5 Mistakes that will Land You in Branding Hell

 

Jessica Alba & The Honest Company (owner of honesttoddler.com)

vs.

TheHonestToddler.com

Brand disputes are about CONTROL. You could be fighting over any number of things (e.g. a logo, content, a name), but at the end of the day, someone wants more control than they currently have…or is trying not to lose it.  And whoever controls best WINS.

By the time you finish reading this, I promise to show you 5 mistakes that cause brand owners to lose control of their brand, followed by 5 tools to ensure you stay in control of the brand you’re building. After all, it’s really hard building a brand the way you planned, when your time, focus, and money suddenly has to shift to defending it. Or worst case scenario —> suddenly being forced to scrap what you were building to start over from scratch. $$$$$$

How do you control it best? PROACTIVELY. Regardless of what stage of branding you are in, here are five tools you can use NOW. Those who have had the opportunity to attend my presentations [like this] on brand infringement and brand defense know that I like to use real brand disputes when I educate.  Stories help us remember important lessons, so here we go.

The Story

First, we have to talk about Jill, a mommy blogger in New Jersey.  She started a company called “Honest Baby” to celebrate the imperfect journey of parenting and had two trademark registrations for “honest baby” dating back to 2008. In January 2012 , Jill’s Google Alerts let her know that someone else – aka Jessica Alba and Friends – was launching a company that very day called “The Honest Company”, devoted to creating the healthiest and safest environment for families by ensuring safe baby products.   Jill immediately sent a letter to The Honest Company to let them know of her company’s existence, her trademark registrations, and website presence.  Instead of asking The Honest Company to cease and desist, Jill made the business proposition to coexist by pooling together resources for their shared mission and purpose.  Apparently, the suggestion worked because here was no trademark battle.  My research suggests that Jill [likely] gladly handed over some trademark assets in exchange for $$$$$.  Hey, it seems that is what she wanted and it worked for her…and The Honest Company.

Now, fast forward to March 2012 when The Honest Company purchased the domain name, “honesttoddler.com”.  A few months later, in July 2012, another mommy blogger, Bunmi Laditan – who according to her trademark application, began using the mark “The Honest Toddler” in May 2012 – purchased the domain name, “thehonesttoddler.com”.   Shortly afterwards, Ms. Laditan filed a trademark application for the “honest toddler” mark.  At that point, The Honest Company apparently became unhappy, and according to the Official Statement on honesttoddler.com, contacted Ms. Laditan to see if they could work out an amicable agreement similar to the situation with Jill.  Now, here’s where the facts get fishy:  According to The Honest Company, the responses of Ms. Laditan have been hostile and contradictory, meaning she allegedly has not done what she promised to do.   The Honest Company believes it has been forced to take legal action in order to protect their brand, in the form of opposing Ms. Laditan’s federal trademark application.  Ms. Laditan’s position is…

…well, I’m not quite sure. I’ve read her blog, I’ve read her personal Twitter timeline and the timeline of @TheHonestToddler  and I’ve yet to find a legal argument or an official statement explaining why she is entitled  – legally – to TheHonestToddler.com and similar marks, or presenting her side of the [factual] story outside of 140 characters or 3 second video (a video which, as the parent of a 2 year old, I find hilarious).  The only things I have seen are motivational declarations of refusing to be bullied, comments from her followers on the #ridikilis-ness of the situation, and assertions of “you-can’t-own-a-common-word” defense, which I debunk here.  Now, don’t get me wrong.  I’m not saying that Ms. Laditan has no defense or couldn’t assert facts to the contrary.  I’m just saying that in all the “stuff” posted by both parties, her story and her defense(s) aren’t clear and plain.

