ZynCoin Meme Token Patches Things Up With Tobacco Giant Philip Morris

The Fortune 500 firm initially demanded an end to the crypto named for its nicotine pouch, but backed down after realizing there was no entity to sue.

Philip Morris, the tobacco behemoth that owns Zyn nicotine pouches, initially sent a cease-and-desist letter to the founder of a memecoin named after the product. After realizing there was no tangible entity to sue, Philip Morris retracted its demands.

The founder of a memecoin named after a hyper-popular nicotine pouch has extinguished a legal threat from the Fortune 500 tobacco giant behind the cigarette substitute. After being notified of the token by a CoinDesk article, Philip Morris, the Fortune 500 company that owns Zyn manufacturer Swedish Match, sent Zyn Coin founder Colton Kirkpatrick a cease-and-desist letter in the first week of April.

The letter, reviewed by CoinDesk, demanded he put the token in the proverbial ashtray. "ZynCoin was to immediately discontinue all use of 'ZYNCoin,''ZynCoin,'and any reference to ZYN products or any other images confusingly similar to the ZYN mark," the letter stated. Kirkpatrick resisted and reached a compromise: The prefix “zyn” will stay in the token's name, but the team will make minor alterations in its marketing. "They wanted to cease and desist the entirety of Zyncoin, which was problematic because it's etched into the smart contract and the coin on-chain," Kirkpatrick told CoinDeskin an interview. "There's no 'off' button."

There's also no tangible entity, centralized or otherwise, behind the Zyn token, which runs on the Ethereum blockchain. So Kirkpatrick was limited in what he could do to satisfy Philip Morris' trademark suit. Philip Morris eventually figured this out, and after speaking with Kirkpatrick and his counsel, the company retracted its demands. "They went from wanting the whole project to cease and desist to, after researching, realizing they couldn't easily sue or stop the coin due to its decentralized nature," Kirkpatrick said. "For the avoidance of any doubt, Kirkpatrick may use '$ZYN,''ZynCoin,''Zyncoin,' and 'ZYNCoin,' (the 'Permitted Marks')," a final version of an agreement between the tobacco giant and Kirkpatrick reads.

Kirkpatrick's counsel pointed out to Phillip Morris that there are numerous other companies with z-y-n in their names, and any infringement created by the Zyn token would be minimal because it's not a competing product to nicotine pouches.

The compromise: Add a dollar sign in front of "Zyn" to clearly indicate Zyncoin is a cryptocurrency, and remove references to specific circular canisters on the project's website to avoid potential brand confusion.

An email to the U.S. general counsel for Swedish Match, the Philip Morris subsidiary responsible for Zyn, went unreturned.

The dispute may be a sign of disputes to come as memecoins named after celebrities or consumer products without any formalities proliferate. It also shows that brands or celebs can do only so much to stop crypto projects from piggybacking on their names. "The practicalities of enforcing compliance within a decentralized community present unique challenges," said Florida-based digital assets attorney John Montague, who was not involved in the case. "Even if the founder can change the website to remove infringing materials, the decentralized decision-making process inherent to DAOs adds another layer of complexity."

For example, "token holders might refuse to approve proposals to alter on-chain details, making compliance with legal demands difficult," Montague said. There have been prior attempts to stomp out unofficial, fan-made crypto homages to real-world products. Nintendo's lawyers quickly quenched NFTs and Metaverse games using the company's recognizable characters during the height of the last crypto bull market. But these all relied on centralized entities as hosts. Entities that could be served. Ross Feingold, special counsel at Taiwan's Titan Attorneys-at-Law, told CoinDesk that if sufficient effort were made, there could be means to serve entities on-chain through an non-fungible token, though this could be time-consuming and expensive. "You might just consider the cost as being cost-prohibitive to start sending demand letters anyway," he said. "But I can imagine where there'd be some situations where you say, 'we're not really suffering any harm here,'" Feingold continued, noting that there's not an evident case of brand damage or confusion with the token and the Zyn pouch.

After all, Zyn token holders are buying the token out of admiration for the product; the coin is free advertising for a company that can't buy it. Philip Morris and other tobacco giants have been prohibited from advertising their products on TV in the U.S. since the 1980s. Then in 1998, the Clinton White House cut off transit, billboards, and product placements, virtually killing tobacco advertising completely. Montague said there might be

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