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Spotify opposes Potify’s ‘high’ hopes- USPTO

May 31, 2022
Trademark Journal Publication

By Ananyaa Banerjee and Girishma C

A precedent-setting judgment by the Trademark Trial and Appeal Board (TTAB) of the U.S. Patent and Trademark Office (USPTO) on January 10, 2022, allowed two oppositions to succeed, which were filed by the well-known music application SPOTIFY, against trademark applications filed by U.S. Software Inc. for the name/mark POTIFY/Potify-img. Read on to find out how Spotify succeeded in opposing the ‘high’ hopes of Potify – a brand looking for its break to launch as a friendly (medicinal) marijuana dispensary locator.

 

Brief Facts of the case

U.S. Software Inc., a software company based in California had filed trademark applications for the name/mark POTIFY/Potify-img  in Classes 9, 25, 35 and 42[1], in respect of a mobile application seeking to create a platform in order to facilitate business access between authorized medical-grade marijuana dealers and their target market.

SPOTIFY on the other hand is a well-known application that hosts a vast range of music albums, podcasts, and video services, providing access to millions of songs and other content from creators all over the world and has duly created a strong IPR portfolio for its marks.

In sum, both the parties essentially offer software, in the form of mobile applications, amongst other things. However, the Opposer (SPOTIFY) aims at providing services relating to music and digital content whereas the Applicant’s (POTIFY) scope of business lies in the field of facilitating access to legalized marijuana, and services related thereto. It is not difficult to pin-point the pain point, i.e. is the similarity in the trade names SPOTIFY and POTIFY.

 

Grounds of Opposition

The grounds for opposition advocated by the counsel for SPOTIFY were:

  • That the co-existence of the terms SPOTIFY and POTIFY in the market would lead to confusion as well as dilution of the mark SPOTIFY in the public domain.
  • That, if permitted, given that the name/mark POTIFY/Potify-img has been applied for in respect of marijuana-related services, the same would dilute the SPOTIFY mark by way of blurring and tarnishment, thereby corroborating Spotify’s negative viewing of marijuana and related services.
  • In support of the same, the Opposing Counsel (for Spotify) asserted that the company has always abided by the stance of illegal drug use and had adduced evidence by submitting that they have habitually been instructing their promotional partners to prohibit the use of the mark SPOTIFY on any website or interface that is in violation of any applicable laws and regulations, including the illegal use of drugs.

Defenses taken by the Applicant

Amongst other things, the Applicant vehemently asserted that they engage in a legitimate business of making medical marijuana accessible to patients and customers. Additionally, they also contended:

  • That Spotify as a platform, hosts a considerable amount of marijuana-related content, including podcasts and talk shows that talk about marijuana, both in its recreational and medical sense, thereby highlighting the rather ironical contention of the Opposing Counsel of cautioning their promotional partners in this aspect. The TTAB duly took note of the same.
  • Additionally, they also contended that the POTIFY was an application designed for legal marijuana dispensaries to market and sell their products and was not intended to cater to individual consumers/recreational use.
  • The Counsel for POTIFY also asserted that the name/mark POTIFY was barely inspired from the term SPOTIFY and stated that prior to settling on the business name POTIFY in 2014, they had also considered trade names like Weedify and Pot Finder. Moreover, they admitted to have sought inspiration from Shopify, the Canadian multinational e-commerce company, rather than Spotify.
  • Thereafter, the Applicant Counsel also asserted that the first use claim, as recorded on their trademark application for the mark POTIFY, is January 01, 2017, further adding that the same was prior to the time when the name/mark SPOTIFY rose to fame.

Rationale 

Upon hearing both sides, the TTAB gave the following rationale before allowing the subject oppositions in discussion to succeed:

 

  • Firstly, upon noting the promotional content published by the Applicant on platforms such as Instagram and Facebook, the TTAB expressed their unconvinced stance that POTIFY intends to facilitate the trade of medical marijuana only. The TTAB recognized that apart from the medicinal aspect, the application partly also aimed at individual marijuana consumers.

 

  • Additionally, they also took on record that it was because of this very apprehension, that Apple Inc. had decided to disallow POTIFY to list themselves on the App Store, as customers may easily (mis)use the app and rather use it for recreational purposes.

 

  • Additionally, upon applying the pre-requisites identified in the Y. Yankees case[2], which was that the Applicant must prove the following in order to fall out of the purview of dilution by way of blurring and tarnishment

The Applicant owns a famous mark that is distinctive: In this regard, the TTAB stated that the mark SPOTIFY was undisputedly distinctive when looked at from the angles of inherence as well as by way of acquiring the distinctiveness owing to extensive use. Thus, they concluded that the mark SPOTIFY was indeed famous and distinctive.