This battle is ongoing and at the time of this post, no new updates were available.  These brand owners can no longer say they are in complete control of the brands they were building because the fate of this word mark now sits in the hands of the TTAB (the Tribunal that decides Trademark Application Oppositions) – awaiting a decision on whether Ms. Laditan’s mark can be a registered trademark.  If the TTAB says “YES, it can”, The Honest Company better get ready to transfer some assets.  If the TTAB says, “NO, it can’t”, Ms. Laditan stands to lose BIG – because she has built an incredible following and is marketing a book using the mark in the title.   The sad part is:  it never had to come to all of this distraction!  So, dear readers, to avoid the distraction that brand disputes bring, avoid the following five mistakes by adopting these five tools into your brand management strategy.

Mistake No. 1:  Leaping before you look

In branding, differentiation is everything and as far as trademarks go, preventing confusion in the marketplace is paramount.  When people jump headfirst into the marketplace (e.g. brand launch, website launch, product launch) without any clue (reverence?) for who may already be using a similar name in the marketplace, they run the risk of the Jill vs. The Honest Company situation:  launching and getting a Cease and Desist Letter on Day No. 1 of a launch.  It’s an incredible financial risk and it doesn’t have to be this way (ask the Kardashians).

Tool No. 1: TRADEMARK CLEARANCES

A trademark clearance is the best defense tool to prevent a situation like this.  A trademark clearance is a search for any company, brand, or product that is using a name or trademark that is similar to the name you plan to use…and an interpretation on whether anything similar would be deemed “CONFUSINGLY SIMILAR” by a federal court or the TTAB (the Federal Trademark Office) or would likely piss off an existing brand owner (or make your target market think you are affiliated with another brand).

It’s one thing to search Google, USPTO.gov, or sites like Trademarkia to see if someone is using your name.   However, there’s a whole ‘nother step left —> interpreting those results. This is where the mistake happens. Determining what is “confusingly similar” or “likely to confuse” is a legal term of art, meaning it isn’t subject to what YOU think and what YOU feel. There is a 6 to 12 factor legal analysis to determine the answer.  A trademark clearance provides you that answer.

The Benefit of a Clearance Report: It goes into your IP portfolio and serves as a guide in your branding strategy.  How so?  By telling you who is using what trademarks so that as your brand grows, you take proactive steps NOT to infringe on someone else.  It also helps by  telling you who could potentially infringe on you at a later date as THEIR brand expands. This is what I mean by proactive.  Clearances give you control in your branding and growth.  It allows you to avoid the reactive – which is where The Honest Company found itself with Jill.  Here’s another benefit:  if, at some later point, someone does infringe on your brand OR you get a cease and desist letter alleging you infringed, you can pull out the trademark clearance report and use the results interpretation section TO CRAFT YOUR RESPONSE.  You can’t get any more efficient with your time and money, folks.

Mistake No. 2: Operating with your eyes wide shut

I have a saying:  “Great brands are always copied, stolen from, and subject to unauthorized “namedropping” (i.e. false affiliation).”  I also say that there are three types of people doing these things:  strangers, formally licensed users of the brand, and employees/agents/independent contractors of the brand.  So, you have to WATCH these people and CATCH them before the damage is done.

Tool No. 2:  BRAND MONITORING
Brand monitoring is a system of policing your brand usage by others.  Policing the brand is a system of checking who is using your brand (or its assets), who is talking about it, how it is being used and misused – and checking it against your brand plan and strategy…AND RESPONDING to things that don’t fit with your brand plan and strategy.

Strangers:  There are only two ways you catch strangers:  (1) by deliberately looking for them or (2) stumbling upon them by pure happenstance.  The mistake is made when you rely on the latter to happen.  You want to find a stranger infringing on your brand as soon as possible, which means you have to actively look for them. That is what Jill did. She had Google Alerts set to find other companies using the “honest” mark and BOOM! She was able to catch The Honest Company on the day of launch.  Here are some other ways to find strangers using your brand:

  • Google Alerts
  • Social Mention, Sprout Social (and other similar applications)
  • manual searches of various social media platforms
  • manual searches of various search engines
  • searching trade industry publications

Formally licensed users: these are people that have formally requested – and received permission – from you to use your brand.  In these circumstances, the mistake happens when the brand is not clear on the permitted scope of usage and/or doesn’t provide for product quality inspections and audits on royalty payments.  Use a Written License Agreement to set forth in great detail what the scope of permitted use is and is NOT, followed by clauses that allow the brand to inspect and pre-appprove product and service quality, as well as clauses that allow audits to make sure that all royalties are paid as agreed.

