Category Archives: Trademarks

Tweet served as evidence of initial interest confusion in trade dress case

The maker of KIND bars sued the maker of Clif bars alleging that the packaging of the Clif MOJO bar infringes the trade dress used for KIND bars. Plaintiff moved for a preliminary injunction, but the court denied the motion. But in its analysis, the court considered the relevance of a Twitter user’s impression of the products. Plaintiff submitted a tweet as evidence in which a the user wrote, “I was about to pick up one of those [Clif MOJO bars] because I thought it was a Kind Bar at the vitamin shop ….” The court found that this type of initial interest confusion was actionable and therefore the tweet supported plaintiff’s argument.

KIND LLC v. Clif Bar & Company, 2014 WL 2619817 (S.D.N.Y. June 12, 2014)

Evan Brown is an attorney in Chicago, advising clients on matters dealing with trademark protection and enforcement, technology, the internet and new media. Contact him.

Company facing liability for accessing employee’s Twitter and Facebook accounts

While plaintiff was away from the office for a serious brain injury she suffered in a work-related auto accident, some of her co-workers accessed and posted, allegedly without authorization, from her Twitter and Facebook accounts. (There was some dispute as to whether those accounts were personal to plaintiff or whether they were intended to promote the company.) Plaintiff sued, alleging several theories, including violations of the Lanham Act and the Stored Communications Act. Defendants moved for summary judgment. The court dismissed the Lanham Act claim but did not dismiss the Stored Communications Act claim.

Plaintiff had asserted a Lanham Act “false endorsement” claim, which occurs when a person’s identity is connected with a product or service in such a way that consumers are likely to be misled about that person’s sponsorship or approval of the product or service. The court found that although plaintiff had a protectable interest in her “personal brand,” she had not properly put evidence before the court that she suffered the economic harm necessary for a Lanham Act violation. The record showed that plaintiff’s alleged damages related to her mental suffering, something not recoverable under the Lanham Act.

As for the Stored Communications Act claim, the court found that the question of whether defendants were authorized to access and post using plaintiff’s social media accounts should be left up to the jury (and not determined on summary judgment). Defendants had also argued that plaintiff’s Stored Communications Act claim should be thrown out because she had not shown any actual damages. But the court held plaintiff could be entitled to the $1,000 minimum statutory damages under the act even without a showing of actual harm.

Maremont v. Susan Fredman Design Group, Ltd., 2014 WL 812401 (N.D.Ill. March 3, 2014)

Fair use is a trademark concept as well

Ninth Circuit finds trademark fair use of name of online music site.

Webceleb is a “social marketplace for independent music.” It sued several defendants over the use of the term “web celeb” in connection with a television show award category and a section of an entertainment website. Defendants moved for summary judgment and the trial court granted the motion. Plaintiff sought review with the Ninth Circuit. On appeal, the court affirmed the award of summary judgment.

The court held that defendants’ use of the term “web celeb” was a classic fair use because:

  • the use of the mark was not a trademark use;
  • the use was fair and in good faith; and
  • the use was only descriptive

There was no trademark use because the term “web celeb” (at least according to the court) is “common parlance” for internet celebrities, which was what the award category was intended to recognize. And the use of “web celeb” in connection with the electronic magazine was merely descriptive of the online magazine’s content. The use was in good faith, as the evidence showed defendants were unaware of plaintiff’s mark when they created the “straightforward, descriptive title.”

The court came close to blaming the plaintiff for its own trademark woes:

Any minimal confusion here is the “risk the plaintiff accepted when it decided to identify its product with a mark that uses a well known descriptive phrase.” (Citing KP Permanent Make–Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111, 121–22 (2004))

That should serve as an instruction to all trademark adopters: While descriptive marks may do a good job of conveying information about a product, for the same reason the trademark owner may not enjoy as much protected exclusivity in the mark.

Webceleb, Inc. v. Procter & Gamble Co., 2014 WL 448648 (9th Cir. February 5, 2014)

No copyright protection for two word phrase

quipIn a final pretrial order, plaintiff stated that “to this day [defendant] persists in using [plaintiff's] copyrighted ‘usurpassed performance’ language on its packages.” Defendant filed a motion in limine (a motion to exclude evidence) to preclude plaintiff from introducing evidence or putting on testimony that would infer or suggest the phrase “unsurpassed performance” has been registered as a copyright.

The court granted the motion.

Under the Copyright Act, “[w]ords and short phrases such as names, titles, and slogans” are not subject to copyright. 37 C.F.R. § 202.1(a). The court looked to a number of cases in which short phrases had been denied copyright protection. For example, other courts had held that “Where Words Come Alive,” “Earth Protector,” “Chipper,” and “Retail Plus” were not copyrightable material.

