Friday, March 20, 2009

Traverse Internet Law Federal Court Report: February 2009 Trademark Infringement Cases

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.

FILED: 2/26/2009

I have blogged about this issue extensively and I have included a chapter on this phenomenon of allegedly false “product review websites” in my upcoming book that is hitting the stands in September, 2009. The publisher is HCI, best known for its “Chicken Soup” books. Obviously if the allegations are true this is a very serious problem for the Defendant. Small businesses ought to stay on top of your Google results, constantly monitor AdWords for your products and services, and be vigilant in reviewing the sites to which both ads and organic results point to identify what has become a very common practice of deceit.

Video Professor is in the business of developing, marketing, and distributing for sale to retailers and the general public computer learning products including video tapes and CD-ROMs for over 15 years. The Defendant, Montgomery, appears to be the registrar and owner of a domain name that purports to be a rip-off review website. The Plaintiff alleges that when someone conducts a Google search on its trademarks the Defendant presents an AdWords ad that diverts the searcher to its own website with claims of being a scam reporting site with incriminating information about Video Professor on the site. In fact, Plaintiff claims that while the site appears to be an objective “product review” website, it is actually a rating site with all of the top ratings having links directly to web properties owned by the Defendant.

Plaintiff has sued for false designation of origin, trademark infringement, common law trademark and trade name infringement, commercial disparagement, violation of the Colorado Consumer Protection Act, tortious interference with business relationships, and common law disparagement. Video Professor is asking for an accounting, the imposition of a constructive trust upon the illegal profits, an award of compensatory and punitive damages, and recovery of reasonable attorneys’ fees and costs together with injunctive relief. Traverse Internet Law Cross-Reference Number 1295.

FILED: 2/23/2009

Another Google AdWords lawsuit this time including not only the triggering of ads through use of a keyword of an alleged trademark, but also the inclusion of the trademark in the ad text itself. Most courts are recognizing this situation as a basis for proving trademark infringement through initial interest confusion. How do you make sure that you are not using another company’s trademark, particularly when there is no requirement that the trademark be registered in any way? It’s almost impossible to know.

HomeDirect is a transportation company specializing in last mile logistics services and the Defendant, Ensenda, Inc., is a competitor of HomeDirect. Defendant is alleged to have purchased keywords for Google AdWords advertising using the Plaintiff’s trademark as a keyword. In addition, Plaintiff alleges that Defendant is using the HomeDirect trademark within the wording of its sponsored advertisement.

The first claim for relief is federal trademark infringement, the second claim is state law deceptive trade practices, the third claim is common law unfair competition, and the fourth claim is common law trademark infringement. Extensive injunctive relief is requested and, in addition, monetary relief including all profits received by the Defendant, all damages sustained by the Plaintiff, triple damages due to willful misconduct, punitive damages, and a recovery of attorneys’ fees and costs are requested. Traverse Internet Law Cross-Reference Number 1296.

FILED: 2/20/2009

Businesses are now fully appreciating the importance of trademarks. It still is difficult to understand how anyone could get a trademark in “The Scooter Store” and not be ready to have to defend the rights to it in court.

The Plaintiff owns “U-Scoot”, a scooter store that sells to the elderly, infirm, obese, and other customers. The Defendant is a competitor of the Plaintiff. The Plaintiff, U-Scoot, admits that it is purchasing keyword advertising on various search engines that are in combinations with what the Defendant considers to be infringing on its “The Scooter Store” trademark.

Plaintiff has requested a declaratory judgment that the Plaintiff is not infringing on Defendant’s trademark. The Plaintiff is also attempting to invalidate the Defendant’s “The Scooter Store” trademark and has requested that the court enter a declaratory judgment which would, in effect, support its use and award attorneys’ fees and costs against the Defendant. Traverse Internet Law Cross-Reference Number 1297.

FILED: 2/19/2009

Every company needs to not only be diligent in not keying AdWords off of competitor’s trademarks, but also avoid using competing trademarks in the html and metatags of a website. There are nuances of law that can allow this practice under certain circumstances, but they are complex and very high risk. The best practice is to simply make sure that you avoid the use of competitor’s names online.

OpticsPlanet, Inc. is an Illinois corporation and leading optics supplier for sports optics, tactical and military gear, microscopes and designer eyewear. Defendant is a competitor. Plaintiff alleges that Defendant has started using the Plaintiff’s trademark as a keyword to trigger its advertising when the Plaintiff is searched on Google and is also using its trademark in the html code of Defendant’s website, in other advertisement, and in other promotional materials.

The lawsuit includes a claim for trademark infringement, false designation of origin, and trademark dilution. Damages requested include compensatory damages, triple damages, profit disgorgement, attorneys’ fees, interest, cost of the suit and other relief. Traverse Internet Law Cross-Reference Number 1298.

FILED: 2/09/2009

Harry and David has now filed a large number of cases in the United States District Court for the District of Oregon. Many of these suits have apparently been settled and were initially brought against smaller companies. One of the strategies in attacking a pervasive legal problem is to start small and work to the bigger companies that can pay more damages since you will have established the law of the case in the earlier cases against weaker Defendants.

Harry and David is the famous gourmet food and fruit gifts purveyor and one of the nation’s oldest catalog mail order companies. Hickory Farms operates an online retail website selling the same kinds of products. Defendant is alleged to be purchasing the “Harry and David” keyword and triggering AdWords ads.

The lawsuit claims federal trademark infringement, federal unfair competition, federal trademark dilution, state trademark infringement, and state trademark dilution and requests injunctive relief against the Defendant’s continued practice of keying ads off of the Harry and David trademark, and an award of compensatory damages, triple damages, attorneys’ fees and costs. Traverse Internet Law Cross-Reference Number 1287.

FILED: 2/05/2009

The Defendant’s flat out denial of the purchase of the Plaintiff’s trademark as a keyword to trigger its sponsored advertising does raise the possibility, although this is not widely known, that Google’s algorithms are presenting ads based upon user behavior and not based upon the purchase of keywords. There is little doubt, however, that at some point in the recent past ads were triggered based upon artificial intelligence supplementing keyword purchases, so the Defendant may be correct in its assertion. There are several ways to determine if this is occurring prior to filing a lawsuit.

IO Data Centers provides facilities for the location of computer servers with the equipment of others as a “co-location service provider”. The company holds a trademark in “IO Data Centers”. Defendant is a competitor allegedly keying ads off of Plaintiff’s trademark term in the Google AdWords program. The Defendant flatly denies it has ever purchased the Plaintiff’s trademark terms as a keyword to display its sponsored links in the AdWords program.

Count one of lawsuit is for federal trademark infringement, count two is for unfair competition, count three is for state unfair competition, and count four is for state common law trademark infringement. The prayer for relief requests extensive injunctive relief, compensatory and punitive damages, an award of attorneys’ fees and costs, and other relief. Traverse Internet Law Cross-Reference Number 1281.

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