E.D.N.Y. holds purchase of competitor’s trademark to trigger sponsored listing not trademark “use” under Lanham Act

Site Pro-1 v. Better Metal, LLC, No. 06-6508 (E.D.N.Y. May 9, 2007)

Site Pro-1 sued its competitor Better Metal, LLC, accusing Better Metal of committing trademark infringement when it purchased the terms “site,” “pro,” and “1″ to trigger sponsored links on Yahoo! The facts of the case were “straightforward and not in dispute”: the mark SITE PRO-1 did not appear in the sponsored search results linking to Better Metal’s website.

Better metal moved to dismiss the complaint under FRCP 12(b)(6). The court granted the motion.

Relying heavily on the cases of 1-800 Contacts v. When-U, 414 F.3d 400 (2d Cir. 2005), Merck & Co., v. Mediplan Health Consulting, Inc., 425 F.Supp.2d 402 (S.D.N.Y. 2006), and Rescuecom Corp. v. Google, Inc., 456 F.Supp.2d 393 (N.D.N.Y. 2006), the court held that the internal use of the plaintiff’s mark to trigger the sponsored listings was not “use” as provided under the Lanham Act. The key question was “whether the defendant placed plaintiff’s trademark on any goods, displays, containers, or advertisements, or used plaintiff’s trademark in any way that indicate[d] source or origin.” Because the court answered that question in the negative, Site Pro-1′s infringement claim failed.

Hat tip to Eric Goldman.