A few days ago I discussed a decision by Massachusetts U.S. District Court Judge Nancy Gertner holding that purchase of a trademarked keyword to trigger a sponsored link on a search engine constitutes a “use in commerce” of the trademark under the Lanham Act (the Federal Trademark statute). (Earlier post here). In that post I mentioned that among cases addressing this issues, only the Second Circuit had held otherwise.
Now the Second Circuit seems to have changed its position on this issue. In Rescuecom v. Google, issued on April 3, 2009, the court reversed a motion to dismiss by the trial court, holding that Rescuecom properly alleged that Google’s keyword ad practices constituted a “use in commerce” under the Lanham Act.
In a somewhat unusual step, the court attached to its opinion an Appendix entitled “On the Meaning of “Use in Commerce” in Sections 32 and 43 of the Lanham Act.” The Appendix, which is described as dicta, discusses at some length the statutory history of the “use in commerce” phrase in the Lanham Act.
This decision appears to be a game-changer for Google, and will require it to modify its policies on selling key word search ads to competitors.
The issue here, presented in the context of a motion to dismiss, is whether adoption of a trademark as a search engine keyword constitutes a “use” under the Lanham Act. The Lanham Act requires “use in commerce” as a condition of infringement, and as Judge Gertner points out, various courts have taken different positions on whether purchase of a trademarked keyword to trigger a sponsored link on a search engine is a “use” of the trademark. Judge Gertner surveyed the field and noted that most of the courts that have considered this issue have found that utilizing a trademark in this manner does constitute “use” under the Act, and she sided with what she considers to be the majority view (the significant exception being the Second Circuit’s decision in 1-800 Contacts v. WhenU).
Hearts of Fire v. Blue Nile
For earlier postings on this issue click here and here.
[Update: decision denying Blockshopper’s Motion to Dismiss]
[Update: Jones Days’ Opposition to Blockshopper’s Motion to Dismiss]
Blockshopper.com is one of many small web sites that have sprung up to follow local residential real estate markets. So far, the site highlights purchases in upscale neighborhoods in Chicago, St. Louis, South Florida and Las Vegas. The site identifies purchasers by name, street address of the property and the price paid. Of course, this information is available in local real estate publications (like Banker & Tradesman here in Boston) or at the local registry of deeds. Blockshopper also performs an Internet search on the person, and based on what it finds identifies the purchaser’s job title and employer. When it can, the site pulls a photo of the person from somewhere on the Internet (like the purchaser’s company site), and pastes it into the item. If the home purchaser has an online bio, the site will link to it.
Example: I saw on Blockshopper that Juan Luis Goujon had recently purchased a property in Chicago. I Googled “Juan Luis Goujon,” and the first hit I got was to Blockshopper, profiling the property, linking to Mr. Goujon’s company, and posting a photo of him from the site. Mr. Goujon is not a celebrity or a politician, and he may not be thrilled with this publicity (if anyone truly cares). However, the information regarding the address of the property, the purchase price, and Mr. Goujon’s job as an executive at a Chicago HR firm, are all public, factual information.
So, if you are Mr. Goujon, or any one of the many other real estate purchasers profiled by Blockshopper, just too bad, eh? In the age of almost unlimited information, factual, public information like this can be pulled together and posted on the Internet, right? So you would think, but not so fast.
Jones Day is one of the largest law firms in the U.S., with over 2,000 lawyers worldwide. That’s a heck of a lot of lawyers, no matter how you slice it. As many lawyers know, Jones Day is one of the premier law firms in the United States, respected by its clients and feared by its adversaries. These are not people to trifle with.
Blockshopper encountered Jones Day after Blockshopper profiled several Jones Day associates who had purchased real estate in Chicago. No big deal here – the properties were not exactly big ticket items, and you wouldn’t think that anyone would be very interested, with the possible exception of the attorneys’ friends and co-workers at Jones Day. And, as it often does, Blockshopper posted photos of the attorneys (from the Jones Day web site) and provided a link to their bios on the Jones Day site.
But Jones Day was very interested. It filed suit against Blockshopper in U.S. Federal District Court in Chicago. After reminding the court that Jones Day is “one of the world’s most famous law firms” (probably unnecessary), the complaint goes on to assert that:
- the photos of the associates were “proprietary.” (Recall: they can be viewed on Jones Day’s public web site).
- the references to Jones Day on Blockshopper were likely to cause “confusion and mistake” as to the source of the services provided on the site. In other words, people looking at Blockshopper could be misled to think that the site was affiliated with, or sponsored by, Jones Day. Accordingly, Jones Day claimed that Blockshopper was infringing Jones Day’s trademark rights.
Of course, these allegations (along with some others that I’ll skip over here) would seem to fail the laugh test. It challenges my imagination to think that anyone would conclude that the link to a couple of Jones Day associates on this site suggested that Jones Day had sponsored the site or was in some way associated with the site. After all, the World Wide Web is built on links – millions of them, if not billions. Everyone who uses the Internet for a few hours quickly realizes that a link does not mean that the “linked to” site has anything to do with the “linked from” site. And, the Blockshopper site links to hundreds of other purchasers, often with links to their web sites. Does Jones Day think that users of the site will conclude that the employers of those real estate purchasers are also sponsors of the site? (Interestingly, Blockshopper’s reported real estate purchases seem to involve a disproportionately large number of lawyers).
When you file a suit that doesn’t pass the laugh test, you attract unwanted attention, especially when you are “one of the world’s most famous law firms” and the suit threatens what many would consider First Amendment rights of expression. When it comes to the First Amendment, the Internet is very protective of its own.
And so, Jones Day’s lawsuit has attracted a great deal of attention. A Google search (“Jones Day” and Blockshopper) results in hundreds of hits, almost all (based on my quick survey) critical of Jones Day. The old expression is that “there’s no such thing as bad publicity,” but in this case, I have to wonder. On the other hand, the owners of Blockshopper must be drinking Dom Pérignon champagne and eating Beluga caviar – they could never have bought this much publicity for their site. I doubt that very many people in Chicago were even aware of the site. (Hey guys, when are you opening a Boston branch?).
It takes muscle to fight muscle, and the Electronic Frontier Foundation (the pre-eminent civil liberties group focused on digital media), has come to the rescue in Blockshopper’s defense. The EFF has filed a motion to dismiss the case which (in my opinion) makes mincemeat of Jones Day’s claims.
I expect a quick retreat by Jones Day. But, as a matter of principal, I think that Blockshopper (with the EFF’s encouragement and support) will demand that Jones Day drop its suit without terms. However, we’ll have to wait to see how this plays out; after all, Jones Day is not known to back down from a fight.
Nevertheless, I the lawyers at Jones Day who filed this case, and the associates whose real estate purchases led to the case, may be asking themselves, “what was I thinking”? And other lawyers at Jones Day may be wondering whether, after this is all over, their future real estate purchases will be targeted for special attention by Blockshopper.