Why Wacoinda Matters

The brewing Trademark battle between Cryptocurrency startup Wacoinda and Disney Enterprises’ Wakanda

Written by Israel Ace Burns [1]

“Wacoinda”

WE KNOW DISNEY, WHO IS WACOINDA?

Without a doubt, when it comes to fame, it does not get bigger than the legacy of Mr. Walter Elias Disney and his brainchild corporation, The Walt Disney Company. I’m wondering however, how many Black Panther fans know that the mythical city of Wakanda[2], the pious T’Challa, and even the vengeful Killmonger are all the tightly held intellectual property of Disney Enterprises Inc. Well you may have known that, but you definitely didn’t know that the trademark for “Wakanda” was published several weeks after an organization called “Wacoindapublished their name and there may be a brewing David versus Goliath battle over the rights.

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According to Black Enterprise, Wacoinda is “THE FASTEST-GROWING BLACK ECONOMIC GROUP ON FACEBOOK” and was founded by Lafe Taylor and Lamar Wilson in the first quarter of 2018. The group currently has over 30,000 members, and is completely decentralized. Mr. Wilson, one of the more vocal founders of the decentralized network, has given details about the mindset of the original group. He’s explained that the purpose of Wacoinda is to “teach people about economics, try to help and eradicate economic injustice, and to bring people together through love and collaboration.” According to their founders:

The only way to fight against any injustice in this world is with unity. Wacoinda not only brings like-minded people from all over the world together but does it in love, the strongest force against the evils of injustice. We all know that Black Panther is a fictional character, but in Wacoinda there are real-life Black Panthers, of all colors, who believe in freedom and ownership, and that it’s more powerful to love than to be loved.

One wonders if Mr. Disney believed in a similar concept when he stepped out on his own and decided he wanted to focus on expressing his love by enchanting people with his animation.

It was 1928 when Disney, a young entrepreneur at the time, created a sensation through his animated figure Mickey Mouse. That business has grown radically, until now it is the stuff of American folklore, the epitome of the American dream with an American size bank account to boot. The brand has become so well known and so powerful that in August of 2009 it had the muscle to acquire Marvel Entertainment for $4 billion. With that acquisition Disney gained volumes of rights to the most powerful and interesting characters in modern history. It also acquired Marvel Studios’ Black Panther.

The box office success of Black Panther in the United States was certainly a ground breaking cultural phenomenon. But what’s more, seeing the African Kingdom of Wakanda left a lasting impression on Black Americans. The Kingdom of Wakanda (wə-Kɑ(H)N-də), which perfectly matches the location and phonetics of Uganda (yoo-Ga(H)N-də) in East Africa, spoke to the hearts and minds of a majority of Black people who watched the flick. Black Panther’s concepts were so vivid that some paid to see the film two or three times to support the movement.

In the words of Time magazine, “Hollywood has never produced a blockbuster this splendidly black.” And even going to the theaters the Black community wouldn’t be left out. As Time explained, at Black Panther’s primer the Actors adorned themselves in African royal attire, and presented a booming cultural display. This trend was a pattern replicated throughout the United States, bringing the African diaspora front and center to the film. Dressing up became an act of solidarity, and on display were “ascending head wraps made of various African fabrics . . . natural hair tightly wrapped above a resplendent bejeweled gowns. Men . . . wore Afrocentric patterns and clothing, dashikis and boubous, [even] a kanzu the formal tunic of [] Ugandan ancestry.” The image of Wakanda represented to them the type of “Black Wall Street” that they were denied in 1921. Wakanda is like the combined philosophical wet dream of Malcolm X, Langston Hughes and James Baldwin intertwined and made real.

Enter Wacoinda. Wacoinda is a real decentralized community that was birthed in January 17th, 2018. It was the result of a live conversation about economic empowerment and cryptocurrency. Facebook served as the principal location until organizers launched a website for their digital currency called the Wacoinda Fa’Eva Wallet. The group has also released its own currency which it trades internally and has even launched a Wacoinda-Marketplace where the currency is accepted.