The Applicant is using a mark in commerce that allegedly dilutes Opposer’s famous mark: In continuation to the satisfaction of the first criterion, the TTAB also concluded that the second criterion also stands satisfied, given that the Applicant is using the name/mark POTIFY in commerce and has sought for a trademark registration for the same within the United States.

Applicant’s use of its mark began after Opposer’s mark had become famous: While the Applicant attempted to rely heavily on this criterion by asserting that the mark SPOTIFY was not famous at the time of the name/mark POTIFY’s first use (January 01, 2017), the TTAB held against their contention.

Applicant’s use of its mark is likely to cause dilution by blurring or tarnishment: To satisfy the fourth criterion, the TTAB recognized 6 considerations while determining the scope of a mark to cause dilution and tarnishment and concluded that all the considerations were satisfied in the instant case, given the analogous functions performed by them, as well as the phonetic similarities between the terms SPOTIFY and POTIFY. The TTAB was of the view that commercial impressions are similar even if consumers take different meanings from SPOT and POT. The six considerations to be satisfied in proving dilution/tarnishment are:

    1. The degree of inherent or acquired distinctiveness of Opposer’s mark;
      The extent to which Opposer is engaging in substantially exclusive use of its mark;
      Whether Applicant intended to create an association with Opposer’s SPOTIFY mark?
      Any actual association between Applicant’s mark and Opposer’s mark
      The degree of recognition of Opposer’s mark;
      1. The degree of similarity between Applicant’s mark and Opposer’s famous mark;

 

Court’s decision

Based on the above findings and considerations, TTAB concluded the matter by sustaining the oppositions filed by Spotify, stating that even though they were only required to find the likelihood of dilution of the mark SPOTIFY, they also recognized that the mark POTIFY would inevitably diminish SPOTIFY’s distinctiveness.

Conclusion

The instant case appeared to be a straightforward case involving the logical application of legal principles to the facts of the case. Nevertheless, it may be pertinent to pay heed to one particular argument put forward by the Applicant Counsel asserting that “if Potify cannot be registered, then other marks ending in ‘otify’ – like Clotify, Votify, Notify, and Plotify – shouldn’t be registered either”, each of these marks being registered.

In this regard, it may also be pertinent to note that Spotify derives a lot of their distinctiveness from their logo Spotify-img-logo/Spotify-logo. Thus, considering that ‘otify’-formative trade marks are currently co-existing with the mark Spotify, it may look like the fame that comes along with the Spotify brand pre-dominated the TTAB to grant an overly broad protection. More so, since Potify has also created a logo Potify-img, which is fairly different from Spotify-img-logo, and has adopted the same in respect of a different service altogether, i.e. marijuana dispensary locators as opposed to music and digital content.

As far as the dilution by way of tarnishment is concerned, the stance of viewing any association with marijuana in bad light does come as a mixed signal/surprise after seeing the trend of several jurisdictions in the United States relaxing their laws around the medicinal and recreational use of the drug. The same is rather ironically supported by the fact that Spotify themselves ironically host content (which is often user generated) on their app that openly relate to cannabis and its uses – a fact that did not affect the rationale, despite being brought to the notice of the Board.

[1] The services as described in their trademark application states:

Class 9 – “downloadable software for use in searching, creating and making compilations, rankings, ratings, reviews, referrals and recommendations relating to medical marijuana dispensaries and doctor’s offices and displaying and sharing a user’s location and finding, locating, and interacting with other users and place, in International Class 9”;

Class 25 – “clothing, namely, shirts, tops, t-shirts, hoodies, headwear, shorts, in International Class 25”;

Class 35 – “providing consumer information in the field of medical marijuana dispensary inventories and locations; providing links to web sites of others featuring consumer information on medical marijuana inventories and locations; providing a web site featuring the ratings, reviews and recommendations on products and services for commercial purposes posted by users; providing consumer information regarding medical marijuana dispensaries, inventories and locations, in International Class 35”;

Class 42 – “and computer services, namely, creating an on-line community for registered users to participate in discussions, get feedback from their peers, form virtual communities, and engage in social networking in the field of medical marijuana; providing a web site featuring temporary use of non-downloadable software for providing medical and healthcare services, scheduling of medical and healthcare services, in International Class 42.”

 

[2] N.Y. Yankees P’ship v. IET Prods. & Servs., Inc., 114 USPQ2d 1497, 1502 (TTAB 2015)

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