ENFORCEMENT OF TRADEMARK RIGHTS ON THE INTERNET: NUTS AND BOLTS TOOLS TO HELP PROTECT AGAINST INFRINGEMENT. By Joan K. Archer, Ph.D., J.D.
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1 ENFORCEMENT OF TRADEMARK RIGHTS ON THE INTERNET: NUTS AND BOLTS TOOLS TO HELP PROTECT AGAINST INFRINGEMENT I. Introduction. By Joan K. Archer, Ph.D., J.D. ABA June 2012 Regional Intellectual Property CLE The Internet is constantly evolving and changing and, for many businesses, presents one of the greatest challenges for preservation of intellectual property rights. The abundant availability of domain names, which are inexpensive and easy to obtain, creates trademark enforcement problems that only are magnified by the multitude of available top-level domain names (TLDs), generic top-level domain names (gtlds) and country code top-level domain names (cctlds). Parties may purchase keywords or adwords that include another party's registered marks and courts, in some instances, have essentially provided their stamp of approval on these purchases. Additionally, content can be easily copied from many websites or scanned and uploaded to the Internet with the push of a button. This content often infringes not only registered copyrights, but trademarks as well. Therefore, it is extremely difficult for many businesses to keep up with the constant change to successfully police against Internet infringement and trademark misuse. Moreover, the enforcement of intellectual property rights for on line infringement can be very expensive. This is because adding content to the Internet is fast and inexpensive. On line infringements come and go with the blink of an eye. Most clients have a limited budget available (if any) for addressing Internet infringement and look to their counsel to make specific policing recommendations. Consequently, intellectual property attorneys need to have a system in place for discovering, analyzing and prioritizing measures to be taken against infringements as they occur.
2 This paper suggests that all IP practitioners should develop a practical yet systematic approach to assist clients with protecting trademarks against Internet infringement and trademark misuse. Strategies for identifying and monitoring Internet infringement will be considered and methods for policing trademarks on line will be suggested. These tools can be used to develop an overarching approach to Internet policing that then can be adapted to specific clients on a case by case basis. Once a system for enforcement is in place, it will provide a ready arsenal for addressing on line infringement. II. Strategies for identifying and policing Internet infringement. Intellectual property, including trademarks and service marks, can be an asset of substantial value to many businesses. Even banks are recognizing the importance of valuing intellectual property when loaning money. Furthermore, for some enterprises, branding via a trademark is an essential element of success. A strong trademark can provide a competitive advantage and even deter others from entering the field. Thus, a party's mark portfolio is something worth protecting. Widespread use of a mark by others, however, can render it generic or no longer protectable. Thus, the asset value of a trademark can be impaired or even destroyed through on line infringement. One need only look at "aspirin" as a living example for proof of this fact. See 6 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition, 31:38 (4th ed. 2007) (noting that trademark owners have a duty to police its rights against infringers ). Sometimes genericide occurs as a result of the trademark owner's failure to police the mark, resulting in widespread usage by competitors leading to a perception of genericness, 2 McCarthy on Trademarks and Unfair Competition, 12:1 (4th ed. 2007). Not even aggressive marketing and advertising can save a mark found to be generic through extensive use by others.