Organizers originally called themselves the “Black Coin Group” however after a funny interlude from one of their members, the organization agreed on the name Wacoinda. When they attempted later on to change it back to the Black Coin Group, people disliked it, so the name stuck. A few days later, organizers noticed that other facebook groups using the exact name began to pop up and a trademark was subsequently filed by Wilsondom LLC merely for expeditious processing. The name was published on July 17th, 2018 almost two weeks before Wakanda’s publication.

WHAT HAPPENED?

On August 7th 2018, Marvel Characters, Inc. a subsidiary of Disney filed a “First 90 Day Request for Extension of Time to Oppose for Good Cause” to oppose Wacoinda’s trademark. Formally, it does not mean that Disney will file an opposition to Wacoinda’s name, but rather that it “needs additional time to investigate the claim [and] confer with counsel.” We too can investigate the potential claim based on what we know about the Wacoinda name and current case law.

WHAT IS TRADEMARK INFRINGEMENT / DILUTION?

Trademark Infringement and Dilution, as originally conceived, refer to the harm that occurs when a famous, distinctive mark loses its singular meaning. The federal standard for trademark infringement is “likelihood of confusion.” To be more specific, the use of a trademark in connection with the sale of a good constitutes infringement if it is likely to cause consumer confusion as to the source of those goods or as to the sponsorship or approval of such goods. See15 U.S.C. §§ 1114, 1125. Under the Lanham Act § 32, § 43(a), 15 U.S.C. §§ 1114, 1125, “likelihood of confusion” is the use of a trademark in connection with the sale of a good that is likely to cause consumer confusion as to the source of those goods or as to the sponsorship or approval of such goods. In deciding whether consumers are likely to be confused, the courts will typically look to a number of factors, including: (1) the strength of the mark; (2) the proximity of the goods; (3) the similarity of the marks; (4) evidence of actual confusion; (5) the similarity of marketing channels used; (6) the degree of caution exercised by the typical purchaser; (7) the defendant’s intent. Polaroid Corp. v. Polarad Elect. Corp., 287 F.2d 492 (2d Cir.), cert. denied, 368 U.S. 820 (1961).

According to Barton Beebe, NYU School of Law, the idea underlying “dilution by blurring” is that the defendant’s use of a mark similar or identical to the plaintiff’s mark, though perhaps not confusing as to source, will nevertheless “blur” the link between the plaintiff’s mark and the goods or services to which the plaintiff’s mark is traditionally attached. In Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC, 507 F.3d 252, 264 (4th Cir. 2007), the Court determined the main elements of a claim for dilution by blurring or by tarnishment which are: (FAME) (1) that the plaintiff owns a famous mark that is distinctive; (ACTUAL DILUTION) (2) that the defendant has commenced using a mark in commerce that allegedly is diluting the famous mark; (SIMILARITY) (3) that a similarity between the defendant’s mark and the famous mark gives rise to an association between the marks; and (IMPAIRMENT) (4) that the association is likely to impair the distinctiveness of the famous mark or likely to harm the reputation of the famous mark. Id. at 264–65. The fame element of dilution and the strength element in likelihood of confusion has a slightly similar analysis and so they will be discussed together under the dilution analysis. However, because the likelihood of confusion standard is lower, we will assume Disney meets requisite requirement for the “strength of the mark” element. See TCPIP Holding Co. v. Haar Communications Inc., 244 F.3d 88, 100 (2d Cir. 2001) (describing the two concepts of strength).

So the question remains, under U.S. trademark law, has Wacoinda infringed or diluted Disney’s trademark?

For the reasons stated below, it is extremely unlikely the trademark office or a Federal judge will find that Wacoinda has in any way infringed or diluted the Wakanda brand. This is because, 1) Wacoinda’s products and services are totally different[3]; 2) Even if, arguendo, Wacoinda and Wakanda have similar sounding names, there is no evidence of confusion; 3) Wakanda’s Trademark is not strong enough to initiate a dilution claim; and finally, 4) the theory of Trademark Parody should shield Wacoinda from liability.