One wonders whether plaintiff was really trying to assert some form of unfair competition or trademark infringement. The notion is worth entertaining for but a brief moment, till one realizes that laudatory phrases such as “unsurpassed performance” find no protection under trademark law either.

Predator International, Inc. v. Gamo Outdoor USA, Inc., 2014 WL 321069 (D.Colo. January 29, 2014)

The trademark and right of publicity woes of having a cryptocurrency named after you

Not too surprisingly, Kanye West’s lawyers have demanded the developers of the Coinye West cryptocurrency not use his name. The somewhat obnoxious letter shows that Kanye’s lawyers are asserting, among other things, trademark infringement and right of publicity misappropriation.

Russell Brandom at the Verge observes that “[o]nce the code is public, the original coders will be unable to prevent its use, forcing West’s legal team to prosecute every instance of Coinye individually.”

That observation raises a couple of interesting points. The first one is more of a clarification — once the code is in the wild, we should assume Kanye would only care to stop the use of his name, and would not seek (nor have any basis upon which) to stop anyone from using the code.

Stopping users of a cryptocurrency from using the name of that cryptocurrency could be a bit tough. Kanye’s lawyer threatens to “purse all legal remedies against any business that accepts the purported COINYE WEST currency.”

Infringement and misappropriation both depend on a use of the offending term in a commercial way. But users of the decentralized system, and the vendors who accept that currency, are not providers of any goods or services onto which Kanye’s identity will be attached. If one is merely using the currency as a tool, it’s hard to see how that’s any different from implicating the rights of the historical figures who appear on paper currency. So might it all be about the Benjamins? Maybe not at all.

Court considers Yelp posting as evidence of potential consumer confusion in trademark case

Posting by confused consumer was not hearsay.

You Fit, Inc. v. Pleasanton Fitness, LLC, 2013 WL 521784 (M.D.Fla. February 11, 2013)

In a trademark case between competing health clubs, the court considered a Yelp posting in entering a preliminary injunction, finding that while the anonymous posts were not conclusive evidence of actual confusion, they were indicative of potential consumer confusion.

The dispute centered over the use of “You Fit” and “Fit U” for health clubs. A Yelp user posted the following:

I am soo [sic] confused. I was a member at Youfit in [Arizona] and when I moved back to [California] I saw this place by my house and thought great my gym is here! When I went into the gym, I realized it was called Fit U. They use the same basic color scheme on their sign and the motto seemed the same. When I asked the girl at the desk, … [she] said her owner created this brand. I said what are you [ sic ] rates? Seemed very similar to me as when I was a member at Youfit. Very confusing and a big let down.

The court rejected defendant’s hearsay argument. It noted that affidavits and hearsay materials which would not be admissible evidence for a permanent injunction may be considered if the evidence is appropriate given the character and objectives of the injunctive proceeding. With no analysis as to why, the court found the Yelp posting appropriate to consider at this stage of the case.

Moreover, the court observed in a footnote that the Yelp post was not hearsay to begin with. It was not being offered to prove the truth of the matter asserted, but to demonstrate the consumer’s confusion — a then-existing mental state of the declarant, which is an exception to the hearsay rule. This is an interesting finding. The hearsay and non-hearsay uses of the post both turn on the same content, particularly the statement “I am soo [sic] confused.” That statement is the matter asserted (and in such capacity, excludable hearsay). And it is also the mindset of the declarant (and in such capacity, subject to an exception to the hearsay rule).

The court’s opinion does not address what one might see as the real problem with the Yelp evidence — its authenticity. Perhaps the parties did not bring that up. But one does not have to venture far in imagination to see how a crafty plaintiff could generate, or direct the generation, of self-serving social media content that would be helpful as evidence in a litigated matter.

See also: Customer reviews on social media provide important evidence in trademark dispute

No Computer Fraud and Abuse Act violation for taking over former employee’s LinkedIn account

Eagle v. Morgan, 2012 WL 4739436 (E.D.Pa. October 4, 2012)

After plaintiff was fired as an executive, her former employer (using the password known by another employee) took over plaintiff’s LinkedIn account. It kept all of plaintiff’s contacts and recommendations but switched out plaintiff’s name and photo with those of the new CEO.

LinkedIn identity writ large

Plaintiff sued in federal court under the Computer Fraud and Abuse Act, the Lanham Act, and a slew of state law claims including identity theft, conversion and tortious interference. The former employer moved for summary judgment on the CFAA and Lanham Act claims. The court granted the motion, but continued to exercise supplemental jurisdiction over the state law claims.

