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Designer Skin LLC v. S & L Vitamins, Inc., et al.
Unauthorized internet reseller of plaintiff’s products is not guilty of trademark infringement, and does not cause actionable initial interest confusion, by using plaintiff’s trademarks in meta tags of website at which plaintiff’s and its competitors’ products are sold, and in...

Search Engines - Internet Library of Law and Court Decisions - Updated April 4, 2008

437 F. Supp. 2d 273 (D.N.J., July 13, 2006)

Federal District Court holds that the use of plaintiff's 'JR Cigars' trademark as a keyword in GoTo.com's pay-for priority search engine to trigger the display of advertisements from third party competitors constitutes a "trademark use" sufficient to support trademark infringement and dilution claims under the Lanham Act.  Such trademark use arises out of GoTo.com's acceptance of bids from JR Cigar's competitors for a linkage to plaintiff's marks, by which GoTo trades on the value of those marks.  Such trademark use also arises out of GoTo's act of giving such advertisers priority over 'natural' search results, and thereby steering potential customers away from JR Cigar to its competitors.  Finally, such trademark use arises out of GoTo.com's use of a "Search Term Suggestion Tool" to assist in marketing JR Cigar's marks to its competitors, which tool shows the search traffic attracted by plaintiff's mark.

The Court went on to deny cross-motions by JR Cigar and GoTo.com for summary judgment, holding issues of fact precluded its determination of the likelihood of consumer confusion arising out of such usage of plaintiff's marks, and hence from resolving the trademark infringement claims at issue.

Finally, the Court dismissed claims advanced by plaintiff under both New Jersey's Consumer Fraud Act, N.J.S.A. §56:8 et seq. and the federal Telemarketing and Consumer Fraud and Abuse Prevention Act, 15 U.S.C. §6102(b).  The Court held that plaintiff lacked standing to proceed under New Jersey's Consumer Fraud Act, and that the reach of the Telemarketing Act did not extend to the acts at issue in the case at bar.

2006 WL 737064, Civil No. 04-4371 (D. Minn. 2006) (JRT/FLN)

The Court holds that the purchase of keyword advertisements triggered by a search containing another's trademark constitutes a use of that mark in commerce sufficient to give rise to trademark infringement claims.  The Court accordingly denied a motion by defendant The MLS Online.com to dismiss trademark infringement claims arising out of its purchase of keyword advertisements from Google and Yahoo that displayed 'sponsored links' to defendant's website when a user entered plaintiff's Edina Realty trademark as a search term.

The Court also denied defendant's motion to dismiss trademark infringement claims arising out of its use of plaintiff's mark in hidden text and links found on its website, and in the text of its sponsored links, which motion was premised on the ground that this was a permitted nominative fair use of plaintiff's marks.  Adopting the 'fair use' test followed by the Third Circuit, the Court held such uses of plaintiff's mark were not necessary to the description of defendant's product or services.

Finally, the Court dismissed trademark dilution claims advanced by plaintiff Edina Realty as a result of its failure to provide evidence of actual dilution.

Case No. C03-05340-F (N.D. Cal., March 30, 2005)

Court denies Google's motion to dismiss trademark infringement and dilution claims asserted by American Blind, which claims arose out of Google's alleged use of American Blind's trademarks to trigger the display of third party advertisements in search engine results for those marks.  The Court declined, on this motion, to hold that use of American Blind's trademarks in this fashion was insufficient to give rise to trademark infringement or dilution claims because it did not constitute a use of the marks to identify the source of goods or services supplied by Google.  The Court did dismiss the tortious interference with prospective business advantage claim asserted by American Blind, holding that American Blind had failed to allege the interference with sufficiently certain economic relationships necessary to proceed with such a claim.

Civ. Action No. 1:04cv507 (E.D., Va., December 15, 2004)

In a bench ruling, Court holds that the display by search engine giant Google of third party advertisements denominated "sponsored links", which ads are triggered by the entry of a trademark as a search term, does not run afoul of the Lanham Act provided the "sponsored links" do not contain the searched-for trademark.  However, the display of "sponsored links" which do contain the searched-for trademark are likely to confuse consumers and thus was held to run afoul of the Lanham Act.