Employees, agents, independent contractors of, and contributors to the Brand:
They are usually given certain implied permissions to work with a brand and its intellectual property assets, but they can also be negligent infringers OR  use their contributions to the brand as grounds for claiming to brand ownership (and then send a cease and desist to the Brand claiming ownership).  Yikes.  The mistake is made when the Brand doesn’t make it clear to its employees, agents, independent contractors, and contributors on WHO owns WHAT, HOW they own it, and what is being given in exchange for ownership. Make these details clear in the following documents:

  • social media policies
  • terms and conditions (especially for third party website contributions)
  • nondisclosure/confidentiality/nonsolicitation clauses
  • intellectual property ownership clauses
  • contractual releases

Benefit of Brand Monitoring: YOU CATCH ‘EM BEFORE THEY GAIN TOO MUCH INFLUENCE.  INFLUENCE = CONTROL.  And if you, as the brand owner, do not have control, it leads to LOSS OF BRAND VALUE AND PROFITS.

Mistake No. 3a: Mistaking the purchase of a domain name as being the equivalent of a trademark registration or establishing trademark rights  Mistake No. 3b: Not realizing domain names and social media handles are trademark assets that must be purchased for the IP portfolio

In the trademark game, only USAGE of a trademark in connection with a service or a product in the marketplace establishes trademark rights.  With that said, purchasing a domain name or snagging a Twitter handle does NOT automatically mean you own a trademark for that same name.   You could end up purchasing a domain name that encompasses the trademark of someone else…and find yourself in brand conflict as the “alleged infringer”.  On the same token, brand owners should not provide opportunities for people to purchase domain names or secure social media handles that encompass their mark.   These items are trademark assets and should not be left up for grabs!  To do so is merely an invitation for brand conflict down the road.

Tool No. 3:  STRATEGICALLY PURCHASE ALL DOMAIN NAMES and SECURE ALL SOCIAL MEDIA HANDLES

As I’ve already acknowledged, I don’t have all the facts in the The Honest Company vs. Laditan story.   So, I am unclear on why someone would purchase “honesttoddler.com” and not also snag “thehonesttoddler.com” at the SAME time.  Or why someone would use @honesttoddler knowing that “honesttoddler.com” was already purchased and attached to company with a 5 year history of using the HONEST mark.   In general, I’m astonished why people begin to build brands without snagging up ALL available domain names and social media handles…or building brands knowing that half of what you need is already being used by another brand!  Domain names and social media handles are TRADEMARK ASSETS and should be purchased as soon as your trademark clearance CLEARS the brand name for usage!  If someone has them, take that seriously (to be honest, this should have been a reported item in your trademark clearance).  Such a simple strategy could prevent a “The Honest Company v. Laditan”  brand building distraction.

Benefit of Supplementing your Trademark Registrations with Trademark Assets:  COCKBLOCKING IS AN EXTREMELY EFFECTIVE METHOD OF CONTROLLING A SITUATION.   =)

Mistake No. 4a: Boilerplate Cease and Desist Letters
The cease and desist letter has been abused greatly in the last decade.  It has been used to bully and intimidate the receipient into obliging to demands that aren’t necessarily supported by the facts and/or the law.  It burns me up because the cease and desist letter, when used correctly, is an extremely effective tool to resolving brand conflict.  With that said, the mistake is made when folks cut-and-paste boilerplate language from the internet (or lawyers who don’t know what they are doing just print off  a “standard” template) without any care or consideration of the brand and its strategy and plan.  This mistake will backfire.  Everytime.  EVERYTIME.  Why?  Because boilerplate language provides the sender NO CONTROL over the outcome of the dispute.  A boilerplate C & D letter will put people in defense mode, rather than make them open to good faith negotiations.  Just ask will.i.am, who just recently learned that one consequence of sending a cease and desist letter is the recipient filing a declaratory action in federal court requesting a judge to decide who owns what.   Yikes.  #outofcontrol

