New Trademark Prosecution Policy for “Green” Trademark Applications

By Carol Anne Been and Kevin MacKinnon

The Patent and Trademark Office (“Trademark Office”) is waving the red flag at certain applications for trademarks that include the word “green.” As you may soon learn from office actions or other communications with trademark examiners, the Trademark Office has adopted a new prosecution policy that requires federal applications for marks that include the word “green” for selected products or services to contain a statement of “environmental friendliness” in the description of goods or services. This is a new requirement. While the Trademark Office has not yet published this policy change, trademark examiners have begun denying non-compliant applications.

The Trademark Office is basing its refusal to register selected trademarks with “green” references on Section 2(a) of the Lanham Act, which allows the Trademark Office to refuse registration of a trademark that “consists of or comprises . . . deceptive . . .matter.” 15 U.S.C. § 1502(a) (emphasis added).

Under Section 2(a), a trademark is deceptive if its misrepresentation increases the marketability of its product or service by materially affecting the consumer’s purchasing decision. See, e.g., Glendale Int’l Corp. v. U.S. Patent & Trademark Office, 374 F. Supp.2d 479, 485 n.10 (E.D. Va. 2005). Studies show that a product’s environmental reputation impacts purchasing decisions made by the majority of consumers. See Federal Trade Commission (“FTC”), Environmental Marketing Consumer Perception Study § 4, at 136-38 (2009), available here.

The Trademark Office’s primary concern seems to be to prevent “greenwashing” via trademarks. Typically an advertising issue, greenwashing is “the act of misleading consumers regarding environmental practices or the environmental benefits of a product or service,” according to TerraChoice. Because many consumers are willing to pay more for products that they believe are “green” or environmentally friendly, greenwashing pervades everyday advertising and marketing. See FTC Consumer Perception Study § 4, supra, at 138.

However, very few products actually contain all of the environmental benefits that consumers would reasonably expect them to have based on those products’ marketing materials. The Trademark Office’s new policy effectively brings trademarks into the mix when evaluating greenwashing concerns.

Because the question of whether a trademark materially affects a consumer’s purchasing decision is fact-intensive, the Trademark Office’s new policy is evidence-based. Thus far, three types of products and services have been pulled under its purview: green buildings, green cleaning supplies, and green power/energy. While these three areas are the Trademark Office’s current focus, trademark examiners indicate that the scope of the new policy may expand in the future if sufficient evidence demonstrates that the word “green” in marks for other types of products and services raises a Section 2(a) deceptiveness issue.

The details of the new policy have not been released, so its potential ramifications are largely unknown. Since “green” is an amorphous concept and can convey any number of meanings, the new policy could create difficulties for some trademark owners using the word “green” in their marks for other, non-environmental purposes. Trademarks using “green” to suggest money, envy, or sickness could be held up under this policy, even though businesses do not intend and consumers do not perceive an environmental message. In addition, long-established trademarks could be refused registration when they are the subject of new filings, simply because they include the word “green.” Thus, undiscriminating and broad application of the policy could cause significant cost and delay to trademark owners that use the word “green” apart from its environmental connotations. While it is unclear at this time how the Trademark Office will deal with these situations, it seems that trademark examiners should use discretion when implementing this new policy.

FTC’s Green Guides

The Trademark Office joins the Federal Trade Commission in seeking to address environmental claims. The FTC’s authority on this issue derives from the Federal Trade Commission Act, which bars “{u}nfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce.” FTC Act § 5, 15 U.S.C. § 45(a)(1).

In 1992, in response to greenwashing concerns, the FTC issued the Guides for the Use of Environmental Marketing Claims (“Green Guides”),,16 C.F.R. § 260. While the Green Guides lack the force of law, they are meant to instruct the public regarding the proper and acceptable use of environmental claims. Id. at § 260.2. The Green Guides are intended to help businesses avoid innocently making misleading environmental claims, as sometimes the consumer’s understanding of “green” does not correspond with the company’s intended message. See FTC Press Release, supra. The Green Guides apply to “labeling, advertising, promotional materials and all other forms of marketing, whether asserted directly or by implication, through words, symbols, emblems, logos, depictions, product brand names, or through any other means, including marketing through digital or electronic means, such as the Internet or electronic mail.” 16 C.F.R. § 260.2.

