Litigators Get (Anti-) Social in the Crusade For Brand Protection

The opportunities have not gone unmissed by media-monitoring businesses, which have been quick to offer services that police online discussions, identify potential infringements and track legal threats. Using the latest technology, they sift through consumer-generated media ranging from high-profile sites such as Facebook to more modest forums and message boards. Not only do they track brand references (usually using a series of keywords provided to them by the brand owner), but they can also identify trends and discussion themes which may be of reputational importance to the business.

Moreover, the social media phenomenon has created a valuable network of legal-savvy users. For example, Fashionista, a popular New York-based blog, regularly publishes a column entitled “Adventures in Copyright,” that identifies and debates copycat designs. Similarly, second-year law student at the Columbus School of Law at the Catholic University of America, Julie Zerbo, is the author behind “Fashion Law,” a blog that regularly “outs” alleged intellectual property infringements. Within three days of her posting in March 2012 that “Chanel's Crystal Bangles Look FAMILIAR!,” Chanel had removed the products from sale “out of respect for the concerns raised.” What is interesting about these sites is that the authors are not corporate law firms, but students and industry insiders who are immersed in new trends and swoop in on newsworthy stories.

Using Social Media As Part of a Litigation Strategy

Social media also offers an accelerated and flexible alternative to traditional litigation strategies of cease-and-desist letters and interim injunctions. A classic example came in March 2012 when offbeat British jewelry brand Tatty Devine published a blog post entitled, “Can You Spot the Difference?,” that named a number of products made by Claire's Accessories that it considered to be infringing (http://bit.ly/zHBF5v). The enterprising tactic sparked a backlash across the online fashion community, eventually resulting in a joint statement from the brands confirming that several (although not all) of the high-street items had been removed from sale. (See, “Claire's Accessories official Statement,” http://bit.ly/Ia5lMt.)

Similar strategies were employed this July by fabric designer Rachael Taylor with regard to an “Etched Floral” design that she believed had been copied by Marks and Spencer. (See, “Strikingkly Similar Design?” http://bit.ly/Nm7eVe.) Further, Scottish knitwear designer Kate Davies accused Debenhams of “ripping off” her owl-design sweater. Both allegations, which were originally made public through the designers' respective websites, resulted in the high street chains eventually agreeing a settlement: Marks and Spencer apologized for any disappointment caused to Taylor and withdrew the t-shirts, insisting that they had bought them “in good faith” from an unnamed supplier (see, “Marks & Spencer (Update),” http://bit.ly/LiGwl5). Davies issued a formal announcement that: “Although we disagree on the issue of copying, as a gesture of goodwill, Debenhams have agreed to make a donation to my chosen charity, Chest, Heart and Stroke Scotland” (http://katedaviesdesigns.com).

The approach can be a particularly effective one for small businesses, generating quick and cheap results compared to the cost of drawn-out litigation in court. A social media expos' also enables the brand owner to exploit consumer sentiments, epitomized by the call to arms in Taylor's original Web statement: “I'm a [sic] posting this today as I understand the importance of standing up for yourself as a designer & your intellectual property rights ' to not be scared ' to speak out & protect what's rightfully yours '.” Particularly given the viral capacity of social media, the ability to get consumers (and press) onboard can be a deadly weapon: Regardless of the merits of a complaint, large businesses are sensitive to the “customer is always right” principle, which may serve as an incentive toward a quick settlement.

However, such strategies are not risk-free. Incensed brand owners need to ensure that any finger-pointing is factually accurate, as they may otherwise become exposed under local law for a counterclaim, such as defamation, unjustified threats or unfair competition. Moreover, the limitations to online exposures cannot be ignored: If the online attack does not have the intended effect, then brand owners may be forced to jump through the usual legal hoops anyway. For example, in the UK, a blog post is unlikely to satisfy the Civil Procedure Rules requirement that a party send a pre-action letter before commencing court proceedings. Similarly, unless a brand owner incorporates financial compensation into an ancillary settlement, the best outcome it can hope for is a withdrawal of the infringing products from sale.

Using Social Media To Serve Proceedings

Social media, by its nature, makes individuals more accessible and the world smaller. Its burgeoning status as an accepted manner of communication and connection calls for a natural progression toward it becoming a normalized forum for service of process. While the practice continues to raise eyebrows, it is slowly being accepted and implemented by a variety of common law jurisdictions.

In April 2012, an Australian district court judge granted a disgruntled music festival promoter, Mothership Music, permission to serve a lawsuit against American rapper Flo Rida through a Facebook “wall post.” Mothership Music Pty Ltd. v. Darren Ayre (trading as VIP Entertainment & Concepts Pty Ltd) and Flo Rida (also known as Tramar Dillar), NSWDC 42 (Apr. 13, 2012) (www.caselaw.nsw.gov.au/action/pjudg?jgmtid=158099).

