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No Trademark Violation by "Gripe Site" and Keyword Triggered Advertising May Be Trademark Infringement
April 26, 2005
NO TRADEMARK VIOLATION BY “GRIPE SITE”
A federal appellate court has found that a Web site that incorporates another entity’s trademark in its domain name, for the purpose of criticizing the trademark owner’s goods or services, does not commit trademark infringement or dilution. But the appellate court left open the possibility that the gripe site violated the federal AntiCybersquatting Consumer Protection Act (ACAP), because that statute has no “commercial use” requirement.
Michael Kremer brought the lawsuit because he was dissatisfied with the hair restoration service he received from Bosley Medical Institute Inc. Kremer created a gripe site at bosleymedical.com. The site contained criticism of Bosley, and also summarized the findings of a 1996 investigation into Bosley by the Los Angeles County District Attorney. Kremer earned no revenue from the site, and he did not link to any of Bosley's competitors.
Bosley sued for trademark infringement, trademark dilution, violation of the ACAP and assorted state law claims. As to the trademark claims, the Ninth Circuit ruled that Kremer did not use the "Bosley Medical" mark in a way that triggers liability. Both the infringement and dilution causes of action require that the mark be used "in connection with" the sale of goods or services.
The appellate court found that expressing an opinion about goods or services is not the same thing as actionable "use" of the trademark in connection with those goods or services. According to the court, trademark law is not designed to "shield" a trademark owner from criticism nor act as a "sword" to silence unwanted speech. Even if visitor’s to the site choose to discontinue using the target’s goods or services, the loss of business does not equate to an actionable “commercial use under federal trademark law.
The court also noted, though, that commercial use of the mark is not necessary for a "cyber squatting" claim brought under the ACPA. The appellate court determined that the district court erred when it read a commercial use requirement into the ACPA. There is no such requirement, the Ninth Circuit held, as ACPA permits a cause of action against one who "registers, traffics in, or uses" the domain name.
Because the statute does not qualify the term “use” as “commercial” the appellate court reversed the summary judgment granted by the district court.
KEYWORD TRIGGERED ADVERTISING MAY BE TRADEMARK INFRINGEMENT
A California company is permitted to go to trial with to determine whether Google violated federal trademark law by triggering sponsored links to appear when a user searches for a rival's trademark. According to a federal trial court sitting in California, this may constitute a use in commerce of the mark that supports a claim for trademark infringement.
After receiving threats from American Blind & Wallpaper Factory to the effect that the company would sue Google for trademark violations, Google itself filed a declaratory judgment action against American Blind & Wallpaper Factory Inc. American Blind counterclaimed for trademark infringement and related unfair competition claims against Google and several of its licensees.
At issue was whether Google’s “current policy regarding the sale of keyword-triggered advertising” constitutes trademark infringement. Google filed a motion for summary judgment, arguing that as a matter of law, its policy did not violate the federal trademark law.
Google argued that the keyword triggers was permitted because the system did not use American Blind’s trademarks to identify Google’s products. The trial court disagreed, however, citing prior case law that had established that there was a genuine issue of material fact whether "keying" the display of unlabeled banner ads to a competitor's trademarks caused initial interest confusion.
The trial court compared the use of trademarks as keywords to the insertion of trademarks as metatags in the coding of a Web site. If such metatags are capable of causing initial interest confusion, then keyword-triggered ads are "sufficiently analogous" such that American Blind properly alleged actionable trademark use.
This Newsletter is a periodic publication of Graydon Head & Ritchey LLP and should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general information purposes only, and you are urged to consult your own advisor concerning your situation and any specific legal question you may have.