ARE WACOINDA’S SERVICES LIKELY TO BE CONFUSED WITH WAKANDA’S GOODS?

“Related goods are generally more likely than unrelated goods to confuse the public as to the producers of the goods.” Brookfield Communications, Inc. v. West Coast Entm’t Corp., 174 F.3d 1036, 1055–56 (9th Cir. 1999). “[T]he danger presented is that the public will mistakenly assume there is an association between the producers of the related goods, though no such association exists.” AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 350 (9th Cir. 1979). The proximity of goods is measured by whether the products are: (1) complementary; (2) sold to the same class of purchasers; and (3) similar in use and function. Id.

First, the goods and service of these two entities could not be further apart. They have almost no overlap, save possibly “entertainment.” As such, their products do not complement each other in any respect.

Second, the class of purchasers are equally distinct. Disney, has always marketed its products to children, and so they have a legitimate interest in children’s items, like games, and playthings. However, Wacoinda is about cryptocurrency, and financial matters, which are purely the realm of adults. They deal in real world issues, and serious monetary programs. Therefore, the two entities again are distinct.

With respect to the last element of the proximity of goods analysis, Wacoinda and Wakanka’s goods and services are completely distinct. Disney’s attorney selected one International Class, section 028 for “Games and playthings”, and “decorations for christmas trees.” Disney marketing to children decidedly selected the following goods and services for its brand:

“Action skill games; action figures and accessories therefor; board games; card games; children’s multiple activity toys; badminton sets; balloons; basketballs; bath toys; baseball bats; baseballs; beach balls; bean bags; bean bag dolls; bobblehead dolls; bowling balls; bubble making wand and solution sets; chess sets; toy imitation cosmetics; Christmas stockings; Christmas tree ornaments and decorations; collectable toy figures; crib mobiles; crib toys; disc toss toys; dolls; doll clothing; doll accessories; doll playsets; electric action toys; equipment sold as a unit for playing card games; fishing tackle; fishing rods; footballs; golf balls; golf gloves; golf ball markers; hand-held units for playing electronic games for use with or without an external display screen or monitor; hockey pucks; hockey sticks; infant toys; inflatable toys; inflatable pool toys; jigsaw puzzles; jump ropes; kites; magic tricks; marbles; manipulative games; mechanical toys; music box toys; musical toys; parlor games; party favors in the nature of small toys; paper party favors; paper party hats; party games; playing cards; plush toys; puppets; roller skates; rubber balls; skateboards; snow boards; snow globes; soccer balls; spinning tops; squeeze toys; stuffed toys; table tennis balls; table tennis paddles and rackets; table tennis tables; talking toys; target games; teddy bears; tennis balls; tennis rackets; toy action figures and accessories therefor; toy boats; toy bucket and shovel sets in the nature of sand toys; toy building blocks; toy mobiles; toy vehicles; toy scooters; toy cars; toy figures; toy banks; toy vehicles in the nature of toy trucks; toy watches; toy weapons; toy building structures and toy vehicle tracks; video game machines for use with televisions; volley balls; wind-up toys; yo-yos; toy trains and parts and accessories therefor; toy aircraft; fitted plastic films known as skins for covering and protecting electronic game playing apparatus, namely, video game consoles, and hand-held video game units; balls for games; battery operated action toys; bendable toys; construction toys; game tables; inflatable inner tubes for aquatic recreational use; inflatable swimming pools; piñatas; radio controlled toy vehicles; role playing games; snow sleds for recreational use; stacking toys; surf boards; swim fins; toy furniture; toy gliders; toy masks; toy model train sets; water slides.”

See USPTO TSDR Wakanda Trademark Publication Stylesheet § Goods And Services at p.1.

