ICYMI: Michigan Business Beat | Mikhail Murshak, Foster Swift Attorneys Watching out for Trademark Trolls!

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Chris Holman welcomes back Mikhail Murshak, Senior Attorney, Foster Swift Collins & Smith, Lansing, MI, but serving 6 offices across MI.

Watch Mikhail and Chris discuss the growing problem of trademark trolls and how your business can protect itself, in the YouTube video shared below:

In their conversation, Chris looked to find out several things from Mikhail;

What does it mean to be a trademark troll?

What not to do when you are approached by a trademark troll?

What you should do when responding to a trademark troll?

Meanwhile Foster Swift also has a reference article on this topic:

Under the Bridge – The Rise of Copyright Trolls in the Intellectual Property Space

Through tactical litigation practices, copyright trolls rely on copyright law to allege infringement and threaten major statutory damages upon unsuspecting defendants. The term “copyright troll” is an unflattering nickname for someone who manipulates the intellectual property (“IP”) laws to force a “toll” by way of a settlement payout on market participants.

Copyright trolls use technology to identify potential unintentional infringement activity and send template demand letters for payment. To leverage a higher payment with minimal effort, the letter is filled with threats and misrepresentations of how the law would likely be applied. The amount is usually too little to initiate federal litigation, but big enough that the recipient is usually afraid and rightfully concerned. The ask in a demand letter can often exceed $10,000 – even $30,000, depending on the circumstances. As to be expected, receiving this sort of letter from a copyright troll can be scary and overwhelming for most people faced with such allegations. Most of the time, recipients of these demand letters feel they have done nothing wrong, but are being asked to pay a significant fee. Hence, a “troll” has jumped out from under a bridge and demanded a “toll” if you want to move forward with the alleged infringing activity.

This trolling practice has continued to become more frequent as technology has evolved. The trolls acquire rights to huge quantities of digital images and the like, mostly ubiquitous in nature, and then head into the wild world of the internet, searching for anyone using that media without permission. Modern search tools or software have become efficient and effective at scouring alleged infringements across the internet. From there, once a copyrighted graphic is detected – whether that be a licensed photo on a website, a clipart on an online menu, or the use of a protected image on social media – the troll engages their legal representatives to seek monetary damages by way of settlement in lieu of litigation from everyday persons and small business owners.

Several law firms have emerged recently specializing in this opportunistic practice. Their business model relies on strategic use of this search-based technology and threats of litigation to unwary defendants to drive fast settlement.

There is hope in the IP legal field that greater copyright protections may come due to the soaring presence of copyright trolls. Notably, there is a pending copyright case before the United States Supreme Court, Warner Chappell Music, Inc. v. Nealy, that will be heard on February 21, 2024. The Electronic Frontier Foundation (“EFF”) has chosen to submit an amicus brief in support of the defendants accused of copyright infringement in that case. Within the brief, EFF alleges that copyright trolling imposes unnecessary costs on affected defendants and limits the exercise of creativity.

While the recent level of engagement on the issue is promising, it may not deter copyright trolls in the meantime from their unscrupulous practices. However, just because a copyright troll makes allegations of infringement does not mean there is evidence of an actual copyright violation in each case, nor proof that the damages the plaintiff requests are reasonable. The monetary request could be inflated for settlement purposes, and the ownership of the license for permissible copyright use may not be clearly evidenced in the plaintiff’s demand letter. As such, to avoid the hassle of negotiating with a copyright troll, consider the following best practices we recommend below to protect yourself and your business from alleged infringement.

It can be helpful to assess whether the image is copyrighted. Before posting any photograph or digital media graphic, make sure you have adequate permission. Just because something is on the internet does not mean it is free for everyone to use. Although the degree of originality does matter in a copyright infringement case, the easiest path to avoid being pursued by a troll is to never use content without permission. To ensure rightful use, research the owner or creator of the image, check for a watermark, view the art’s metadata, and/or search the United States’ Copyright Office’s database. Compiling this information will help you or your lawyer analyze whether the image is free to use in the public domain, or whether you should obtain a license to utilize the graphic.
Make sure your rights or permissions to utilize digital media are consistent with its use. For example, obtaining the right to a “one-time use” of a copyrighted image would permit you to a single use of that image. You would not be permitted to subsequent use of that image without additional licensure or consent from the copyright owner. As such, assess whether there is a limitation on the use of protected digital content; different types of use may require obtaining separate licenses or permissions.
If you have used a licensed image and are unsure if such use was permissible, research when that license protection began. Try to trace back the origin of the graphic you utilized. Common image licensors include Canva, Shutterstock, and Getty Images, among many others. If you cannot trace the graphic back to a licensor to confirm your rightful license, seek out a new, like image for the intended use that would not violate anyone else’s copyright.
Proactively monitor your website and social media presence for any past potentially infringing activity.
Consider implementing a company policy regarding use of digital media and engagement online. A company policy can ensure that all employees are compliant with the rules you set forth and can deter copyright infringement by setting parameters for your marketing team regarding what images may be safe to use or who in the business to consult before publishing online content.

If you receive a letter from a copyright troll, do not ignore it or presume it is spam. Contact a Foster Swift IP attorney at your earliest convenience. You do not have to automatically assume the claims made in the letter are legitimate, or disregard available defenses you may have to such allegations. We are here to assist with any correspondence responses, copyright counseling, and litigation or settlement negotiations that may follow. Typically, with enough time, we can extend artificial deadlines the troll may demand in its letter and properly assess the merits of their claims with you.

Additionally, if you have any questions about copyright law in general, please reach out to Mikhail Murshak or Lindsey Mead to discuss. At Foster Swift, we are committed to monitoring changes in the IP space. Our practice group can help familiarize you with copyright laws and obtain a better understanding of IP-compliant business practices.