3 See, e.g., America Online, Inc. v. AT&T Corp., 342 F.3d 812 (4th Cir. 2001) (use of the phrase "You've Got Mail" was determined to be generic and, therefore, unenforceable as a trademark."). When counseling clients on Internet enforcement issues, it is important to be systematic and adopt methods that are consistently applied. The more systematic and consistent the approach, the more defensible it becomes. There are several steps and points of analysis that should be considered for inclusion in any Internet enforcement strategy. These include the following: 1. Identify trademarks/service marks that merit the most aggressive policing methods and determine their relative value to the entire portfolio. Not all marks owned and/or registered are of equal value. Some entities register slogans or terms associated with particular sales campaigns, for example. Other registrations concern the primary house brand marks. Obviously, the latter may be of far greater import to a particular organization. Some clients with very large revenue have extremely large portfolios. Others are small businesses that not only have few trademarks, but also have little in the way of available resources for policing against on line infringement. Consequently, it is critical to gather in depth knowledge of a client's business and analyze the trademark portfolio to formulate a recommendation concerning enforcement prioritization. Such an approach can prevent mark enforcement from becoming ad hoc or even haphazard. 2. Recommend and implement an Internet infringement monitoring procedure. An important component of any policing strategy is to have a procedure in place to monitor infringement. Some clients elect to undertake in house Internet monitoring by using tools such as periodic on line searches and/or setting up Google alerts and the like. After all, the most important infringements are those that originate with a competitor, so most business owners
4 likely will be well aware of any improper use of their marks. For small business clients or ones with large in house legal departments, such monitoring can be very effective as long as it occurs on a routine basis. That said, informal monitoring is not perfect and undoubtedly will miss some instances of infringement. Offer to educate clients concerning policing of trademarks. Employees should be instructed on the basics of trademark law and should be provided information concerning their employer's portfolio. Also, be sure clients include social networking sites within their routine monitoring. Once armed with this information, employees in the field may be the best source for identification of instances of infringement. Additionally, one can always recommend that his or her law firm utilize the services of a paralegal to perform periodic searches. The responsibility of making sure such monitoring is thorough and complete may be such that it is more appropriate to suggest that a monitoring service be used so a third-party can provide reassurance that instances of Internet infringement will more than likely be discovered. Companies such as Corsearch, Thomson CompuMark and others have search capabilities that may better ensure the completeness of on line policing efforts. Companies offer a wide variety of search scope options and pricing structures. There is competition developing in the industry, so monitoring prices may be quite reasonable. Whatever method is used, it is important that Internet policing occur on some type of periodic basis. The frequency of monitoring needed will depend on the nature of the business and marks monitored, as well as budgetary constraints. Some portfolios should be monitored monthly because infringements are typically prevalent and extensive. To do otherwise will make it difficult for both the client and counsel to keep up. Others may merit monitoring once or twice
5 a year. Each client's monitoring routing should be specifically adapted to their circumstance and needs. 3. Develop a methodology for analyzing instances of infringement once they are discovered. On line infringement and trademark misuse can appear in many forms. Sometimes a mark is included in another party's domain name. Other times it may be used as a search term that leads consumers to a "parked" website that is designed merely to direct traffic to other websites. The nature of the infringement, along with the identity (if known) of the infringer are important considerations in determining a particular course of action to remedy the infringement. Develop a decision tree, such as the following, to use in making enforcement recommendations: High Priority for Enforcement Direct infringement by a competitor: It goes without saying that it is critically important that any infringement or misuse by a competitor be stopped. Domain name infringement: Domain name infringement is among the most important type that can occur, especially if the mark is used by a party in a business that in any way overlaps a client's goods or services. Some, but not all, clients may have purchased the most prevalent TLDs. If not, this aspect of a portfolio also should be examined and recommendations made for proactive protection. Keyword/adword infringement: The issue of whether use of a trademark as a keyword/adword constitutes infringement has not yet been fully settled, although increasingly courts are finding that such use should be subjected to a traditional infringement analysis. See, e.g., Rosetta Stone, Ltd. v. Google, Inc., 676 F.3d 144 (4th
6 Cir. 2012). Nonetheless, if traffic is being driven to a competitor's site, the infringing use clearly merits a hard look. Moderate Priority for Enforcement Posted content that includes infringement of a trademark or other intellectual property: Increasingly, clients who are in a content based business find that written content or excerpts of content may be posted on line as a.pdf, slide show or in some other form. The attention given to this type of infringement depends on the nature of a client's business, as well as the actual content that appears on line. Some content postings may actually encourage the reader to purchase the original book or other item, especially if the content concerns published material. Other times, the content serves little or no practical purpose other than to diminish the power of a party's mark as a single source identifier. Thus, posted content may be an enforcement priority in certain circumstances. Use of a mark in a domain name extension or otherwise in connection with businesses of a more questionable nature: More often than one might imagine, a client discovers use of their mark by another on line business of more questionable repute. This type of infringement may take a variety of forms. Such use may be made, for example, in connection with a special offer that advertises "free" gift cards for a client's products, but it really was designed to get people to purchase other goods or even apply for credit cards. Others may use a client's mark as a domain extension so a search will reveal high placement for a link to a business that is wholly unrelated. Depending on the nature of the use, this type of infringement may be a priority for policing. In some instances, a dilution claim rather than one for infringement may be more appropriate, although not all clients' marks are sufficiently famous to make this a viable
