Trademark Issues: What SEMs Should Know

Aug 21, 2008 - 3:43 pm 1 by

In 2008, U.S. paid search advertisement revenue is expected to reach 15.52 billion. This represents a 31.9% increase over 2007. Despite this tremendous growth, uncertainty in recent court developments may discourage search engine marketers from purchasing keywords that are trademarked by others for fear of being found liable for trademark infringement. The presentation will include a discussion of the state of the law as well as legal ways to use another's trademark to enhance your visibility on the web. Moderator: · Jeffrey Rohrs, Vice President, Marketing, ExactTarget Speakers: · Mark J. Rosenberg, Esq., Sills Cummis & Gross P.C. · April Wurster, Attorney, Baker & McKenzie · Eric Goldman, Assistant Professor & Director of the High Tech Law Institute, Santa Clara University School of Law Jeffrey Rohs introduces all the panelists. Eric: Normally I have a strong biased opinion that I am going to try to keep in check. My goal is to outline a bit of trademark law in keyword advertising. Trademark infringement is a popular topic. There are 4 elements of a claim in court: 1. Ownership of valid trademark. 2. Priority 3. Use in commerce in connection with the sale of goods services. There words come out of a statute. If the advertiser buys the trademark as a keyword but doesn't use the keyword in the ad copy, there's a huge split in opinion on whether or not this infringes on a trademark. We also have a geographic split – in New York it appears to be no, in the rest of the country it appears to be yes. 4. Likelihood of consumer confusion. A couple of courts say that if there is a purchase of a keyword without the keyword in the ad copy, it does not confuse the consumers. Another court says that consumers will always be confused and the plaintiff should always win. So we don't really have judges with consistent opinions. If consumers are confused, there are a variety of defenses; referencing the trademarked owner. In the Tiffany vs. Ebay case, Ebay was buying advertising on Tiffany trademarked products, and was excused because the use was nominative – "Ebay is a great place to buy tiffany products". Some other regulations: - State anti-keyword law: Utah spyware control act and a law in Alaska against popups. Neither of these statutes are dormant though. - There was a frontal assault on keyword advertising in Utah, that was designed to ban keyword advertising, an assault on our entire industry. Utah screwed up a second time and they repealed the law. Search engine trademark policies: the gist is that Yahoo and MSN have banned certain types of keyword ad buys based on the trademarks. As you know Google allows bidding on trademarked keywords, but does not allow reference of the trademark in the ad copy. This may be more helpful. I am not a big fan of the trademarked policies. The cost of litigating is so expensive. Jeffrey: Next up is April Wurster, a practicing attorney in the arena. April: Good morning. I will talk to you about how a trademark owner can protect their rights. First you want to know who is using your trademark, monitor your trademarks. There are some companies out there that do this. They are relatively inexpensive; they range from $200 – $500. The second thing you can do when you find out if someone is using your trademark is send them a cease and desist letter. But talk to your attorney about this because it can get complicated. If it's strongly worded, the accused infringer can file a lawsuit against you and they then become the plaintiff. So be careful. You can also file lawsuits, which we will talk more about later, and you can also address trademark concerns without going to court. Google trademark complaint procedures: US, UK, Ireland and Canada: won't investigate in keywords, but only in ad text. Outside the US, UK, Ireland and Canada: will investigate usage in both keywords and ad text. Google's complaint procedure is very easy, you can fill out an online form. Yahoo has the opposite procedure; they don't allow users to bid on trademarked keywords. Ebay has a complaint procedure, it's called the VeRO program (Verified rights owner) and they can and will kick people out. You just fill out a form, it's easy, you don't need an attorney. So what if the self-help programs don't work for you? You might need to file a law suit. When an attorney looks at your case, there are a lot of different factors, but they will look at the type of trademark you have – common law, state registration, or federal. Common law trademarks are free and extremely limited – so you get what you pay for. They don't get any of the presumptions you get with federal regulations, like validity. State registration is a good alternative, very cheap, about $70, compared to federal which is $325, and you can get it fairly quickly. But they are limited geographically to the state where you register. If you are really motivated to protect your property rights you should be seeking federal registration. Some advantages: 1 – you get nationwide notice of rights 2 – you can get increased damages 3 – if you use your trademark exclusively for 5 years,, it can become incontestable, meaning that certain challenges against your mark are taken away from the defendant. How to use your mark so you don't abandon or misuse: - Always use proprietary notices: "this TM is registered" - Distinguish your mark in print perhaps use it in all caps, or use it with the first letter as the capital (though don't use it is a proper noun because then it becomes generic. For example, Escalator lost trademark rights because they used it as a noun, and now an escalator is the generic word for "moving stairs"). Also don't use it as a verb, like Xerox, you should use it as an adjective, like Xerox copier. - Never change your mark. So if you update or modernize your mark, be cautious of the trademark implications. Thank you. Jeffrey: Next is Mark Rosenberg Mark: Bad news: marketers can use your trademark. There are limits though on how they can use it. My goal today is to give you those limits. Trademark use is prohibited if it causes confusion. But there are ways you can use it. The issue of what is and isn't likely to cause confusion - just ask yourself the question, why am I using someone else's trademark? - To identify a genuine product or service. - To let users know you are offering a product or service. - To make a comparison between your product and another, for example, you are marketing a generic version of a product. - There is no other readily identifiable way of identifying the trademarked product or service. Infringement: - To get a search engine listing when your website was nothing to do with the trademarked product. - To get a more prominent organic listing when your website has nothing to do with the trademarked product. - To get more traffic to your site. - To divert a competitor's traffic to your site. If you have the right answer to why am I using this trademark, here are some permitted uses: - When your website sells the genuine trademarked product - In a meta tag when the website sells the genuine product - In a meta tag when the website sells the generic version of the trademarked product Limits on use: You can say, "We have the best prices on Rolex watches", or "Our burgers are better than McDonalds", or, "We sell the generic version of Lipitor". You can't use the trademark more than necessary (Viagra Viagra Viagra Viagra), or in a more prominent form than necessary (We sell VIAGRA). You can not overly exclaim a trademark (We are not Orbitz, We are not Orbitz, We are not Orbitz). You can't use a trademarked logo instead of the word and you can't falsely claim sponsorship. Domain names: It's usually a bad idea to use a trademark in a domain name. Don't do it. A new use is when a marketer writes about a product or service, and this comes up in the search listings results, when it has nothing to do with the site. The articles are usually written to drive traffic to the site. I have not seen any case law, but it will get the person in trouble. Jeffrey: Thanks Mark, thanks guys, this has been a great overview. Now we'll open it up to Q&A. Session coverage provided by Sheara Wilensky of Promediacorp.


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