The Court did not resolve the issue of Google's potential liability for the display of such third party ads, noting that Google had a policy prohibiting its advertisers from displaying "sponsored links" containing trademarks of third parties when such marks are used as the triggering search term.  It should also be noted that the Court's finding that consumers would not be confused by "sponsored links" that did not contain a trademark was based, in large part, on its rejection of survey evidence presented by the mark holder.  The Court rejected this evidence, despite its showing of consumer confusion, because the consumers were simultaneously shown both ads that did and did not contain the trademarked term.

1:04cv507 (LMB/TCB) (E.D. Va. August 25, 2004)

Court denies motion to dismiss brought by search giants Google and Overture, and allows plaintiff GEICO to proceed with trademark infringement and unfair competition claims arising out of defendants' alleged practice of selling advertising triggered by the entry of plaintiff's trademarks as search terms, which advertisements are displayed in the search results generated by such searches.

Case No. C 06-2057 JF (RS) (N.D. Ca., March 16, 2007)

Court dismisses action seeking redress as a result of Google’s alleged downward manipulation of the “Page Rank” it assigned plaintiff’s website.  This act allegedly reduced the ranking of plaintiff Kinderstart.com’s search engine in various Google Search results which, in turn, adversely impacted both the traffic and advertising revenue plaintiff Kinderstart.com’s site generated.  “Page Rank” is a system offered by Google for rating the usefulness of websites.  Google’s search engine utilizes the relative “Page Ranks” it assigns to websites in determining the order in which to deliver responsive search results to a user’s query. 

In its Second Amended Complaint, plaintiff claimed such acts constituted violations of the Sherman Antitrust Act, the Lanham Act and California Business and Professions Code Section 17200, as well as plaintiff’s right to free speech under both the Federal and California constitutions.  Plaintiff Kinderstart.com also alleged that it was defamed by Google’s alleged statement that the low “Page Rank” it assigned plaintiff’s site was arrived at objectively, without human manipulation.

The Court found that Kinderstart.com had failed to state a claim, and accordingly dismissed its complaint with prejudice.

2007 WL 530156, Civ. Act. No. 06-319-JJF (D. Del. February 20, 2007)

The Court held that the First Amendment, and the guaranties afforded Google and Yahoo thereunder, barred claims seeking redress as a result of Google and Yahoo's refusal to run advertisements on their search engines they did not wish to run.  In reaching this result, the Court followed decisions that afforded newspapers similar First Amendment protections when challenges arose concerning their refusal to run advertisements they deemed objectionable.  As a result, the Court dismissed claims advanced by plaintiff arising out of the defendants' refusal to run his advertisements, including claims that the defendants defrauded him and engaged in deceptive business practices, violated his First Amendment rights, and failed to meet the duties imposed on those, like inn keepers, engaged in a public calling.

The Court also held that Google and Yahoo were immunized from such claims by the Communications Decency Act, 27 U.S.C. Section 230, which "bars 'lawsuits seeking to hold a service provider liable for its exercise of a publisher's traditional editorial functions - such as deciding whether to publish, withdraw, alter or postpone content.'" It should be noted that plaintiff was proceeding pro se.

425 F.Supp.2d 402 (S.D.N.Y., March 30, 2006)

In six related lawsuits arising out of the sale by online Canadian-based pharmacies of both branded and generic versions of plaintiff's popular anticholesterol medication "Zocor," the Court granted motions to dismiss trademark infringement claims challenging defendants' purchase of the keyword "Zocor" from search engines to trigger the display of "sponsored links" to defendants' websites.  Such purchases do not constitute the requisite 'use in commerce' of plaintiff's mark necessary to sustain such claims.  The Court also granted defendant CrossBorder's motion to dismiss trademark infringement claims arising out of its use of plaintiff's trademark "Zocor" on its website, at which CrossBorder sold both plaintiff's own product, as well as a generic version described as "generic simvastatin."  "Simvastatin" is the active ingredient in "Zocor."  Because it sold branded Zocor at its website, this was a permitted fair use of plaintiff's mark.

