2.
Specifically, the settlement agreement prohibited the plaintiffs from using the words “cloud,” “cloud v” and/or “cloud vapes” in close association with the words “pen” and “penz," among others, in connection with their products as a unitary trademark. See id. at 14. For example, the plaintiffs were prohibited from using the unitary mark CLOUD PENS. See id. Even so, the plaintiffs were not precluded from accurately describing their product as a “pen”—which is considered a common descriptor of e-cigarettes. Id.
The defendants asserted that the plaintiffs materially breached the agreement by using the hashtags #cloudpen and #cloudpenz in Instagram posts and in promotional contests. Id. An example of the plaintiffs’ promotion is shown below:
Notably, the defendants owned federal registrations for the mark CLOUD PENZ 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” (U.S. Reg. Nos. 4,567,139 and 4,567,140) as well as pending applications for CLOUD PEN covering the same goods (U.S. App. Nos. 86/403,974 and 86/404,032).
The Eksouzian court held that the plaintiffs did not breach the settlement agreement through their use of #cloudpen “because hashtags are merely descriptive devices, not trademarks, unitary or otherwise, in and of themselves.” Id. at 15 (emphasis added). In finding that #cloudpen did not function as a trademark when used by the plaintiffs on Instagram, the court noted that the term “pen” was merely a descriptive term for the products at issue and cited the TMEP provision stating “[t]he addition of the term HASHTAG or the hash symbol (#) to an otherwise unregistrable mark typically cannot render it registrable.” Id.
The court found that the use of #cloudpen was merely “a functional tool to direct the location of Plaintiffs’ promotion so that it is viewed by a group of consumers, not an actual trademark.” Id. at 15‒16 (internal citations omitted). Accordingly, the court concluded that the plaintiffs’ use of #cloudpen did not violate the settlement agreement, which prohibited the use of a unitary trademark featuring the term “cloud” in close association with the term “pen,” but not the use of the generic descriptor “pen” with the term “cloud.” Id.
Several commentators disagreed with the court’s decision because it failed to consider whether the term “cloudpen” can function as a source identifier under the standard set forth by the USPTO. See Alexandra Roberts, Hashtags Are Not Trademarks—Eksouzian v. Albanese (Guest Blog Post), Tech. & Marketing L. Blog (Aug. 26, 2015), http://blog.ericgoldman.org/archives/2015/08/hashtags-are-not-trademarks-eksouzian-v-albanese-guest-blog-post-2.htm; Hashtags in #Trademark Law, Cislo & Thomas LLP (Oct. 7, 2015), http://cisloandthomas.com/hashtags-in-trademark-law. They note that while the term “pen” is considered to be descriptive of compact vaporizers, the court did not conduct an analysis of whether the term “cloud” is also descriptive of such devices. Moreover, the court failed to address whether the plaintiffs’ use of #cloudpenz was also descriptive, especially in light of the defendants’ federal registrations for the mark CLOUD PENZ for electronic cigarettes and vaporizers.
It is unclear whether the court in Eksouzian found that use of #cloudpen did not violate the parties’ settlement agreement simply because the term “cloudpen” was not capable of functioning as a source identifier, or if it was broadly holding that no hashtag can ever function as a trademark. In any event, the decision has created ambiguity for the hundreds of applicants and owners of trademark registrations for hashtags in the United States, as well as any business that currently uses its trademark as a hashtag on social media.
Although no other U.S. courts have definitively addressed whether a hashtag can function as a trademark, another recent opinion indicates that the use of a competitor’s name as a hashtag could form the basis of trademark infringement or false advertising claims. In Fraternity Collection, LLC v. Fargnoli, Case No. 3:13-CV-664-CWR-FKB, at 3 (S.D. Miss. Mar. 31, 2015), a clothing manufacturer, Fraternity Collection, brought Lanham Act false advertising and common law trademark infringement claims against a former designer based on her use of the hashtags #fratcollection and #fraternitycollection in connection with marketing performed for a competitor.
The court refused to dismiss the trademark and false advertising claims, noting that the use of a competitor’s name or product as a hashtag in social media posts “could, in certain circumstances, deceive consumers.” See Case No. 3:13-CV-664-CWR-FKB, at 6‒7. Until other courts weigh in on the issue, however, Eksouzian remains the only statement regarding whether hashtags are protected by trademark law.
Implications of the Eksouzian Decision
The Eksouzian decision presents a risky situation for the owners of hashtag trademark registrations. If interpreted broadly by other courts, Eksouzian could essentially invalidate trademark protection for hashtag marks on social media. For example, use of the #STEAKWORTHY mark on Twitter by a competing restaurant would not be actionable as trademark infringement. In a more concerning scenario, if hashtags cannot function as source identifiers, a competitor may be able to use a company’s name as a hashtag—such as #Starbucks or #McDonalds—in connection with the promotion of competing goods or services without being liable for trademark infringement.
As a result of the Eksouzian decision, trademark owners may be vulnerable to damage to their goodwill and ultimately discouraged from marketing their goods and services on social media. Of course, Eksouzian is a district court decision that has not been subject to appellate review. Other courts may follow the USPTO and enforce against the use of hashtag marks by third parties as long as they function as source identifiers. Until other courts take up this issue, however, Eksouzian provides the only guidance for trademark owners and legal practitioners.
Recommendations for Brand Owners
In light of the Eksouzian decision, businesses should take steps to protect their brands on social media. First, when evaluating whether to register a hashtag as a trademark, brand owners should consider registering only the underlying word or phrase without the hash symbol or the term “hashtag” in order to make clear that it functions as a source identifier. For example, the court in Eksouzian may have found that #cloudpen functioned as a source identifier if the defendant had owned a trademark registration for CLOUDPEN without the hash symbol. Moreover, the scope of protection for the mark CLOUDPEN is broader than #CLOUDPEN, as it would unquestionably allow enforcement against use of the mark without the hash symbol.
Additionally, businesses should prioritize the development and use of hashtags that do not include the company’s trade name or primary brand. In the event that other courts follow Eksouzian, using hashtags that do not contain trade names or other key trademarks will help limit the infringing use of such marks by third parties in a manner that companies cannot enforce against. Companies that continue to use their name or primary trademark as a hashtag on social media should closely monitor future cases addressing this issue.
Finally, because hashtags are now becoming a valuable asset for social media and marketing campaigns, brand owners should consider incorporating language addressing hashtags in coexistence or settlement agreements. For example, trademark owners seeking to prevent another party from using a hashtag similar to their trademark should include language in the agreement stating:
[COMPANY] agrees not to use or seek to register the term “[TRADEMARK]” as a trademark, domain name, social media username, or hashtag in connection with [PRODUCTS OR SERVICES].
Similarly, a license agreement could allow or restrict the use of a term as a hashtag to provide broader protection for trademark owners in the event that hashtags are not protected by trademark law.
In sum, while the USPTO allows for the registration of hashtags where they function as a source identifier of a party’s goods or services, the Eksouzian decision may have stripped the stakes from the ground. Only one thing is certain, and that is the uncertainty of trademark protection for hashtags. Until the legal status of hashtags has been further established, trademark owners should develop strategies to minimize the risk to their investment in hashtags and protect their brands from misuse on social media.
Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.
© 2016 International Trademark Association