Thursday, December 18, 2008

Traverse Internet Law Federal Court Report: November 2008 Trademark Infringement Lawsuits


The facts are unproven allegations of the Plaintiff and all commentary is based upon the allegations, the truthfulness and accuracy of which are likely in dispute.


J2 GLOBAL COMMUNICATIONS, INC. AND CALL SCIENCES, INC. v. ZILKER VENTURES, LLC AND CHOOSEWHAT.COM, LLC
CENTRAL DISTRICT OF CALIFORNIA (LOS ANGELES)
2:08-CV-07470
FILED: 11/12/2008

I recently blogged about some of the more prevalent abuses of business trademarks. These allegations layout at least four separate abuses. The first involves the use of the Plaintiff's keyword to trigger ads. The second involves the use of the trademark in the title and description of the ad. The third involves a purported "comparison review" website. The fourth implicates false advertising claims within the comparison website itself. If you are an affiliate marketer, great care needs to be paid to all of these issues. If you are a business, all "comparison shopping" websites need to be looked at very carefully. Many are affiliate marketing sites pushing a competitor’s product or service.

Plaintiff J2 is a leading provider of Internet fax and messaging services and is widely known as "eFax" for which it has a registered trademark. The Defendants are keying Google AdWords ads off of the "eFax" keyword according to the Plaintiff. In addition, the term "eFax" is being used in the title of ads and in the text of the ads presented as sponsored links. Finally, the Defendants’ websites, to which the ads resolve, purport to be "comparison review" websites that give the consumer the false impression that they are unbiased. Plaintiff alleges that the Defendants are in fact paid by competing Internet faxing services as affiliate marketers.

The lawsuit alleges trademark infringement, unfair competition, false advertising, state unfair competition, common law unfair competition, and common law trademark infringement. The Plaintiffs request the issuance of preliminary and permanent injunctive relief, an accounting of all profits, an award of compensatory damages, punitive damages, attorneys' fees and costs of the suit. Traverse Internet Law Cross-Reference Number 1256.


GOFORIT ENTERTAINMENT, LLC v. DIGIMEDIA.COM, L.P., ET AL
NORTHERN DISTRICT OF TEXAS (DALLAS)
3:08-CV-02011
FILED: 11/10/2008

The federal anti-cybersquatting act and the ICANN rules do not apply to "subdomains". Since it is not prohibited by the ICANN rules, since one cannot lose this domain name through a UDRP arbitration process, and since this name is not a violation of the U.S. Anti-Cybersquatting law, my guess is someone assumed that you could legally use a trademark in this way. Don't think that because certain laws don't apply no law will apply to a particular situation. Trademark infringement exposure is very real in this case. For online businesses, don't just be careful with the domain names you own or acquire. Also put into place appropriate controls to prevent a web developer from using a trademark in either a subdomain or a directory extension.
Plaintiff operates a directory located at "www.goforit.com". Defendants own second-level domain names that are the same as the most common first-level domain names. Defendants own "org.com", "com.org", "gov.org", and "org.net". The Plaintiff alleges that the Defendants have added its registered trademark of "goforit" as a subdomain so that it appears as "www.goforit.com.org". According to the Plaintiff this obviously creates tremendous confusion, and also has an adverse search engine optimization impact on the Plaintiff.

The Plaintiff alleges cyberpiracy, federal trademark infringement, false designation of origin, common law trademark infringement, and common law unfair competition. Extensive injunctive relief is requested together with compensatory damages, punitive damages, attorneys' fees and costs. Traverse Internet Law Cross-Reference Number 1257.


GENERAL NUTRITION CENTERS, INC. AND GENERAL NUTRITION INVESTMENT COMPANY v. THOMAS PARK
SOUTHERN DISTRICT OF TEXAS (HOUSTON)
4:08-CV-03230
FILED: 10/30/2008

This case brings to the forefront one of the more interesting developments we have seen in the past 6 months. Many of our clients use "Google alerts" as well as various copyright reporting solutions to automatically search the web for uses of its trademarks and content. So, how does one use the content or trademark without tipping off the owner of the intellectual property? The answer is by using it in foreign languages. This is a hot arena for intellectual property infringement that your business needs to be thinking about.
The Plaintiff is the largest global specialty retailer of nutritional products including vitamin, mineral, herbal, and other specialty supplements and sports nutrition, diet, and energy products. The Defendant is alleged to be using trademarks of the Plaintiff on its Korean language website.