The Court declined at this early stage of the proceedings to dismiss the trademark infringement and dilution claims advanced against the remaining defendants.  Defendants link the "Zocor" mark to web pages at which they sold both branded Zocor and generic products described alternatively as "generic Zocor," "Zocor generic" or "Zocor-generic."  The Court was unwilling on this motion to determine whether such uses were likely to confuse consumers as to the source and sponsorship of these generic products, and hence unwilling to declare them permitted fair uses of plaintiff's trademarks.

Finally, the Court granted the motion to dismiss for want of personal jurisdiction of defendant CanadaDrug's CEO.  This individual, a Canadian resident, was neither alleged to have personally undertaken any actions in the United States in furtherance of the infringing activities at issue, nor been a "primary actor" therein.

Civ. No. 04-CV-3918 (E.D. Pa., March 10, 2006), affirmed -- F.3d – (3rd Cir., July 10, 2007).

District Court dismisses claims charging Google with direct copyright infringement as a result both of its archiving Usenet postings that contain excerpts of plaintiff’s copyrighted works, and its display of excerpts of plaintiff’s copyrighted website in search results.  The District Court holds that Google has not engaged in the requisite volitional conduct necessary to be held guilty of direct copyright infringement because such copying is a by-product of the automated operation of Google’s search engine and related technologies.  As such, Google’s acts are akin to a user’s use of its ISP to transmit infringing material to a third party, which do not give rise to direct infringement claims against the ISP.  On appeal, the Third Circuit affirmed the dismissal of Parker’s direct infringement claims, on the grounds that Google’s archiving of infringing Usenet postings lacked the requisite “volitional conduct.”

Relying on Field v. Google, (D. Nevada 2006), the District Court also dismisses direct copyright infringement claims arising out of Google’s presentation to users of “archival” copies of plaintiff’s website in search results denominated “cache.”  The District Court holds that Section 512(b) of the Digital Millennium Copyright Act (“DMCA”), applicable to copyright infringement claims arising out of “system caching,” bars such claims here.

The District Court also dismissed vicarious and contributory copyright infringement claims arising out of Google’s archiving of Usenet posts created by third parties that themselves allegedly infringe plaintiff’s copyright, both because Google lacks the requisite knowledge of such inadequately identified infringing activity, and because it does not derive sufficient direct financial benefit therefrom.  This decision too was affirmed by the Third Circuit on appeal.

The District Court further dismissed defamation, invasion of privacy and negligence claims advanced by plaintiff arising both out of Google’s archiving of Usenet posts authored by third parties that allegedly defamed plaintiff, as well as out of Google’s storage and display in its “cache” of a website that purportedly defamed plaintiff.  Such claims are barred by the immunity afforded Google by Section 230 of the Communications Decency Act (“CDA”), a decision affirmed on appeal.

Finally, the District Court dismissed Lanham Act claims brought against Google as a result of its alleged republication of a website operated by a third party titled “the Official Roy Gordon FAQ.”  The District Court held that the third party was not violating the Lanham Act both because it was not using a mark in commerce as it was not selling anything on its site, and because consumers were not likely to be confused as to the origin of the site, given the criticism of plaintiff found thereon.  The Lanham Act claims against Google also failed because it was not a “moving force” or “active participant” in the creation of this site, or the alleged use thereon of plaintiff’s ‘mark.’  The Third Circuit affirmed the dismissal of the Lanham Act claims because of the absence of a likelihood of consumer confusion.  The Court also affirmed the dismissal of plaintiff’s trade disparagement claims because the statements at issue on the third party website were not made in the context of commercial advertising.

It should be noted that the plaintiff appeared pro se.  In addition, the Third Circuit’s opinion was denoted “Not Precedential.”

