In a legal twist befitting the turbulence of social media, X Corp., the once-iconic Twitter, now finds itself at the center of a trademark lawsuit. The plaintiff? X Social Media, an ad agency based in Florida. They contend that X Corp.’s recent rebranding has caused significant confusion among consumers.
The Allegations
X Social Media (XSM) filed the lawsuit in a Florida federal court. They accuse X Corp. of unfair competition, trademark and service mark infringement, and violation of Florida’s Deceptive and Unfair Trade Practices Act. According to XSM, they have been continuously using their registered trademark, “X SOCIALMEDIA,” since early 2016. They argue that X Corp.’s rebranding has resulted in a loss of revenue directly related to the public’s confusion between the two entities.
The Challenge of an “X” Trademark
Legal experts have noted the complexity surrounding trademarks using the letter “X.” There are numerous entities with trademarks involving this letter. The crowded field of “X” trademarks can make it challenging for any individual X-branded service to enforce a claim against another. This complicates XSM’s case against Elon Musk’s X Corp.
The Impact on Consumers
XSM asserts that X Corp.’s rebranding has led consumers to mistakenly associate their ad services with Musk’s company. The lawsuit seeks an order to prohibit X Corp. from using its mark and treble damages for what it deems “exceptional” infringement.
The transition from Twitter to X Corp. was part of Elon Musk’s vision to transform the social media platform into an “everything app.” However, at the time of the announcement, nearly 900 trademark registrations already covered the letter “X” across various industries. This included one by Meta for social networking services and another by Microsoft for gaming.
X Corp. has filed for registration of “X” in association with various services, including social media, business data analytics, market research, and advertising. In contrast, XSM claims to have used the mark in identical and closely-related services for over eight years.
The Consumer Perception Challenge
According to XSM, the overlapping use of the “X” mark has led consumers to believe that X Corp. is the source of services offered by X Social Media. Given that both entities operate in social media, this perception issue has been a significant point of contention in the lawsuit.
XSM highlights the “X” portion of its mark in advertising, blogs, and newsletters, all branded with names like “The X Blog” and “X Weekly.” They claim to have invested over $400 million in advertising, with more than $2 million dedicated to building brand awareness.
Legal Duties and Due Diligence
X Corp.’s adoption of the “X” mark has raised allegations of exceptional willful conduct on their part. XSM contends that X Corp. had a legal duty to conduct due diligence and avoid infringing on existing trademarks. An August cease-and-desist letter from XSM was allegedly ignored by X Corp.
“In a short time, X Corp. has wielded its social media clout, marketing resources, and overall national notoriety to dominate consumer perception of its ‘X’ mark,” states the complaint.
X Social Media’s lawsuit includes claims of trademark infringement and violations of Florida competition and unfair trade practices laws.
