The start of the new year is a pivotal time in the retail sector for re-evaluating marketing and brand protection. Unfortunately, competitors often devise innovative ways to capitalize on the marketing and sales efforts of hardworking brand owners. While shady marketing tactics often give rise to legal claims, identifying these tactics can be difficult, and pursuing litigation is extremely expensive. Fortunately, brand owners can proactively safeguard themselves against competitors who seek to gain an unfair market advantage. This article will discuss the strategies competitors use to hurt leading brands, the types of legal claims a brand owner might have against a competitor seeking to gain an unfair advantage, and immediate steps you can take to safeguard your brand’s interests in advance of an attack.
How Competitors Unfairly Capitalize on the Success of Leading Brands
The e-commerce marketplace allows businesses to reach consumers worldwide around the clock, providing infinite opportunities for market expansion. At the same time, increased opportunity comes with heightened competition. Businesses must stay relevant by finding new and innovative ways to reach the attention of customers. Unfortunately, struggling competitors often try to garner consumer attention by capitalizing on the reputations of successful brands and products. These unethical marketing and sales tactics commonly give rise to legal claims, including but not limited to the following:
Trademark infringement occurs when a registered mark is reproduced or imitated without permission from the owner, leading to customer confusion in the marketplace (as defined by the Lanham Act of 1946 § 15 U.S.C. § 1114(1)(a)). Competitors who seek to gain an unfair advantage often incorporate the registered trademarks of other brands in their own e-commerce listings, product advertisements, and product descriptions by optimizing these trademarks as keywords. This marketing strategy can confuse and direct customers to purchase a competitor’s products. Brands who register trademarks receive increased protections which makes enforcement easier when your brand is under attack. Thus, companies should register trademarks so they can utilize intellectual property tools as leverage when sending takedown demands.
Defamation occurs when a person publishes false information about an individual with the intent to harm their reputation. Some states also recognize defamation against a business, known as trade libel. Defaming competitors through various means such as posting fake reviews and product comparisons is a growing trend on e-commerce platforms like Amazon, Shopify, and eBay. Additionally, competitors can pose as actual customers on social media platforms like Facebook or Reddit and provide defamatory information about a product to damage a competitor’s reputation.
Because competitors can defame leading brands by impersonating genuine customers or publishing anonymous comments, fake reviews are not always obvious. As a result, it is paramount for brand owners to engage in vigilant online monitoring.
When a brand owner identifies a suspicious review, an internet defamation and content removal attorney can help unmask the reviewer’s true identity through a John Doe lawsuit. A John Doe lawsuit is a specific type of lawsuit initiated against an unidentified person. During the course of the lawsuit, the discovery process enables attorneys to issue subpoenas to websites used by the anonymous individual. These subpoenas can lead to the revelation of the person’s identifying information, including email addresses, phone numbers, and Internet Protocol (IP) addresses, which in significantly aiding in determining the fake reviewer’s actual identity. Once the fake reviewer’s identity is uncovered, an attorney can help a brand owner secure a court order to remove the fake review.
If you suspect that a competitor is leaving fake reviews for your brand or products, it is important to act fast. E-commerce and social media platforms often keep identifying information related to users for limited periods of time. Furthermore, identifying data, like IP addresses can get stale. Lastly, if you wait too long to pursue your claims, you may lose the opportunity to file a lawsuit.
Unfair competition arises when a company employs deceptive or unethical practices to gain a competitive advantage by causing customer confusion (as defined by the Lanham Act of 1946 § 15 U.S.C. § 1114(1)(a)). Unfair competition is not limited to a single action; rather, it covers a broad range of deceptive commercial actions.
Once category of unfair competition claims arises when a competitor deceives customers about the origin or quality of a product. This includes instances where a company with an inferior product falsely asserts that their product is associated with a leading brand or manufactured by the same entity as a leading brand.
Unfair competition also occurs when a competitor infringes on another brand’s trademarks. For example, a brand owner might notice competitors using their popular slogan in product descriptions, product names, product listings, or advertisement(s). This unauthorized use of a brands slogan would likely constitute the unauthorized use of their trademark. Note that brands still have common law rights even when trademarks are unregistered.
Another category of unfair competition occurs when a competitor makes false representations about the capabilities of a product. For example, competitors may make claims in e-commerce product listings (often in product descriptions or in Q&As) that their product is superior to a leading brand’s product. When competitors make false representations about their own product’s capacities in that comparison, this would give rise to claims of unfair competition. When competitor’s make false statements about the capabilities of the leading brand, this would likely also constitute trade libel.
As deceptive marketing tactics become more creative, they become harder to detect. Awareness helps solve this issue. Thankfully, brand owners can take steps to proactively safeguard their brands and products against potential threats.
