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Online advertising and trademark disputes

A recent opinion from the U.S. Court of Appeals for the Tenth Circuit in Denver, Colorado, outlines some factors that may be considered by courts in matters involving certainintellectual propertyrights. As internet advertising becomes more commonplace and competitive, courts are increasingly being asked to rule on trademark and service mark violations involving search engine and other advertising methods.

The July 16 opinion involved two online companies that cater to wearers of contact lenses. In 2003, a company called 1-800 Contacts registered its service mark '1800CONTACTS." Two years later the company discovered that paid advertisements for a competitor company appeared when a Google search was made using that phrase. It became apparent that the competitor had purchased similar phrases in order to have its advertisements appear when those phrases were typed into the search engine.

The owner of the mark filed suit in 2007, claiming that the competitor infringed upon its registered service mark as prohibited by the Lanham Act. During the investigation, it was discovered that the defendant had purchased a number of key phrases that were similar to the plaintiff's service mark. The plaintiff claimed that potential customers could become confused due to the presence of the defendant's ads, which is one of the elements required to prove infringement.

The court in its opinion listed six factors that were used to determine the likelihood of confusion, including evidence of actual confusion by the customer. In this particular case, it was determined that there was minimal actual confusion by customers and thus affirmed a lower court opinion that had found no infringement.

Intellectual property is an important part of many businesses. Companies seeking to protect their rights in and to trademarks and trade names that they have developed may wish to speak to a business and commercial attorney who has experience in these types of matters..

Source: Northern Colorado Business Reports, "Case sets rules on online ad trademark disputes", Dan Jones, October 04, 2013

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