TM LAW and ADWORDS and METATAGS AIPPI Congress October 22 Workshop V Prof. Charles Gielen, NautaDutilh, Amsterdam, NL chair Mincheol Kim, Knobbe Martens, Irvine, US Sara Ashby, Redd, London, UK Emmanuel Larere, Gide, Paris, France Programma 1. Technical background (Mincheol) 2. TM owner v. advertiser – European viewpoint on confusion (Emmanuel) and dilution (Sara) – US and Korean viewpoint (Mincheol) 3. TM owner v. host – European viewpoint (Sara) – Application in France (Emmanuel) – US viewpoint (Mincheol) 4. Q and A Technical Background Technical Background © 2012 Knobbe, Martens, Olson & Bear, LLP all rights reserved. 3 Metatags • Metatags (or meta tags) • HTML or XHTML code providing information about a web page <HEAD> <TITLE>This is the Web Page Title</TITLE> <META name="description" content="This is where you place your web page's description."> <META name="keywords" content=“Place, your, keywords, here, separated, by, commas"> <META name="language" content=“Language"> </HEAD> • Internet searching and keyword metatags • In the past, almost all Internet search engines used keyword metatags for searching • Keyword metatags are chosen by website owners and could be abused • What if “NIKE” is inserted as keyword meta tag • For a website selling NIKE and other shoes • For a website of a show maker unrelated to NIKE • In 2009 Google and Yahoo! announced • They would no longer use “keyword metatags” to produce search results • Google uses information from “description metatags” for its internet searches 4 Keywords • Google sells keywords for Internet advertisements • One can purchase a term related to its business • When an Internet user searches for the purchased term, a web link to the business appears on Google’s search results • More than one person can purchase the same term 5 Search term Ads of Sponsored Links Description meta tag Natural search results 6 Keywords - 7 TM Owner v. Advertiser: the European viewpoint ALGIERS BEIJING BRUSSELS BUCHAREST BUDAPEST CASABLANCA HANOI HO CHI MINH CITY HONG KONG ISTANBUL KIEV LONDON MOSCOW NEW YORK PARIS ST. PETERSBURG SHANGHAI TUNIS WARSAW 1. Competitor’s use of a “classical” trademark - when is it infringement? Focus on ECJ Cases Google France, Bergspechte and Portakabin [2010] Situations tackled in the ECJ cases Situation 1 - “Pure” utilisation of trademarks as keywords A owns trademark X and B (competitor of A) registers X or variants of X as “Adword” The ad displayed in the “sponsored links” section contains no reference to trademark X Situation 2 - Same as 1, but : B’s website offers second-hand X products The ad displayed in the sponsored links section refers to “used X products” Situation 3: - Same as 1, but : B’s website offers imitation versions of X products B registers X as “Adword”, in combination with terms like “imitation” or “copy” PAGE 9 The legal background A trademark owner is entitled to prohibit a party from using, without his consent, a sign identical with or similar to that trademark, when : That use is in the course of trade; That use is in relation to goods or services identical with those for which that trademark is registered; That use is liable to affect the functions of the trademark. The functions of a trademark include: The function of indicating origin (which is the essential function) The function of guaranteeing the quality of the goods The functions of communication, investment and advertising If the sign is identical with the trademark The owner may prohibit uses that affect any of the functions If the sign is similar to the trademark The owner may only prohibit uses that affect the essential function PAGE 10 When is the function of indicating origin liable to be adversely affected? When the ad does not enable normally informed and reasonably attentive internet users (or enables them only with difficulty), to ascertain whether the goods or services referred to by the ad originate from the trademark owner or from a third party, i.e.: When the ad suggests that there is an economic link with the trademark owner; or When the ad, while not suggesting the existence of an economic link, is vague to such an extent, on the origin of the goods or services, that normally informed and reasonably attentive internet users are unable to determine, on the basis of the ad, whether the advertiser is a third party vis-à-vis the trademark owner or, on the contrary, economically linked to that owner. It is for the national court to assess, on a case-by-case basis, whether the facts of the dispute indicate adverse effects, or