Proposal to seek legal advice on opening up Zcash Trademarks to royalty-free commercial use

[gottabeJay]

Hello Zcashers and Community Members

I would like to share some thoughts

1. The current problems

The ZF’s Trademark Policy in its current form is greatly restrictive and unnecessarily bureaucratic and inefficient.

Last week we had the debacle with MightyJaxx and ECC. Where the bureaucratic inefficiencies of the ZF’s Trademark Policy and ECC-ZF TM Agreement blew up in the open. The ECC started a marketing campaign and collaborated with a Singaporean collectibles company to design Cypherpunk Zero dolls and NFTs intended to go on auction. It all came to a halt when the ZF asserted that the ECC cannot not pursue this type of marketing relationship due to the language under section 6.1 of the ECC-ZF Trademark Agreement. That even the ECC couldn’t use the Zcash trademarks for a Zcash marketing campaign without agreement from ZF struck me as kinda crazy.

It has apparently been resolved.

This is not the first time that the ZF shot down friendly projects based on the ZF’s Trademark Policy.

In November I wanted to start a sticker store selling stickers with the Zcash logo to community members. I didn’t want to sign a trademark agreement because I didn’t want to dox myself just for selling stickers. I was told it was impossible to sign the agreement under a pseudonym, and threatened with enforcement if I went ahead with the project. I shut it down.

All of these legal knots are very detrimental to Zcash protocol, hindering the project, adding needless bureaucracy, and unnecessary complexity. It is not helping. This is not conducive to growing the Zcash protocol. Other projects do not have all these walls; they are more agile, allowing community members to contribute without needing legal instruments. All the fighting is becoming quite toxic and will put off people from engaging, joining or contributing to the Zcash eco-system. If we want to fight over the ZF’s Trademark Policy every now and then, rather than to be more open and permissive, we are heading in the wrong direction, in my opinion.

2. Usecases we want to avoid

There are use cases where we want to protect the Zcash trademarks from being used and potentially abused. Blockchain projects using the Zcash trademarks - for instance a Zcash Gold chain and crypto scams.

What other use cases would we want to prevent using the Zcash trademarks apart from scams, other chains or crypto related projects?

3. Allowing the use of the Zcash TM for Commercial Use

I suggest loosening the ZF’s Trademark Policy to allow the Zcash logo to be used for ‘friendly’ broad commercial use. Where it doesn’t hurt the brand, and has a positive or non negative effect on the Zcash brand. And clearly excluding the trademarks to be used in use cases outlined above for instance blockchain clients. ECC or ZF should be able to pursue a marketing campaign without needing the third party to sign an agreement. The ZF’s Trademark Policy should be as open and permissive as possible while protecting it from malicious use.

4. Concerns about Trademark abandonment

Jack Gavigan said on the Zcash Telegram group, that not policing the ZF’s Trademark Policy in its current form ‘’would risk effectively abandoning the trademark’’.

I am not advocating for the tearing up or abandoning of the ZF’s Trademark Policy, and a situation where we lose it needs to be avoided. However, the question whether allowing a very wide use of a trademark would be the same as abandoning it needs to be answered by a qualified professional.

5. Get legal opinion on allowing commercial use

I suggest seeking legal opinion if the ZF’s Trademark Policy can be loosened up to include ‘friendly’ uses cases of commercial use. To be more open and permissive and include the ability to use the trademarks for projects like selling Zcash branded merch, selling NFTs, etc while also allowing the ECC and ZF to be able to police and protect the ZF’s Trademark Policy.

ECC - ZF TM Agreement

ZF’s Trademark Policy

[fireice_uk]

I helped @gottabeJay to copy-edit this proposal. To reiterate his point, we need to ask ourselves a question. What’s the point of all this? To step on well meaning projects? To collect royalties? So that ECC and ZF can do their powerplay act? Is all this helping Zcash in any way whatsoever?

I will be willing to organise a fundraiser so that we can collect the few thousand usd it will take for a professional opinion on this. As far as I know (and IANAL) giving a wide permission to almost everyone is not the same as abandoning the trademark altogether.

[Shawn]

Some links for background / history of the existing TM agreement:

A Solid Future for the Zcash Trademark

Electric Coin Co. donates Zcash trademark to Zcash Foundation - Electric Coin...