The Plaintiff has sued for trademark infringement, trademark counterfeiting, unfair competition, and federal trademark dilution. Extensive preliminary and permanent injunctive relief has been requested, an award of up to one million dollars per counterfeit mark, other compensatory and punitive damages, and its attorneys' fees and court costs. Traverse Internet Law Cross-Reference Number 1258.

Friday, November 21, 2008

Traverse Internet Law Federal Court Report: October 2008 Trademark Infringement Lawsuits


The facts are unproven allegations of the Plaintiff and all commentary is based upon the allegations, the truthfulness and accuracy of which are likely in dispute.


OMAHA STEAKS INTERNATIONAL, INC. v. RAEMICA, INC., ET AL.
CENTRAL DISTRICT OF CALIFORNIA (LOS ANGELES)
2:08-CV-06975
FILED: 10/22/2008

This issue of the use of a business or product name by a competitor on its website is taking on a life of its own. While this issue used to be debated, and some will still argue as to whether simply using a competitor's name can be a commercial use and therefore trademark infringement, it is apparent that many dozens of lawsuits have been filed in recent months all across the country in federal courts asserting this use as a trademark infringement. Anytime your business uses a competitor's business name, service name, or any product name it is essential that you have that use evaluated in advance. The doctrines of fair use and comparative advertising can provide the legal justification for using a competitor's name but these are very complex issues.

Plaintiff Omaha Steaks is a Nebraska Corporation and is a well known purveyor of quality meats. Defendant is a California corporation that engages in the sale of beef, pork, and poultry. Plaintiff owns a trademark for "triple-trimmed" that identifies a lean filet mignon steak trimmed of virtually all exterior fat. The Defendant is alleged to be using the term "triple-trimmed" in the content on its website and using it as a meta-element or keyword in its html on its website. The result is that when Internet search engines are used by consumers seeking the Plaintiff's product, the Defendant's website is presented as a result.

Omaha Steaks claims trademark infringement, "passing off", trademark dilution, unfair competition, and unjust enrichment. The lawsuit also demands an accounting, the establishment of a constructive trust of monies generated through this alleged misconduct, the entry of permanent injunction, award of compensatory damages, punitive damages, attorneys' fees, costs, interest, and the entry of permanent injunction from the use of the term "triple-trimmed" in the metatags or keywords or otherwise on its website. Traverse Internet Law Cross-Reference Number 1236.


PETMED EXPRESS, INC. v. PETCARERX, INC.
SOUTHERN DISTRICT OF FLORIDA (FT. LAUDERDALE)
0:08-CV-61694
FILED: 10/21/2008

Another metatag trademark infringement case but with a slight twist. This lawsuit alleges the use of the trademark in the text of pay-per-click ads. This is not a gray area at all. You can’t do that. With the money at stake, an accommodating resolution to this matter is not likely to occur.

Plaintiff PetMed is in the business of offering for sale, selling and distributing prescription and non-prescription pet medications, nutritional supplements, and pet accessories through its website. The Defendant is in the business of offering for sale, selling and distributing prescription and non-prescription pet medications, nutritional supplements, and pet accessories also. The Plaintiff helps consumer identify its PetMed’s trademarks by purchasing targeted keywords and achieving prominent organic placement on the top search engines. From 2003 through the end of 2007, PetMed sold approximately $750 million worth of merchandise. Defendant is alleged to have used the word "Petmeds" in the text of advertisements on presumably pay-per-click in the major search engines, and in the metatags of its website to increase its organic results when consumers are searching for the Plaintiff's name.