a risk thereof, on the function of origin. PAGE 11 Application in France Impact of the GoogleFrance case (dated 23 March 2010) on French case law PAGE 12 Application in France: a few examples French case law tends to consider that the trademark’s functions are not adversely affected when: No reference is made to the trademark in the ad; The name of the advertiser is mentioned in the ad (e.g. in the domain name/link). For a recent example: French Supreme Court, 25 September 2012, Auto IES Examples of cases involving reproduction of a trademark in the ad, by a reseller / spare parts seller : Trademark Competitor’s Ad Case Outcome PCM (hydraulic pumps) PCM Pumps www.pump-hero.com (The website only sold compatible spare parts) Referencing prohibited. TGI Paris, 10-11-2011 Pandora (jewels) www.bijoux-online.fr PANDORA jewels Discover the world of do-it-yourself jewels. Referencing authorized. TGI Paris, 29-02-2012 Weston (shoes) Weston shoes. Greatest brands at low prices. www.shopping.com (The website actually did not sell any Weston shoes) Referencing prohibited. TGI Paris, 15-12-2011 Weston (shoes) Weston shoes at low prices. Buy & sell. www.eBay.fr Referencing authorized. TGI Paris, 26-06-2012 PAGE 13 Application in France: the “simultaneity” issue Google France case (Point 85): “In a situation which is characterised by the fact that the ad appears immediately after entry of the trade mark as a search term by the internet user concerned and is displayed at a point when the trade mark is, in its capacity as a search term, also displayed on the screen, the internet user may err as to the origin of the goods or services in question. In those circumstances, the use by the third party of the sign identical with the mark as a keyword triggering the display of that ad is liable to create the impression that there is a material link in the course of trade between the goods or services in question and the proprietor of the trade mark.” Applications in France French Supreme court, 29-11-2011, PCA / Suza TGI Paris, 15-12-2011, Weston / Shopping.com But TGI Paris, 2 February 2011, Auto IES “The fact that the ad is displayed at a point when the trade mark is, in its capacity as a search term, also displayed on the screen, does not, by itself, cause the internet user to err as to the origin of the goods or services”. PAGE 14 TM Owner v. Advertiser: the European viewpoint 2. Competitor’s use of a trade mark with a reputation – when is it infringement? Focus on ECJ Case Interflora v Marks and Spencers Interflora v Marks and Spencers Google Adwords advertising case Adwords: • INTERFLORA • INTERFLORA FLOWERS • INTERFLORA DELIVERY • INTERFLORA.COM Advertisment: “M&S Flowers Online www.marksandspencer.com/flowers Gorgeous fresh flowers & plants Order by 5pm for next day delivery” Referral to European Court of Justice by High Court, London Evidence: Interflora’s advertising costs up by $750,000 p.a. Cost per click up from 2p per click to 23 – 28p per click It now took 3.75 click-throughs (on average) to obtain an order where previously it took 3.37 The word INTERFLORA was the fifth most frequent “paid click” driving traffic to M&S’ website M&S would make about £1.1million sales to customers who had placed an order following clicking through from an INTERFLORA keyword search Adverse effect on origin function? Google France applied Infringement? If the facts show that users are misled into thinking M&S’ services are part of Interflora’s commercial network (because users cannot tell whether M&S is economically linked to Interflora) then origin function adversely affected. The national court will need to assess: 1) whether in the basis of the general knowledge of the market users are aware M&S is not part of the Interflora network but is in competition with it 2) if that is not generally known, whether the advert enabled a user to tell that M&S was not part of the network Investment function Use of a trade mark to acquire or preserve a reputation capable of attracting consumers and retaining their loyalty. If the trade mark already has a reputation, keyword use which affects that reputation or jeopardises its maintenance adversely affects this function But the mere fact that keyword use means some consumers switch brands, or the trade mark owner has to adapt his efforts to acquire and preserve a reputation is not enough Trade marks with a reputation Interflora is a mark with a reputation Trade marks with a reputation are protected from three types of injury which are independent of the origin function: 