Hashtags have played an all-important role in the digital world, especially when it comes to content marketing on social media and video platforms. Being a cross-reference tool, a hashtag links together all website content with the same hashtag, enabling users interested in a hashtagged topic or theme quickly locate all related content through keyword searching. However, as hashtags mushroom, legal issues arise. In recent years, Taiwan has seen trademark and passing-off law disputes over trademark hashtags, where one’s trademark is hashtagged by competitors, yet hashtagging one’s own name may also give rise to legal disputes when misuse occurs.
In a recent decision of Taiwan’s Fair Trade Commission (“FTC”), a Taipei-based video platform and an interior design company were found violating Articles 21.4 and 21.1 of the Fair Trade Act due to hashtag misuse (Case No. Gong-Chu 111025, FTC (May 2022)). According to the FTC decision, the platform, based on a content marketing business model, invited the design company to produce a video introducing the history and design of a third party hotel, with the design company’s designer being featured as a tour guide. The platform then posted the video on the platform’s Facebook site to showcase the design company’s knowledge on interior designs as well as the platform’s media power. However, in the video description was a hashtag whose keywords were the design company’s name and phone number, which drove the FTC to find that the public would be misled into believing that the design company designed the hotel that was not their work.
The said Articles of the Fair Trade Act provide, “No enterprise shall make or use false or misleading representations or symbols on the matter that is relevant to goods/services and is sufficient to affect trading decisions on goods/services or in advertisements, or in any other way make it known to the public.”
The platform did not deny that they inserted the disputed hashtag in the video description to help advertise the services of the design company which was their member user. However, the platform argued that just because a name and a phone number were hashtagged in the video post does not mean the public would get misled about who designed the hotel, since the public are always well aware about the nature and function of hashtags: they are just a topic cross-reference tool.
The FTC held a different view. It found that, on top of the problematic hashtag, the video description contained other content, including a line which read “… the Hotel being designed by a skillful designer has transformed into a featured hotel…” This juxtaposition, the FTC held, would mislead the public about the designer of the hotel, hence the Fair Trade Act violation. Interestingly, both the platform and the design company were found to be advertisers liable in this case, although it is not altogether clear whether the design company participated in the disputed hashtagging and how the platform benefited from this. The FTC’s decision is appealable; whether an appeal has been filed is yet unknown.
Takeaways
- When hashtags are used along with contents (as they almost always are), their respective meanings inevitably permeate each other, and alter together according to the context of content. Especially when it comes to advertising, a field that never fails to attract competitors’ gaze and government’s regulation, hashtags are unlikely to remain a technology-neutral tool with zero legal risk.
- Content marketing as a wide concept of business model offers different types of cooperation between content creators and platforms/channels. At one end of the spectrum, content creators set the topic and complete the content plus accessory items like illustrations, precis, and hashtags, all by themselves, thus enjoying full credits and copyrights, while platforms/channels just post the content without any editing or processing. At the opposite end, content creators are subordinate to platforms/channels. Most content marketing cases fall somewhere in between. At any rate, platforms/channels’ and content creators’ interests are not always aligned with each other, and this is especially true when non-compliance issues occur.
- The reported decision reflects FTC’s position that, as a general rule of thumb, both a platform/channel and a credited content creator are to be held liable when content marketing is found not in compliance with the Fair Trade Act, and the FTC tends not to look into which one of them created the posted content element crucial to the dispute. This undoubtedly increases the risks for content marketing business.
- Under this circumstance, platforms and content creators should be more careful with their contracts. A well-drafted contract should define the parties’ editing rights (including rights to post-publication amendment/editing) along with IP rights, regarding not only the main body of the posted content but also its accessory items including hashtags, and indemnity clauses should be included in the contract if possible to reasonably allocate legal risks. After all, monitoring what your business partners are doing all day long is not cost-effective at all.