Category Archives: Best Practices

Social Media Terms of Use – Is Your Brand Following the Rules?

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Advertisements and promotions on social media channels are a daily occurrence.  In addition to complying with traditional advertising rules and regulations, brands need to comply with each social media channel’s Terms of Use and advertising-specific rules.

NBC recently ran afoul of Facebook’s rules when it posted a three-minute clip from the latest episode of Saturday Night Live that began with a five-second ad for Subway.  The rules state that “Third-party advertisements on Pages are prohibited, without our prior permission.”  In other words, video clips with ads not sold by Facebook are not allowed…unless a brand enters into an agreement similar to typographic-poster-design-i-have-read-and-accept-the-terms-and-conditions_GJfTZN_dFacebook’s deal with the NFL that allows brands to run ads after clips are shown and gives Facebook takes a piece of the ad revenue.  Earlier this year, Facebook launched Anthology, which connects brands and digital media publishers (like Funny or Die, The Onion and Oh My Disney) to create branded content to be targeted and optimized through Facebook.

The Terms of Use and related policies for each social media channel (Twitter, Instagram, Facebook, etc.) can differ greatly and tend to change frequently. The Terms of Use often contain guidelines or rules for advertising and hosting contests, sweepstakes and other promotions through the social media channel, ownership and (restrictions on) use of content, rules (and prohibitions) for using native functionality (e.g., “share on your Timeline to enter”), and other important information. Some social media channels, such as YouTube, require you to obtain written permission from them before you can post ads or product placements.

Before your brand posts content on a social media channel, be sure to check the rules on each channel to make sure you’re in compliance.

 

What’s in a (Brand) Name?

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Choosing a name for your company, creative project, product or service is just as important as (and often more difficult than) naming a child or pet. Brands are so important that many big companies spend hundreds of thousands of dollars and months or even years on research, focus group testing and the like in attempts to find just the right name or logo for a new product or service.

Your brand distinguishes your products and services from your competitors’ products and services. But a brand is much more than just a name or logo.  Your brand also serves as a symbol of the quality, value, and reputation which customers and fans expect in products you sell and services you provide…not to mention the emotional connection customers and fans can develop with your brand.  For example, if we’re talking about driving a Beetle or listening to The Beatles, you probably don’t just think “car” or “band.”  Instead, you likely have thoughts and emotions related to your experiences with and perceptions of those brands — whether positive or negative.

With so much at stake, choosing a name that will resonate with your customers and fans and convey information about your product or service is important.  When brainstorming a name for your company, creative project, product or service, remember that not all brands are created equal … particularly when it comes to trademark protection.

Brands — also known as Trademarks (used on products) and Service Marks (used in connection with services) — include any word, name, symbol, or device, or any combination of these, used, or intended to be used, in commerce to identify and distinguish the goods or services of one entity from those sold or provided by others, and to indicate the source of the goods or services. Trademarks can include entity names, product names, logos, domain names, 800 numbers, slogans, phrases and tag lines, character names, band names, jingles, and trade dress, such as product configurations, color, packaging and store designs.  

The best marks are memorable, appealing and elicit desired responses.  The ultimate goal should be to find a mark that is uniquely yours — a mark that is not confusingly similar to an existing mark used for similar products or services (i.e., someone else beat you to the punch), one that suggests some connection with another organization or famous person, or one that consists of a person’s last name.  And it can take a village of marketing, artistic, business and legal types to find that perfect mark.

While searching for that perfect mark, you should keep in mind that some marks are stronger than others…