1)use which is detrimental to the distinctive character of the mark = “dilution” 2) use which is detrimental to the repute of the mark = “tarnishment” 3)Use which takes unfair advantage of the distinctive character or repute of the mark = “free-riding” Detriment to distinctive character – “dilution” Use reduces the mark’s ability to distinguish goods, so the trade mark no longer capable of creating an immediate association in the minds of consumers with a specific commercial origin Interflora arguing M&S’ use gradually means users think the word INTERFLORA is generic, for any flower-delivery service The European Court said that • even if the national court finds there has been an adverse effect on the origin function (because the advertising does not enable users to tell that M&S’ service is independent from the Interflora network) • the national court would still have to consider whether as a question of fact has had such an impact on the market for flower delivery services that the word “interflora” has come to designate any flower delivery service. Unfair advantage – “free riding” Where an advertiser rides on the coat-tails of a mark with a reputation to benefit from its power of attraction, reputation and prestige, and exploits the trade mark owner’s marketing efforts the create and maintain the image in the mark, without paying financial compensation or having to make its own marketing efforts On the facts? where a mark has a reputation it is likely a large number of users will use the name as a search term where a competitor uses that word as a keyword, the purpose is to take advantage a large number of people will see the competitor’s advert when the competitor makes a sale, it derives a real advantage and does not pay compensation to the trade mark owner Is the use ‘unfair”? Up to the national court to determine Google France is clear that where the competing goods are imitations of the trade mark owner’s goods, likely to be “unfair advantage” But if no imitation, no dilution or tarnishment, and no adverse affect on origin function or other functions, the use “falls within the ambit of fair competition” Technical Background TM Owner v. Advertiser The US and Korean viewpoint © 2012 Knobbe, Martens, Olson & Bear, LLP all rights reserved. 25 Liability of Third Party Advertiser: US and Korea • Use in commerce? • Inserting another’s mark as keyword meta tag for its own website • Buying another’s mark for keyword advertising • Inserting another’s mark in advertisement text for its own website • Theories of liability • Likelihood of confusion • Initial interest confusion • Dilution • Defenses 26 Brookfield Comm. V. West Coast Ent. (9th Cir., 1999) • Brookfield Communications • Owner of federally registered mark “MovieBuff” • Business: Searchable movie database services providing entertainment-related information such as listings of actors, directors, upcoming movies and related news • West Coast Entertainment • Announced to launch website of searchable database for entertainment-related news • Using “MovieBuff” in metatags of its website • Brookfield sued West Coast claiming trademark infringement and unfair competition • Brookfield applied for TRO and injunction, both were denied • Brookfield filed an appeal and requested injunction • 9th Circuit granted injunction against West Coast based on initial interest confusion • No likelihood of confusion • West Coast’s site appearing in the search results for the search term “MovieBuff” will be unlikely to cause consumer confusion as the searcher will see West Coast’s site listed by domain name (e.g., westcoast.com) • But liable for initial interest confusion • E.g., Fat Burgers (a fast food restaurant) posting a large sign “McDonald’s, exit 7" on the highway when in fact McDonald’s is at exit 8 and Fat Burgers is at exit 7 27 Playboy v. Welles (9th Cir., 2002) • Playboy Enterprises • Owner of trademarks: Playboy, Playmate of the Year, and PMOY • Terri Welles • Welles was the Playmate of the Year for 1981 and on the cover of 1981 Playboy • She maintained a personal website identifying her as such • The website’s metatags included Playboy’s trademarks • The website displayed “Playmate of the Year 1981” and “PMOY ‘81” repeatedly in headlines, banner ads and wallpaper • Playboy sued Welles claiming trademark infringement and dilution • District court held the use on the website and metatags are nominative fair use • 9th circuit affirmed • Nominative use • A type of fair use for identifying the product itself • There was no other practical