06 Civ. 1923 (JGK) (S.D.N.Y., March 12, 2007)

Court allows plaintiff to proceed with ‘click-fraud’ claim against defendant Findwhat.com, a search engine operator.  The complaint alleged that to increase its revenues from pay-per-click advertisements posted on its site by plaintiff, defendant Findwhat.com directed defendant Advertising.com to engage ‘bots’ and individuals to click on plaintiff’s advertisements.  This had the effect of increasing defendant Findwhat.com’s revenues, as plaintiff paid it on a pay-per-click basis.  The complaint alleged that defendant Findwhat also bid on pay-per-click search terms, thereby improperly increasing the price plaintiff had to bid therefore to obtain higher placement for such terms.  The Court held that such misconduct could run afoul of the implied covenant of good faith and fair dealing in the parties’ contract, and accordingly allowed plaintiff to proceed with a breach of contract claim against defendant Findwhat.com.

Findwhat.com changed its name to Miva, Inc. in June 2005.

The Court did dismiss the balance of the claims plaintiff asserted.  Its unjust enrichment claims failed because there was a valid contract governing the subject matter of plaintiff’s claim.  Plaintiff’s negligence claims failed because of the absence of any independent duty on the part of defendant Findwhat.com to monitor the source of the ‘clicks’ plaintiff received.  Such an obligation would be governed by the terms of the parties’ contract. 

Finally, plaintiff’s fraudulent concealment claim failed because of plaintiff’s failure to plead such claim with the requisite particularity.  Plaintiff was granted leave to replead this claim, premised on defendant Findwhat.com’s alleged duty to disclose that it was improperly causing a third party to click on plaintiff’s ads so as to increase Findwhat.com’s revenues.  Such a claim, if properly alleged, would serve to support a civil conspiracy claim against defendant Advertising.com, which was the party that allegedly arranged to have a ‘bot’ click on plaintiff’s ads.

Case No. CV 04-9484 AHM (SHx) (C.D. Cal., February 2006) aff'd. in part, reversed in part, remanded, 487 F.3d 701 (9th Cir., May 16, 2007).

On a motion for a preliminary injunction, the Court holds plaintiff likely to succeed on copyright infringement claims arising out of defendant Google's display of "thumbnail" images of plaintiff's copyrighted photographs in response to users' searches for images matching their description.  The Court held that it is likely to find that such a display is not a fair use of plaintiff's works, given, inter alia, its commercial nature, and the fact that such use likely interferes with a market for plaintiff's photographs.

The Court further holds that plaintiff is not likely to prevail on copyright infringement claims arising out of Google's use of "in-line links" that incorporate into Google's own web pages the web pages of third parties that themselves contain infringing copies of plaintiff's copyrighted photographs.  These "in-line links" allow users who are interested in a thumbnail image presented in Google's search results to view the actual image on the web page on which Google found it.  The Court held that it is not likely to find that Google directly infringed plaintiff's copyrights by such conduct, because, adopting the "server test," it is the third parties who created the websites that contain the infringing images, and not Google, that are displaying and/or distributing them in violation of plaintiff's copyright.

The Court further held that it was not likely to find Google guilty of contributory or vicarious copyright infringement as a result of such third party displays, notwithstanding any advertising Google may deliver to the web pages that contain such images, or revenue Google may derive therefrom.  Google is not guilty of vicarious infringement because it does not possess the requisite ability to control the content of such third party sites, or compel the third parties that operate them to remove infringing content found thereon.  Google's ability to remove such websites from search engine results does not constitute such control.  Nor, the Court stated, was it likely to hold that Google encourages or assists such infringement sufficiently to be guilty of contributory infringement.  The Court held that the record before it was insufficient to establish that the third parties displaying plaintiff's content were motivated by the revenue they might derive from the display of Google ads or that such revenue contributed to their posting of the infringing images in question.