The Green Guides contain numerous practical examples, and discuss deceptiveness in terms of various specific environmental marketing claims, including deceptive and non-deceptive examples of “biodegradable”, “recyclable”, and “ozone friendly”. Id. at § 260.7.

The FTC updated the Green Guides in 1996 and 1998. Since then, industrial growth and the prevalence of new terms, such as “sustainable” and “renewable,” encouraged the FTC to again revisit the Green Guides. On October 6, 2010, the FTC released its proposed updates to the Green Guides for public comment; however, the updates still are under review.

The proposed updates include guidance on claims of “renewable energy,” “renewable materials,” and “carbon offsets,” as well as “green” and “greener.” See FTC Press Release, supra. Despite the fact that “organic,” “natural,” and “sustainable” claims pervade the marketplace, those terms are not found in the current Green Guides or the proposed revisions. See id.

Intersection between the FTC’s Green Guides and the Trademark Office’s new policy

Compliance with the Green Guides is voluntary, though non-compliance may result in an enforcement action by the FTC. 16 C.F.R. § 260.1. Such actions have been relatively rare. The new Trademark Office prosecution policy, however, is mandatory to the extent that an application for a “green” trademark may be refused registration unless it includes a statement of environmental friendliness. Thus, the policy might serve to increase compliance with the FTC’s Green Guides, since at least some of the trademarks to be used in marketing covered by the Green Guides will undergo this pre-screening procedure. As a result, the new policy also could influence business decisions regarding trademarks, as some companies may be reluctant to put an assertion of “environmental friendliness” on the record with the Trademark Office if that statement is not appropriate to its business or not fully substantiated, and could be used against the company in other contexts.

Substantiation of environmental claims

According to the Green Guides, at the time an environmental claim is made, the claimant must “possess and rely upon a reasonable basis substantiating the claim.” Id. at § 260.5. The Green Guides acknowledge that substantiation often requires “competent and reliable scientific evidence, defined as tests, analyses, research, studies or other evidence based on the expertise of professionals in the relevant area . . . .” Id.

The substantiation requirement covers any materials in which environmentally themed messaging occurs. This means that the requirement is not limited to newspaper advertisements or television commercials; it includes press releases, direct mail pieces, financial disclosures, company social networking sites, etc. Also, besides being adequately substantiated when made, “green claims” must be truthful and non-deceptive, as well as not open-ended, over-stated, or ambiguous.

For businesses, one important implication of these developments is the necessity of thorough documentation. If and when challenged, businesses are responsible for proving that their environmental claims were substantiated at the time that they were made. Thus, links should be forged between the legal, marketing and science departments of businesses to ensure that the proper steps are being taken and recorded, a process which must be followed for every piece of “green” messaging that the business employs.

What this new policy means for businesses

Based on both the recent Trademark Office policy change and anticipated increased scrutiny of “green” claims, businesses should take steps to ensure that the intended meaning of their marketing claims mirrors the commonly-held consumer perceptions of those claims. These steps now include making sure that trademarks do not inadvertently convey unintended “green” messaging both on their own and as part of the overall advertising claims. Additionally, those engaging in environmental marketing should pay particular attention to ensuring that their environmental messages are properly substantiated. Businesses should pay particular attention to ensuring that environmental messages are both substantiated and consistent with the law.

Conclusion

As the Trademark Office has not published this new prosecution policy, many of its details and possible ramifications are yet unknown. It is unclear when and even if the policy will be published. However, what is clear is that the Trademark Office, like the FTC, is escalating its requirements for “green” claims, with the goal of reducing greenwashing and its negative effects. Just as the FTC’s updates to the Green Guides, when adopted, should further help business avoid innocent acts of greenwashing, the Trademark Office’s new policy, if applied and expanded with the proper discretion, could help reduce instances of unsubstantiated environmental marketing claims through trademarks.

image: Gurmit Singh via Flickr cc (some rights reserved)