Conversely Wacoinda’s attorney selected two International Classes for the Wacoinda brand, section 036 for “Insurance; financial affairs; monetary affairs;” and section 041 for “Education; providing of training”, and “sporting and cultural activities.” Wacoinda then selected the following services for its brand:

“Financial services, namely, providing a virtual currency for use by members of an on-line community via a global computer network; Financial services, namely, providing electronic transfer of a virtual currency for use by members of an on-line community via a global computer network; Issue of tokens of value.” and

“Education services, namely, providing live and on-line classes in the field of cryptocurrency; Educational services, namely, conducting programs in the field of cryptocurrency; Educational services, namely, providing educational speakers in the field of cryptocurrency.”

See USPTO TSDR Wacoinda Trademark Publication Stylesheet § Goods And Services at p.1.

In Federal Foods Inc., the Court explained how vastly different products and services can help dispel a theory of likelihood of confusion. The court explained that “[n]obody, during the course of this proceeding, has asserted that the utilities of opposer’s toilet tissue and appellant’s aluminum foil, plastic bags, and sponges are even remotely associated by the consumer, nor has it been asserted that, under these circumstances, a consumer might pick up sponges or aluminum foil when he really wanted toilet tissue. Opposer has failed to adduce any evidence of a nexus between these products in the mind of the consumer which would negate the above-noted obvious dissimilarities. In our opinion, the cumulative differences between the respective goods and the respective marks are sufficient to preclude likelihood of confusion, mistake, or deception.” See, e.g., In re Iolo Techs., LLC, 95 USPQ2d 1498, 1499 (TTAB 2010); In re Max Capital Grp. Ltd., 93 USPQ2d 1243, 1244 (TTAB 2010) ; In re Thor Tech, Inc., 90 USPQ2d 1634, 1635 (TTAB 2009).

Based on the rulings above, its fairly obvious that Wacoinda’s products and services are distinct enough not to conflict with Wakanda’s goods. Noticeably, there is absolutely no product overlap in the Goods and Service between Wacoinda and Wakanda, in fact, Wakanda sells Goods and Wacoinda sells Services. As such, the analysis sketched out by Federal Foods, Inc., follows here, there is absolutely no similarity in the product of the entities. The secound prong of the likelihood of confusion analysis, the proximity to goods, weighs in favor of Wacoinda.

IS THERE ANY PROOF OF WACOINDA / WAKANDA NAME CONFUSION?

While there may be a question regarding whether Wacoinda and Wakanda sound similar phonetically, there is no empirical data to prove that point. Typically high-stakes well-funded trademark litigation cases will involve survey evidence, in which they poll a large number of consumers. In fact, it is so customary that courts will sometimes draw an “adverse inference” against a party for failing to present it. See, e.g., Eagle Snacks, Inc. v. Nabisco Brands, Inc., 625 F. Supp. 571, 583 (D.N.J. 1985) (“Failure of a trademark owner to run a survey to support its claims of brand significance and/or likelihood of confusion, where it has the financial means of doing so, may give rise to the inference that the contents of the survey would be unfavorable, and may result in the court denying relief.”). Furthermore this analysis is similar to the standard set forth in Trademark Dilution under Actual Dilution.

In either case, Disney has yet to put forth any data suggesting that those looking for Wakanda were actually confused and interrupted by Wacoinda. Since Wacoinda has spent zero dollars on marketing, there is also no similarity of marketing channels used. The balance of the third and fourth prong enures in favor of Wacoinda.

WHO IS MORE SOPHISTICATED WACOINDAN OR WAKANDAN PURCHASERS?

In Hormel Foods Corp. v. JIM, 73 F.3d 497 (1996), the Court found that “a child or adult who would be likely to buy merchandise [one brand] would do so ‘because he likes the [one product], not because he mistakenly thinks that it is a [another product]’.” Id. (citation omitted). Hormel established that in reviewing consumers, sophisticated products were rarely associated with unsophisticated primary products (like toys) and would not easily be confused by its merchandise if its product were labeled. Id. This finding is relevant in the sophistication analysis, especially because sophistication and market proximity are closely related concepts. See, Vitarroz Corp. v. Borden, Inc., 644 F.2d 960, 968–69 (2d Cir.1981).

