Who owns the trademark rights in the name of a user-created community?

trademarks social platforms

In the realm of online communities, where does the ownership of trademark rights lie – with the platform hosting the community or the individual user who creates and develops it?

The intriguing case involving Reddit and the founder of the well-known r/WallStreetBets subreddit presents a scenario that addresses this question concerning online communities and intellectual property rights. The case deals with the ownership and alleged infringement of two trademarks: WALLSTREETBETS and WSB.

Reddit and WallStreetBets

Reddit is a widely-used social media platform that enables users to create, manage, and participate in communities known as subreddits, centered around various interests. Plaintiff Rogozinski launched r/WallStreetBets in January 2012 to establish a forum for discussions and information exchange about the financial industry. While preparing for the launch, plaintiff invested considerable time and effort in developing the subreddit’s unique identity. This included creating the WALLSTREETBETS logo, designing the site using CSS to modify Reddit’s template. Later he set up related online channels, including an Internet Relay Chat (IRC) chatroom, a Discord channel, and a Twitter account under the WALLSTREETBETS name. By 2020, the r/WallStreetBets subreddit had amassed over a million followers.

Reddit Got Mad

The conflict took shape when plaintiff filed an application to register the WALLSTREETBETS trademark with the USPTO in March 2020. Reddit subsequently suspended plaintiff’s account for a week, citing his attempt to monetize the community, and barred him from moderating on the platform. In January 2022, plaintiff filed to register the mark WSB, and the USPTO granted this registration in June 2022.

Then There Was Litigation

Plaintiff sought a declaratory judgment – which in this case was a request for the court to acknowledge his ownership of the WALLSTREETBETS and WSB trademarks. He also made a claim against Reddit for infringing these trademarks, together with various other claims arising under state law. On the infringement issue, his theory was that he did not give Reddit permission to use the WALLSTREETBETS trademark following his ban as a moderator of the r/WallStreetBets subreddit he created.

The court dismissed Plaintiff’s first complaint, which he filed in February 2023. That dismissal, however, came with the opportunity for plaintiff to amend his complaint to address these issues. Despite his efforts to fix the identified shortcomings in his amended complaint, Reddit argued that he had still failed to meet the necessary legal standards. The court agreed and dismissed the case again.

Court Says the Rights are Reddit’s

The Court’s placed significant emphasis on the principle of “first use in commerce,” a critical element in establishing trademark ownership. In his amended complaint, plaintiff attempted to demonstrate his early and significant involvement in the development and use of the trademarks in question. He detailed his efforts in creating the logo, designing the subreddit, and establishing associated online channels. However, the court remained unconvinced by these assertions, noting that plaintiff’s actions did not meet the threshold of “use in commerce” as required by trademark law. The Court also scrutinized the timing and nature of plaintiff’s activities in relation to the establishment and popularity of the subreddit, ultimately finding that these actions did not suffice to establish his ownership of the trademarks.

And the case addresses the interesting issue of who owns trademark rights in a user-generated community – the platform or the moderator/creator? Reddit asserted that it owned the trademark rights in the community. Specifically, citing a case from the USPTO’s Trademark Trial and Appeal board, In re Florists’ Transworld Delivery Inc., 2016 WL 3998062 (T.T.A.B. May 11, 2016), Reddit had argued that account holders like plaintiff “generally will not be able to rely on use of [their] social media account to support an application for registration of a mark for such service.” Reddit argued that “[j]ust as the applicant in In re Florists’ Transworld could not claim rights in connection with ‘creating an online community’ based on use of Twitter, Plaintiff cannot rely on his use of Reddit’s platform to support alleged service mark rights in connection with a ‘web based community'”.

Regarding the state law claims, the court looked to 47 U.S.C. 230, which provides immunity to providers of interactive computer services from liability for content posted by others. The court found that these claims, as presented, did not get around Reddit’s Section 230 immunity.

Rogozinski v. Reddit, Inc., 2024 WL 150727 (N.D. California January 12, 2024)

Read Franklin’s post at Creator Economy Law.

See also:

Copyright, not privacy, motivated Reddit to take down photos of nude celebrities

This VentureBeat piece with Reddit CEO Yishan Wong brings up a number of interesting facts concerning Reddit in the wake of its receiving an additional $50 million funding round. One of those pieces of interesting information concerns Reddit’s decision to take down a subreddit devoted to the sharing of recently-leaked celebrity nude photos.

Says Wong:

If there’s any confusion: [Reddit] did not shut down /r/TheFappening due to content linking to nude celebrity photos. The subreddit was shut down because users were reposting content already taken down due to valid DMCA requests, and because spammers began posting links to the images hosted on their own pay-per-click sites, or sites intended to spread malware.

We can’t read too much from this comment, but it does implicate that the dignitary interests of the celebrities involved did not motivate Reddit to do the right thing. Instead, the risk of copyright liability (or, more precisely, the risk that DMCA safe harbor protection may be eliminated) was a stronger motivation.

Evan Brown is an attorney in Chicago advising clients on matters dealing with technology, the internet and new media.

Megaupload takedown reminds us why website terms and conditions can be important

Kashmir Hill pointed out that at least one erstwhile file sharing service has changed its business model in response to the federal government’s action against Megaupload. She observes that:

FileSonic users can’t be too happy to have one of the main features of the site taken away. But the company must be less worried about its breach of contract with existing users than it is about the possibility of getting the Megaupload treatment, i.e., arrest, seizure of its property, and a criminal indictment.

This raises an important point. Any kind of online service that pushes the legal envelope may want to build in some mechanisms to pull back with impunity if it gets freaked out or loses its envelope-pushing courage. Said another way, that service should not make promises to its users that it cannot keep in the event the service wants to change what it is doing.

Some well known user generated content sites do this pretty well already in their terms of service. For example:

  • Dropbox: “We reserve the right to suspend or end the Services at any time, with or without cause, and with or without notice.”
  • YouTube reserves the right to discontinue any aspect of the Service at any time.”
  • Reddit: “We also reserve the right to discontinue the Program, or change the content or formatting of the Program, at any time without notice to you, and to require the immediate cessation of any specific use of the Program.”
  • Facebook (being kind of vague): “If you . . . create risk or possible legal exposure for us, we can stop providing all or part of Facebook to you.”

All good examples of foresight in drafting website terms and conditions that help innovative sites with damage control.

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