Four Things You Should Do Right Now to Protect Your Brand from Competitors
1. Protect Your Intellectual Property
Brand owners should take necessary steps such as ensuring names or slogans associated with the leading product are registered with the United States Patent and Trademark Office (USPTO). If the trademark has been registered, brand owners should make sure the protected intellectual property is properly maintained with the USPTO. Registering a trademark provides a legitimate property right to protect and can lead to greater damages if legal action is ever needed.
Brand owners should also consider registering specialized designs of products and slogans specific to the brand owner’s product. Sometimes, copyright of a product description may be necessary as well. Competitors can easily plagiarize or use key words and phrases incorporated into leading brands’ marketing strategies for each popular product. Brand owners should consider speaking with an attorney regarding what types of things should be registered (a design, key word, slogan) or when it becomes appropriate to take steps on lesser common intellectual property registrations such as a product description.
Protecting intellectual property before the holidays is crucial, as the volume of infringement can increase during the holiday season. The potential recoverable damages only strengthen when pre-emptive measures, such as protecting intellectual property rights, are taken.
2. Monitor the Marketplace for Infringement
Brand owners should regularly monitor online marketplaces such as Amazon, eBay, and Walmart to identify competitors seeking to gain an unfair advantage. Once brand owners identify bad actors, they can work to stop the marketplace manipulation. Taking quick and strategic action prevents competitors from continuing to misdirect costumers. Further, it sets a precedent that your brand will not tolerate marketplace manipulation, which will prevent competitors from continuing to target your products.
Monitoring should include conducting regular searches on e-commerce platforms for intellectual property including slogans, catch phrases, and other unique product identifiers to see whether competitor’s products are displaying more prominently than the company who owns that intellectual property. Results which display the competitor’s product first should cause a brand owner to conduct further searches to see if the text of the competitor’s listings contain the brand owner’s intellectual property. Monitoring marketplaces will also ensure that competitors are not deceiving customers about the source of the goods, or disseminating incorrect information about the leading brand’s products to mislead potential customers into believing that the leading brand’s products are inferior to the competitor’s products.
3. Monitor your Company’s Online Reputation
Competitors can unfairly catch the attention of consumers by publishing false information about market leaders on e-commerce platforms, social media platforms, and web forums. While this conduct can sometimes be obvious, this is not always the case. It is essential for brand owners to monitor and identify suspicious reviews and publications so that quick action can be taken to remove them.
Brand owners should keep in mind that customers have a First Amendment right to compare and review products, even if that review is negative. However, competitors do not have a right to defame a brand owner’s products in their own e-commerce listings or through the utilization of fake accounts. Indeed, posing as a dissatisfied customer to disparage a leading brand’s product and direct sales to a competitor’s products goes against the policies of most e-commerce platforms and likely gives rise to multiple legal claims.
If you notice a negative review about your brand or products, you should carefully examine it to determine whether it exhibits certain indicators of a fake review.
Common Signs that a Review is Fake:
- The reviews disparage your products in a way that is not representative of any true customer experience, or in a way which promotes a competitor’s comparable product.
- The account that left the suspicious review has no other activity other than to disparage your products or compare your products to a competitor’s goods.
- The account that left the fake review utilizes a name or pseudonym not found in your customer records.
- The fake review is one of several that appear within a short time frame.
- The fake review appears to be written with improper sentence structure and grammar as if it was created by a bot or a foreign actor.
Brand owners who actively monitor their brand’s online reputation can quickly identify and take legal action against competitors or anonymous online actors who disparage them.
4. Know When to Contact an Attorney
Attorneys can assist brand owners before, during, and after an attack. While a brand may be able to handle marketplace monitoring and reputational audits internally within marketing departments, high volumes of infringement may necessitate involvement of an attorney.
When a brand owner discovers suspect or infringing conduct, they have a variety of enforcement options. For example, a brand owner can report infringing conduct to e-commerce or social media platforms, send takedown demands to competitors, or take legal action. By working with attorneys who focus on brand protection and internet content removal attorneys, brand owners can evaluate and assessing enforcement options while maintaining the strong reputations they worked so hard to attain.
Brand owners should keep in mind that suspect product description or review necessitate quick action. An attorney can assist in taking quick, strategic action to protect your brand.
Defend Your Brand in E-commerce Marketplaces
Selling products on e-commerce platforms provides numerous opportunities for competitors to gain an unfair advantage against your brand. If brands do not take steps to enact online marketplace monitoring, reputational audits, and intellectual property protections, competitors can and will attract consumer attention at the expense of your brand.
If would like to discuss steps your company can take to protect and defend itself from the shady tactics of competitors or if you suspect your brand is withstanding a reputational attack please reach out to KJK e-commerce attorney Hannah Albion (firstname.lastname@example.org) or internet defamation and content removal attorney Ali Arko (email@example.com).