Plaintiff has sued for federal trademark infringement, federal unfair competition, and false designation of origin. The Plaintiff requests the enforcement of the preexisting permanent injunction, additional injunctive relief, an order awarding the Defendant's profits to the Plaintiff, other compensatory damages, treble damages, punitive damages, attorneys' fees, its cost, and an order that the Defendant be held in contempt of court for violating the previous injunction relating to the same subject matter. Traverse Internet Law Cross-Reference Number 1237.


HALF PRICE BOOKS, RECORDS, MAGAZINES, INC. v. HALF PRICE BOOKS, INC.
NORTHERN DISTRICT OF TEXAS (DALLAS)
3:08-CV-01860
FILED: 10/17/2008

Trademarks are often all about geographic location. Of course, on the web, a local store's website most often competes nationally, at a minimum. The Plaintiff may be the first to use the mark in interstate commerce and may in fact have a valid federal trademark, and this case is a good lesson for those expanding the geographic reach of your business. Trademark attorneys can provide "trademark clearance" so that your business understands the conflicts that may exist prior to expanding your reach. This case does raise a couple of interesting issues. Has the Plaintiff been infringing on the Defendant's state trademark over the years? And how does your business, when taking orders overseas, know that it is not infringing on the trademark of a business located in a foreign country? This issue is a potential liability that exists for almost all web businesses taking orders outside the U.S., and all web businesses located in the U.S. that have not obtained "clearance" of your business, product or service name.

Plaintiff is the owner of the "Half Price Books" registered trademark which it has used continuously for more than 25 years. Defendant operated a single store in Englewood, Colorado since 1987 called "Half Price Books". Plaintiff acknowledges Defendant's rights to continue to operate its single store in Englewood, Colorado. However, Defendant launched a website advertising and taking orders on a national basis over the Internet in early 2008, and at that time Plaintiff alleges that its trademark was being infringed.

Plaintiff has sued for federal trademark infringement, common law trademark infringement and unfair competition. The Plaintiff is asking for the entry of a permanent injunction prohibiting the use of the "Half Price Books" trademark by the Defendant except at its current store location in Englewood, Colorado, and requesting an award of compensatory damages, an accounting and award of all profits, an award of attorneys' fees, and court costs, and an additional award of the three times the amount found as actual damages due to willful misconduct. Traverse Internet Law Cross-Reference Number 1238.


SOLUTIONARY, INC. v. PANASAS, INC.
DISTRICT OF NEBRASKA (OMAHA)
8:08-CV-00468
FILED: 10/16/2008

This is not the use of a trademark in the pay-per-click advertising. This is, however, the use of a product trademark of a competitor on at least 10 occasions on a website. While the impact of this technique may not be self evident, the repetitive use of a name on a website is a search engine optimization technique that will rank that website higher in search results when the competing product is sought by consumers. In other words, repeating a term is an SEO technique for optimizing organic or natural search results.

Solutionary conducts business in the computer services industry and is a managed security service provider ("MSSP"). Panasas is engaged in the computer services industry and does business throughout the U.S. and the world with customers throughout Europe and China. Plaintiff claims a registered trademark in the term "Active Guard", which is an award winning, patented IT security technology owned exclusively by Solutionary. The Defendant is using the "Active Guard" trademark on its website and a search returned at least ten (10) references to "Active Guard". An organic search for "Active Guard" reveals results for both the Plaintiff and the Defendant.

Plaintiff sues for trademark infringement, false advertising and false designation of origin, federal trademark dilution, state trademark dilution, violations of the state Deceptive Trade Practices Act, common law unfair competition, and unjust enrichment. Prayer for relief includes a request for entry of monetary judgment for triple damages, compensatory damages, costs and attorneys' fees. The Plaintiff also requests entry of an extensive injunction prohibiting the use by the Defendant of its trademark name in any manner. The injunctive relief also requests remedial actions including an order requiring the Defendant to display a disclaimer on its website for one year that it is not affiliated with the Plaintiff, send notices by mail to all current, past, and prospective clients with appropriate disclaimers, and other mandatory injunctive relief. Traverse Internet Law Cross-Reference Number 1239.


