BUSINESS Technology

Santa Monica couple fights Snapchat over 'geofilter' trademark

A Santa Monica couple seeking to defend more than two years of part-time work is going to battle with Snap Inc. over whether the term “geofilters” can be trademarked.

Tracy and Paul Grand picked up a partial victory this month when the international body in charge of website name disputes ruled against Snap’s bid to snatch geofilters.com from their control.

Their next move is expected to be a formal filing in August opposing Snap’s effort to secure a U.S. trademark for the word “geofilter.” In Snap’s Snapchat messaging app, geofilters apply decorative graphics to images that often name or depict a location, such as a shop or city.

Paul Grand, a veteran software developer who runs competitions and mentorship programs for medical device start-ups, says he’s been working on an app related to location-based graphics since late 2014.

Snapchat introduced geofilters in mid-2014. About the same time, Apple announced it would begin allowing app makers to create editing features for the iPhone camera app. It’s that update that Paul Grand says prompted him to start thinking about building his geofiltering tool. He registered geofilters.com in November 2014.

Using spare time on weekends to build the app, he says he has come up with a working version. But he and his wife don’t think it’s ready yet for release. He declined to say why exactly the geofilter term is essential to the app, but he doesn’t want Snap to have a monopoly.

“We’ve spent three years developing it, and we’re passionate about it,” Paul Grand said.

The Grands see “geofilter” — like “banner ad” or “profile photo” — as a term that has come to describe a feature across the tech industry, as opposed to a distinctive word associated only with Snapchat.

The three-person panel at the World Intellectual Property Organization that heard the geofilters.com dispute agreed, finding that Snap “failed to show that the consuming public has come to recognize ‘geofilter’ as an indicator of the source of the product rather than the product itself.”

Snap declined to comment for this article, but it told the panel that the Grands have no legitimate interest in the term and that they registered the domain in bad faith. As evidence, the Los Angeles company cited the Grands’ suggesting that the URL was worth hundreds of thousands of dollars. Paul Grand said a formal offer was never solicited or made.

Snap’s desire to protect the term makes sense. It produces some of the graphics internally, but also allows customized submissions from the public and paid ones from advertisers. Ordinary users, let alone big-name brands, are expected to collectively spend tens of millions of dollars on geofilters tied to their weddings, birthdays and graduations.

Even if they win trademark protection, the Grands fear that Snap could pursue litigation against them. Even if Snap can’t use geofilters.com, it “can still make life difficult for the Grands,” the couple’s attorney, David Miclean, said.

Tracy Grand runs JacketFlap, a decade-old online community centered on children’s books. And Paul Grand operates MedTech Innovator, which he formed after more than a decade as an investor at a biotech firm. He also founded and sold online shopping and visitor-tracking companies during the 1990s.

They’ve toyed with other ideas, including a smartphone app that would use the device’s camera to identify lice in someone’s hair. The ideas led them to register dozens of URLs over the years — evidence in Snap’s eyes, according to the WIPO filings, that the couple registered the disputed domain name after the company launched its geofilters in an attempt to sell it “at an exorbitant price.”

Paul Grand disputed the accusation, saying “that’s never been our M.O. [This] is the first time we’ve dealt with a dispute. ”

UCLA Investment Co. dropped support of venture capital firm tied to harassment accusations

The group that manages $2 billion of UCLA’s endowment had invested in a venture capital firm whose co-founder has come under scrutiny this week for allegedly unprofessional behavior toward women.

Six women, three of whom allowed their names to be used, came forward in a story in the Information saying that Justin Caldbeck of Binary Capital made unwanted sexual advances as they tried to seek investment from his firm. On Friday, Caldbeck went on an indefinite leave of absence from the firm and apologized for “mistakes” over the years.

UCLA Investment was among many contributors to the $125 million in Binary Capital’s inaugural fund in 2014. But over undisclosed concerns with the management style of Caldbeck and his partner Jonathan Teo, UCLA Investment decided not to invest in the San Francisco firm’s second fund, which was raised last year. And it has no intentions of putting money into Binary Capital’s newest fund.

Joe Bryant, associate investment director for UCLA Investment, said her team had stepped up the amount of research it does before investing in venture capital firms. After this week’s revelations, among the questions she plans to bring up are whether venture capital firm founders have faced sexual harassment allegations.

“Folks should be a lot more careful when committing to first-time funds,” Bryant said.

Binary Capital didn’t respond to a request to comment.

Former insurance commissioner seeks to rally start-up creation in Southern California

Steve Poizner, the former state insurance commissioner who sold a GPS technology start-up to Qualcomm years ago, launched a nonprofit venture this week that plans to bring together investors, universities and entrepreneurs.

Poizner, who splits time between La Jolla and Los Gatos, plans to work nearly full time on the staff-less operation, a spokeswoman said. The Alliance for Southern California Innovation initiative remains in the early stages, but its major goals include serving as a local conduit for investors from other regions and coming up with a branding strategy for Southern California’s tech community. Boston Consulting Group plans to work for free to develop recommendations by the fall on boosting technology development in Southern California.

Michael Yanover, Creative Artists Agency business development head, and Scott Wolfe, an attorney at Latham & Watkins, are among volunteer leaders who plan to begin brainstorming ideas. Alphabet Executive Chairman Eric Schmidt and venture capitalist Bill Maris, whose $150-million health tech fund is based in San Diego County’s Cardiff-by-the-Sea, have signed on as advisors.

Elsewhere on the Web

  • Entertainment company AEG invested in e-sports team operator Immortals, which plans to host events at AEG’s L.A. Live complex in downtown Los Angeles, according to ESPN.
  • The latest investment in Culver City mobile game maker Scopely valued the start-up at near $600 million, according to Variety.
  • San Jose continues to woo tech conferences away from Los Angeles, according to the Silicon Valley Business Journal.
  • Yoshi, a subscription service that brings the gas pump to drivers wherever their car is, launched in Los Angeles, according to L.A. Biz.
  • Los Angeles start-up FinalPrice wants people to pay $99-a-year for access to discounted travel bookings, according to TechCrunch.
  • Los Angeles media start-up Beautycon expects to generate more than $25 million in revenue next year, according to Forbes.

In case you missed it

Coming up

The Los Angeles Venture Capital Assn. hosts First Look L.A. at Cal State Los Angeles on Wednesday. The event is expected to feature about 40 young companies in physical and life sciences and presentations tied to research out of Caltech, UC Santa Barbara and the University of Hawaii.

paresh.dave@latimes.com

Twitter: @peard33

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UPDATES:

11:40 a.m., June 25: This article was updated to provide more specific details from the WIPO filing.

This article was originally published at 3 a.m. on June 24.

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