Legal Ownership Of AI-Generated Trademarks: The Authorship Crisis

Today’s topic: AI-generated trademarks.

Artificial intelligence has gone from being a simple tool for automating tasks to now being involved directly in creating a company’s brand identity. Things like names, logos, and/or marks are being registered as trademarks (to receive legal protection).

In the past, these brand identities required human creativity to develop. Now, using AI, it is possible to generate a trademark in seconds. Thus, it poses a legal dilemma: Who, if anyone, owns the trademark created by an artificial intelligence?

AI-Fueled branding has become a leading method for creating logos and other commercial entities. However, businesses look to algorithms for information to develop distinctive, commercially viable logos.

The introduction of AI-Generated Branding allows for greater efficiency. However, the use of AI-generated branding will ultimately undermine traditional definitions of authorship and ownership under trademark law.

Copyright laws across most countries assume that a human author has created the work in question, while AI does not.

As a result, there is now a legal gap. Trademark laws in both the global and Indian arenas fail to define who the actual “author” is. Or if the owner is the one using the mark, the creator of the mark, or someone else entirely.

Thus, we find ourselves with considerable legal uncertainty regarding these matters and limited scope for further action.

The Legal Hurdles: Distinctiveness And Authorship

Representing the intersection between technology and the law, AI-generated trademarks highlight an area of uncertainty in existing trademark law.

Trademark laws were written under the assumption that any owner would be a human being with intent and control. However, AI lacks legal personality and therefore does not provide a clear distinction in ownership between the user, developer, or platform.

An example of uncertainty in authorship and ownership is displayed when a trademark is created. And that’s not by an individual but by AI. This is because it uses databases of previously used logos or signifiers. 

The result is that an AI-created trademark is very likely to be rejected for lack of distinctiveness. That’s because any proposed mark would be found generic, descriptive, or otherwise unoriginal is increased by an AI trainee’s ability to access, collect, and process vast amounts of data.

The fear of unintentional infringement is great. And the potential for AI systems to replicate existing trademarks (and thus trigger infringement actions) exposes businesses to liability under the Trademark Act. Yes, even when there was absolutely no intention to duplicate them.

Examiners might also raise questions about originality if similar marks produced by AI are used in other sectors. This would make it more difficult to determine the scope of exclusive rights.

This creates a complexity issue when deciding whether to apply for trademark registration. This is because the company has to prove its distinctiveness and legal right.

Until a clearer set of standards emerges, it is therefore critical to have an assessment and human review when applying for trademark protection for AI-created brands.

Strategic Guidance For The Legal Practitioner

A strategy lawyer may first focus on the issue of whether there is sufficient human control over the trademark created by the AI.

Attorneys Should Track

Attorneys may counsel their clients to keep such records as to how the AI tool was controlled, and such decisions made by human intervention may include things such as the prompts and ultimate selections made with a view to indicating that such a trademark is made by human choice and not by the AI.

Another area highlighted is ensuring that the client’s Trademark Registration will represent the rightful owner of the Registration.

Proper Documentation

A Lawyer must ascertain that the Trademark Registration is supported by proper documentation evidencing an intention to use the mark, for example, through the existence of Branding Briefs and Board (Executive Management) or Founders’ approvals of the use of the Register Mark.

These documents serve as evidence of trademark ownership for purposes of trademark registration and protecting that mark.

If the inherent uniqueness of a trademark is challenged, the attribution of acquired uniqueness becomes very critical in the fight for the acquired right to ownership.

In such cases, lawyers must recommend to the client to accumulate evidence of its marketing (advertising) activity, such as sample Advertising Brochures, Website Launches, Testimonials, Advertising Spending Totals, and Advertising Reach and or Coverage.

Over a period of time, a Client should be able to show that its Trade Mark is related to the source of goods and/or services, even though created using Artificial Intelligence.

Understanding Contractual Agreements

Contractual agreements constitute a large portion of Risk Management. These are an important part of managing risk between Clients and Suppliers of Artificial Intelligence tools.

The conditions of the Contract Agreement between the client and supplier must clearly define the ownership rights to any “output” generated by the Client’s AI tools. Additionally, there should also be warranties of non-infringement and indemnification associated with it.

Failure to do so creates potential liability for either party due to the possibility that litigation could arise in the future concerning the point of similarity in the Client and Supplier’s Trademark Registration.

Individuals must take an active, proactive approach when advising on AI-generated trademarks. This is because they represent higher-risk assets and require greater diligence than more typical trademarks.

Performing clearance-based searches, reviewing with legal counsel prior to registration, and making meaningful representations of the trademark during the registration process are essential. This ensures that a company can appropriately protect its brand in an ever-changing intellectual property environment.

Legalities In The Age Of AI-Generated Trademarks

With AI creating new opportunities for trademark protection, it has also introduced new challenges in establishing authorship and originality in trademark law.

Distinctiveness and infringement risk arise because of the following:

• Lack of direct legal acknowledgement of AI as an author.
• Ambiguity with respect to ownership.

Should organizations engage in the use of AI in developing trademarks, they may be harming their trademark protection rights.

To the extent of legal counsel, the path forward is clearly defined: to treat AI-generated trademarks as legally sensitive assets.

Legal counsel will need to advise clients on how to apply for a trademark in a complete, evidence-based manner. This will ensure the client successfully obtains enforceable rights in the new and evolving landscape of AI-branded products and services.