HARRY AND DAVID v. ICG AMERICA INC.
DISTRICT OF OREGON (MEDFORD)
1:08-CV-03106
FILED: 10/15/2008

If the allegations are true, the Defendant likely is either a very savvy SEO or hired an SEO company to optimize its webpage so that it would be presented when "fruit-of-the-month club" is searched by a consumer on a search engine. The term is used in the meta-keywords, meta-description, and page title, all of which are significant techniques for optimizing a webpage for organic/natural results. The repetition of the name in the content within the first 100 words of the page is a classic SEO technique for "on-page" search engine optimization. The knowledge base of online businesses in the field of SEO is evolving rapidly, and techniques that have gone undetected historically are obviously being identified and being met head-on with lawsuits.

Harry and David is a nationally famous premier direct marketing, e-commerce and retail company operating over 140 stores nationwide. Its best known and most successful offering is the "fruit-of-the-month club". The Defendant is a competitor. The Defendant uses the term "fruit-of-the-month club" on its website even though Harry and David owns a federally registered trademark to the term. In addition, "fruit-of-the-month club" is used in the title for a page located at the "fruit" extension on the site, and also used in the meta-keywords and meta-description. In addition, the name itself is set forth 4 times within the first 100 words on the page. Defendant is also alleged to be using the "fruit-of-the-month club" trademark in both the title and the text of pay-per-click advertising on Google.

The lawsuit includes a claim for trademark infringement, false designation of origin, unfair competition under Oregon state law, and trademark infringement under Oregon state law. The prayer for relief requests the entry of an extensive injunction, an order requiring an accounting of all gains, profits and advantages derived by the Defendant, statutory damages, compensatory damages, triple damages, attorneys' fees and costs. Traverse Internet Law Cross-Reference Number 1240.


FRIENDLY FAMILY PRODUCTION LLC v. LITTLE HOUSE ON THE PRAIRIE, INC.
CENTRAL DISTRICT OF CALIFORNIA (LOS ANGELES)
2:08-CV-06602
FILED: 10/7/2008

Your web business may have a federally registered trademark or you may have an unregistered trademark in your business name, and/or the name of your goods or services. In order to keep the trademark rights you must police and protect your trademark from the use by infringers. If you do not do so, you will likely lose the ability to enforce your business's rights in the trademark, which will open you up to big problems. That is why you see so many "cease and desist" and trademark infringement lawsuits filed. The law requires an owner of a trademark to be proactive in policing and protecting the mark from unlicensed commercial uses. Does the Plaintiff have a problem here?

Plaintiff is the owner of all merchandising rights to the famous name and trademark "Little House on the Prairie". Defendant is a not for profit corporation which runs a small museum on the site of the house where Laura Ingalls Wilder once lived near Independence, Kansas. In or around 2001, the Defendant launched a website and started selling a few items of merchandise using the Plaintiff's trademark. Defendants also obtained a domain name with the Plaintiff's trademark contained within it, and registered federal trademarks for various goods and services in the name.

Plaintiff has sued for federal trademark infringement, federal unfair competition and false designation of origin, common law trademark infringement, trademark dilution, state trademark dilution, state unfair competition, federal false advertising, state false advertising, and tortious interference with prospective business advantage. The prayer for relief includes a request for cancellation of the Defendant's registered trademarks, an award of compensatory damages, an award of profits and gains by the Defendant, together with a recovery of Plaintiff's attorneys' fees, costs, and disbursements. Extensive injunctive relief is also requested. Traverse Internet Law Cross-Reference Number 1241.


DISCUSS DENTAL, LLC v. ALEXANDER YAKUBOV AND ANR INTERNATIONAL, INC.
NORTHERN DISTRICT OF ILLINOIS (CHICAGO)
1:08-CV-05600
FILED: 10/1/2008

The Plaintiff probably has missed the issue relating to the use of the product's name for search engine optimization purposes. At any rate, there is a difference between legitimate "comparative advertising" which allows the use of a competitor’s name in certain situations and the ownership and control of "review sites" that appear to the consuming public to be objective and unbiased. Again, using the name of a competitor's business, product, or service, while potentially very lucrative, carries with it very significant risks.

