IT Law- Week 2 Notes

Trademarks Pt. II

A) Trademark- Defenses to Infringement

 1) Fair Use (mostly case law for trademarks, not really
codified)
o Brookfield Communication v. WCE
 BC owns MovieBuff trademark, WCE registers
domain name  moviebuff.com
 BC sues WCE for infringement of its trademark
 WCE argues that its use is fair because “movie
buff” has a broader meaning than BC’s trademark
 Court here says that there is no fair use
 WCE was not using “moviebuff” in a way
that was unavoidable
 They were using it to try to steer
customers away from BC
 It was not just being used for
comparative purposes
o Rather, it was being used to
describe WCE’s own products
o Bihari v. Gross
 Bihari is an interior designer; Gross is a
disgruntled former client
 Gross registered domain names for bihari.com,
etc.
 Eventually the client gives up these domain
names, but the case continues regarding the use
of Bihari’s name and “Bihari interiors” in the
meta-tags for Gross’s new websites
 Bihari sues Gross for trademark infringement
 Court here says Bihari cannot make a case here
for likelihood of confusion (no initial interest
confusion)
 Gross’s use of Bihari’s name was fair use: it
was being used in a descriptive way simply
to describe the service he got
 Term was describing the good/service
and not being offered for commercial
purposes
 The court also points out there is no bad
faith in this case (no intention of capitalizing
on owner’s reputation)
  Intent matters even though there is
no mens rea component
o Is it comparative descriptive?
o Or are you trying to establish
some type of commercial
advantage?
 2) Nominative Use
o Playboy v. Welles
 Welles is former Playboy Playmate of the year;
she created her own website to promote herself
and used “Playmate of the Year” to describe
herself, Playboy metatags, Playboy watermarks in
background
 Playboy sued Welles for trademark infringement
 Court says that Welles cannot separate herself
from this notable aspect about herself without
using Playboy’s marks
 She has to bring these marks into play in
order to effectively describe the award she
won
 So while she is trying to use these names
commercially, the court still said there is no
infringement if the use is nominative
 Court applied four prong test to see if her
various uses were nominative:
 1) No way to readily identify Terry
without the use of these marks
o True for the “Playmate of the
Year” and the metatags
o BUT Watermarks  court has
issue with this use; the mark is
not associated directly with
Terry’s name
 2) Was more of the mark used than
was needed?
o Here, no  the whole title was
required to describe her (for
metatags and Playmate of the
Year)
o Watermarks: not needed at all
by Terry
 3) Does it suggest endorsement
 o Here: no, she included
disclaimers saying she was not
affiliated with Playboy anymore
 4) Headlines and banner advertising
o Here, Terry was only using the
words “playmate of the year”
without using the stylized
words/logos
 So the metatags and “Playmate of the
Year” title were nominative uses, but the
watermarks weren’t nominative uses
 3) First Amendment Defense
o The courts will not impose themselves in some
situations, because the power of government being
used to stop some form of speech may be seen as a
first amendment right violation
 If I want to complain about someone that has a
trademark, I should be able to
o Bally Total Fitness v. Faber
 Faber put disparaging complaints about Bally on
his website
 Bally claims trademark infringement
 Faber claims First Amendment defense
 Court says Faber can write something critical
about Bally if he wants- courts will not squash
First Amendment right
 Faber can’t effectively complain about you
without using your marks
 He wasn’t using this in a commercial way

