POTIFY Dilutifies SPOTIFY

By James Juo.

Famous trademarks are protected from dilution, regardless of the presence or absence of actual or likely confusion. 15 U.S.C. § 1125(c); see also Research in Motion Ltd. v. Defining Presence Mktg. Grp., Inc., 102 USPQ2d 1187, 1192 (TTAB 2012) (sustaining oppositions to applications for the mark CRACKBERRY because of a likelihood of dilution by blurring with the mark BLACKBERRY).

Dilution may be caused by blurring or tarnishment. N.Y. Yankees P’ship v. IET Prods. & Servs., Inc., 114 USPQ2d 1497, 1502 (TTAB 2015); Coach Servs. Inc. v. Triumph Learning LLC, 668 F.3d 1356 (Fed. Cir. 2012).

“Blurring” occurs when the connection in consumers’ minds between the plaintiff’s mark and the plaintiff’s goods or services is weakened. “Tarnishment” occurs when the accused trademark is used in connection with inferior products or otherwise creates an unsavory connection. However, comparative advertising, news reporting, news commentary, and other forms of fair use would not constitute dilution.

Whether a trademark is sufficiently “famous” for dilution is determined based on whether it “is widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark’s owner.” N.Y. Yankees P’ship, 114 USPQ2d at 1502 (quoting 15 U.S.C. § 1125(c)(2)(A)).

The Trademark Trial and Appeal Board (“TTAB”) recently considered whether SPOTIFY was a famous mark in Spotify AB v. U.S. Software Inc., Opposition Nos. 91243297 and 91248487 (TTAB Jan. 10, 2022). The TTAB found that “[t]he advertising and publicity-related evidence of record is overwhelming,” including less conventional marketing efforts such as the “President of Playlists” job posting after President Obama expressed a desire to work for Spotify—a marketing effort that became “the number one trending moment on Twitter.”

Corroborating the advertising and publicity evidence, there were sales resulting in “more monthly SPOTIFY users than most U.S. states had residents” in 2015.

With respect to actual recognition of the mark, 23.3 million Facebook “likes” (and millions of followers on other social media platforms) evidenced “widespread recognition of the mark by a substantial fraction of the United States population.”

The TTAB concluded that “[b]y any and all measures, SPOTIFY is exceedingly famous, and entitled to protection against dilution under 15 U.S.C. § 1125(c).”

POTIFY markThe opposed POTIFY mark (for software and services in the cannabis industry) was accused of dilution by blurring, which “occurs when a substantial percentage of consumers, on seeing the junior party’s mark on its goods, are immediately reminded of the famous mark and associate the junior party’s mark with the owner of the famous mark, even if they do not believe that the goods emanate from the famous mark’s owner.” N.Y. Yankees P’ship, 114 USPQ2d at 1509; Coach Servs. Inc. v. Triumph Learning LLC, 668 F.3d 1356 (Fed. Cir. 2012)).

The concern is that “the gradual whittling away of distinctiveness will cause the trademark holder to suffer ‘death by a thousand cuts.’” Nat’l Pork Board v. Supreme Lobster and Seafood Co., 96 USPQ2d 1479, 1497 (TTAB 2010) (citation omitted). See also, Enterprise Rent-A-Car Co. v. Advantage Rent-A-Car Inc., 330 F.3d 1333, 66 USPQ2d 1811, 1816 (Fed. Cir.) (“dilution law is intended to protect a mark’s owner from dilution of the mark’s value and uniqueness”). Blurring may occur “regardless of the presence or absence of actual or likely confusion, of competition, or of actual economic injury.” Omega SA (Omega AG) (Omega Ltd.) v. Alpha Phi Omega, 118 USPQ2d 1289, 1298 (TTAB 2016) (quoting 15 U.S.C. § 1125(c)).

The following factors are considered in determining whether use of a mark is likely to cause dilution by blurring:

(i) the degree of similarity between Applicant’s mark and Opposer’s famous mark;

(ii) the degree of inherent or acquired distinctiveness of Opposer’s mark;

(iii) the extent to which Opposer is engaging in substantially exclusive use of its mark;

(iv) the degree of recognition of Opposer’s mark;

To determine whether Applicant’s use of its mark is likely to cause dilution by blurring, we consider:

(i) the degree of similarity between Applicant’s mark and Opposer’s famous mark;

(ii) the degree of inherent or acquired distinctiveness of Opposer’s mark;

(iii) the extent to which Opposer is engaging in substantially exclusive use of its mark;

(iv) the degree of recognition of Opposer’s mark;

15 U.S.C. § 1125(c)(2)(B)(i-vi).

The TTAB found that the above factors favored finding dilution by blurring, in particular noting that the founders and officers of the Applicant “were both longtime SPOTIFY users prior to Applicant’s adoption of it POTIFY.”

Applicant’s claim of innocent adoption calls to mind Nat’l Pork Bd., 96 USPQ2d at 1479. There, the applicant adopted THE OTHER RED MEAT, even though the evidence showed that applicant’s CEO was not only aware of the opposers’ slogan THE OTHER WHITE MEAT, but also had “customer relationships with well-publicized restaurants in the Chicago area that prominently participated in opposers’ THE OTHER WHITE MEAT campaign.” Nat’l Pork Bd., 96 TTABVUE at 1498. Thus, the CEO’s “assertion that he came up with the slogan THE OTHER RED MEAT ‘out of the blue’ and without any thought of opposers’ well-known slogan stretches credulity.” Id. Ultimately, while we were “reluctant to conclude bad faith on the part of applicant,” we found “that applicant’s principals may have believed it was permissible for applicant to create such an association, and hence, consistent with a likelihood of dilution by blurring, resolve this factor in opposers’ favor.” Id.

Finding “[t]here is no question that SPOTIFY is as famous as marks come,” and “inevitable” that POTIFY “will diminish [SPOTIFY’s] distinctiveness,” the TTAB sustained the opposition based on dilution by blurring.

The trademark attorneys at Thomas P. Howard, LLC are experienced in the prosecution of trademark applications before the USPTO, as well as in enforcing trademarks or defending against infringement claims in litigation nationwide including in Colorado.