The Plaintiff is an industry leader for teeth whitening products and services. The company was co-founded by William Dorfman, D.D.S., who is known as "America's Dentist" for his appearance on ABC's hit television show "Extreme Makeover". Defendant owns multiple websites that sell teeth whitening products which compete with the Plaintiff's products. Defendants' websites are "comparative advertising" except that they purport to be "review sites" that offer objective information reviewing Plaintiff's and Defendants' products. The Defendants' websites provide false and misleading pricing and effectiveness information for the Plaintiff's products in a manner that appears to be "independent and unbiased". The Plaintiff claims that the reviews are created and controlled by the Defendants and uniformly lists the Defendants' products as the best teeth whitening products available.

The Plaintiff has sued for federal false advertising, deceptive trade practices, and common law unfair competition. The prayer for relief requests the entry of a temporary and permanent injunction, an award of compensatory damages, and other relief as the court deems proper. Traverse Internet Law Cross-Reference Number 1242.


LIFELOCK INC. v. CUSTOM DIRECT INC.
DISTRICT OF DELAWARE (WILMINGTON)
1:08-CV-00626
FILED: 9/26/2008

This is a pure, straight forward trademark infringement lawsuit for buying a keyword that is the trademark of a competitor and presenting an ad that does not apparently contain the mark in either the title, description, or URL presented. You will find that the search engines all handle this type of problem differently, with Google presently being the least restrictive and most accommodating to those purchasing a keyword that is a trademark of a competitor. No matter what the policy of the search engine is in your country, purchasing a keyword so that your advertisement is presented when a search is conducted for a competitor's product or service is high risk.

LifeLock is the industry leader in the field of offering identity theft prevention and recovery services to consumers. The Defendant, Custom Direct, operates a check fraud prevention business, and uses "keyword advertising". Custom Direct is allegedly purchasing the "LifeLock" trademark as a keyword and presenting its ads.

The lawsuit alleges federal trademark infringement, federal unfair competition under the trademark laws, common law trademark infringement, deceptive trade practices, and common law unfair competition. LifeLock requests the entry of a preliminary and permanent injunction prohibiting its competitor from keying its ads off of the trademark of the Plaintiff, an award of compensatory damages, profits of the Defendant, exemplary damages, costs and attorneys' fees, and pre and post judgment interest. Traverse Internet Law Cross-Reference Number 1243.

Tuesday, October 21, 2008

Traverse Internet Law Federal Court Report: September 2008 Trademark Infringement Lawsuits


The facts are unproven allegations of the Plaintiff and all commentary is based upon the allegations, the truthfulness and accuracy of which are likely in dispute.


GARY LEON TETER, JR. v. GLASS ONION, INC.
WESTERN DISTRICT OF MISSOURI (ST. JOSEPH)
FILED: 9/23/2008
5:08-CV-06097

The two alleged instances of intellectual property misconduct, taken together, are a big problem. Once again, understanding the totality of your business practices is critical to assessing risk.

G. L. Teter is a renowned artist. The Defendant is a website that provides hard to find, rare works of art on its website. The Defendant is using the Plaintiff's name in meta-data associated with its own website and is using "thumbnail images" of the Plaintiff's copyright protected artworks on its website.

The lawsuit alleges copyright infringement, false designation of origin, violations of the visual arts rights act, unfair competition under the federal trademark laws, trademark infringement, and trademark dilution. The Plaintiff is moving for injunctive relief, an accounting of the Defendant's website profits, reimbursement of all damages sustained by the artist, the tripling of all profits and damages, attorney's fees, punitive damages, and other relief. Traverse Internet Law Cross-Reference Number 1213.


HARRY AND DAVID v. ANSHU PATHAK dba ORGANIC FRUIT OF THE MONTH CLUB, ALSO dba BRENTWOOD TRADING GROUP, ALSO dba PREMIUM ENTERPRISES
DISTRICT OF OREGON (MEDFORD)
FILED: 9/23/2008
1:08-CV-03101

This is another example of a business trademark being used to sell competing products or services online. The allegations in this case include the use of the registered trademark in the domain name and then a separate use of the registered trademark to key a sponsored ad being presented from the Defendant whenever the Plaintiff's trademark was searched. A good rule of thumb is that keying ads off of a competitor’s name will often get you a cease and desist from the competitor's lawyer. However, when you acquire domain names that are used in conjunction with the advertising often times the consequences will far exceed a simple "cease and desist" communication.