487 F.3d 701, No. 06-55405 (9th Cir., May 16, 2007).

The Ninth Circuit holds that Google’s creation and display in search results of lower resolution ‘thumbnail’ copies of infringing images found on third party websites for the purpose of aiding the public in locating such images is a fair use that does not infringe the rights of the holder of the copyright therein.  In reaching this result, the court relied largely on the transformative nature of the thumbnails Google created, which, by facilitating the public’s ability to search the web for images, serve a different purpose than the original images, which are designed to entertain.  The Ninth Circuit accordingly reversed so much of the decision of the District Court which had enjoined Google from displaying such thumbnails in its search results. 

The Ninth Circuit further held that framing infringing images found on third party web sites via “in-line linking” to such sites does not directly infringe the display or distribution rights of the holder of the copyrights in such images.  As part of the process by which it provides results to those who search for images, Google presents a ‘framed page,’ the bottom half of which comes directly from the third party web site on which the image is found, and contains that image.  For the purpose of direct infringement, the Ninth Circuit endorsed the “server test” applied by the District Court.  Under this test, a party infringes the display rights of a copyright holder in an image when it stores a copy of that image on its own server, and delivers it to a third party.  When a party merely provides a link to a third party website on which such infringing material can be found, it is that third party web site, and not the party providing the link, that directly infringes the display rights of the copyright holder by causing that infringing image to be displayed on a user’s computer screen.  Applying this test, Google did not directly infringe by providing “in-line links” to third party websites that themselves contained infringing images.

Reversing the District Court, the Ninth Circuit held, however, that Google is potentially liable on a theory of contributory infringement for infringing plaintiff’s copyrights as a result of its provision of such in-line links.  According to the Court, “Google could be held contributorily liable if it had knowledge that infringing Perfect 10 images were available using its search engine, could take simple measures to prevent further damage to Perfect 10’s copyrighted works, and failed to take such steps.”  Issues of fact as to the adequacy of notices sent by Perfect 10 alerting Google that it was in fact providing links to third party web sites that contained infringing images, of Google’s response thereto, and of Google’s ability to remove such infringing sites from its search results, mandated denial of plaintiff’s motion for summary judgment.  Also left for the District Court to resolve on remand was whether the Digital Millennium Copyright Act (“DMCA”) immunized Google from liability for such contributory infringement, an issue the District Court had not addressed because it had determined that Google was not likely to be found liable for contributory infringement.

Finally, the Ninth Circuit held that Perfect 10 was unlikely to prevail on vicarious infringement claims arising out of Google’s provision of in-line links to third party web sites that contained infringing images.  The Court held that Perfect 10 had not demonstrated that Google had the ability to control such third party websites, and compel them to remove infringing images found on their sites, a prerequisite to a finding of vicarious infringement.

The Ninth Circuit resolved the copyright infringement claims Perfect 10 asserted against Amazon.com in a similar fashion.  These claims arose out of the provision by Amazon.com to users of its site of Google search results, “framed” via in-line links. By this arrangement, the Amazon user received the same search result as the Google user.  Accordingly, the Court reached the same conclusions concerning Amazon’s conduct as it did concerning Google’s.  All claims save that which sought to hold Amazon.com liable on a theory of contributory infringement were held likely to fail.  The contributory infringement claim, arising out of Amazon’s provision of in-line links to third party sites that contained infringing images, was remanded for further consideration by the District Court.

File No. 5:05-CV-102 (W.D. Mich., February 8, 2006)

Court dismisses plaintiffs' claim for $3 million in lost profits arising out of Ameritech's failure to register plaintiffs' website with search engines, holding such claims barred by the limitation of liability clauses contained in the parties' contracts.  These clauses limited recoverable damages to the $1,600 in fees paid by plaintiffs to Ameritech under the parties' agreements in this case.  In reaching this result, the Court rejected plaintiffs' claim that these limitation of liability provisions were unconscionable, and hence unenforceable.  This claim failed because the services provided by Ameritech that were the subject of the parties' agreements were available from multiple sources and hence Ameritech had the right to offer its services on such terms as it saw fit.  This claim also failed because the limitation on liability contained therein did not 'shock the conscience', particularly in light of the fact that plaintiffs themselves could have performed the very services defendants failed to provide - the registration of their website.