  • Generic terms are common names for products or services, such as SALT when used in connection with sodium chloride or THE CHOCOLATIER for a store providing chocolate candy.  These terms can never be protected as trademarks.
  • Descriptive marks describe an ingredient, quality, characteristic, function, feature, purpose or use of the product or service, such as SALTY used in connection with crackers or DALLAS.COM for a website providing tourism information about Dallas.  These marks are not initially protectable unless the owner can show that the mark has gained “secondary meaning” or “acquired distinctiveness” (proof that the mark has become distinctive of the mark owner’s goods or services) in the marketplace over time through extensive and substantially exclusive use.
  • Suggestive marks suggest some characteristic or nature of the product or service and require imagination, thought or perception to reach a conclusion as to the nature of those products or services, such as COPPERTONE for suntan lotion or BLOCKBUSTER for a video rental store. Although there can be a fine line between descriptive and suggestive marks, suggestive marks are automatically protected as trademarks because they are “inherently distinctive.”
  • Arbitrary marks are very strong marks because they have no relation to the product or service, such as APPLE for computers.   However, because these are real words, other companies may have also adopted the words as marks, such as APPLE VACATIONS.
  • Fanciful/coined marks are the strongest marks because they are made up words, such as XEROX for copiers or EXXON for gasoline, and consumers only associate the mark owner with selling that service or product.  

From a trademark protection perspective, fanciful/coined, arbitrary or suggestive marks are preferable to descriptive (protectable with acquired distinctiveness) or generic (never protectable) marks.  Many company, product and service names tend to be descriptive or suggestive because business owners attempt to quickly choose names that help consumers easily identify their products or services.  However, the more creativity you use in the naming process, the stronger the mark and the more likely you are to prevent third parties from being able to use the same or similar mark on similar (or even unrelated) products and services.

Before using or registering a name for your services or products, you should, at the very least, perform a quick “knockout” availability search to see if a third party may already be using the same or similar mark in connection with the same or similar products or services.  You should:

  • Check for entity names and state trademark registrations with Secretary of State Offices where business will be done.
  • Search the U.S. trademark database.
  • Perform a Google search to determine whether third parties have common law rights to the name.
  • Perform a WHOIS search to determine whether domain names are available (as brands typically want a corresponding web presence).

A mark is one of the most important words, phrases or designs you will use to represent your products or services to the world.  Although selecting a name may seem simple, trademark law is very nuanced and is often much more complex than it appears. Therefore, I believe it is a wise investment of resources to engage a trademark attorney to perform more sophisticated searches to determine whether your mark is available and inform you as to the potential risks associated with use and/or registration of your proposed mark.  (Note:  You can save yourself some time and money by performing knockout searches for your potential marks before asking an attorney to search a particular mark more thoroughly.)

Choosing a mark that’s already being used by a third party can result in cease and desist letters and trademark infringement lawsuits…potentially requiring you to abandon use of the mark, destroy all products and materials that depict the mark, and potentially even paying the third party mark owner profits gained from infringing uses of a mark as well as damages the mark owner may have incurred from such infringing use.  The last thing you want to do after spending a bunch of money to print business cards, stationery, packaging, advertising and goodness knows what else emblazoned with your mark is having to scrap everything and start from scratch with another mark.

Hiring a lawyer to guide you during the mark selection process can save you (potentially hundreds of) thousands of dollars and several headaches down the road.

 

Endorsements and Testimonials: Are You Following the Rules?

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Does your company use endorsements or testimonials to promote its products or services on its website or in its advertising or marketing materials?  Do you allow customers to post on your social media pages or website?  Are you a blogger who reviews products or services?

When most people hear the words endorsement or testimonial, they likely imagine a celebrity or expert getting paid big bucks to talk about an “amazing” product or service.  And, they would be right.

However, if you answered “yes” to any of the questions above, then you likely need to comply with the Endorsement and Testimonial Guides issued by the Federal Trade Commission (“FTC”).

Examples of messages that constitute endorsements include a film critic’s review of a movie used in Excellent result on survey on blackboardan advertisement for the film, a well-known athlete using a certain brand of sporting equipment in an ad for that brand, and a positive product review posted by a consumer on her personal blog where the consumer received the product free as part of a network marketing program.

The Guides reflect three basic truth-in-advertising principles:

  1. Endorsements must be truthful and not misleading;
  2. If the advertiser doesn’t have proof that the endorser’s experience represents what consumers will achieve by using the product, the ad must clearly and conspicuously disclose the generally expected results in the depicted circumstances; and
  3. If there’s a connection between the endorser and the marketer of the product that would affect how people evaluate the endorsement, it should be disclosed.

