How to Not “Hashtag” Your Way into A Lawsuit – #IHATEGETTINGSUED

While using a hashtag on social media has become commonplace and even a “cool” new way to market your brand – when you are a company you need to be aware of the type of hashtags that can get you sued.

What is a Hashtag (#)?

First, for those that do not use social media and do not know what a hashtag is, a hashtag is a word or an unspaced phrase prefixed with the hash symbol (“#”).1 For example, #ILOVENY is a hashtag.

Why use hashtags?

On social media, such as Twitter and Facebook, a hashtag turns any word or group of words that directly follow it into a searchable link. This allows you to organize content and track discussion topics based on those keywords. For example, if you wanted to post about the Game of Thrones finale, you would include #GameofThrones in your tweet to join the conversation. You would then be able to click on a hashtag to see all the posts that mention the subject in real time.

How are hashtags used by companies?

The use of hashtags has become a marketing tool for companies. While some campaigns were a flop, others have been successful.2 For example, electronics retailer RadioShack welcomed Verizon Wireless in September 2011 with a hashtag campaign that made tweeting #kindofabigdeal into a real-time interactive game. In short, Verizon phones were arranged on a table and whenever anyone tweeted that hashtag, the phones would vibrate. Eventually, and due to the vibrations, a tweet would send a phone off the table, in which case the final tweeter would get the phone. The campaign netted more than 80,000 mentions of @RadioShack.3 Great marketing.

What do I need to know about using hashtags?

While hashtag campaigns can be great, companies need to be careful. Here’s what you need to know:

  1. You Can Be Sued for Trademark Infringement, False Advertising and False Association.

Use of a hashtag before a trademarked word or phrase does not make you immune from trademark infringement, false advertising or false association under federal and/or state laws. The ultimate questions you should be asking yourself are (i) “does my company’s use of the trademark lead people to believe that the trademark owner has given my company permission to use their trademark?” and (ii) “will people think my company is affiliated with the trademark owner?” Some examples of infringing uses are:

#NIKE (trademark infringement)

#MYCOMPETITORSPRODUCTHASPOISONINIT (false advertising, unfair competition)

While there is only one reported case on this topic, it is still instructive. In AvePoint, Inc. v. Power Tools, Inc., the plaintiffs alleged that the defendants had “engaged in a campaign of making false, defamatory, and deceptive claims and statements” regarding competitor AvePoint’s software products and services both via online social networking services and in direct communications with customers and prospective customers.4 These statements allegedly include asserting on Twitter and other social media sites that AvePoint is a Chinese company instead of an American company, that Axceler’s software is “Microsoft recommended” over that of AvePoint and that AvePoint’s software is maintained in India.5 In its opinion denying a motion to dismiss by defendants, the court held that (i) a hashtag can be considered commercial speech, and (ii) you do not need to directly refer to a competitor in order to falsely advertise.6

  1. There Are Strategies to Mitigate Your Risk

As a way to minimize your risk for liability, the first rule is to avoid using registered trademarks in hashtags. If you do need to use them, however, there are some considerations that you will need to make. For instance, you will need to consider whether the mark you are using is sponsored by any of your competitors – if so, this raises your risk of liability. You will also need to consider whether the trademark owner is particularly litigious and actively enforces its intellectual property.

The second rule is to avoid suggesting any sort of endorsement of affiliation with brands (unless, of course, you are actually affiliated or sponsored by them).

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1 http://en.wikipedia.org/wiki/Hashtag, accessed 3/26/2014

2 http://mashable.com/2012/03/23/twitter-hashtag-campaigns/, accessed 3/26/2014

3 Id.

4 AvePoint, Inc. v. Power Tools, Inc., 7:13CV00035, 2013 WL 5963034, *1 (W.D. Va. Nov. 7, 2013).

5 Id.

6 AvePoint, 2013 WL 5963034, *18 (“Based on these allegations, the court concludes that the plaintiffs have adequately asserted that the Twitter messages constitute commercial advertising.”. . . “Taking AvePoint’s allegations as true, the statements about the “Red Dragon” and “SinkingREDShip” can be fairly understood to refer to AvePoint and its products and services, and Axceler’s representatives made the statements with the intent to target AvePoint’s customers, by creating the impression that AvePoint is a Chinese company and its products and services are not made, developed, or supported in the United States.”).