03 August 2012

SNS and marks

'Social Media Amplify Consumer Investment in Trademarks' by Deborah Gerhardt in 90 North Carolina Law Review (2012) 1492 comments that
 New ways to use brands in social media are pressuring traditional conceptions of trademark law. Contrary to much trademark doctrine, every brand is built by a community, not by its proprietor alone. I previously described this phenomenon as consumer investment in trademarks. Internet technology amplified the effects of the consumer investment model, enabling consumers to gain more power over the marks of others. This Article shows that social media have turned the volume of consumer voices up another notch and explores the consequences for trademark law. Sites like Facebook offer consumers a platform for the expression of personal identity through trademark preferences. Social media also give consumers unprecedented power to affect brand value by publishing positive and negative commentary. If corporate brand owners want to take advantage of social media, they must let go of much of their control by opening their brands to constant consumer feedback. This trend is changing traditional notions of what it means to acquire goodwill in a mark. Brand owners no longer work alone to craft the story of a trademark. Instead, modern brand narratives are written in collaboration with consumer communities. This new trend of trademark co-authorship through social media will require rethinking some entrenched concepts of trademark law. Ironically, one way for trademark owners to reassert control of their story is by linking their brand narrative to marks belonging to others. This phenomenon occurs every time one brand owner tells its audience to “like it” on Facebook or “follow it” on Twitter. In social media, many brand owners use the marks of others for commercial benefits without express authorization. The ubiquity of this trend requires rethinking when unauthorized uses should result in trademark liability. New social media norms will require tolerance of expressive, informational and even some commercial use of marks that happen without the owner’s permission. Consequently, social media are creating multiple challenges for everyone attempting to apply trademark doctrine to new practices in cyberspace.
Gerhardt concludes that -
Social media have shifted the trademark balance of power. Brands were once used to tell a set story to a passive audience. All that has changed. In social media, the brand owner no longer has exclusive control. The audience participates in shaping the brand narrative. Both consumers and businesses contribute to these stories by using the brands of others for an array of informational, expressive and commercial purposes. Critical consumer speech can force a mark owner to change product or service features or abandon a brand entirely. Social media have also empowered people to use the brands of others as props in their own narratives. On individual online profiles, the brands of our schools, employers and favorite products and services have become ubiquitous in defining our reputations. Social media also provide consumers with easily accessible opportunities to use brands for favorite products and services as ties in social networking. This increased use of brands is made possible by open Internet architecture, social media platforms and, most importantly, loosening the reins of brand owner control. 
Corporate America is also embracing this trend, adopting new advertising norms for social media. Many brand owners are encouraging consumers to use social media to participate in the brand narrative. In building a broader community around their brand, they are also relying on marks belonging to others such as brands for social media, charitable organizations or products that may be used as a contest prize. These new norms have required corporate brand owners to loosen their tight grip on brand control. This changed balance of power creates new risks. Consumers may steer a mark away from a planned marketing path or take it down altogether. 
Welcoming consumers to participate in developing the story of a brand has its benefits. Social media give brand owners an open window into the world of consumer perceptions and a platform to respond. Rather than serving as a prop in a story experienced by a silent audience, the brand becomes a tie in a social network where brand owners can connect with the public. In this way, brands that once offered the impression of a community can now create an authentic community with meaningful reciprocal communications. This new landscape may benefit the brand owner’s bottom line. Patrons who believe that brand owners are listening, reflecting and responding to consumer feedback may deepen their allegiance. 
Trademark doctrine was not based on a foundation that can easily accommodate these new norms. Rather, it was founded on the idea that the owner controls the story about the quality of goods or services associated with a brand. For trademark doctrine to evolve with advances in communication technology, the consumer investment model is a necessary doctrinal addition. It will give courts a mechanism to balance consumer informational interests, bringing public concerns back into trademark law. Keeping consumer interests as a balancing force in trademark doctrine has become of greater importance since new advertising norms have given consumer voices much more deference. 
To practically achieve this goal of bringing public interests back into trademark doctrine, courts and legislatures could begin with the following changes to trademark law. First, the outdated and simplistic Boston Hockey standard should be expressly overruled. Not every unauthorized use of a trademark that triggers a sale should be the basis of trademark liability. Second, a clear statutory safe harbor should be created for nominative fair use. Third, the malleable likelihood of confusion standard should not be available to silence consumer commentary. In Lifestyle Lift, the plaintiff posted fake reviews on the defendant’s website and then tried to use trademark litigation to silence genuine ones. Consumer interests will be much better protected if trademark law is available to sanction false and deceptive speech without shutting down stages for sharing genuine critical opinions. Calibrating the appropriate balance will not be easy. As illustrated in Tiffany, the Internet business that does not create deceptive content—but may inadvertently host it—should not be held responsible. In order for truthful consumer information to be available, a clear exclusion from liability should be applied when an Internet-based seller has made significant efforts to keep deceptive information contributed by others off its site. Liability should be available against the person who posted the content, but not against the Internet service hosting it, especially if it did what it could to take down content that it had reason to know was deceptive. Adopting these doctrinal bright lines would go far in keeping the Internet open for meaningful consumer discussion using the branded symbols that, thanks to social media, create so many ties in today’s social networks.