456 F.Supp.2d 393 (N.D.N.Y., September 28, 2006)

Federal District Court holds that Google's use of plaintiff's trademark "Rescuecom" as a keyword in Google's "Ad words" program to trigger the display of "sponsored link" advertisements from third party competitors for a fee is not a "trademark use" of plaintiff's mark, as the mark is not being used to identify the source of any goods or services.  The same holds true of Google's use of plaintiff's trademark in its "Keyword Suggestion Tool," in which Google recommends to potential advertisers, including plaintiff's competitors, keywords they may be interested in using, for a fee, as a trigger for the display of their advertising.  Notably the advertisements themselves, which appear along with search results for plaintiff's mark, were not alleged to display plaintiff's Rescuecom mark. 

As a result, the Court grants Google's motion to dismiss trademark infringement, unfair competition and dilution claims brought by plaintiff under the Lanham Act, as such claims require a showing of actionable "trademark use" which, the Court holds, Rescuecom cannot make.  Having dismissed plaintiff's federal claims, the Court declined to exercise pendant jurisdiction over plaintiff's state law claims, including a claim for tortuous interference.

In reaching this result, the District Court elected not to follow decisions reached by the courts in Geico v. Google, 330 F.Supp. 2d 700 (E.D. Va. 2004) and Edina Realty v. MLS Online.com, 2006 WL 737064 (D.Minn., March 20, 2006) which had denied motions to dismiss trademark infringement claims arising out of similar activity.  The Court, instead, followed the path taken by the court in Merck & Co. Inc. v. Mediplan Health Consulting, Inc., 425 F.Supp. 2d 402 (S.D.N.Y. 2006), which dismissed similar claims on the ground, inter alia, that there was no "trademark use."

Case No. Civ-02-1457-M (W.D. Okla., Jan. 13, 2003)

Court denies plaintiff's application for a preliminary injunction, finding plaintiff is not likely to prevail on its claim that defendant Google is guilty of tortuous interference with contractual relations as a result of having intentionally lowered the ranking of plaintiff's websites on Google's search engine.

Despite the fact that this action adversely impacted the traffic plaintiff's sites received from those using Google, the Court held that plaintiff was unlikely to prevail because Google's determination of how a page is ranked in response to a search query is an expression of opinion protected by the First Amendment which cannot give rise to a tortuous interference claim.  The court further held that plaintiff, an ad broker, neither had the right to be listed on Google's search engine nor have its page ranked in a certain way in response to search requests.

Quick Hits

Boston Duck Tours, L.P. v. Super Duck Tours, LLC, et al.
Civ. Act. No. 07-11222-NMG (D. Mass., December 5, 2007).

Court holds that competitor’s purchase of sponsored links from Google that are triggered by the entry of plaintiff’s “Boston Duck Tours” mark constitute a trademark use of plaintiff’s mark actionable under the Lanham Act.  Recognizing that the courts have reached conflicting answers to this question, the Court stated:

In short, the emerging view outside of the Second Circuit is in accord with the plain language of the statute.  Because sponsored linking necessarily entails the ‘use’ of the plaintiff’s mark as part of a mechanism of advertising, it is ‘use’ for Lanham Act purposes.

The Court further holds that the display of such sponsored link advertisements by defendant in the case at bar does not violate either the Lanham Act, or a prior preliminary injunction issued by the Court, because the ads market defendant as “Super Duck Excursions” and ‘serve[] to distinguish the defendant from the plaintiff.”  The preliminary injunction previously issued by the Court had enjoined defendant from continuing to use the phrase “duck tours” as a trademark or service mark in the greater Boston area, as such use was likely to infringe plaintiff’s ‘Boston Duck Tours’ mark.  As a result, defendant had changed its name from “Super Duck Tours” to “Super Duck Excursions.”