It is clear that Wacoindan consumers, who have an interest in their mission to eradicate economic injustice, are highly sophisticated and will be able to distinguish from Disney’s products. Likewise, the children looking for T’challa school backpacks, Black Panther pencils, and Killmonger masks would not be interested in online lectures and bitcoin. Because this prong regards the level of care an individual purchaser would take in navigating the market to their intended product, the 6th element of likelihood of confusion weights in favor of Wacoinda. Hermes Int’l v. Lederer de Paris Fifth Ave., Inc., 219 F.3d 104, 109 (2d Cir. 2000) (“[A] loss occurs when a sophisticated buyer purchases a knockoff and passes it off to the public as the genuine article, thereby confusing the viewing public and achieving the status of owning the genuine article at a knockoff price.”); see also, Ferrari S.P.A. Esercizio v. Roberts, 944 F.2d 1235, 1244–45 (6th Cir. 1991).

Finally, as to the last element of the analysis, there is no evidence that Wacoinda attempted to create confusion in the market by creating its name. The history of the organization establishes, that the group was functioning and working together prior to the trademark, and by sheer happenstance and group think a new name was born. No one person choose the name, in that sense it was conceived in a purely decentralized manner. As such, no negative intent can be implied in that process.

IS THERE ENOUGH FOR TRADEMARK TARNISHMENT?

According to Beebe, the Lanham Act § 43(c)1 covers dilution, “which is probably the single most muddled concept in all of trademark doctrine.” Dilution comes in two forms, dilution by tarnishment and dilution by blurring. Dilution by tarnishment deals with uses that have damaging effects on the positive associations of a trademark. Principal cases like Deere & Co. v. MTD Prods., Inc., 41 F.3d 39, 43 (2d Cir. 1994), explain that “tarnishment generally arises when the plaintiff’s trademark is linked to products of shoddy quality, or is portrayed in an unwholesome or unsavory context likely to evoke unflattering thoughts about the owner’s product[s].”

This is not the case in Wacoinda’s use. While it is possible that Disney’s reputation is offended by the concept of a group “centered around cryptocurrency and financial education that encompasses black wealth, power, and influence,” even the cryptocurrency media suggests that if approved Wacoinda “would be applied to financial education and economic empowerment initiatives aimed at the African-American community.” As such, it is hard to argue both sides of Trademark tarnishment in Wacoinda’s case. However, dilution by tarnishment, and dilution by blurring are reviewed under the same analysis below.

IS THE WAKANDA BRAND FAMOUS ENOUGH FOR TRADEMARK DILUTION?

The threshold question in our trademark dilution analysis is whether the name Wakanda meets the level of fame required for dilution. Dilution is only for those marks which can summon the general knowledge of a majority of the plaintiffs market. In other words, a famous mark is one that has become a “household name.” Nissan Motor Co. v. Nissan Computer Corp., 378 F.3d 1002, 1012 (9th Cir. 2004) (quoting Thane Int’l, Inc. v. Trek Bicycle Corp., 305 F.3d 894, 911 (9th Cir. 2002); Beebe — Trademark Law: An Open-Source Casebook 134 V3.0/2018–08–27. According to the Lanham Act § 43(c), in deciding the fame aspect of dilution by blurring or tarnishment the mark must be “widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark’s owner.” Lanham Act § 43(c)(2)(A). Additionally, the mark must have become famous before the defendant began its allegedly diluting use. See Lanham Act § 43(c)(1).

Among the marks that have failed to meet the fame requirement are the “longhorn” logo of the University of Texas, Board of Regents v. KST Elec., Ltd., 550 F. Supp. 2d 657, 678 (W.D. Tex. 2008), and the red dripping wax seal of the Maker’s Mark whiskey bottle, Maker’s Mark Distillery, Inc. v. Diageo North America, Inc., 703 F. Supp. 2d 671, 698 (W.D. Ky. 2010) (“Congress intended for dilution to apply only to a small category of extremely strong marks.”). Among the marks that have met the fame requirement are JUST DO IT, CHANEL, AUDI, and AMERICA’S TEAM. See respectively Nike, Inc. v. Peter Maher and Patricia Hoyt Maher, 100 U.S.P.Q.2d 1018, 1027 (T.T.A.B. 2011); Chanel, Inc. v. Makarczyk, 110 U.S.P.Q.2d 2013 (T.T.A.B. 2014); Audi AG v. Shokan Coachworks, Inc., 592 F. Supp. 2d 246, 280 (N.D. N.Y. 2008); Dallas Cowboys Football Club, Ltd. v. America’s Team Properties, Inc., 616 F. Supp. 2d 622 (N.D. Tex. 2009).

