Facebook Username Feature Underscores Need to Monitor Trademarks and Business Names on Social Networking Sites

Are you one of the many companies today exploring ways to tap the potential of popular social networking websites such as Facebook and LinkedIn for business development and marketing purposes? If so, you should be aware a new feature offered by Facebook that has serious implications for your company’s intellectual property rights.

Facebook’s New User Name Feature

In recent years, social networking services have quickly become a popular way for people to connect, communicate, and share information via the Internet. With millions of people accessing such services on a daily basis, companies now realize the significant business opportunities that may be captured through the social networking realm. At the same time, social networks present certain intellectual property issues that must be managed properly to protect your company’s interests. Facebook’s new “user name” feature highlights the risk posed to trademark owners through the use of trademarks and business names in Facebook user names.

On June 13, 2009, Facebook began allowing its users to personalize their Facebook URL through selection of a user name. For instance, the popular band U2 has reserved “U2” as its user name, thereby creating the following URL for its Facebook page: http://www.facebook.com/U2. Obtaining a user name and unique Facebook URL makes it easy for your company to promote its presence on Facebook (www.facebook.com/companyname). The Facebook URL can then be incorporated into your company’s marketing communications, web sites, letterhead, and business cards to maximize exposure of your company’s Internet presence, thus increasing the marketing value derived from these networking sites.

What This Means For You

Registering your company’s user name and unique URL on Facebook, however, may be challenging. In fact, a Facebook user may have already registered a user name and Facebook URL in bad faith, incorporating the business name or trademark of your company, with the intent of profiting from the goodwill belonging to you. Potentially, this person may have secured the unique URL and user name from Facebook to obtain payment from you to turn over rights and access to this Facebook URL.

Cybersquatting, as this practice is known, is not a new issue – it also arose in the context of registration of domain names when the internet gained widespread popularity in the 1990s. At that time, certain dishonest entities would reserve domain names consisting of the trademarks or name of a successful company for the purpose of selling the right to that domain name to the interested company for an inflated price. A significant body of case law quickly followed, holding that such activities constitute dilution and uncompetitive conduct under Federal trademark laws. As a result, special legislation addressing domain name cybersquatting was passed in 1999, which made these activities largely obsolete. While cybersquatting on Facebook with user names and URLs is similar to the problems experienced a decade earlier with domain name registrations, the federal Anti-cybersquatting Consumer Protection Act of 1999 relates only to domain name registrations, and not user names on Facebook.

Recognizing this inherent problem in its new “user name” feature, Facebook has proactively set forth several policies and procedures to help trademark owners protect their intellectual property. Facebook has limited eligibility for registration of user names and unique URLs to current, active users through June 28, 2009. During this grace period, users will not be able to create a new Facebook account for the purpose of improperly registering user names for exploitation. Additionally, Facebook is encouraging trademark owners and rightsholders to contact them to request that certain names be blocked from registration. Facebook does not allow users to change or transfer usernames, hoping to avoid user name scalping. Finally, Facebook has a procedure in place for reporting intellectual property infringement on Facebook. If infringement is found, Facebook may prohibit or eliminate use of the problematic user names and URLs.

Together these policies and procedures assist rightsholders in monitoring and enforcing their intellectual property rights. We strongly recommend that if your company has a Facebook presence, it should register an appropriate user name promptly. For assistance with the user name feature of Facebook or to report infringement, please visit Facebook’s help section for this feature (http://www.facebook.com/help.php?topic=username).

- Devin Gordon, devin.gordon@agg.com


Arnall Golden Gregory LLP serves the business needs of growing public and private companies, helping clients turn legal challenges into business opportunities. We don't just tell you if something is possible, we show you how to make it happen. Please visit our website for more information, http://www.agg.com/.

Friday's "Patent of the Week"

Legendary entertainer Michael Jackson wasn't only the King of Pop. He was also an inventor.

This week, we have selected U.S. Patent No. 5,255,452 entitled "Method and Means for Creating Anti-Gravity Illusion" as our first "Patent of the Week." The patent covers a system for allowing a person to lean forward beyond his center of gravity.

