Trademark infringement is generally the improper use of a competitor’s trademark that results in the customer buying one product thinking it is another. The classic example is when the new competitor adopts the name of the established competitor, or varies the name ever so slightly. Company A calls its new product “TheUltraWidget” to trade on the goodwill Company B has built in its best-selling “UltraWidget.”
These cases are pretty simple. If the consumer is likely to be confused by Company A’s use of Company B’s trademark, and Company B is harmed by (or Company A profits from) that use, there is actionable trademark infringement. As long as Company B can establish the elements of the claim, it is entitled to injunctive relief and monetary damages.
A trickier question arises when the consumer knows it is buying “TheUltraWidget” rather than the “UltraWidget,” and has no idea she has been confused. Is this still infringement? In many cases, the answer is yes. This is “initial interest confusion,” and occurs when the consumer is looking for Company B but is tricked into looking first at Company A. It doesn’t matter that the consumer knows she is looking at Company A; the important part is that she was tricked into looking there when she was trying to find Company B.
Overt examples of initial interest confusion are easy: Company A lists itself as Company B in the phone book, or Company A uses www.companyB.com or www.ultrawidget.com as its website. The Internet has provided new ways of creating initial interest confusion that are much more subtle and harder to detect.
Metatags and hidden text are perfect examples. Metatags are keywords that are built into a web page that are not visible on the page, but search engines use them to evaluate searches. Hidden text is generally text that would appear on the page, but is entered in the same color as the page background so that it is invisible. The search engines that search page text still reads it, and counts it as a hit.
So if Company A wants to attract people looking for widgets, especially ultrawidgets, and wants consumers to see that they have a choice besides Company B’s UltraWidget, it might include “Company B” and “UltraWidget” as search terms and as hidden text on its own website. The consumer has no idea it has been fooled into looking at Company A for her UltraWidget purchase, and Company B has no idea it has lost a sale. Is this infringement of Company B’s trademarks?
In the Ninth Circuit, the use of a competitor’s trademarks in metatags, and presumably hidden text, is trademark infringement. The Ninth Circuit established this rule in Brookfield Communications, Inc. v. West Coast Entertainment Corporation, 174 F.3d 1036 (9th Cir. 1999). In that case, West Coast used Brookfield’s moviebuff trademark as a metatag on its website. The holding is not universally accepted and has been criticized, even within the Ninth Circuit. For example, in his concurring opinion in Playboy Enterprises, Inc. v. Netscape Communications Corp., 354 F.3d 1020 (9th Cir. 2004), Judge Berzon stated he simply couldn’t understand Brookfield as applying so broadly. Judge Berzon believed that if the website address itself showed the consumer it was not visiting Company B’s web page, but was actually visiting Company A’s, then there would be no confusion. As the District of Arizona noted last year, however, even though Brookfield has been criticized, it is still the law of the Circuit and must be followed. Soilworks LLC v. Midwest Indus. Supply Inc., 575 F. Supp. 2d 1118.
Not only is the use of metatags infringing, it is willful and deliberate infringement, which allows the competitor to recover its attorney’s fees and the infringer’s profits. This should provide a strong disincentive to use another company’s trademarks in metatags or hidden text within a web page. And on the defensive side, it’s also not a bad idea to have your IT people monitor your competitor’s websites to make sure your competitors are not using your trademarks on their websites.