At a hearing, Mothership Music's counsel presented evidence from its process server that, despite its attempts to arrange meetings with the rapper's agents and additional attempts to approach the rapper at public appearances, he could not be physically served. Counsel further presented evidence that the rapper was active on Facebook. As a result, the district court issued an order permitting service of court papers through a Facebook wall post.

That decision follows on the heels of those in other jurisdictions that have been granted over the course of the past few years. In Knott v. Sutherland, Edmonton, 0803 002267 (Alta. Q.B.M) (Feb. 5, 2009), a Canadian court permitted a plaintiff to serve a defendant through his Facebook page. Similarly, in Axe Market Garden Limited v. Axe, CIV-2008-485-2676 (Mar. 16, 2009), the New Zealand High Court permitted substituted service on an overseas defendant through a Facebook page where it became clear that newspaper advertising could not effectively target the defendant. Meanwhile, in September 2009 the English High Court pragmatically interpreted its civil procedure capabilities, which already permitted service of some court papers by electronic means, and permitted service of papers on an anonymous (and therefore un-locatable) blogger through Twitter.

While such innovative means of service have not expressly been permitted by U.S. courts yet, the concept may have some viability. The Federal Rules of Civil Procedure include a provision that permits a party to serve defendants located abroad through any means “prescribed by the foreign country's law for service.” Fed. R. Civ. Pro. Rule 4(f)(2)(A). This suggests that if a defendant were located in a jurisdiction that has accepted service by social media, then that means of service would be acceptable to the U.S. federal courts.

Using Social Media As a Means of Enforcement

Just as social media can be a vehicle for spotting infringements, reporting them and commencing related actions, the social networking realm is also becoming an essential forum for the enforcement process. This evolution in branding litigation is a creature of necessity. While Internet counterfeiters have traditionally hawked their goods on websites with confusing domain names and on auction websites such as eBay, the latest round of counterfeiting innovation has moved goods-hawking beyond the traditional Internet platforms and onto social media platforms. Twitter, Facebook and Pinterest, and even RSS feeds, are all now used by counterfeiters to publicize and sell infringing products. The most innovative counterfeiters are even creating fashion blogs on which they advertise the products, causing consumer confusion and, in turn, increasing their selling abilities.

In response, many U.S. court judgments involving websites that sell counterfeit goods now commonly include specific orders calling for the “de-indexing” of the illegitimate websites on search engines and social media platforms. Through the de-indexing process, all past archival social media content that links to counterfeiting websites is erased, further ensuring that future consumers are not lured back to the same counterfeiting websites ' even after a court issues a permanent injunction. For example, in the recent and widely publicized decision, Hermes International v. John Doe, No. 1:12-CV-01623(DLC), (S.D.N.Y. Apr. 30, 2012) (http://bit.ly/NODalr), issued by the Southern District of New York, Judge Cote awarded $100 million in damages and a permanent injunction that recognized the influential power of social media. Judge Cote's Order went beyond the usual call for Internet search engines to de-index infringing domain names and any affiliated websites, but also specifically included additional instructions that “any social media websites including, but not limited to, Facebook, Google+, and Twitter” also de-index the offending domain names and affiliated websites from their search results. The judgment followed a series of similar preliminary injunction orders issued by the District of Nevada in Chanel, Inc. v. Eukok.com et al., 2:11-cv-01508-KJD-PAL, (D. Nev. Nov. 14, 2011) (http://bit.ly/LyxFvw), where Judge Dawson called for the immediate de-indexing of over 700 infringing domain names and websites which sold counterfeit Chanel products from “all social media websites including, but not limited to, Facebook, Google+ and Twitter.”

The Next Steps

As social media gradually permeates all stages of litigation and brand protection, it is clear that brand owners, practitioners and adjudicators need to work both individually and collectively to make certain that its extraordinary opportunities are harnessed and that potential risks are averted. Whether this means a luxury brand ensuring that its public-relations specialists engage with fashion bloggers to spot knock-off goods, or outside counsel demanding de-indexing across social media platforms during the enforcement process, social media has become an integral part of the evolving brand protection landscape and, if employed strategically, is likely to remain in vogue for many years to come.

Did you know that if Facebook were a country it would have the world's third largest population? Or that Twitter welcomes nearly 500,000 new users a day? With mind-boggling usage statistics like this, it should come as no surprise that social media is rapidly becoming a tour de force for litigators. Indeed, in August 2010, the Supreme Court of Singapore went so far as to publish a consultation paper seeking to “explore ways of capitalising on social media to improve the civil litigation process.” Consultation Paper: Use and Impact of Social Media in Litigation, http://sg.sg/OZtgyx.

