ORLANDO, Fla. (Legal Newsline) - X Corp., the former Twitter, has lost most of its motion to dismiss a trademark lawsuit from a social media company that was first called X.
X Social Media sued X Corp. last year in Florida federal court after new owner Elon Musk changed Twitter's name to X. Though the defendant categorized the case as a "shakedown" of a large company, Judge John Antoon ruled July 15 that three of the four claims made by XSM can move forward.
Only rejected was a claim under the Florid Deceptive and Unfair Trade Practices Act, though XSM can try to refile it in an amended complaint by the end of the month.
Antoon wrote XSM needed to allege its mark was entitled to protection and that X Corp. used a mark so similar that it was likely to cause consumer confusion.
"Plaintiff's complaint sufficiently pleads both prongs of trademark infringement," Antoon wrote.
"Although Defendant maintains that Plaintiff's rights are in 'X SOCIALMEDIA' and not 'X' - weakening Plaintiff's claim - this argument does not show that Plaintiff's mark lacks protection."
He also noted a "reverse confusion" pattern in which customers mistakenly think the old X's goods or services are connected with the new X's.
"Plaintiff attached to its complaint a Google search result suggesting Elon Musk owns 'x social media' as well as evidence of multiple headlines in major news outlets referring to Defendant as 'X Social Media,'" Antoon wrote.
"Plaintiff's allegations of likelihood of confusion are sufficient at this stage of the case."
The case started in October. XSM says it is a "vanguard" in using social media and marketing to connect consumers with legal services like personal injury litigation and it registered its trademark X SOCIALMEDIA in 2016.
Twitter became X a year ago. X Corp.'s attempt to register the mark led to XSM's lawsuit.
XSM, a Florida company, operates xsocialmedia.com and has invested more than $2 million to build "brand awareness." The suit says those efforts have worked, leading to a 2,439% revenue growth in one three-year period.
The complaint successfully alleged infringement violations under the Lanham Act, common law unfair violation and common law trademark and service mark infringement.
X Corp.'s lawyers called the case "a shakedown masquerading as trademark infringement" in a December motion to dismiss.
"Plaintiff's trademark registration for X SOCIALMEDIA does not confer upon it an exclusive monopoly to use X, one of only 26 letters in the alphabet," the motion said.
"On the contrary, Plaintiff has peacefully coexisted for years with hundreds of other registered X-formative trademarks for services ranging from advertising, marketing, social media, computer software and more."
XSM's response took offense to the 'shakedown' allegation.
"(W)hy are lawsuits filed against powerful companies too often termed shakedowns," XSM wrote in January. "Despite Defendant's choice of cliche, this case is not about unethical extortion."