Mistake No 4b:   Emotional Responses to a Cease and Desist Letter
I’m a lawyer, so law school brainwashed me from feeling emotion. Good for litigating, bad for relationships. But I digress. Nevertheless, nothing gets in the way of brand conflict resolution than a reply to a cease and desist letter that does not address the substance of a C & D, but rather goes off to the left with avoidance tactics (e.g. fluff and small talk, contradictions), pouting, crying, whining, complaining, badmouthing, “getting loud”, threats of going viral, and countless other “defenses” that have never worked in the history of C and D replies.  This mistake only frustrates the plaintiff and forces them to take legal action so a judge can intervene by shutting down the emotional bullcrap to make things happen (i.e. get some facts and evidence on the table).  Don’t believe me?  Go read The Honest Company’s Official Statement again.  When did they take legal action?  When they felt they were being hit with “avoidance” tactics.

Listen folks, you don’t need a judge in most cases to help resolve a dispute.   You can be disciplined enough to divorce yourself from your emotion and address the substantive issues presented in a C & D letter.   Here’s how:

Tool No. 4:  A REAL STRATEGY.
Before you send or reply to a C & D letter, you must take time to answer the following questions:

1.  What do I want?
2.  What brand assets do I VALIDLY own?
3.  What does the other party want?  What would they want?
4.  What brand assets does the other party VALIDLY own?
5.  What proof does each party have to PROVE brand asset ownership?
6.  How does this brand conflict disrupt my brand plan?  How would this disrupt the other party’s brand plan?
7.  How does this C & D letter FURTHER my brand strategy (or this reply to the C & D further my brand strategy)?
8.  What do I want the other party to do to get me what I want?  What would the other party be willing to do so I can get what I want?

The answers to these questions will tell you the language that goes into your C & D letter or reply.    Guess what?  Many of these answers will already be in your Trademark Clearance and/or IP Portfolio.  Are you seeing a pattern yet?  =)

Benefit of a Real Strategy:   Because no one has ever said, “Wow, I really wish I  DIDN’T think that all the way through.”

Mistake No. 5:    Letting the chips fall where they may (also referred to as “No Comment”).

The previous mistake was about the lack of legal strategy in resolving brand management conflict.  Mistake No. 5 is about the lack of a communication strategy when the dispute goes viral. Don’t be fooled:  a brand dispute is a crisis situation and when that crisis goes viral, a brand must be prepared to communicate to its followers and to the general public about it.  Why?  Because there are always three sides to each story:  your story, the other party’s story, and the story that the public chooses to believe.  So, don’t leave folks hanging!

Tool No, 5:   THE OFFICIAL STATEMENT

Most lawyers don’t want their client to “talk” or “do press” in light of litigation.   That’s because most lawyers are risk adverse and fear the effect a statement will have on a case.  However, when it comes to brand disputes that have become public knowledge because things have gone “viral”, a public relations component is added to the mix.

Why is this important?  To make your defense and/or story clear and plain.  We know The Honest Company’s story because they posted an official statement.  And right now, their story is controlling because they told it well, in one place, and did it first.  There is an old saying among us trial lawyers:  (S)he who tells the best story, wins.   It  applies here.

Benefit of Official Statements:   Tell your story = Control THEE story being told.  Control it best = WIN for the brand plan.

I hope that you can use these tools in your everyday brand management strategy.  Use them to make sure that what you’re putting out in digital sphere and physical sphere is not just protected, but in your control so you can not only prevent distractions but dismiss them quickly should they come.

