“The similarities between the logos are striking, obvious, and patently unlawful.”

Some heavy tech hitters have been in the spotlight lately for haggling over their trademarks. Ars recently reported about Google, which successfully defended its mark amid accusations that the term "google" is no longer eligible for legal protection because it has become too generic of a word for "searching the Web."

Now comes two more companies battling over a different area of trademark law. PayPal is suing music-streaming company Pandora on accusations that Pandora's latest logo looks a lot like PayPal's and hence causes consumer confusion. Pandora launched the new logo in October as part of its campaign to turn its free listeners into paid subscribers.

"Pandora's recent adoption of a new 'P' logo, which is unlawfully similar to PayPal's logo, threatens the interests of PayPal's customers and disrupts their user experience. PayPal brings this action to remedy the harm Pandora is causing to the PayPal user experience and the PayPal brand," the payment company said in its federal intellectual property lawsuit filed in New York federal court.

PayPal submitted several social media postings from members of the public who said they were mistaking the PayPal app—and its 3-year-old logo—for the new Pandora app. One of the postings on Twitter asked: "Did PayPal buy Pandora?"

According to the lawsuit (PDF):

Element by element and in overall impression, the similarities between the logos are striking, obvious, and patently unlawful. Just like the PayPal Logo, the Pandora Logo is a capital P in block style, sans serif, with no counter, in the same deep-blue color range. And just like the PayPal Logo, the Pandora Logo plays the critical role of serving as an identifier on customers' mobile devices, guiding them to the PayPal payments platform.

PayPal said it had asked Pandora to change its design. Pandora, which isn't commenting on the lawsuit, declined to alter the logo, according to the lawsuit. PayPal also said it sent Pandora 110 pages of social media examples of "consumer confusion" about the logo similarities.

The previously registered Pandora trademark looked like a serified "P" surrounded by a square with rounded corners.

I’m so confused

The lawsuit raises the question of how consumers could confuse Pandora for PayPal when they are two completely different businesses. PayPal has the answer:

"There is a demonstrable nexus between PayPal's and Pandora's services, starting with the fact that the companies are in direct competition for the precious 'real estate' on the screens of consumers' mobile devices. Consumers also use PayPal to pay for their Pandora subscriptions," PayPal said in the suit.

Having a trademark grants the right to use the registered trademark symbol (®) and the right to file trademark infringement lawsuits in federal court. Trademark holders are also eligible to seek monetary damages. Having a trademark is also supposed to bar competitors from registering confusingly similar works, according to the American Bar Association.

In its trademark infringement and dilution lawsuit, PayPal is demanding that a federal judge stop Pandora from using its logo. The suit also seeks legal fees and costs, in addition to damages, including "punitive damages" to punish Pandora for its allegedly infringing logo.

No hearing date has been set. Pandora is scheduled to respond in court by June 12.