way for Welles to describe herself without using the trademarked terms 28 Network Automation v. Advanced Systems Concepts (9th Cir., 2011) • Advanced Systems Concepts • Owner of federally registered mark “ActiveBatch” • Job scheduling and management software • Network Automation • Selling AutoMate, directly competing product of ActiveBatch • Network purchased keyword “ActiveBatch“ from Google and Bing • Network sued Advanced, seeking declaration of noninfringement • Advanced counterclaimed trademark infringement and sough preliminary injunction • District court ordered preliminary injunction against Network • 9th circuit reversed the district court decision • Likelihood of confusion not sufficient to support trademark infringement • Appearance of the advertisement - The advertisements for Google and Bing were labeled as “Sponsored Links” and separated from the natural search results • Defendant’s intent - Network was not trying to mislead consumers, but to inform them of other choices of comparable products 29 Advanced Wave v. Kim (Korean Supreme Court, 2012) • Advanced Wave • Owner of Korean registered trademark “VSP” • Voltage surge protectors and suppressors • Dong Ang Kim • Kim purchased keyword “VSP” from Daum Communications (Korean search engine operator) for keyword advertising • Kim placed “VSP 엔티씨” (VSP NTC) as title of his sponsored link that is listed in the search results using the keyword • Advanced Wave sued Kim (a scope trial), seeking finding of trademark infringement • The case went up to the Korean Supreme Court (2010Hu3073) • The Court held no trademark infringement based on dissimilarity of the marks • Trademark Use • Use of a keyword in advertising text of sponsored links can constitute a trademark use when the keyword identifies the source of a product or service • Displaying information in internet search results can be advertising • No Likelihood of Confusion • VSP represents “Voltage Sag Protector” and is a weak mark in connection with goods • VSP엔티씨 differs from VSP in its appearance, sound, and meaning 30 TM Owner v. Host: the European viewpoint Focus on ECJ Case L’Oreal v eBay Is there infringement by the “Host”? Google France ECJ decision No trade mark infringement by Google What the host is doing is “in the course of trade” • Selling keyword advertising is carrying out a commercial activity with a view to commercial advantage But the host is not itself “using” • It is allowing its clients to use trade marks in keyword advertising without itself “using” the trade mark What if the competitor sites are selling infringing goods or counterfeits? Potential defence if Google is storing information as a “host” under Article 14 of the e-Commerce Directive Article 14 e-Commerce Directive - Hosting Where an information society service is provided that consists of the storage of information provided by a recipient of the service, Member States shall ensure that the service provider is not liable for the information stored at the request of a recipient of the service, on condition that: a) the provider does not have actual knowledge of illegal activity or information and, as regards claims for damages, is not aware of facts or circumstances from which the illegal activity or information is apparent; or b) the provider, upon obtaining such knowledge or awareness, acts expeditiously to remove or to disable access to the information. Can Google’s activities be classified as hosting? Only if it has no knowledge of or control over the information stored Is its conduct merely technical, automatic, passive? Up to the national court to decide on a case-by-case basis What amounts to “knowledge” under article 14 of the e-Commerce Directive? L’Oreal v eBay ECJ decision Facts: eBay sellers in the UK were selling goods advertised as L’Oreal perfume products there was infringement by the eBay sellers eBay was also: • purchasing adwords for the trade mark terms, to advertise the sellers • promoting the sellers by sponsored listings • not making information about the identity of sellers available to L’Oreal L’Oreal v eBay – ECJ decision Could eBay (the Host) be exempt from liability? The mere functioning of the eBay marketplace was not “playing an active role” But, facts: • sponsored adword (e.g.: on Google) • helped to optimise and promote the sales • gone beyond a neutral position • playing an active role Not covered by the Article 14 exemption and may be liable L’Oreal v eBay – ECJ decision To lose the protection of Article 14, eBay must have been “aware of facts or circumstances