Harry and David is a nationally famous premier direct marketing, e-commerce and retail company operating over 140 stores nationwide and its best known and most successful offerings are its "FRUIT-OF-THE-MONTH Club" mail order services. Defendant Pathak has allegedly registered multiple knock off domain names of the "FRUIT-OF-THE-MONTH" trademark and is using "keyword triggers" on search engines such as Google with the Plaintiff's trademark term keying sponsored link advertising placed by Defendant.

Plaintiff is alleging federal trademark infringement, federal false designation of origin, false representation, unfair competition, Oregon state trademark infringement, Oregon State unfair competition, and cyberpiracy. Harry and David is requesting extensive injunctive relief as well as statutory damages tripled due to alleged specific misconduct, and an award of attorney's fees and costs. Traverse Internet Law Cross-Reference Number 1214.


HOURIGAN, KLUGER AND QUINN, P.C. v. DOMAIN DISCREET
MIDDLE DISTRICT OF PENNSYLVANIA (SCRANTON)
FILED: 9/22/2008
3:08-CV-01753

Another in the long line of ever growing cases brought by a trademark owner against a third party using its name online. There is a clear connection between the use of the name, which clearly would result in higher organic search ranking, and the advertising on the website that leads directly to competitor’s products or services. The twist here is that it is likely the owner of these domain names is an "affiliate marketer" being paid by referrals and/or simply a squatter on the domain names participating in an advertising program for which the owner is paid a percentage of revenue generated by the traffic from his site.

Hourigan, Kluger and Quinn, P.C. is a law firm in Northeastern Pennsylvania and the attorneys practice before federal and state courts throughout the commonwealth of Pennsylvania in the areas of medial malpractice, personal injury, workers compensation, commercial law, labor law, and other areas of the practice of law. The Defendant is alleged to have registered numerous Internet domain names that consist of marks owned by the law firm or intentional misspellings of the law firm's trademarks. A number of marks with the name of the law firm included with various top level domain names are the subject of this lawsuit. Websites located at the domains allegedly refer traffic to competing lawyers and competing websites that provide lawyer advertising.

This lawsuit alleges cybersquatting under the anti-cybersquatting consumer protection act, trademark infringement under the Lanham Act, false designation of origin under the Lanham Act, unfair competition and false advertising under the Lanham Act, unfair competition under Pennsylvania common law, and conversion. Plaintiff requests an award of actual damages, liquidated damages, statutory damages, disgorgement of Defendant's profits, triple damages, attorney's fees and costs, and the entry of temporary and permanent injunctive relief against the Defendants continued acquisition of the domain names and more extensive injunctive relief. Traverse Internet Law Cross-Reference Number 1215.


INTERSECTIONS INC. v. LIFELOCK, INC. AND KBJ HOLDINGS LLC.
EASTERN DISTRICT OF VIRGINIA (ALEXANDRIA)
FILED: 9/16/2008
1:08-CV-00960

Yet another case of a lawsuit arising from the use of a trademark by competitor in the online world. Most important is the conspiracy allegation bringing into this case liability for third party misconduct. And affiliate marketers are the alleged third parties. Of course, in a conspiracy the misconduct of one conspirator can be imputed to all conspirators and jurisdiction as to one conspirator is often adequate to bring in all conspirators. This type of a lawsuit is another perfect example of why your business must be proactive, self policing, and self regulating as it relates not only to your internal business practices but the business practices and policies of those around you.

The Plaintiff, in its first paragraph, lays out this case very clearly as follows: This is an action for trademark infringement and other related causes arising from Defendants' practice of displaying Plaintiff's trademarks in advertisements that appear when consumers perform searches using Internet search engines such as Google. When consumers follow the hyperlink that appears in the advertisements created by Defendants', they are directs to Lifelock's website. This practice infringes upon Plaintiff’s Federal and common law trademark rights, constitutes false advertising and unfair competition, and also is believed to have occurred as part of a conspiracy amongst Defendants and with Defendant's affiliates.

