Paris Hilton filed a complaint against Hallmark on September 6, 2007 for the greeting card pictured above.
Hilton alleges Hallmark knowingly and without her consent (i) commercially
appropriated her identity; (ii) invaded her privacy by using her name and
likeness; (iii) misappropriated publicity, and; (iv) falsely represented
that the card was associated with her or authorized or endorsed by her.

But Hallmark says Hilton's rights haven't been compromised. A Hallmark
spokesperson was quoted as saying the card is meant to be satirical. It's
part of one of Hallmark's humour lines that parodies celebrities and takes
a tongue-in-cheek look at news and gossip about these individuals.
(Hallmark is not alleging the fair use defence, and they would likely not
meet that criteria under US trademark law.)

Paris Hilton registered her pop cultural statement, "That's Hot" with
the US Patent & Trademark Office for its use in apparel in 2006, and in
2007 applied to have this expanded. Trademark protection doesn't require
that a mark be novel, original or creative, instead rights are related to
use, reputation and public recognition.

It would be difficult to argue that giving Hilton rights to "That's
Hot" is a justifiable reward for the fruits of her labour. Whether this
could be an incentive for others to produce similarly protected material
is also debatable, particularly if you're talking about socially useful
material. Also, it's probably easier to argue this is an impediment to
the free flow of ideas, rather than a just reward.

Despite all this, I would say that Hilton has a good chance of
success. Although trademark registration doesn't grant rights as
extensive as copyright or patent law, the purpose of trademarks is to
signal to consumers the source of a product or service and hinder the
ability of others to use similar marks to draw business away from the
original owner. (David Vaver, "Canada's Intellectual Property Framework:
An Overview," 17I.P.J.125(2004), p.15)

Public figures like Hilton make money by stamping their name, picture,
and "famous phrases" on commercial products. They are
in-and-of-themselves, a brand. Hilton's underlying interest may not be to
protect the public from deception. However, cross-market protection has
become a controversial area that trademark law takes into
consideration.

The problem is that I don't think the satire or parody in this case is
so obvious that I would assume it was an independent "critique" rather
than a product endorsed by Hilton. If I had seen the card-in-question at
my local Hallmark store, I would have assumed, "Paris Hilton is
capitalizing on the greeting card market and is probably making 50 cents
off this $2.47 card." If I bought the card it would be because of the
value brought to it by Hilton's image and "That's Hot" being on it.

This is precisely the type of confusion that trademark law is meant to
alleviate. The use of a photo of Hilton, her name and her catch-phrase
conjures an association to a particular brand, a brand that Hilton has
done a good job of developing and exploiting for commercial success. Who
knows, maybe Hilton was planning on releasing her own line of greeting
cards for the holiday season?

Luckily I don’t risk being sued by Hilton if I burn my hand on a cookie
tray and cry out, "Ouch! That's hot!" When used generically, as opposed
to commercially, a phrase takes on a different meaning. But if Donald
Trump has a registered trademark on "You're fired!" (which he does),
should this prevent me from starting up my own line of hot sauces with
that name? This is problematic for obvious reasons. As trademark rights
are expanded, they begin to take on copyright-esque qualities. It would
be harmful to give these expansive rights to trademark owners for simple
words and two-word phrases.

Where does trademark law draw the line? Another Hallmark card,
pictured below, may offer an answer. It also depicts Hilton, but it does
not use an actual photo or her trademark phrase. It may be that Hilton is
unaware of this card, but it is more likely that this would qualify as a
parody and exempt Hallmark from liability.

Who knows how far the law will stretch beyond the current state. Right
now, the law gives trademark holders rights of exclusion against others
and the ability to profit off marks associated with their reputation
across product markets. And right now, these are exactly the rights that
Hilton is claiming.