Dropbox v. Thru: the fight over who owns the 'Dropbox' name
2014–2018
Thru Inc. claimed it had used the term 'Dropbox' since 2004 and threatened the company's trademark; Dropbox sued first for declaratory relief, won summary judgment, and the Ninth Circuit affirmed — with a roughly $2.3 million attorneys'-fee award against Thru.
What happened
File-transfer company Thru Inc. asserted that it had used the term 'dropbox' for a feature dating back to 2004 and challenged Dropbox, Inc.'s rights to the name, opposing Dropbox's trademark applications. After years of back-and-forth, Dropbox took the dispute to court, filing a declaratory-judgment action in the U.S. District Court for the Northern District of California (Dropbox, Inc. v. Thru Inc., Case No. 15-cv-01741-EMC) seeking a ruling that it did not infringe and that Thru had no enforceable rights.
In November 2016 the district court granted Dropbox summary judgment. It found that Dropbox held senior rights to the 'Dropbox' name through an assignment from another party, and that even if Thru had any rights, Thru was barred by laches — the court characterizing Thru as having deliberately delayed asserting its claim for years in hopes of increasing its settlement value. The court deemed the case 'exceptional' under the Lanham Act and awarded Dropbox roughly $2.3 million in attorneys' fees and costs.
Thru appealed. On 25 April 2018 the U.S. Court of Appeals for the Ninth Circuit affirmed the district court's rulings in full, upholding Dropbox's senior rights, the laches finding, and the fee award. The decision ended the dispute in Dropbox's favor.
Impact
The case secured Dropbox's exclusive claim to its own brand name — an existential issue for a company whose identity is the word 'Dropbox.' The exceptional-case finding and multimillion-dollar fee award also stood as a warning about laches in trademark disputes: a rights-holder who sits on a claim while a competitor's brand becomes globally famous may recover nothing and pay the other side's legal bills.