Using Social Media As Brand Protection Intelligence

As networkers blog about everything from the banal to the ridiculous, sifting through the social media landscape for brand protection intelligence can seem like a task of Herculean proportions. While some postings are retweeted like wildfire, garnering global exposure, others sit buried and largely unread. However, if brand owners get it right, they are sitting on a gold mine of information.

The opportunities have not gone unmissed by media-monitoring businesses, which have been quick to offer services that police online discussions, identify potential infringements and track legal threats. Using the latest technology, they sift through consumer-generated media ranging from high-profile sites such as Facebook to more modest forums and message boards. Not only do they track brand references (usually using a series of keywords provided to them by the brand owner), but they can also identify trends and discussion themes which may be of reputational importance to the business.

Moreover, the social media phenomenon has created a valuable network of legal-savvy users. For example, Fashionista, a popular New York-based blog, regularly publishes a column entitled “Adventures in Copyright,” that identifies and debates copycat designs. Similarly, second-year law student at the Columbus School of Law at the Catholic University of America, Julie Zerbo, is the author behind “Fashion Law,” a blog that regularly “outs” alleged intellectual property infringements. Within three days of her posting in March 2012 that “Chanel's Crystal Bangles Look FAMILIAR!,” Chanel had removed the products from sale “out of respect for the concerns raised.” What is interesting about these sites is that the authors are not corporate law firms, but students and industry insiders who are immersed in new trends and swoop in on newsworthy stories.

Using Social Media As Part of a Litigation Strategy

Social media also offers an accelerated and flexible alternative to traditional litigation strategies of cease-and-desist letters and interim injunctions. A classic example came in March 2012 when offbeat British jewelry brand Tatty Devine published a blog post entitled, “Can You Spot the Difference?,” that named a number of products made by Claire's Accessories that it considered to be infringing (http://bit.ly/zHBF5v). The enterprising tactic sparked a backlash across the online fashion community, eventually resulting in a joint statement from the brands confirming that several (although not all) of the high-street items had been removed from sale. (See, “Claire's Accessories official Statement,” http://bit.ly/Ia5lMt.)

Similar strategies were employed this July by fabric designer Rachael Taylor with regard to an “Etched Floral” design that she believed had been copied by Marks and Spencer. (See, “Strikingkly Similar Design?” http://bit.ly/Nm7eVe.) Further, Scottish knitwear designer Kate Davies accused Debenhams of “ripping off” her owl-design sweater. Both allegations, which were originally made public through the designers' respective websites, resulted in the high street chains eventually agreeing a settlement: Marks and Spencer apologized for any disappointment caused to Taylor and withdrew the t-shirts, insisting that they had bought them “in good faith” from an unnamed supplier (see, “Marks & Spencer (Update),” http://bit.ly/LiGwl5). Davies issued a formal announcement that: “Although we disagree on the issue of copying, as a gesture of goodwill, Debenhams have agreed to make a donation to my chosen charity, Chest, Heart and Stroke Scotland” (http://katedaviesdesigns.com).

The approach can be a particularly effective one for small businesses, generating quick and cheap results compared to the cost of drawn-out litigation in court. A social media expos' also enables the brand owner to exploit consumer sentiments, epitomized by the call to arms in Taylor's original Web statement: “I'm a [sic] posting this today as I understand the importance of standing up for yourself as a designer & your intellectual property rights ' to not be scared ' to speak out & protect what's rightfully yours '.” Particularly given the viral capacity of social media, the ability to get consumers (and press) onboard can be a deadly weapon: Regardless of the merits of a complaint, large businesses are sensitive to the “customer is always right” principle, which may serve as an incentive toward a quick settlement.

However, such strategies are not risk-free. Incensed brand owners need to ensure that any finger-pointing is factually accurate, as they may otherwise become exposed under local law for a counterclaim, such as defamation, unjustified threats or unfair competition. Moreover, the limitations to online exposures cannot be ignored: If the online attack does not have the intended effect, then brand owners may be forced to jump through the usual legal hoops anyway. For example, in the UK, a blog post is unlikely to satisfy the Civil Procedure Rules requirement that a party send a pre-action letter before commencing court proceedings. Similarly, unless a brand owner incorporates financial compensation into an ancillary settlement, the best outcome it can hope for is a withdrawal of the infringing products from sale.

Using Social Media To Serve Proceedings

Social media, by its nature, makes individuals more accessible and the world smaller. Its burgeoning status as an accepted manner of communication and connection calls for a natural progression toward it becoming a normalized forum for service of process. While the practice continues to raise eyebrows, it is slowly being accepted and implemented by a variety of common law jurisdictions.