The Plaintiff has sued for trademark infringement, Federal unfair competition, Virginia common law trademark infringement, and violation of the Virginia Business Conspiracy Act. Damages and extensive injunctive relief has been requested by the Plaintiff. Traverse Internet Law Cross-Reference Number 1216.


Z57, INC. v. iHOUSEWEB, INC.
NORTHERN DISTRICT OF CALIFORNIA (SAN FRANCISCO)
FILED: 9/08/2008
3:08-CV-04226

This case is very much about the evolving issues of the use of a competitor’s name online. We are now seeing many cases filed each month dealing with the purchase by a competitor of a "search term" on the web. One of the next major areas of litigation will be the less obvious, surreptitious use of competitor's names once search engine optimization and online business practices are more fully understood by businesses, lawyers, and judges. There are many, many ways to use a trademark of a competing business that does not involve metatags, domain names or advertisement triggers, many of which will ultimately be seen as a clear case of "trademark infringement".

Z57 is a website that provides marketing information relating to the Real Estate industry. Defendant is alleged to be using the "Z57" keyword to trigger Google AdWords advertisements when the "Z57" term is searched. Plaintiff also alleges that Defendant has been "scraping" and extracting content from Z57's website in order to secure customer sales leads for its own commercial gain.

Plaintiff claims federal trademark infringement, false advertising, common law unfair competition, and violations of the California Unfair and Fraudulent Business Practices Act. Z57 requests a permanent injunction prohibiting the Defendant from using the mark "Z57" alone or in combination with other words, compensatory damages, disgorgement of Defendant's profits, treble damages, punitive damages, interest, costs, expenses and reasonable attorneys' fees, and other relief. To the extent there has been "unauthorized access" through the scraping allegation, there is neither a state unauthorized access claim nor a federal violation of the Computer Fraud and Abuse act alleged. Traverse Internet Law Cross-Reference Number 1217.


AGEL ENTERPRISES, LLC v. RANDY SCHROEDER AND RISING SUN, INC.
CENTRAL DISTRICT OF UTAH
FILED: 9/05/2008
2:08-CV-00673

This is once again another lawsuit dealing with the use of a competing trademark term in relation to web business. This time the trademarked term is embedded in a domain name, and the most interesting aspect of this case might be the fact that the websites now used to market competing products were built, and have a history of search engine optimization, around the Plaintiff's trademark. This is a new legal issue that has yet to be dealt with in the courts. When you build the page rank of a website using a trademark, are you then allowed to switch the site over to selling a competing product and reap the benefits of the search engine optimization page rank when the previous competing product is the subject of a search on Google? These are the very types of issues that will be considered in the coming years and this is a high risk practice that carries with it potential consequences.

Agel is in the business of selling nutritional supplements in individual portable gel packs, deliverable to the user through the Plaintiff's "suspension gel technology". The Defendants are alleged to have operated at least two Internet websites with the trademarked term "Agel" in the domain name. Defendants, at the time, were multilevel marketers and also affiliate marketers of the Plaintiff. Defendants then decided to terminate its relationship with the Plaintiff and start selling a competing product known as "MonaVie", a nutritional supplement sold in bottled juice form and manufactured and/or distributed by Monarch Health Sciences. The Defendants continued to use the name of the Plaintiff in the domain names it had earlier acquired while acting as an affiliate marketer for the Plaintiff, and this lawsuit followed.

Plaintiff sued for trademark infringement, false advertising, unfair competition under Utah state statutory and common law, and has requested the entry of a temporary and permanent injunction, compensatory damages and disgorgement of profits, and the recovery of costs and attorney's fees. Traverse Internet Law Cross-Reference Number 1218.


BARRY WRIGHT CORPORATION v. FIXTUREWORKS, INC.
DISTRICT OF MASSACHUSSETTS (BOSTON)
FILED: 9/04/2008
1:08-CV-11511

This appears to be a straight forward case of a business suing a competitor because the competitor is using its name or trademark in commerce. This is becoming a very common legal claim and any use of a competitor's name, whether it be for triggering advertising, in content, in metatags, or otherwise should be closely scrutinized.