On the CFAA claim, the court found that plaintiff failed to show how the taking over over her account gave rise to a cognizable loss under the CFAA. The kinds of losses she tried to prove, e.g., lost future business opportunities and professional reputation, did not pertain to any impairment or damage to a computer or computer system. Moreover, the court found, plaintiff failed to specify or quantify the damages she alleged.

As for the Lanham Act claim, the court found that there was no likelihood of confusion. It noted that “anyone who navigated to [plaintiff’s] LinkedIn account would be met with [the new CEO’s] name, photograph and new position.” Accordingly, there was no effort to “pass off” the new CEO as plaintiff or to otherwise suggest an endorsement or affiliation.

Though it dismissed all the federal claims, the court kept the pending state law claims. The matter had been before the court for over a year, the judge was familiar with the facts and the parties, and dismissing it so soon before trial would not have been fair.

Other coverage by Venkat.

Photo credit: Flickr user smi23le under this Creative Commons license.

Six interesting technology law issues raised in the Facebook IPO

Patent trolls, open source, do not track, SOPA, PIPA and much, much more: Facebook’s IPO filing has a real zoo of issues.

The securities laws require that companies going public identify risk factors that could adversely affect the company’s stock. Facebook’s S-1 filing, which it sent to the SEC today, identified almost 40 such factors. A number of these risks are examples of technology law issues that almost any internet company would face, particularly companies whose product is the users.

(1) Advertising regulation. In providing detail about the nature of this risk, Facebook mentions “adverse legal developments relating to advertising, including legislative and regulatory developments” and “the impact of new technologies that could block or obscure the display of our ads and other commercial content.” Facebook is likely concerned about the various technological and legal restrictions on online behavioral advertising, whether in the form of mandatory opportunities for users to opt-out of data collection or or the more aggressive “do not track” idea. The value of the advertising is of course tied to its effectiveness, and any technological, regulatory or legislative measures to enhance user privacy is a risk to Facebook’s revenue.

(2) Data security. No one knows exactly how much information Facebook has about its users. Not only does it have all the content uploaded by its 845 million users, it has the information that could be gleaned from the staggering 100 billion friendships among those users. [More stats] A data breach puts Facebook at risk of a PR backlash, regulatory investigations from the FTC, and civil liability to its users for negligence and other causes of action. But Facebook would not be left without remedy, having in its arsenal civil actions under the Computer Fraud and Abuse Act and the Stored Communications Act (among other laws) against the perpetrators. It is also likely the federal government would step in to enforce the criminal provisions of these acts as well.

(3) Changing laws. The section of the S-1 discussing this risk factor provides a laundry list of the various issues that online businesses face. Among them: user privacy, rights of publicity, data protection, intellectual property, electronic contracts, competition, protection of minors, consumer protection, taxation, and online payment services. Facebook is understandably concerned that changes to any of these areas of the law, anywhere in the world, could make doing business more expensive or, even worse, make parts of the service unlawful. Though not mentioned by name here, SOPA, PIPA, and do-not-track legislation are clearly in Facebook’s mind when it notes that “there have been a number of recent legislative proposals in the United States . . . that would impose new obligations in areas such as privacy and liability for copyright infringement by third parties.”

(4) Intellectual property protection. The company begins its discussion of this risk with a few obvious observations, namely, how the company may be adversely affected if it is unable to secure trademark, copyright or patent registration for its various intellectual property assets. Later in the disclosure, though, Facebook says some really interesting things about open source:

As a result of our open source contributions and the use of open source in our products, we may license or be required to license innovations that turn out to be material to our business and may also be exposed to increased litigation risk. If the protection of our proprietary rights is inadequate to prevent unauthorized use or appropriation by third parties, the value of our brand and other intangible assets may be diminished and competitors may be able to more effectively mimic our service and methods of operations.

(5) Patent troll lawsuits. Facebook notes that internet and technology companies “frequently enter into litigation based on allegations of infringement, misappropriation, or other violations of intellectual property or other rights.” But it goes on to give special attention to those “non-practicing entities” (read: patent trolls) “that own patents and other intellectual property rights,” which “often attempt to aggressively assert their rights in order to extract value from technology companies.” Facebook believes that as its profile continues to rise, especially in the glory of its IPO, it will increasingly become the target of patent trolls. For now it does not seem worried: “[W]e do not believe that the final outcome of intellectual property claims that we currently face will have a material adverse effect on our business.” Instead, those endeavors are a suck on resources: “[D]efending patent and other intellectual property claims is costly and can impose a significant burden on management and employees….” And there is also the risk that these lawsuits might turn out badly, and Facebook would have to pay judgments, get licenses, or develop workarounds.