In other words, endorsements:

  1. Must reflect the honest experience or opinion of the endorser (there are different rules for consumer, celebrity and expert endorsements, as well as for endorsements by organizations);
  2. May not contain representations or claims that would be deceptive, or could not be substantiated, if the advertiser made them directly; and
  3. Must disclose any material connection between the person endorsing a product or service and the company selling the product or service that might materially affect the weight or credibility of the endorsement (employee, relative, paid, etc. – even small incentives, such as free product for bloggers to sample, must be disclosed).

Although the Guides don’t mandate the specific wording of disclosures, the Guides states that disclosures “must be clear and conspicuous on all devices and platforms that consumers may use to view the ad”…even if there are only 140 characters available for the entire message.  For example, paid spokespeople must disclose that they are sponsored (#sponsored or #ad) or explicitly mention that they are working with the brand/company (e.g., I’m teaming up with [brand/company] to do X) on social media platforms, such as Twitter.

If you are a brand owner, use caution before you follow, friend, like, or engage with a celebrity, third-party trademark or brand. Do not imply that there is an affiliation between the brand/company and the user/celebrity/trademark/etc….especially when such a relationship doesn’t exist. (Most consumers will assume there is a relationship between the brand/company and the user/celebrity/trademark.)

For more information, see the FTC’s FAQs about endorsements and testimonials.

 

Controlling Your Domain (Name) to Avoid a Domain Name Fumble

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Next week’s NFL Draft brings to mind a cautionary tale…

It could happen to any of us, and it almost happened to the Dallas Cowboys at a crucial time.  In the middle of the 2010 NFL season, buzz surrounding whether Cowboys’ head coach Wade Phillips was going to be fired (which was ultimately the case) was at an all-time high.  No doubt, fans, rivals and press were all scouring the internet for updates on the situation, and the Cowboys’ website was probably the prime online destination of the day. Unfortunately, the team forgot to renew the dallascowboys.com domain, and many would-be site visitors got error screens instead of highlights and instant replays. Talk about a game-changing fumble! See related article here.Blue Url Words Shows Org Biz Com Edu

It’s worth noting that the dallascowboys.com domain name was originally purchased in 1995 and probably was reserved for the longest possible time allowed.  Although most domain name registrars timely send email renewal reminders to domain name owners, it’s likely that whomever was initially responsible for the domain name was long gone and the renewal information didn’t get forwarded to the proper person (and, although auto-renew is available, the credit card info on file with the domain name registrar was probably no longer valid as well). It’s lucky that the ‘Boys became aware of the problem (which you might call an incomplete pass) and quickly renewed the domain before someone else (perhaps a disgruntled, recently fired coach) grabbed it and tried to hold it hostage.

At least Dallas Cowboys Football Club, Ltd. was listed as the domain name owner.  Many times, the person who originally registers the domain name (whether an employee of the organization or someone with the company hired to design the website) is listed as the owner of the domain name and the domain name is never officially transferred to the organization and/or the information doesn’t get updated…which can cause a host of problems for the organization utilizing the domain name (especially if the employee is terminated or if the development company relationship dissolves).

Although the Cowboys had a close call and almost wound up on the disabled list, this is a great example of how easy it can be for an organization to neglect (and almost lose) one of its most important intellectual property assets. We all know how valuable your website is to your business, so here’s what you should do to prepare your domain name offensive strategy…

If you have a website: 

(1)   Determine who is listed as the owner of your domain name.

To find out who owns your domain name and when the registration expires, type in the domain name (e.g., dallascowboys.com) in a WHOIS search database, such as InterNIC, Network Solutions, or GoDaddy.

(2)   Check to ensure that this information is correct. 

If the Administrative and/or Technical Contact information is not in your company’s name, you’ll want to update this information as quickly as possible.

You may need a Domain Name Transfer Agreement to perfect the chain of title for the domain name ownership.  (While you’re at it, you may also want to make sure you have a Website Development Agreement in place with any third-party web developer for the website associated with the domain name so you own/have rights to your web content and design.)

