New Jersey Law Journal       Volume 188, No. 4, Index 237     April 23, 2007

INTERNET EXPANDS TRADEMARK INFRINGEMENT -- NOVEL TRADEMARK CLAIMS SPRING FROM E-COMMERCE

By Jonathan Bick    Bick is counsel to WolfBlock Brach Eichler of Roseland and is an adjunct professor of Internet law at Pace Law School and Rutgers Law School. He is also the author of 101 Things You Need To Know About Internet Law [Random House 2000].

Internet use of trademarks expands trademark infringement claims and lawsuits. Novel Internet trademark claims spring from the innovative but unlawful use of trademarks in e-commerce. Internet domain names, hyperlinks, meta tags and framing marks enlarge the number of trademark infringement opportunities.

While the Internet reduces the likelihood of confusion by allowing the buyer to be more sophisticated, it bolsters the 'likelihood of confusion' by allowing new, unlawful uses of trademarks. Additionally, the traditional use of a mark on the Internet (to identify the source of goods) is likely to amplify certain trademark characteristics, including: the strength of a mark; the proximity of the products or services to a geographical location; and actual confusion.

Trademarks connect a name or symbol with a good or service. Trademarks benefit owners by allowing them to profit from the good will associated with the mark. Trademarks benefit consumers by memorializing a quality level. United States trademark law is designed to prevent confusion in the market place and is enforced by preventing fraud through deception.

The elements necessary to prove trademark infringement are well established under both federal and state case law. These elements apply to both Internet and traditional trademark infringement. A plaintiff in a trademark infringement matter has the burden of proving that the defendant's use of a mark has created a likelihood of confusion about the origin of the defendant's goods or services. This is achieved by first showing that it has developed a trademark right worthy of protection and then showing that the defendant is using a confusingly similar mark in such a way that it creates a likelihood of confusion, mistake and/or deception with the consuming public.

Poloroid Corp. v. Polorad Elec. Corp., 287 F.2d 492 (2d Cir. 1961), details eight factors a court must evaluate prior to finding an entity has used a trademark in such a way that would result in a likelihood of confusion in the mind of a consumer regarding the source of a product. They are: 1) the strength of the plaintiff's mark; 2) the degree of similarity between plaintiff's mark and defendant's mark; 3) the proximity of the products or services; 4) the likelihood that the plaintiff will bridge the gap; 5) evidence of actual confusion; 6) defendant's good faith in adopting the mark; 7) the quality of defendant's product or service; and 8) the sophistication of the buyers.

The Lanham Act (Federal Trademark Act of 1946) also provides rights for the trademark holder. In particular, the act allows mark holders to take action to end deceitful practices in interstate commerce involving the misuse of trademarks.

Marks gain rights when used. The Internet allows marks to be used in nontraditional ways. The nontraditional uses expand the use of the marks as well as the likelihood of confusion and, therefore, infringement claims. Trademark Internet use has four major alternative use forms, in additional to their traditional use form as a publication. The nontraditional use forms include: domain names, hyperlinks, meta tags and framing marks.

A domain name is the registered identifier that generally replicates a firm name, product or phrase. To acquire an Internet address, an entity need only pay a nominal fee to an Internet registrar, such as Network Solutions, Inc., and file for a name not previously registered. Due to the ease with which domains can be registered, many trademarked domain names were initially registered by enterprising entities known as cybersquatters, who knowingly reserve a trademark as a domain name merely to sell it for profit.

Typo-squatting is another form of cyber-squatting that relies on erroneous user input. Typo-squatting occurs when an entity registers a famous mark with misspellings, reversed letters or other common typos built into the domain name in an attempt to redirect an Internet user to the cyber-squatter's own Web site. Alternatively, a cyber-squatter may attempt to get the famous mark's owner to pay to redirect the mistyped Web address to the mark owner's Web address.

Another potential trademark issue involving domain names are those names which more than one person or entity could claim. In Nissan Motor Co. v. Nissan Computer Corp., 89 F. Supp. 2d 1154 (C.D. Cal. 2000), the Nissan car company (who was first in time to register their trademark) brought suit against the Nissan computer company (named after the owner's surname) for trademark infringement after the computer firm registered domain names using the word 'Nissan.' The court found the computer firm's registration resulted in consumer confusion for several reasons, including both initial interest confusion and actual confusion.

The court found initial interest confusion because the Nissan name may have led a consumer to believe that this was a Web site for Nissan cars, and that alone is enough to find consumer confusion. The court also found actual confusion because of the fact that nearly all of the computer company's revenue stemmed from visitors to the Web site clicking on automobile advertisements displayed on the Web site. Despite this, the court was careful to point out that there is a 'judicial reluctance to enjoin use of a personal name' even when it apparently infringes on a trademark, but that it was still possible to limit the use with a 'carefully tailored injunction.'