from which the illegal activity or information is apparent” Satisfied by an objective standard: • “aware of facts or circumstances on the basis of which a diligent economic operator should have identified the illegality in question” This covers every situation in which the Host becomes aware, in one way or another, of such facts or circumstances Up to the national courts to decide whether the Host had sufficiently precise and adequately substantial information to identify alleged illegal activities L’Oreal v eBay – ECJ decision: The operator of an online marketplace: Must take steps to: • bring infringements to an end • prevent further infringements Injunction available: may be ordered to take positive steps to prevent infringing sales, or risk facing liability in the courts cannot be required to “actively monitor” all of the data of each of its customers Must be “fair and proportionate”, not excessively costly But cannot be a blanket ban on sales TM Owner v. Host: the European Viewpoint Application in France France is reputedly the country where disputes between IP right holders and internet operators are the most frequent Notable evolution of French case law under the influence of the ECJ But no stabilizing effect on French case law as ECJ case law leaves much room for national courts’ assessment of facts As far as trademarks are concerned, case law has mostly concerned: The Google Adwords service + a few other search engines operators eBay + a few other vending platforms operators PAGE 40 GOOGLE ADWORDS (1/2) French case law before the Google France ECJ case Google Adwords was regarded not as a host but as an on-line advertising agency It could not benefit from the specific liability regime for hosts Google liability regarding the Adwords service Initially, courts tended to hold Google liable for trademark infringement Then, case law evolved: as judges came to consider that Google used the trademark for services which were different from those covered by the trademark or supplied by the advertiser (while similarity is required under article 5(1) of the Directive) However, Google was still found liable on other grounds: Damage caused to or unfair advantage taken of a reputed trademark (art. 5(2)); or General civil liability for unfair behaviour PAGE 41 GOOGLE ADWORDS (2/2) French case law after the Google France ECJ case 1st post Google France decisions Paris Court of Appeal, 19 November 2010, Belle Literie; followed by other similar judgments Google may not be held liable for trademark infringement either on article 5(1) or on article 5(2) Google may not be held liable for unfair behaviour as it benefits from the specific liability regime for hosts Is the tide turning ? TGI Paris, 17 November 2011, Olivier Martinez / Google and Prima As regards the Adwords service, Google may not be regarded as a host as its role is not neutral: The mere fact of modifying the order of appearance of the natural results constitutes an active role Such active role is also evidenced by the Adwords Terms of Use that show that Google has a power of control over its clients’ choice of Adwords PAGE 42 eBay (1/2) French case law before the L’Oreal / eBay ECJ case Case law was very unstable but the growing trend in French case law was to deny eBay the host status E.g.: the LVMH / eBay saga Paris commercial court, 30 June 2008: eBay is not a host eBay is liable for negligence vis-à-vis trademark holders Court orders eBay to pay € 40 million in damages Paris court of appeal, 3 September 2010 Upholds judgment on the merits but reduces damages to € 6 million PAGE 43 eBay (2/2) French case law after the L’Oreal / eBay ECJ case Case law still extremely unstable ! eBay 2012cases January 23 March 13 Court Paris C.A. Paris TGI Paris C.A. Supreme Court Paris TGI Plaintiff Burberry Maceo Antiques Dealers Guild LVMH Weston Host ? No Yes Yes No Yes N.A. Negligence N.A. Ground for Grounds condemnation April 4 Undue profits from N.A. illicit merchandise underlying pro-eBay judgments (criminal offence) May 3 June 26 eBay merely provides technical and promotional tools and has no control over ads Grounds underlying anti-eBay judgments eBay plays an active role by providing advice and assistance for ad optimization, by promoting ads vis-à-vis prospective clients… PAGE 44 Technical TM OwnerBackground v. Internet Host The US viewpoint © 2012 Knobbe, Martens, Olson & Bear, LLP all rights reserved. 