Last year, Pandora ditched its old logo in favor of a simple blue logo that looks very much like PayPal's logo. The online payment service has decided to hit the company back for this.

Trademark Infringement

On Friday, May 19, PayPal issued a lawsuit against Pandora as a result of the logo. In October 2016, the music streaming company changed its logo to a blue "P," which bears a strong resemblance to the dual-blue "P" logo PayPal has used for years.

The lawsuit claims that Pandora's logo has damaged PayPal, with customers mistaking the Pandora app on their smartphone for the PayPal app. The lawsuit claims that Pandora "deserted its longstanding logo and latched itself on to the increasingly popular PayPal Logo as part of its efforts to catch up to its competition."

To support its claims, PayPal included several social media postings that highlight the confusion the logo change brought users. According to Gizmodo, included in the suit was a sample of the posts from Facebook and Twitter that PayPal sent to Pandora as part of an "effort" to resolve the issue before any legal action. Unfortunately, nothing came of it, and PayPal v. Pandora was filed at the Manhattan Federal Court for trademark infringement and trademark dilution.

Pandora's Box

This lawsuit could not come at a worse time for Pandora. The company recently agreed to a $150 million investment and is said to be in serious talks to be purchased by Sirius XM. Getting dragged into this lawsuit by PayPal, regardless of how it goes, can only hurt Pandora more.

Pandora has been struggling to turn a profit, with the company losing nearly $500 million in the last two years alone. It has managed to stay relevant, but with services like Apple Music and Spotify growing month to month, it hasn't made things easy for Pandora.

PayPal only added fuel to that fire, claiming in the suit that Pandora reached a point where it was unable to turn a profit. By the same token, though, PayPal is trying to make the most of this, only becoming independent in 2015 after years of being attached to eBay.

It could be argued that other companies under PayPal's umbrella, like Venmo, are of more value to the whole than the parent company. So between the grandstanding of PayPal and the recent struggles of Pandora, it will be interesting to see just how this lawsuit shakes out for both sides.

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