This case and others resulted in the enactment of the Anti-Cyber-Squatting Consumer Protection Act. Additionally, the Internet Corporation for Assigned Names and Numbers adopted its Uniform Domain Name Dispute Resolution Policy to provide an alternative to litigation in dealing with abusive domain name registrations.

The second trademark infringement issue unique to the Internet entails meta tags. Meta tags provide Internet page setting information, which is normally invisible to a user. Meta tags are commonly used by search engines, such as Google, to index site content. The content of meta tags, when properly used, gives context to content. Four types of content are often used as a part of meta tags: resource type, key word, description and distribution. The unauthorized use of another's mark as an element of meta tag content may result in infringement.

The use of registered marks as part of a meta tags may result in consumer confusion and, therefore, be a basis for infringement litigation. For example, the use of various 'Playboy' trademarks in meta tag lines. See Playboy Enter., Inc. v. Calvin Designer Label, 985 F. Supp. 1220 (N.D. Cal. 1997); and Playboy Enter., Inc. v. Torri Welles, 7 F. Supp. 2d 1098 (S.D. Cal. 1998).

Additionally, both the Seventh and Ninth District courts have ruled that meta tag use may infringe upon famous marks. See Promatek Indus. v. Equitrak Corp., 300 F.3d 808 (7th Cir. 2002); and Brookfield Communications v. West Coast Entertainment, 174 F.3d 1036 (9th Cir. 1999). Both courts have followed the same line of reasoning, holding that the 'initial interest confusion' that consumers experience, whether it results in actual confusion once they are viewing the Web site, is adequate for the imposition of trademark infringement liability. It should be noted that the Promatek decision was amended to state that meta tag usage by a defendant is only available when the infringing company is actually using the trademark to deceive consumers.

Hyperlinks are the third trademark infringement issue unique to the Internet. A hyperlink is an element of an electronic document that links to another place in the same document or to an entirely different document. Users typically click on the hyperlink to follow the link. Hyperlinks are an indispensable constituent of all hypertext systems, such as the World Wide Web. Hyperlink use has the potential for trademark infringement. It has been alleged that hyperlinks can potentially cause trademark infringement problems in the form of 'passing off, reverse passing off, and false advertising.'

Framing is the fourth way a trademark can be violated on the Internet. Framing occurs when one Internet site displaces another site's content by surrounding or framing it with a portion of its own site. In the case of TotalNews (The Washington Post v. TotalNews Southern District of New York, Civil Action Number 97-1190), the Washington Post and other newspaper publishers brought suit against an Internet news site for using framing technology to display the news organizations' information on the TotalNews Internet site and surrounding the other content with its own advertising. This practice was found to be tantamount to trademark dilution. The framing practice was likely to confuse users in that they would be led to believe that the source of these advertisements were in fact the plaintiff newspapers.

The special trademark infringement problems presented by the Internet (domain names, hyperlinks, meta tags and framing, as well as typical infringement), are in addition to the amplification of traditional trademark infringement that results from the worldwide use of the Internet. Consider the international trademark infringement difficulties faced by Playboy Enterprises. In Playboy Enter., Inc. v. Chuckleberry Publ'g, Inc., 687 F.2d 563 (2d Cir. 1982), the Second Circuit Court of Appeals had granted an injunction, enjoining Chuckleberry from using the confusingly similar mark 'Playmen' for the distribution of their Italy-based magazine. Despite this judicial result in a parallel suit brought to enjoin Chuckleberry's use in Italy, the Italian court upheld the use of the Playmen mark.

Subsequently, in Playboy Enter., Inc. v. Chuckleberry Publ'g Inc., 939 F. Supp 1032 (S.D.N.Y. 1996), when Chuckleberry published an Internet Web site for its magazine, again using the mark 'Playmen,' based in Italy, Playboy brought suit for a violation of the injunctive order granted in the prior Playboy v. Chuckleberry case, citing that the worldwide nature of access to Internet Web sites was a violation of the court order. The court agreed, stating that the Web site equated to the circulation of a magazine (a 'use ') within U.S. territory and ordered Chuckleberry to block U.S. access to the Web site.

Other cases have similarly expanded the application of United States trademark law when the Internet has been involved. In the case of Levi Strauss & Co. v. Sunrise Int'l Trading Inc., 51 F.3d 982, 984 (11th Cir. 1995), a confusingly similar product to that of Levi-Strauss' was sold from China, though never actually within the United States. Based on the fact that the quality of these goods could reflect poorly on the mark owner, the court applied the Lanham Act extraterritorially.