45 Liability of Internet Hosts: US • Internet Hosts • Internet search companies – Google, Yahoo, Bing • Internet marketplace businesses – Amazon, eBay • Use in commerce • Selling TM owner’s mark to third party as keyword for keyword advertising • Searching advertisements with the sold keywords and displaying sponsored links • Theories • Direct Infringement • Contributory Infringement • Vicarious Liability • Dilution • Unjust Enrichment 46 Playboy Enterprises v. Netscape Communications (9th Cir., 2004) • Playboy Enterprises • Owner of marks: “Playboy” and “Playmate” • Netscape Communications - Internet search engine operator • Netscape sold and displayed banner ads to adult entertainment companies in response to searches using the terms “playboy” and “playmate” (keying) • Netscape did not require the source of the banner ads to be identified • Playboy sued Netscape claiming trademark infringement and dilution • District court granted summary judgment for Netscape • 9th Circuit found genuine issue of material fact regarding infringement and dilution • Summary judgment reversed and the case remanded for further proceeding • Initial interest confusion • 9th circuit applied this doctrine established in Brookfield v. West Coast • Displaying banner ads of a company similar to Playboy without specifying the source of banner ads • Despite the consumer’s later knowledge that the products they are purchasing are in fact not from Playboy, the competitors unfairly profited off of Playboy’s goodwill 47 Rescuecom v. Google (2nd Cir., 2009) • Rescuecom Corp. • Owner of mark “Rescuecom” • Computer repair and support business • Google • Google AdWords included a “Keyword Suggestion Tool” recommending additional keywords for an advertiser to purchase • Google recommended the “Rescuecom” trademark to advertisers (including Rescuecom’s competitors) that were buying keywords through Google’s AdWords • Rescuecom sued Google, claiming trademark infringement • District court held that Google's use of the Rescuecom trademark did not constitute a "use" under the Lanham Act • 2nd Circuit vacated the district court ruling and remanded for further proceedings • Later Rescuecom abandoned this suit, and interestingly, Rescuecom was accused of using Best Buy’s “geek quad” trademark as keyword • Use in commerce • Required for infringement under the Lanham Act (US Federal Trademark Statues) • Google’s recommendation and sale of Rescuecom’s mark to its advertising customers are not internal uses and constituted commercial use 48 Tiffany v. eBay (2nd Cir., 2010) • Tiffany & Co. - Owner of mark “Tiffany” and world-famous branded jewelry company • Some time before 2004 Tiffany learned that counterfeit products were sold on eBay and communicated such to eBay • eBay - Internet-based marketplace • eBay facilitates many sales of Tiffany goods, genuine or otherwise • eBay’s effort to reduce the sale of counterfeit items on its website • eBay’s “fraud engine” automatically finds and removes listings violating eBay policies including counterfeit listings, which includes “Tiffany-specific filters” • eBay’s “Verified Rights Owner (VeRO)” program allows trademark owners report potentially infringing listings to eBay by Notice of Claimed Infringement (NOCI). Upon receipt of NOCI, eBay would remove listings involving counterfeits, cancel the bids, inform the seller of the reason within 24 hours • eBay’s advertising to promote sales of premium and branded jewelry • eBay advertised the availability of Tiffany merchandise on its site – “Tiffany,” “Tiffany & Co. under $150,” “Tiffany Rings,” “Tiffany & Co. under $50” • eBay used Sponsored-Link ads on search engines to read e.g., “Tiffany on e-Bay” • In response to Tiffany’s complaint, eBay told Tiffany that it had ceased buying sponsored link, but eBay continued the practice indirectly through a third party 49 Tiffany v. eBay (cont.) • Tiffany sued eBay • Tiffany alleged that eBay’s conduct (advertising the sale of Tiffany goods that turned out to be counterfeit) constituted direct and contributory infringement, dilution and false advertising • District court decided in favor of eBay on all claims • 2nd Circuit affirmed all except the false advertising claim – eBay won!!! • Direct infringement - Nominative fair use defense • eBay used the mark to describe accurately the genuine goods offered on its site • None of eBay’s use suggested Tiffany’s affiliation with eBay or endorsement of the sale of its products on eBay • Contributory infringement • Liability imposed upon those who facilitate or encourage infringement • Under Inwood Labs. V. Ives Labs., 456 U.S. 844 (1982), (1) one intentionally induces another