Trademarks represent important corporate assets of all consumer-facing companies, especially those in highly regulated industries, like the cannabis or beverage industries. The intellectual property comprising a company’s brand sets a business apart from its competitors and can even help overcome the stigma traditionally associated with many highly regulated industries. An important aspect of creating, owning and utilizing these important intellectual property assets involves securing and enforcing trademark rights, and remaining cognizant of preexisting established brands that may attempt to do the same.
As this blog has addressed before, one of the crucial tools for establishing and enforcing trademark rights is to register a trademark with the United States Patent and Trademark Office (USPTO). However, before the USPTO approves a trademark application, it will always publish the applied-for trademark for public review. This publication process raises an important issue for any brand-owner to consider – the Opposition process.
What is a Trademark Opposition?
As the USPTO succinctly summarizes: “After your trademark is approved for publication, your trademark is published in our weekly online Trademark Official Gazette. Your trademark hasn’t yet registered. Publication begins a 30-day period during which any member of the public who thinks they’ll be harmed by the registration of your trademark may oppose it. They may file a Notice of Opposition, which starts a legal proceeding with the Trademark Trial and Appeal Board (TTAB) about your trademark.”
The TTAB Opposition is a formal legal proceeding in which one party tries to prevent registration of another party’s trademark. In an Opposition, a three-judge panel issues a decision after both sides have had an opportunity to present their evidence and make arguments in legal briefs before the Board. A trademark Opposition proceeding entails many of the procedures found in a civil lawsuit, including a formal complaint, answer, discovery, and motion practice, governed by TTAB rules and Federal Rules of Civil Procedure.
Many established brand owners monitor the weekly online Trademark Official Gazette to search for new applications that might infringe upon, dilute, or otherwise damage their preexisting trademarks. Owners of cannabis and beverage brands that do not already embrace this enforcement strategy should consider doing so. It can prevent potential competitive brands from reaching market. Likewise, applicants for new cannabis and beverage brand trademarks should proceed cautiously, with the knowledge that many large companies vigilantly review the Trademark Official Gazette and aggressively oppose new applications.
A Cannabis Industry Trademark Opposition Case Study – Spotify v. Potify
A recent TTAB Opposition, Spotify v. Potify (TTAB Opposition No.: 91243297), shows the challenges faced by cannabis companies that disregard the risks of pursuing a trademark registration that encroaches on an established brand.
Spotify, the prominent music streaming company, opposed trademark applications applications by Potify, an online service that helped customers find dispensaries. In its TTAB opposition filing, Spotify asserted that Potify’s trademark application risked diluting the “SPOTIFY” brand by “tarnishment” and “blurring.” Essentially, Spotify asserted that, if allowed to register, the “POTIFY” trademark would harm Spotify’s reputation and also lead consumers to associate the two brands together.
The TTAB found the two marks, “SPOTIFY” and “POTIFY” to be similar, and that “POTIFY” would “trigger consumers to conjure up the famous [Spotify] mark.” This finding, combined with the fame and distinctiveness of the “SPOTIFY”mark, led the TTAB to conclude that the “POTIFY” mark would inevitably “diminish [spotify’s] distinctiveness,” and on that basis, registration of “POTIFY” was refused.
Many cannabis companies might be tempted to base their brands off of preexisting famous brands. Others might choose to create a brand without diligently clearing their marks first. The example of the Spotify v. Potify opposition shows that the TTAB affords little to no sympathy to the cannabis industry, especially when a new brand is so similar to a famous mark.
Companies in the cannabis and beverage space should keep trademark oppositions in mind whenever enforcing established trademarks or evaluating potential new brand names. Established brand owners should diligently monitor the Trademark Official Gazette for potentially harmful new trademark applications to oppose. Likewise, prospective new brand owners should diligently clear their trademarks before submitting applications to the USPTO, to minimize the risk of facing trademark opposition.
The Intellectual Property attorneys at Rogoway Law have significant experience with Trademark Opposition proceedings for cannabis and beverage businesses. Our IP attorneys can assist you with proactive online brand monitoring for potential infringements including sending cease/desist letters and responses to any potential infringers. If you need assistance, please contact us; we are here to answer your questions and offer legal counsel to help protect your brand.