In April 2012, an Australian district court judge granted a disgruntled music festival promoter, Mothership Music, permission to serve a lawsuit against American rapper Flo Rida through a Facebook “wall post.” Mothership Music Pty Ltd. v. Darren Ayre (trading as VIP Entertainment & Concepts Pty Ltd) and Flo Rida (also known as Tramar Dillar), NSWDC 42 (Apr. 13, 2012) (www.caselaw.nsw.gov.au/action/pjudg?jgmtid=158099).

At a hearing, Mothership Music's counsel presented evidence from its process server that, despite its attempts to arrange meetings with the rapper's agents and additional attempts to approach the rapper at public appearances, he could not be physically served. Counsel further presented evidence that the rapper was active on Facebook. As a result, the district court issued an order permitting service of court papers through a Facebook wall post.

That decision follows on the heels of those in other jurisdictions that have been granted over the course of the past few years. In Knott v. Sutherland, Edmonton, 0803 002267 (Alta. Q.B.M) (Feb. 5, 2009), a Canadian court permitted a plaintiff to serve a defendant through his Facebook page. Similarly, in Axe Market Garden Limited v. Axe, CIV-2008-485-2676 (Mar. 16, 2009), the New Zealand High Court permitted substituted service on an overseas defendant through a Facebook page where it became clear that newspaper advertising could not effectively target the defendant. Meanwhile, in September 2009 the English High Court pragmatically interpreted its civil procedure capabilities, which already permitted service of some court papers by electronic means, and permitted service of papers on an anonymous (and therefore un-locatable) blogger through Twitter.

While such innovative means of service have not expressly been permitted by U.S. courts yet, the concept may have some viability. The Federal Rules of Civil Procedure include a provision that permits a party to serve defendants located abroad through any means “prescribed by the foreign country's law for service.” Fed. R. Civ. Pro. Rule 4(f)(2)(A). This suggests that if a defendant were located in a jurisdiction that has accepted service by social media, then that means of service would be acceptable to the U.S. federal courts.

Using Social Media As a Means of Enforcement

Just as social media can be a vehicle for spotting infringements, reporting them and commencing related actions, the social networking realm is also becoming an essential forum for the enforcement process. This evolution in branding litigation is a creature of necessity. While Internet counterfeiters have traditionally hawked their goods on websites with confusing domain names and on auction websites such as eBay, the latest round of counterfeiting innovation has moved goods-hawking beyond the traditional Internet platforms and onto social media platforms. Twitter, Facebook and Pinterest, and even RSS feeds, are all now used by counterfeiters to publicize and sell infringing products. The most innovative counterfeiters are even creating fashion blogs on which they advertise the products, causing consumer confusion and, in turn, increasing their selling abilities.

In response, many U.S. court judgments involving websites that sell counterfeit goods now commonly include specific orders calling for the “de-indexing” of the illegitimate websites on search engines and social media platforms. Through the de-indexing process, all past archival social media content that links to counterfeiting websites is erased, further ensuring that future consumers are not lured back to the same counterfeiting websites ' even after a court issues a permanent injunction. For example, in the recent and widely publicized decision, Hermes International v. John Doe, No. 1:12-CV-01623(DLC), (S.D.N.Y. Apr. 30, 2012) (http://bit.ly/NODalr), issued by the Southern District of New York, Judge Cote awarded $100 million in damages and a permanent injunction that recognized the influential power of social media. Judge Cote's Order went beyond the usual call for Internet search engines to de-index infringing domain names and any affiliated websites, but also specifically included additional instructions that “any social media websites including, but not limited to, Facebook, Google+, and Twitter” also de-index the offending domain names and affiliated websites from their search results. The judgment followed a series of similar preliminary injunction orders issued by the District of Nevada in Chanel, Inc. v. Eukok.com et al., 2:11-cv-01508-KJD-PAL, (D. Nev. Nov. 14, 2011) (http://bit.ly/LyxFvw), where Judge Dawson called for the immediate de-indexing of over 700 infringing domain names and websites which sold counterfeit Chanel products from “all social media websites including, but not limited to, Facebook, Google+ and Twitter.”

The Next Steps

As social media gradually permeates all stages of litigation and brand protection, it is clear that brand owners, practitioners and adjudicators need to work both individually and collectively to make certain that its extraordinary opportunities are harnessed and that potential risks are averted. Whether this means a luxury brand ensuring that its public-relations specialists engage with fashion bloggers to spot knock-off goods, or outside counsel demanding de-indexing across social media platforms during the enforcement process, social media has become an integral part of the evolving brand protection landscape and, if employed strategically, is likely to remain in vogue for many years to come.