ECC and Zcash Foundation reach landmark TM agreement

In essence, the contract transfers ownership of the trademark to the foundation — at no cost — and stipulates rights, obligations and limitations. It’s a novel agreement, for which there appears to be no precedent, containing unique stipulations such as this: No party has independent authority to declare that a specific chain of Zcash can actually be called Zcash. There must be agreement from both parties, and neither party can unilaterally override the will of the community. Update: J…

Note about trademark strategy

Hey Folks: There is a disagreement on strategy about how to manage the Zcash trademark. This post is to make sure you know the current status of the trademark and draw your attention to the strategy questions about how to use it going forward. ECC is currently the owner of the trademark, having created the trademark along with creating Zcash, and registered it in many countries. ECC had previously publicly stated that we would sign the Zcash trademark into a novel legal agreement which effecti…

[Autotunafish]

Question for ZF: how many people with legitimate intentions to use the Golden Z have asked to but were denied?

[ChileBob]

All that’s needed is for ECC/ZF to pick up a phone & say ‘Hey, we want to do this, you okay with it?’

(Guessing the answer will normally be yes & boilerplate permission could then follow, it doesn’t have to be complicated)

2-of-2 means work together. It isn’t hard, it isn’t what people are used to but that’s what it is.

[Dodger]

Over the past 12 months (I can’t speak to what happened before I joined), the only request we’ve denied (reluctantly) is @gottabeJay’s (and that’s only because they wanted to remain pseudonymous).

[fireice_uk]

Would you support opening up the trademark to commercial use if that’s legally possible?

[Shawn]

@fireice_uk

you support opening up the trademark

Keep in mind that’s not a call ZF could make on thier own.

Any changes to the TM agreement will likely have to be agreed upon by ECC and ZF. That’s the entire point of having a 2 of 2 multisig arrangement in the first place.

[fireice_uk]

I understand. I’m asking for his stance on the question as an ED of ZF.

[Dodger]

@fireice_uk

Would you support opening up the trademark to commercial use if that’s legally possible?

Firstly, let me just say that the trademark is available for commercial use, so long as the person (or organisation) wishing to use it is willing to sign a trademark license.

Secondly (and with specific reference to the title of this topic), ZF has never demanded royalties as a condition of granting such a license.

Would I like to reduce the red tape and make it easier for well-intentioned members of the Zcash eco-system to use the trademark? Absolutely! 100%

The problem we face is that, in order to keep the trademark, we must attach certain conditions to its use (hence the need for a license), supervise the licensees, take action regarding unauthorised usage, etc.

The risk we face in allowing unrestricted use is being ajudged to have permitted what the lawyers call “naked licensing”, which would result in us losing the trademark. When I was drafting the trademark policy back in 2016, I remember reading an article by a law firm about the Freecycle trademark case, that said: “Naked licensing represents Armageddon for trademark owners because, when found, it results in the subject mark being deemed unprotectable.”

“Naked licensing is apocalyptic for trademark owners”. (I may be paraphrasing slightly, as it’s been more than five years now but the sentiment and advice were v.clear.)

Having the trademark means that we can mitigate the risk of end users being misled and potentially defrauded by copycat coins (Zcash Classic, Zcash Gold, etc.). It means that we can issue takedowns against genuine scams like “Zcash Global” that risk tainting Zcash’s reputation.

The trade-off is that we have certain obligations, which unfortunately preclude us from naked licensing.

That said, I’d be very interested to read a legal opinion to the contrary.

Edited to add the correct quote. In searching for it, I came across another choice quote:

While a naked license may not necessarily mean a complete loss of trademark significance, courts are more than willing to strip the trademark owner of its trademark rights. In such cases, the outcome is analogous to nuclear catastrophe: the trademark owner not only loses its trademark infringement case, but loses its trademark rights altogether and can no longer enforce its trademark against others.

[fireice_uk]

@Dodger

The risk we face in allowing unrestricted use is being ajudged to have permitted what the lawyers call “naked licensing”, which would result in us losing the trademark.

This is indeed what we want to seek qualified advice on. It might be possible that a wide licence that rejects bad usecases such as other blockchain clients can meet the legal bar of “controlling the quality of trademark use”.

My question was more on meta level. If this is legally possible, would you support such a wide licence and help to identify the uses that we don’t want?

[Dodger]

@fireice_uk

My question was more on meta level. If this is legally possible, would you support such a wide licence and help to identify the uses that we don’t want?