If the domain name is registered to one of your company’s employees or officers, add this to your employee exit checklist to ensure that this information is updated should the employee/officer leave the company.

A disgruntled/terminated employee or website developer with sole control of a company domain name can easily redirect internet, e-mail and intranet traffic within a matter of moments and bring business to a standstill.

(3)   Calendar a reminder for the domain name renewal date.  

The expiration date for the domain name registration is listed in the WHOIS information (see #1 above).

 

Is Coke’s Trade Secret Out of the Can?

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stamp-143799_1280In early 2011, the public radio show This American Life created an international media frenzy when it revealed what it believed to be the original recipe for Coca-Cola.

The “secret formula” for Coca-Cola — which has been locked away in a bank vault at the Trust Company Bank in Atlanta since at least 1925 — is one of the most famous and highly guarded trade secrets in the world.  Supposedly, only two company executives know the recipe at any one time and they are never allowed to fly on an airplane together in case of a crash.  (For more on the rumors and lore surrounding Coke’s secret formula, visit urban myth-busing website Snopes.com.) So, after 125 years of secrecy, how did a public radio show get hold of such a well-protected and highly-coveted corporate gem?  Did This American Life break into the vault or kidnap and tickle-torture one of the two executives until he talked?  No.  They opened a newspaper.  Apparently, the photo used to illustrate the story published in The Atlanta Journal and Constitution on February 18, 1979, was a hand-written copy of (Coke’s inventor) John Pemberton’s recipe circa 1886.  Talk about adding insult to injury!

This American Life has clarified its position on the recipe printed in the paper, stating that it believes the recipe is Pemberton’s original recipe or a version of Coca-Cola that he made either before or after the product hit the market in 1886, and not the recipe used today.  Perhaps this is because they tested the recipe and determined that it wasn’t quite the same as the Coca-Cola we know today, and, of course, The Coca-Cola Company denies that the secret is out.

Although you may not go to quite the lengths taken by The Coca-Cola Company to protect your trade secrets, you should consider what measures (if any) you are taking to safeguard your “information, including a formula, pattern, compilation, program, device, method, technique or process that: (i) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.” (Definition from Uniform Trade Secrets Act.)

Trade secrets — which often include recipes, sales methods, distribution methods, consumer profiles, advertising strategies, lists of suppliers and clients, and manufacturing processes — provide an enterprise a competitive edge and can last for as long as they are kept secret.  So, you would never want to include your trade secrets in a copyright or patent application, as they will be disclosed once the application or registration is published.

Although whether something truly constitutes a trade secret will depend on the circumstances of each individual case, for something to qualify and be protected as a trade secret:

  • The information must be secret (i.e., it is not generally known among, or readily accessible to, circles that normally deal with the type of information in question).
  • It must have commercial value because it is a secret.
  • It must have been subject to reasonable steps by the rightful holder of the information to keep it secret (e.g., through confidentiality agreements).

 

Misleading and Unsolicited Trademark Service and Fee Requests

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Filing a trademark application in the United States or a foreign country typically results in trademark owners receiving unsolicited notices, invoices, and other communications from U.S. and foreign companies requesting fees for trademark-related services, such as trademark monitoring and document filing.  Although these documents and invoices often look “official” and contain customer-specific information (such as the trademark serial or registration number and owner name), companies that offer these services are not affiliated or associated with the United States Patent and Trademark Office (“USPTO”) or any other federal agency.car-44144_1280

If you receive an invoice related to your trademarks, you should verify its authenticity with your trademark attorney, the World Intellectual Property Organization (WIPO) or the Intellectual Property Office through which your mark is registered before remitting payment and to discuss your options in more detail.

Unless the communication comes directly from (1) the USPTO, (2) a foreign trademark agency equivalent, or (3) your trademark attorney, these notices and invoices are likely unsolicited third party advertisements for services that you may not need or that may not provide you with adequate protection for your trademarks.  The USPTO and the WIPO have issued warnings related to these unsolicited requests for payment of fees.  WIPO has databases containing samples of misleading invoices and similar announcements issued by various countries.

You may file a complaint about these types of solicitations with the Federal Trade Commission (FTC).