Until next time,

Trezanay

—–

Trezanay M. Atkins [was] the Creator and Lead Strategist at tma| The Brand Infringement Firm, a law firm designed to help protect and defend brands by providing preventative education, brand advocacy, and case litigation. She [still] provides licensing and strategic communications solutions to help brands through brand management issues.  Ms. Atkins is the proud mom of two and enjoys live gospel, blues, and jazz music, is a diehard fan of stand-up comedy, and is a dedicated member of her local church in Indianapolis.    

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8 Comments Add yours

  1. Tracey Flattes says:

    Thank you for this – I have been following the case between Honest and Honest Toddler. From a search of the USPTO records, it appears that Ms. Laditan did, indeed, take the correct steps in having a search conducted for similar trademarks – none were found to exist, the trademark was approved and published and was then opposed by Honest Company. This is the gray area to me – if no conflicting trademarks were found, why is this even an issue?

    Like

    1. Hi Tracey,

      Thank you for your comment. Opposition is a necessary part of the trademark application process. When Ms. Laditan applied for her trademark, the USPTO assigned a trademark examiner to her file. The examiner’s job is to conduct a search to determine if the mark is viable and registerable. Once it does its search, it will then publish the mark for opposition. The purpose of opposition is to give any existing registered mark owner the right to prevent the mark from officially becoming a part of the USPTO’s trademark registry – on the grounds that the registration will cause them damage. Ms. Laditan’s mark was given a preliminary search by the USPTO and passed it. However, her mark must go through the opposition period. The Honest Company, as the owner of several HONEST marks, including “Honest Baby”, filed an opposition. On what grounds? At this moment, one can only speculate, but I’m sure they will be arguing marketplace confusion and the fact that The Honest Company (according to their Official Statement) was the prior (and senior) user of “honest toddler”. But, we won’t know until pleadings are filed in the TTAB on this opposition matter.

      So, in short, The Honest Company is exercising a right it has an existing owner of several trademark registrations. And, Ms. Laditan is merely going through a necessary part of the trademark application process. Routinely, applications are successfully opposed in this phase and some are not. The point of my blog post is that it really sucks when you have a judge deciding the fate of your intellectual property ownership. It’s all win, or all lose. Not a good place to be.

      I hope this helps to bring clarity to the grey area. =) tma

      Like

      1. Tracey Flattes says:

        Thank you – appreciate the clarification. Great article – this whole thing has been handled VERY badly. No matter what the outcome now, who wins or loses, it has been a PR fail for Honest Compay – public opinion seems to have spoken. It’s good to hear your side about how this could have so easily been avoided!

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  2. C-A says:

    You may have seen this, but Ms. Laditan’s has published her arguments and version of the timeline breakdown here: http://bunmiladitan.wordpress.com/2013/07/30/honest-company-timeline-of-events/ . The main argument I have seen the Honest Company make is that the Honest Toddler trademark application is being filed “in the same class that we hold superior trademark rights. ” Looking through the Notice of Opposition, the only mark that I could find owned by the Honest Company that is in the same class is “Honest Baby” — the mark that Jill, the mommy blogger that contacted Honest Company about possible infringement, used to own. The trademarks acquired from her are the oldest trademarks (I believe these are the ones you referred to when you mentioned the “5 year history of using the HONEST mark”. However, I believe that the other marks, including HONEST and HONEST CO, were acquired around the beginning of 2012. Please correct me if I am mistaken.)

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    1. Thank you for sharing this Timeline of Events! It and your comment brings up another point (or three) that are worthy of another post: using a mark vs. obtaining a registration for a mark and (2) the right to pursue whomever one pleases in protecting a mark vs. the duty the protect a mark, (3) the opposition process. I may have to post a follow-up post as this trademark dispute progresses. Many lessons can be learned!

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    1. I read your article, Jeneba, and I encourage everyone to read it. It provides such great perspective…especially for bloggers. Thank you for including me in the discussion.

      Like

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