to infringe a trademark, or (2) one continues to supply its service to one whom it knows or has reason to know is engaging in trademark infringement • Tiffany argued that eBay knew or had reason to know that counterfeit Tiffany goods were being sold ubiquitously on its website in view of Tiffany’s thousands NOCIs • In reply to Tiffany’s NOCIs, eBay removed listings and suspended repeat offenders • For all other counterfeits eBay continued its services, more than general knowledge of the sale of counterfeits is needed 50 Tiffany v. eBay (cont.) • Dilution • Tiffany alleged dilution by blurring (impairing distinctiveness of famous mark) and tarnishing (harming the reputation of famous mark) • eBay never used the Tiffany mark to refer to eBay’s own product, thus no dilution either by blurring or tarnishing • False Advertising • eBay’s use of the mark in advertising was not literally false since eBay did sell genuine Tiffany goods on its website • But, eBay affirmatively advertised the goods sold through its site as Tiffany merchandise • eBay should be accountable for the words it chose to the extent that they misled or confused consumers • Reversed and remanded to district court for re-examination of this claim • On remand, district court concluded no additional evidence indicated that eBay’s advertisements misled or confused customers 51 Rosetta Stone v. Google (4th Cir., 2012) • Rosetta Stone • Owner of marks: Rosetta Stone, Rosetta Stone Language Learning Success, Rosettastone.com, Rosetta World • Language-learning software • Google • Google sold the “Rosetta Stone” trademark to advertisers • Google changed its policy regarding the use of 3 rd party trademarks over time • Prior to 2004, Google precluded both use of 3 rd party trademarks in the text of an advertisement and use of such trademarks as keywords • In 2004, Google allows trademark s as keywords even over its owner’s objections • In 2009, Google allows 3rd party trademarks in advertising text in limited situations • Rosetta Stone sued Google claiming infringement, dilution and unjust enrichment • Google’s policy and the changes of selling its Rosetta Stone marks as keyword and permitting the marks in advertising text caused likelihood of confusion, actual confusion and misleading Internet users into purchasing counterfeit software • District Court – Google won over trademark owner • Dismissed Rosetta Stone’s unjust enrichment claim • Granted summary Judgment against Rosetta Stone on all other claims (no genuine issue of material fact for jury trial) 52 Rosetta Stone v. Google (cont.) • 4th Circuit • Affirmed dismissal of unjust enrichment claim • Affirmed summary judgment on vicarious infringement • Vacated summary judgment on direct infringement, contributory infringement and dilution and remanded for further proceeding – This revives trademark owners • Direct Infringement • Google’s intent, actual confusion and sophistication of consumers are disputed out of the nine traditional factors for likelihood of confusion • There is sufficient evidence to create a question of fact on the disputed factors • Summary judgment vacated and remanded • Contributory infringement • Liability imposed upon those who facilitate or encourage infringement • Issue is whether Google continued its service to known infringers • Rosetta Stone notified Google of about 200 Sponsored Links advertising counterfeit Rosetta Stone products - Sufficient evidence to establish a question of fact • Summary judgment vacated and remanded 53 Rosetta Stone v. Google (cont.) • Vicarious infringement • Liability based on the defendant’s relationship with a third party infringer • No evidence that Google acts jointly with any of the advertisers to control the counterfeit Rosetta Stone products • Summary judgment against Rosetta Stone affirmed • Unjust enrichment • Implied-in-law contract - one renders services and the other accepts without contract • Rosetta Stone failed to show that it conferred a benefit on Google for which Google should reasonably have expected to repay • Dismissal of the claim affirmed • Dilution • Federal dilution • Plaintiff’s mark must be famous at time of first use by defendant • Likely to cause dilution by blurring or tarnishment • No likelihood of confusion or actual injury need be shown • Google began using Rosetta Stone as keyword in 2004 • The fame of Rosetta Stone’s mark should be measured from 2004 • Summary judgment vacated and remanded 54 THANKS! Charles.gielen@nautadutilh.com sara@redd.eu mincheol.kim@knobbe.com larere@gide.com