B) Alternatives to Infringement- Dilution

 Dilution action may not rise to level of infringement- but a
mark may have been weakened substantially
 Cases under old dilution law:
o 1) Panavision v. Toeppen
 Toeppen starts to buy up domain names to try to
gain financially from whoever would logically want
that mark (cybersquatting)  he bought
Panavision.com
 He put up photos of Pana, Illinois on the
website
 Panavision brings action for dilution
 Much like infringement. 4 dilution
requirements under old law:
  I) Famous mark
 II) Had to use mark commercially
 III) Use had to happen after the mark
was famous
 IV) And the defendant’s use somehow
dilutes the quality of the mark
 Court here makes interesting argument- says
there was commercial use bc he prevented
Panavision from using their trademark
commercially
 Says there was evidence of dilution here;
kind of similar to initial interest confusion
 Harm to Panavision associated with
people going to website and not
seeing what they expected
o 2) Ty v. Perryman
 Perryman resells Beanie Babies using domain
name bargainbeanies.com
 Ty said this was dilution of their Beanie Baby
trademark
 Court said the use of this mark caused no
confusion- she was really selling beanie babies
and she included a disclaimer on her website
 Blurring v. Tarnishment (2 types of dilution)
 Blurring: The line between the two names
may be blurry- people may get them
confused
 Ex. Tiffany’s (jewelry) vs. Tiffany’s
Café
 Tarnishment: You somehow attach the
jewelry to something that damages its
reputation
 Ex. Tiffany’s (jewelry) v. Tiffany’s
strip joint
 Court says neither blurring nor tarnishment were
present here
 Court says her use is actually purely
nominative since she is actually selling
beanie babies
 Modern dilution law:
o Lantham Act 15 USC §1125(c)- When is dilution
present?
 I) Mark is famous (inherent or acquired
distinctiveness)
  What makes a mark famous?
 One that is widely recognized by
consumer public as a source
designation
o How long has it been a mark?
o To what extent nationally is it
known as a mark?
o Geographic extent of its
advertising publicity
o Amount/volume and geographic
extent of sales
o Is it federally registered?
 II) Mark is being used in commerce
 III) Use is likely to cause dilution by blurring or
tarnishment (defined in Lantham Act)
 Blurring: arises from similarity of mark;
impairs distinctiveness of the marks and
weakens consumers’ ability to distinguish
source
 How similar is the registered mark
against the diluted use?
 What is the degree of
inherent/acquired distinctiveness of
the famous mark? Is it strong?
 Intent to create association with the
famous ark
o There is technically no mens rea
component, but if someone did
intend to create association,
then this is an indicator that
weighs in trademark owner’s
favor
 Actual association
o Consumer surveys
o Actual instances of confusion
 Tarnishment: similarity between two marks,
and the use harms the reputation of the
registered mark
 ***regardless of the presence of absence of
actual or likely confusion, of competition, or of
actual economic injury
 Exclusions to Dilution (kind of analogous to the
defenses to infringement):
 I) Fair use
  Parody, commentary, criticism
 Advertising, promotion that permits
consumers to compare goods/services
 II) News reporting/commentary
 III) Any non-commercial use of a mark
o Remedies
 Normally just injunction; BUT
 You can sometimes get same remedies as for
infringement (money damages):
 If offending mark was first used after
Lantham act went into effect
 Blurring: willful intent to trade on
recognition
 Tarnishing: willful intent to harm
reputation
 Giving fake info to domain name registrar

3) Cybersquatting and Remedies

 Lantham Act 15 USC §1125(d)  Cybersquatting Prevention
Act
o Person is liable if person has a bath faith intent to profit
from the mark and registers, traffics in, or uses a
trademarked domain name
o Provides a mechanism to stop cybersquatting
(registering and trafficking in domain names)
o Covers all types of trademarks- including personal
names
o Requirements:
 1) Bath faith intent to profit
 Court will look at:
 Is the trademark actually in the
domain name?
 How is the mark being used?
o As a placeholder to try to get
money for the name, or is it
actually a fair use?
 Is there an intent to divert
consumers?
 Offering to transfer/sell the domain
name
o Subsequent communications,
offers on website itself
 False contact information when
registering for domain name
  Registration for multiple of these
domain names
 How famous is the mark that is being
used?
 Is there a legitimate use for the
name?
 2) Registration of domain name
 3) Use in a confusingly similar (i.e. infringing) or
diluted way
o Relief:
 In personam case: the defendant is actually
present
 Do this if you can find the person who
engaged in cybersquatting
 Can get profits
 If you can prove you’ve been financially
harmed you can get actual damages
 Also statutory damages are available if you
can’t prove profits/actual damages
 Court costs
 In rem case: go after the domain name itself
 Court can order forfeiture/cancellation of
domain name
 Or transfer of domain name to owner of
registered mark
o ICANN
 A) UDRP: a way to resolve disputes outside of the
courts; it still is structured and is a formal process
 So you can clean up the situation fairly rapidly
 When can you use this:
 Domain name that is confusing similar to
TM or SM to which you have rights
 How do you demonstrate that you
have rights?
o If company is commonly known
by the domain name, rights can
be inferred
 Respondent has no rights/interests in the
domain name and it has been registered in
bad faith
 Bad faith determination:
o Pattern of cybersquatting
o Primarily for purpose of
disrupting competitor’s business
 o Try to attract customers,
causing likelihood of confusion
 What does this process look like?
 Kind of like a mini-trial
 Complaint, service of complaint,
selection of provider/arbitrator, wait
for a response
o They have 20 days to respond
to allegation
 If they don’t respond,
default judgment that
complainant wins
o The person responding to the
complaint can expand the
arbitration panel to three
o Then panel gets appointed
 If one member-
complainant pays
 If more- they split fees
o Can’t be ex-parte
communications
 B) Uniform Rapid Suspension System (URS) 
new; different than UDP
 If you own a generic top level domain
name, and that domain name was
introduced after June 2013 and involves a
registered trademark and there exists
obvious infringement, but you don’t want
the domain name transferred to you, this is
a way to get that domain shut down at a
fraction of the cost (suspended for a year)
 Show registrant has no rights or legitimate
interest in it
 You must have a registered trademark (not
just common law rights); you have high
burden of proof to show defendant has no
rights in it
 Defenses to A and B  15 USC §1114(2)(D)(v):
someone who has had their domain name taken
from them can file a civil action to establish that
the registration or use of the domain name by
such registrant is not unlawful under the Lantham
Act