News Zone

Social media power trumping trademark rights 15 Oct 2014

 

Recent international events where trademark law has come off second best against social media should serve as a caution to New Zealand companies to tread carefully when enforcing their rights.

 

Intellectual property expert and lawyer, Theodore Doucas of Zone Law and Zone IP, an intellectual property law firm and consultancy in Wellington, said a slew of recent international trademark disputes have ended up backfiring when companies attracted public ire on social media.

 

“You will actually find that large international companies are moving away from traditional methods of bullish behaviour. They are conscious of being listed as trademark bullies. Those that haven’t taken note are finding the social media backlash deafening. What’s remarkable is how often those big companies back down, particularly after an infringement story has gone public.”

 

Mr Doucas said that bicycle manufacturer Specialized is a prime example of a large international brand with certain rights around a brand name being forced to back down, often because the matter was handled in a clumsy manner by threatening lawyers.

 

“Specialized sent a cease and desist letter to an Afghanistan war veteran who owned a small bicycle shop in Canada called Café Robaix. Specialized said they owned the Robaix trademark – actually also a famous town and bike race in France. Specialized demanded that the owner of shop change the name of his business, and stop selling components under the Robaix brand.

 

“The backlash on social media was massive. Without going into the details of other complicating factors (the brand was actually under license to Specialized), the president and founder of Specialized, Mike Sinyard, ended up having a mea culpa sit-down with the shop owner, who has been allowed to continue using the name.

 

“Sending strong cease and desist letters to minnow companies is not going to go down well with the public and will invariably invite a social media backlash that can really hurt the brand.”

 

Mr Doucas said a single tweet that goes viral may result in a public relations and social media disaster for companies that come across heavy-handed.

 

“It is a real grey area in the practise of law because legal rights although validly held, can be, and often are, overwhelmed by public opinion. We have a new watchdog out there and it’s called social media.”

 

It is not only large international companies that can feel the heat. In April this year, New Zealand Trade and Enterprise felt a public backlash after they ordered an ex-pat Kiwi to stop using its silver fern logo on his Twitter profile.

 

“Companies are realising that it’s not about being able to protect your intellectual property rights but using a variety of other methods to validly protect your intellectual property rights”.

 

The lesson is to understand that all communications, from emails to cease and desist letters, represent the brand and hold serious implications for the brand if not executed with due consideration, sensitivity and understanding of the implications. Lawyers of course, are not well-known for their sensitivity and understanding. 

 

However, lawyers are learning now what public relations companies have known for years namely “it’s not what you deliver but how you deliver it”. Companies who use lawyers who do not understand the social media phenomenon are likely to be left wondering what went wrong. 

 

“Negotiation and accommodation should always be your lawyer’s first reaction. Legal action should always be the last resort,” he said.

 

Theodore Doucas, Principal