I agree that it is important to distinguish trademarking the phrase “Dia De Los Muertos” with attempting to own the thing itself. I also agree that the biggest thing that made this a dumb move on Disney’s part was its tone deafness as to how this would resonate in the halls of public opinion. But I also think that reasonable, and non-alarmist, concerns could be raised as to Disney’s attempt to trademark this phrase. I haven’t seen the application itself, but, per the LL article, the trademark application was quite broad in scope. In theory, the trademark, if granted, could have been used to preclude any business from using the phrase “Dia De Los Muertos” when selling food, toys, “folk art”, etc. A toy store could, of course, sell toys or games that had a Day of the Dead theme, but they could not use the phrase “Dia Los Meurtos” in any way to market or package those products. This is troubling to me, as that specific phrase is so closely associated with the cultural event itself that forbidding a business from using the phrase would likely have at least some consequences on would-be celebrants, as well as businesses.
By way of analogy, a trademark on “Merry Christmas” in connection with the sale of any toy, food item, clothing, or household decoration would not prevent people from celebrating Christmas, but it would certainly interfere with such celebrations. (OTOH, a trademark of a far more specific phrase, like, “Disney’s Spirit of Christmas Holiday Greetings”, would not have such a chilling effect.)
One thing I would be curious about, though, is whether Disney qualified the trademark in some way, such as, for example, only seeking to trademark the phrase when it is written using a specific and distinctive font and style: such a limitation would greatly reduce the potential for abuse, I think, although it wouldn’t necessarily have had much impact on the predictable public response.
I do, of course, agree that Disney should have the right to try to prevent competitors from selling goods that are blatant knockoffs of, and attempts to cash in on the fame of, Disney’s upcoming movie. But a trademark precluding the use of the phrase “Dia De Los Muertos” when selling any of a wide variety of commercial goods is far too blunt of an instrument to be a proper way of addressing that problem.