(6) Tort liability for user-generated content. Facebook acknowledges that it faces, and will face, claims relating to information that is published or made available on the site by its users, including claims concerning defamation, intellectual property rights, rights of publicity and privacy, and personal injury torts. Though it does not specifically mention the robust immunity from liability over third party content provided by 47 U.S.C. 230, Facebook indicates a certain confidence in the protections afforded by U.S. law from tort liability. It is the international scene that gives Facebook concern here: “This risk is enhanced in certain jurisdictions outside the United States where our protection from liability for third-party actions may be unclear and where we may be less protected under local laws than we are in the United States.”

You have to hand it to the teams of professionals who have put together Facebook’s IPO filing. I suppose the billions of dollars at stake can serve as a motivation for thoroughness. In any event, the well-articulated discussion of these risks in the S-1 is an interesting read, and can serve to guide the many lesser-valued companies out there.

Use of trademark in gripe site subdomain was not likely to cause confusion

Ascentive, LLC v. Opinion Corp., 2001 WL 6181452 (E.D.N.Y. December 13, 2011)

Plaintiffs sued gripe site pissedconsumer.com for trademark infringement and other forms of unfair competition. The court denied plaintiffs’ motion for preliminary injunction. It found, among other things, that defendants’ use of plaintiffs’ trademarks as subdomains (e.g., ascentive.pissedconsumer.com) was not likely to cause confusion.

The court looked to other cases where gripe site operators chose negative words to use in conjunction with the company being criticized. Over the years, gripe site operators have commonly chosen to add the word “sucks” to the target brand. For example, in Taubman Co. v. Webfeats, 319 F.3d 770 (6th Cir. 2003), the court held there was no trademark violation by the site taubmansucks.com.

Other “suck” parts of the URL have risen above the trademark infringement fray. A case from over a decade ago found that the web address compupix.com/ballysucks would not create a likelihood of confusion because no reasonable visitor to the site would assume it to come from the same source or think it to be affiliated with, connected with, or sponsored by Bally’s. Bally Total Fitness v. Faber, 29 F.Supp.2d 1161 (C.D. Cal. 1998).

And it’s not just that these brands purport to suck. In Taylor Building Corp. v. Benfield, 507 F.Supp.2d 832 (S.D. Ohio 2007), the court found that taylorhomesripoff.com, used in connection with a forum for criticizing plaintiff, did not create any likelihood of confusion.

In this case, the notion of being “pissed” joins a lexicon of permissible gripe site nomenclature (depending on the circumstances, of course). So says the court: “Like the word ‘sucks,’ the word ‘pissed’ has entered the vernacular as a word instinct with criticism and negativity. Thus, no reasonable visitor to the [offending pages] would assume the sites to be affiliated with [plaintiffs], and PissedConsumer’s use of plaintiffs’ marks in the various domain names at issue is not likely to cause confusion as to source.”

Aside: Good lawyering by my friend Ron Coleman for the defendants in this case.

Customer reviews on social media provide important evidence in trademark dispute

Chipotle Mexican Grill, Inc. v. Chipotles Grill of Jonesboro, Inc., 2011 WL 2292357 (E.D. Ark. June 9, 2011)

The awesome burrito place Chipotle sued another restaurant that called itself Chipotles for trademark infringement. Plaintiff sought a preliminary injunction. The court granted the motion.

One of the most important factors in the court’s decision to grant injunctive relief was the plaintiff’s showing that it will likely succeed on the merits of the case. In a trademark infringement action, that analysis takes the form of the likelihood of confusion analysis.

Among the factors that a court should consider in determining whether there is a likelihood of confusion is whether there has been any actual confusion among members of the consuming public. In this case, the court found that the evidence plaintiff submitted of actual confusion was “substantial.”

In addition to a number of emails that customers had sent to plaintiff, the court looked to a couple of customer review sites — urbanspoon.com and Yahoo’s associatedcontent.com — each of which contained customer reviews that erroneously linked plaintiff and defendant. The court found this to constitute actual confusion, which could not be remedied even through reasonable care on the part of the consumers.

The case gives a good example of how companies (and their competitors) should be aware of how their brands appear in social media. Evidence of actual confusion is a powerful tool for a trademark plaintiff (and a potentially damning one for a trademark defendant). Smart companies will ensure they remain aware of how their marks and overall brand identity are being put forth, even off the beaten path on the web.

Evan Brown is a Chicago-based attorney practicing technology and intellectual property law. Send email to ebrown@internetcases.com, call (630) 362-7237, or follow on Twitter at @internetcases.