According to the patent, Jackson had incorporated the "zero-gravity" dance move in his recorded video performances by the use of cable connecting a harness around his waist. However, since this requires stagehands to connect and disconnect the cables, it was not possible to use this system in live performances. The solution: Shoes having a specially designed heel slot which can be detachably engaged with the hitch member projecting through a stage surface. As the patent shows, Jackson's creativity went well beyond music.

Although it is unlikely that Jackson will be remembered as an inventor, his lucrative dealings in Intellectual Property are very well known. In 1985, he purchased the ATV Music catalogue containing the music publishing rights to about 250 Beatles songs for $47.5 million. Ten years later, he sold a portion of those rights to the Sony Corporation for $95 million.

-Geoff Rogers, geoff.rogers@agg.com

Arnall Golden Gregory LLP serves the business needs of growing public and private companies, helping clients turn legal challenges into business opportunities. We don't just tell you if something is possible, we show you how to make it happen. Please visit our website for more information, http://www.agg.com/.

Potential Sea Change in Georgia's Competitive Landscape

The competitive landscape in Georgia, and decades of judge-made law about non-compete, non-solicit and non-disclosure agreements, may drastically change next year. I just reread the text of Georgia House Bill 73, which you can find at http://www.legis.ga.gov/legis/2009_10/versions/hb173_HB_173_AP_7.htm. Both the Georgia House and Senate have passed it, and the Governor has signed it. If the voters in Georgia approve a state constitutional referendum in 2010, HB 173 becomes effective and applies to contracts entered into after that date.

For companies looking at their existing non-competes, or considering entering into new ones after that time, we’re talking about a sea change. The General Assembly writes that it believes restrictive covenants in agreements “serve the legitimate purpose of protecting legitimate business interests” and “creating an environment that is favorable” to attracting and keeping Georgia businesses. “Favorable” is perhaps an understatement. Compared to the current state of the law, this bill could not be any more protective of business interests.

Right now, Georgia and California are two of the most pro-employee states in the sense that courts are hesitant to enforce all but the most limited non-competes and non-solicits.

The principle is written into our state constitution: any restraint on trade – and these kinds of contracts are considered restraints – are against our public policy. Taking this pro-competition public policy as a point of departure, Georgia’s courts crafted a vast and sometimes challenging to reconcile body of cases about what is and is not enforceable. Frequently, what companies thought were carefully drafted agreements come before trial courts on motions to enjoin employees and are then struck down as unenforceable.

HB 173 is a broadside on all of that law. My read is that it is designed to make sure that a company that wants to restrict an employee (or a seller of business, or franchisee, or independent contractor, for that matter) from competing for a period of time, can do so without concern that a court will invalidate it. The statue, in fact, reads a lot like an instruction manual for the courts, which is a bit unusual: it creates time periods and kinds of restrictions that should be “presumed” reasonable, it specifies burdens of proof and the definitions of key terms from case law, and it instructs courts to do whatever they need to do to make even a poorly drafted contract enforceable.

Some of the remarkable changes we would see if HB 173 becomes effective, and withstands challenge in the courts:

--Allowing and requiring the courts to “blue pencil,” or rewrite restrictive covenants to make them enforceable, and considering each restrictive covenant on its own terms (not letting non-solicit and non-competes “rise and fall” with one another)
--Instead of case-by-case determination, presumptions that two-, three- and up to five-year restrictions are reasonable for different classes of contract parties (e.g., employees, franchisees or distributors, or the seller of business assets)
--Eliminating the requirements of narrowly drawn scope and description of prohibited activities and geographic area, and of predictability of the covered geographic area

Careful planning is going to be the order of the day. We have a major statute crashing head on into a detailed, if not completely static, set of cases and legal principles. With some major “if’s,” though – whether the referendum passes and what it looks like, and then what our appellate courts say about how this new statute squares with existing law and the state’s constitution – HB 173 presents Georgia businesses with some major competitive opportunities. We’ll keep track of the bill, and provide more detailed analysis of its individual provisions, as its effective date becomes imminent.

-Andrew Flake
andrew.flake@agg.com

Arnall Golden Gregory LLP serves the business needs of growing public and private companies, helping clients turn legal challenges into business opportunities. We don't just tell you if something is possible, we show you how to make it happen. Please visit our website for more information, www.agg.com.

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