Internet Library of Law
and Court Decisions

SNA, Inc., et al. v. Paul Array, et al.

To fully understand this decision, the reader must also read the court's prior decision in this same matter, reported at 51 F. Supp.2d 542. Relevant portions of both decisions will be discussed below.

Plaintiffs SNA, Inc. and Silva Enterprises Ltd. (collectively "SNA") manufacture and market do-it-yourself kits which contain most of the parts (excluding the engine) necessary to construct an amphibious aircraft called the Seawind. Plaintiffs hold a federal trademark in the mark "Seawind and design" and a common law trademark in the mark "Seawind."

Defendant Paul Array owns defendant Horizon Unlimited. Together, these defendants publish a newsletter titled "The Seawind Builders Newsletter" which they send to Seawind customers and builders and publish on a website they operate at www.seawind.net. Defendant Douglas Karlsen operates defendant Turbine Design Inc., which installs turbine engines in Seawinds, and will, at the request of an owner, construct the airplane from a kit he/she purchases from the plaintiffs.

Plaintiffs brought this suit, claiming that defendants had breached contracts they had with SNA, defamed Silva and his company and disparaged their goods, infringed plaintiffs' trademark and trade dress, engaged in unfair competition, and interfered both with plaintiffs' current and prospective business relations with its customers.

Of greatest interest to those involved in Internet law are the court's decisions on plaintiffs' trademark infringement claims. Plaintiffs claimed that defendants' use of plaintiffs' common law trademark "Seawind" in the domain name of its website, www.seawind.net, constituted trademark infringement. At this website, defendants publish copies of each Seawind Builder Newsletter, as well as other information and commentary about the Seawind, SNA and Silva. Much of this latter information is derogatory, as evidenced by the titles such as "Dick Silva Commits Patent Fraud" "Dick Silva copies parts" and "Dick Silva Copies more Parts." The critical nature of the site is further evidenced by the following passage found on the site "SNA is wrong, they are lying, they are unworthy to be a kit manufacturer and deal with the public. They are selling unsafe parts and they need to be stopped. We have proof. That proof is available for any of you to see." Each issue of the newsletter contains a disclaimer that the newsletter is "not affiliated with any aircraft manufactures [sic], kit builders or marketers."

Notwithstanding its determination that defendants' use of the mark in the title of the newsletter did not infringe plaintiffs common law trademark, the court determined that defendants' use of the exact Seawind mark in the domain name of their site did. The court found that such use was likely to confuse the public as to the source of the materials on the website, even though a disclaimer was posted on the website, and the site's content were highly critical of the plaintiffs. Said the court:

Other district courts have examined the use of a plaintiff's trademark as a defendant's domain name and found it violated the Lanham Act. ... Both Jews for Jesus and Planned Parenthood found that an Internet user searching for the plaintiff's website who unwittingly entered defendant's website was likely to be confused about the relationship between plaintiff and defendant. The same is true here. Horizon Unlimited's use of plaintiffs' exact mark for defendants' website address is highly likely to cause confusion. Someone looking for official information about the Seawind will likely go to this address, either by guessing it and typing it in directly or by using a search engine and choosing this site from those listed because it sounds the most official. Internet users expect that a site with a domain name that is a trademark is somehow related to the owner of the trademark. It is highly likely that a person visiting this website would think there is a relationship between the company that makes the Seawind and a company using Seawind for it domain name. It is true that the highly critical and mean-spirited content of the website would indicate to a person examining its entire contents that this is not an SNA-sponsored or approved website, but that might just add further to the viewer's confusion about just what the relationship is. In any case, the initial interest confusion of drawing the viewer to the site is the relevant confusion. ... Horizon Unlimited argues that the presence of a disclaimer on the website precludes any finding of a likelihood of confusion, but that argument fails. ... As stated above, the relevant confusion that the domain name causes is drawing the web user to the site in the first place, and the disclaimer cannot fix that. {Note - this quotation comes from the court's decision reported at 51 F. Supp. 2d 542].

The Court did hold that defendants could use the domain name "www.seawindbuildersnewsletter.com" for their website, provided the first page of the website contains a disclaimer stating "The Seawind kit is sold exclusively by SNA, Inc. The Seawind Builders Newsletter is not sponsored by, approved by, or affiliated in any way with SNA, Inc." Such use, held the court, would not infringe plaintiffs' trademark.

The Court further enjoined defendants from continuing to use the mark "Seawind" in the meta tags at their website. The court found that defendants used the mark in this fashion in an effort to confuse consumers and lure them to defendants' site in lieu of plaintiffs'. The Court rested this finding of trademark infringement on the defendants' repeated use of the Seawind mark in their meta tags, and their general intent to harm plaintiffs.

In the balance of its decision, the court determined that various of the defendants had improperly made molds of plaintiffs' plane parts in breach of contractual agreements pursuant to which defendants bought plaintiffs' kits, and had improperly stolen parts to use as the model for some of these molds. The court directed that the molds be turned over to plaintiffs, and awarded damages arising out of the theft of parts. The Court further found that plaintiffs' defamation and commercial disparagement claims failed because they had failed to carry their burden of establishing injury from defendants' actions. The court also found that defendants did not infringe plaintiffs' mark either by using the mark in the name of the Seawind Builders Newsletter (particularly in light of the disclaimer appearing thereon) and by use of the phrase "Turbine Seawind" to describe the end product of the service they offered of installing turbine engines in Seawinds.