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Buying for the Home, LLC v. Humble Abode LLC
Civ. Act. No. 03-cv-2783 (JAP) (D.N.J., Oct. 19, 2006)

Court holds that alleged purchase and use of a competitor’s trade marks as key words to trigger the display of sponsored ads in a search engine is a use of that mark in commerce subject to the strictures of the Lanham Act.  The ads in question did not feature the searched-for mark.  Said the District Court of New Jersey:

The Court is mindful of the challenges that sometime arise in applying existing legal principles in the context of newer technologies.  As expressed by the Edina Realty court, supra, Defendants’ alleged use of Plaintiff’s mark is certainly not a traditional ‘use I commerce.’  Nonetheless, the Court finds Plaintiff has satisfied the ‘use’ requirement of the Lanham Act in that Defendants’ alleged use was ‘in commerce’ and was ‘in connection with any goods or services.’15 U.S.C. Section 1125(a)(1).  First, the alleged purchase of the keyword was a commercial transaction that occurred “in commerce,’ trading on the value of Plaintiff’s mark.  Second, Defendants’ alleged use was both “in commerce” and “in connection with any goods or services” in that Plaintiff’s mark was allegedly used to trigger commercial advertising which included a link to Defendants’ furniture retailing website.  Therefore, not only was the alleged use of Plaintiff’s mark tied to the promotion of Defendants’ goods and retail services, but the mark was used to provide a computer user with direct access (i.e. a link) to Defendants’ website through which the user could make furniture purchases.  The court finds that these allegations clearly satisfy the Lanham Act’s “use” requirements.

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FragranceNet.com, Inc. v. FragranceX.com, et al.
No. 06-CV-2225 (JFB)(ART)(E.D.N.Y., June 12, 2007)

Following the lead of the Second Circuit in 1-800 Contacts, Inc. v. WhenU.com, 414 F.3rd 400 (2d Cir. 2005) and of other district courts in the Second Circuit, the Court holds that the use of plaintiff’s mark either as a keyword to prompt the appearance of sponsored links advertising defendant’s site in Google’s search engine, or in the metatags of defendant’s site to trigger higher search engine placement, does not constitute a use in commerce of plaintiff’s mark sufficient to give rise to trademark infringement or dilution claims, either under the Lanham Act or New York state law.  Such use of plaintiff’s mark, reasoned the court, is the equivalent to store product placement, where the store places its own generic products on store shelves adjacent to more well-known brands to take advantage of the consumer’s attraction thereto.  As such a use is permissible, so to is the use of plaintiff’s mark in keyword advertising. 

The Court relied on decisions in Merck & Co., 425 F.Supp.2d 402, Rescuecom Corp. v. Google, Inc., 456 F.Supp.2d 393 (N.D.N.Y., 2006) , and Site Pro-1 Inc. v. Better Metal LLC, No. 06-CV-6508 (ILG)(RER)(EDNY, May 9, 2007), each of which “held that the purchase of a trademark as a ‘Sponsored Link’ is not ‘use’ within the meaning of the Lanham Act.” 

Said the Court:

It would be inconsistent with the reasoning set forth in 1-800 Contacts to conclude that the use of trademarks in keywords and metatags constitutes Lanham Act ‘use’ where, as here, defendant does not place the trademark on any product, good or service nor is it used in any way that would indicate source or origin.  Here, the use of plaintiff’s trademark is strictly internal, and, because such use is not communicated to the public, the use does not indicate source or origin of the mark.

As a result, the Court denied plaintiff’s motion to amend its complaint to assert, inter alia, claims of trademark infringement and dilution arising out of the use of its mark in keyword advertising and metatags.  The Court held that such amendment would be futile, as the proposed claims could not withstand a motion to dismiss.

In should be noted that, according to the court, ‘courts in other circuits have generally sustained such claim.’  However, the Court elected to follow the precedent cited above and deny plaintiff’s motion to amend.

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