Are Investment Ticker Symbols Covered By Trademark Law?
from the perhaps dept
Here’s an interesting trademark law dispute that hits on something I never would have considered before: can there be trademark protection in a ticker symbol? My first reaction, honestly, was that the whole concept is silly. A ticker symbol is unique, and anyone buying a particular product should simply know what they’re investing in, and that includes entering the correct ticker. However, the actual lawsuit (posted below) does make a stronger than expected case that Invesco appears to have copied the ticker symbols of more popular Exchange Traded Funds (ETFs) and simply added an “S” to the end of each fund. The suing company is a trust, that appears to somehow be associated with S&P, and offers a bunch of ETFs covering different industries, and each one has a ticker symbol that begins with XL, so XLU is for Utilities and XLI is for Industrial. Invesco offered its own series of ETFs, which always began with a P in the ticker symbol, but recently launched a new series of ETFs, each of which matches the categories of the S&P trust industrial categories, where the symbol is identical, except for an S at the end — i.e., XLUS for Utilities and XLIS for Industrial.
Filed Under: ticker symbols, trademark
Comments on “Are Investment Ticker Symbols Covered By Trademark Law?”
Designed to confuse
I’m a bit torn. I think it would set a very bad legal precedent if trademark law were applied to ticker symbols. However, this is clearly designed to mislead, and there is a reasonable expectation that a somewhat unintelligent person in a bit of a rush would be confused.
Then again, there is so much information on these funds readily available online that anyone not doing the tiny bit of research required to clear up the confusion probably deserves to lose their money.
Re: Designed to confuse
Which is why this smells to me a lot like the tort of passing off… which is what TM law was originally based on…
Passing off is very basically a common law action which enables you to stop someone from representing themselves as you, assuming that misrepresentation is somehow detrimental to you in some abstract way of course.
I’m not convinced on TM on ticker symbols… sounds slippery to me. But PO is pretty plausible from what I can see.
Re: Designed to confuse
I’m wondering if it is actually designed to mislead. It could simply be an attempt to make it obvious to investors that the ETF’s match the categories of the S&P’s ETF’s.
I don’t work in the stock market, but maybe to somebody who does, it would be completely obvious that they are two different sets of funds, after all, they are from different companies, and stock tickers use a short sequence of letters, which means that you could run out of combinations after a while.
The more important question to me is, did the suing company (the S&P or its affiliate or whatever it is) even bother to request that the defendant change the symbols, or did they just head straight for court? Knowing how the lawyers operate, I’d be willing to wager that they didn’t.
50000 shares Akron Toaster and Tunafish
A moron in a hurry who uses ticker symbols directly will get into trouble regardless of intent. If you’re investing with three-letter symbols in a crowded space it behooves you to get all three of them right (or at least be able to count to three), and if you claim the right to play the stock market you should not ask the law for protection if you fail to do so.
the judge should toss out the copyright claim and they should just sue the company for fraud. this whole thing was to impersonate someone else hence it being a matter of fraud not copyright.
Slightly more complicated
Sometimes a competitor will select a trademark or symbol that resembles a competitor’s brand to let the public know that its product is a parallel product. It is not meant to fool the public, but to make an association. Try Wikileaks, for example. I have not reviewed the facts of this case, so I would withhold judgment at this time.
On a quick search, I came across this opinion for someone at Davis and Gilbert: “There is no relationship between ticker symbols and the trademark law. But letters can be registered under the trademark laws. So if a company is
assigned a ticker symbol eg. DVD and it wants to register it as trade dress, they can (If not registered by anybody already) Examples are VW, ABC and NBC. This is no way a legal advise. Wilson Addo Davis & Gilbert
that would be misleading, moron in a hurry or not, they know what they do were doing
Tickers are owned by the issuing authority
Firstly, there are different tickers for different exchanges, the ticker is assigned by the market (exchange) not designed by the company which gets it. I assume you are talking about North American markets when you refer to “tickers” but market data suppliers use “tickers” for the same instrument (share, bond, …) that differ from the ticker used on the trading exchange and other exchanges use different tickers for the local version of the equity (IBM has about 18 equity tickers around the world, “IBM” is one of them). Asian exchanges generally use numbers for “tickers” and Reuters assigns its own “ticker” (called a Reuters Instrument Code or RIC) for each of the thousands of equity instruments it monitors (capital market instruments have tickers assigned too). If you want to use RICs you need a licence from Reuters. You will find that you need a licence for SEDOL, DUNS and others too.
And copyright in prices
The NYMEX even wants to claim a copyright in free market PRICES! http://www.out-law.com/page-3173
Not too confusing
As a moderately savvy retail investor, I’m going to have to go with the “not confusing” side of this question. If a competitor starts up a copycat fund, especially an index fund, it’s entirely reasonable to use ticker symbols that refer to the original fund. This isn’t like a supermarket shelf where you have inches of space to note that although your product says “compare to Tylenol”, you aren’t J&J; you have four letters, tops, and this seems a reasonable way of indicating the equivalence.