In principle, I would support it but, without clear and unambiguous advice, and without knowing what the implications and trade-offs of such a move would be, I’m not prepared to make any commitments.

[Angst01]

Just want to add my voice here and keep the thread alive - I think in the interests of decentralization and frankly improved marketing, it behooves the Zcash community to allow more flexibility with use of the logo. We haven’t seen this issue arise very much yet, but Zcash is still very new and developing. As the project matures I think we will see more and more people in the community looking to promote Zcash in their own particular way, and we should be supportive of that.

Also, it would be very much a bad thing for those of us seeking to genuinely promote and grow the use of Zcash (including ZF and ECC) to lose control of the trademark and see it applied to things we don’t want to associate with.

To that end, I would also support a plan to seek qualified advice on the topic. I may be mistaken, but I get the impression that none of us discussing this here are experts in IP. I’m certainly not. Maybe we should survey the community and see what the level of support for that would be? And how it gets funded?

[fireice_uk]

Myself and @gottabeJay are in the process of building grassroots support and arranging details (picking lawyer, who would be the treasurer, etc).

I don’t see a single opinion costing more that few thousand USD, so we will probably organise a fundraiser here on the forum with someone trusted as the treasurer that will convert ZEC and pay the lawyer.

[artkor]

Hello everyone! I have not delved into this issue with the rights to the Zcash trademark. But now, after reading a few branches on this topic, I’m honestly in a huge confusion. In 2020, I saw with my own eyes the news that ECС had transferred the trademark rights to the Zcash Foundation. And there was a clear understanding that using Zcash logos is now the right of the community, and the community is essentially an unlimited circle of people. And it was equivalent to the fact that the Bitcoin logo is used today by an unlimited number of people in any way, even for commercial or non-commercial purposes. I have never heard of anyone having problems with this, because the Bitcoin logo is already almost as a given to people, almost like the sun and the moon.

And now it turns out that if I suddenly want to use the Zcash logo whenever I want, even if, for example, I hang a flag on my house, or release my own collection of NFT, then theoretically the Zcash Foundation will appear and like Cerberus will grab this initiative of mine. Wait a minute! And why do I need ZF at all? Do you mean to say that you are an organization? Is Zcash not a decentralized money, but an organization’s cryptocurrency? Do you want to sue me on this issue? All thematic media will find out about this. It will be a shot in the foot. Think carefully! @Dodger

[tokidoki]

I believe ZF will only require you to sign an agreement if it’s for a commercial use.

So, hanging a Zcash flag that you make yourself, or given to you as a gift, is fine. But don’t go print Zcash logo on shirts and start selling them.

I’m not a lawyer though and from the convos we had the last couple of weeks, I’ll probably not work on anything involving Zcash trademark if it’s not a ZF project

While we’re on the topic, does ZF require @ZcashGrants recipients to sign tm agreement? I mean, they’ll likely use Zcash mark and there’s always a likelihood that grantees are for-profit entities.

[artkor]

I believe that if we want success for the coin, then no one should sign any agreements with me at all.

People are too lazy to order flags, t-shirts and caps on their own. They will always choose to buy the finished product. And we should not limit, but encourage sellers who can use the Zcash logo to sell something.

Is there any organization that restricts anyone from using the Bitcoin logo for commercial purposes?

[tokidoki]

@artkor

any organization that restricts anyone from using the Bitcoin logo for commercial purposes

Well, the thing is: there’s no Bitcoin trademark. If there were a Bitcoin mark owner, something like Bitcoin cash can’t happen.

There should be some policing done by ZF to protect the mark. There’s so many scammers that happy to use the Zcash name. The problem starts when legit people who wants to do something good for Zcash, had to cancel their project. Hopefully, this doesn’t happen in the future.

[artkor]

We were lucky that this error was not noticed by anyone except the participants of this forum. I repeat - any judicial incident about a trademark will cause a lot of questions from the crypto community. Trademark protection is not an effective barrier against fraudsters. It can only pile up unnecessary bureaucracy, but there will always be scammers and they will not coordinate anything, as a rule they are not legal entities at all.

[tokidoki]

Well, are proposing that Zcash trademark is not protected at all? Or should there be no Zcash trademark?

Personally, I think it makes sense to have a trademark be owned by ZF which is funded by those who bought into the “Zcash” idea.

My qualm if people starts to use the mark as an excuse to entrench bureaucracy in Zcash.