Barry Wright Corporation manufactures and sells spring plungers, ball plungers, leveling devices and other mechanical components for use in a variety of industries and applications. It operates a website at "vlier.com", to which its customers obtain information about the products and order products sold by the Plaintiff. Defendant is a competitor and has purchases the keyword "Vlier" in the Google AdWords program so that when that term is searched a "sponsored link" advertisement is presented for "fixtureworks.net" the Defendant. Plaintiff has filed suit against the Defendant for using its trademark of "Vlier" in order to trigger an advertisement.

Barry Wright Corporation has asserted a trademark infringement claim, a related claim for false designation of origin and unfair competition, a common law claim under Massachusetts law for unfair competition, requested a preliminary and permanent injunction, and actual damages, costs and attorney’s fees. Traverse Internet Law Cross-Reference Number 1219.

Thursday, September 25, 2008

Traverse Internet Law Federal Court Report: August 2008 Trademark Infringement Lawsuits


The facts are unproven allegations of the Plaintiff and all commentary is based upon the allegations, the truthfulness and accuracy of which are likely in dispute.


HARRY AND DAVID v. HOUDINI, INC.
DISTRICT OF OREGON (MEDFORD)
1:08-CV-03088
FILED: 8/15/2008

This is another pay-per-click keyword search lawsuit with a couple of nuances. First, there is use of the trademark deep in the URL used by the advertiser. Second, the traffic is being “trapped” so that the back button on a browser cannot be properly used. Both are issues to be considered in your advertising practices because they arguably build the “initial interest confusion” case for trademark infringement. If you lure a customer into your store, and then lock the doors, it looks really bad. Stay away from browser trapping.

Harry and David sued the Defendant for triggering ads using the “Harry and David” name. In addition, there is a reference to “Harry and David” buried in the URL string which the Plaintiffs are suggesting is another misuse of its trademark. Plaintiff also alleges a partial “mouse trapping” or “browser trapping” practice by the Defendants when traffic comes to its site.

Harry and David has sued for federal trademark infringement, federal unfair competition, federal trademark dilution, state trademark infringement, and state trademark dilution, requested triple damages and the entry of an injunction prohibiting Defendant from using the “Harry and David” marks for any advertisement for the sale of any product, together with an award of its attorney’s fees and court costs. Traverse Internet Law Cross-Reference Number 1205.

JONES DAY v. BLOCKSHOPPER.COM, ET AL.
NORTHERN DISTRICT OF ILLINOIS (CHICAGO)
1:08-CV-04572
FILED: 8/12/2008

This case reminds me (although this issue may not be part of this case) to suggest that a business be very careful about allowing your affiliate marketers to operate “directories” or “comparison” or “review” websites. Pure aggregators of information can claim that they are fairly using the trademarks of businesses. However, there appear to be abuses occuring online in which seemingly independent and fair use of business names is really a direct commercial use, which opens up potential legal issues. “Review” websites are almost always fronts for trademark infringement, product disparagement, defamation or unfair competition and once businesses and their lawyers figure out what is going on expect to see a spike in lawsuits against these sites and owners. This lawsuit is getting a lot of press and commentary.

Jones Day, one of the largest law firms in the world, sued the owners of a website that gathers and publishes details of private residential real estate transactions. Jones Day alleged that the Defendants were publishing this information in a scheme to solicit advertisements and garner advertising income. The website, according to the Plaintiff, uses the service marks of others, links to website owned by others, and uses material from websites belonging to others, and the site attempts to create the false impression that the Defendants are affiliated or endorsed by the Plaintiff.

The lawsuit alleges service mark infringement, federal false designation of origin, federal service mark dilution, unfair business practices, common law infringement and unfair competition. Jones Day has requested that the court enter extensive preliminary and permanent injunctive relief, award triple damages, profits, costs and attorney’s fees, as well as punitive damages. Traverse Internet Law Cross-Reference Number 1206.