Wakanda is an interesting and exciting name, but it is not a household name. Further without empirical data, it is impossible to establish Wakanda, as reaching the level of recognition owed the protection of dilution. Based on the established case law, Wakanda has not met the standard to be considered famous under the Lanham act. As such Dilution would not apply.

WHAT IS TRADEMARK PARODY?

Admittedly, the name Wacoinda seems to parody the name Wakanda in an almost satirical manner, much like in Louis Vuitton Malletier, S.A. v. Haute Diggity Dog, LLC, 507 F.3d 252 (“Louis Vuitton”). A parody of a trademark must convey two simultaneous — and contradictory — messages: that it is the original, but also that it is not the original and is instead a parody. Cliffs Notes, Inc. v. Bantam Doubleday Dell Publ’g Grp., Inc., 886 F.2d 490, 494 (2d Cir. 1989).

Louis Vuitton, elaborated on the concept of Trademark parody. 507 F.3d 252 at 264. Trademark parody involves the appropriation of another’s mark as a well known elements of popular culture, and then building on it to contribute something new for humorous effect or social commentary. The Fourth Circuit’s decision in Louis Vuitton provides a detailed analysis of the parody defense to trademark infringement claims. In sum, the Court explained that defendants products and names were clearly similar in monogram, design and coloring, which indicated they were imitation. Normally, a strong mark favors the senior trademark owner, but, in the case of a parody, the fame of the mark allows consumers to readily perceive the target of the parody. Similarity of the marks themselves also favor the new trademark owner so long as the parody is sufficiently blatant so as to easily invoke the famous trademark in the mind of consumers, yet still distinguish the products.

CONCLUSION

For the reasons stated above Wacoinda has not infringed or diluted Wakanda’s brand. Because Wacoinda’s products and services are totally different, to date there is no evidence of actual confusion, the Wakanda brand is not strong enough to initiate a dilution claim and, even if it were, the theory of Trademark Parody does properly shield Wacoinda from liability. For these reasons it is axiomatic that Disney would fail in its attempt to prevent Wacoinda from Trademarking its name.

[1] For sake of full disclosure, admittedly, I am a proud member of the Wacoinda family, and I’ve had direct communication with its founding organizers and members.

[2] U.S. APPLICATION SERIAL NO. 87675039
MARK: WAKANDA*87675039*
CORRESPONDENT ADDRESS: STEVE ACKERMAN
THE WALT DISNEY COMPANY 500 SOUTH BUENA VISTA STREET
IP DEPARTMENT — TRADEMARK GROUP BURBANK, CA 91521

[3] “To prevail on a claim of trademark infringement under the Lanham Act, 15 U.S.C. § 1114, a party must prove: (1) that it has a protectible ownership interest in the mark; and (2) that the defendant’s use of the mark is likely to cause consumer confusion.” Network Automation, Inc. v. Advanced Systems Concepts, Inc., 638 F.3d 1137, 1144 (9th Cir. 2011) (citations omitted). However, where the products and services are so dissimilar such that it is not possible for consumer to be confused as to its source, there is no likelihood of confusion. Federated Foods, Inc. v. Fort Howard Paper Co., 544 F.2d 1098, 1103, 192 USPQ 24, 29 (C.C.P.A. 1976).

Music Executive / Founder of Burns Consulting / Owner at Lagos Diamond Exchange / Juris Doctor / ICO consultant/ Founder of Koinda Records

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