7 approach. A general claim for unfair competition should be considered when a true trademark infringement claim is not possible because the use to which the mark is put is by a business that does not directly compete with a client. "Parked" websites: Some infringement occurs on "parked" websites that are simply designed to drive traffic to any other website in hopes that click through revenue is gained. Some of these sites may be parked with on line advertising in hopes that the domain will then be purchased once a party discovers the infringement. Although a client may want to consider purchasing such a domain name in some cases, they should not feel that they always must do so. Often the party owning the site will voluntarily remove the content when it is questioned. In the alternative, Internet Service Providers ("ISPs") are often helpful in seeing to it that such infringing content is blocked. Entities in the Internet advertising revenue chain, such a Google or Yahoo, also will work with clients to render such sites ineligible for click-through revenue when it is gained through infringing means. Lower Priority for Enforcement Use of a mark by a wholly unrelated business: Some trademark use that is discovered on the Internet is by those who are in a different business but, for whatever reason, have adopted a mark that is the same as or very similar to a client's mark. Although clients often become upset by such use, unless a mark is truly famous and, therefore, can serve as the basis for a dilution claim, there may be no reasonable grounds for enforcement. The client may need to be educated concerning the scope and purpose of trademark protection.
8 Use of a mark that only appears several pages into an Internet search: Some infringing use will be difficult to find and can only be discovered by culling through multiple pages of Internet search results. These instances of infringement generally will be a lower priority since it can be assumed that most consumers do not dig down into the depths of Internet search results. As such, the potential for harm to a client's business is slight and a case can be made, if need be, as to why enforcement was not undertaken. Parties need only make reasonable efforts to police their marks. At a certain point in time the expense and effort required to police against all uses may render policing wholly unreasonable. This list of Internet infringement categories is not intended to be exhaustive. Nonetheless, it can serve as a starting point for development of one's own system for making recommendations concerning policing the use of trademarks on line. 4. Determine what method of enforcement should be used and develop an arsenal of form letters and documents to facilitate efficient enforcement campaigns. There are a variety of strategies and tactics that can be used to initiate a successful Internet infringement enforcement campaign. When faced with on line infringement, a mark owner has the following options: Do nothing: Clients should be advised that they may elect to ignore the infringement. In some cases, an instance of on line infringement may go away over time on its own because a party finds it is not profitable or otherwise moves on to another target. Also, this may be the best option for low priority infringements, as discussed above. Send a cease and desist letter: Cease and desist letters are an important tool for any Internet policing arsenal. Forms should be developed which can be reused and adapted
9 again and again as new infringements are discovered. Clients always, however, should be cautioned that a cease and desist letter can, when combined with other litigious conduct, potentially serve as the basis for a declaratory judgment action in an unfriendly, remote venue. See, e.g., Green Edge Enterprises v. Rubber Mulch, et al., 620 F.3d 1287 (Fed. Cir. 2010). The risk in most cases of facing a declaratory judgment action will likely be relatively small unless an internet infringer is a legitimate competitor's business. There are a wide range of parties who readily respond to cease and desist letters and remove infringing content. In some cases, these parties may be innocent infringers who correct their behavior once they are put on notice. Some competitors may be aware of the infringing conduct but once they are caught in the act wish to save the expense of trying to defend against the claim. Others may be less reputable business who also respond quickly out of a desire to avoid litigation. In some instances, it may be appropriate to also send a cease and desist letter to an infringer's ISP, who may be a contributory infringer or who nonetheless may cooperate in assisting with the removal of infringing conduct. Each ISP has its own policies and procedures concerning notices of infringement, which should be followed. File suit to preserve jurisdiction and send a message that the infringement is serious, but hold off on serving the Complaint pending settlement efforts: If a declaratory judgment action is a legitimate concern and if jurisdiction is otherwise supported, it may be prudent to file a Complaint in a local venue to preserve the favorable jurisdiction. This Complaint, along with proof of filing, can then be included as an exhibit to a cease and desist letter. Filing suit while holding off on service is
10 relatively inexpensive and often can get the attention of a party who otherwise ignores an initial cease and desist letter. Be sure, however, to docket the service deadline. File suit and seek entry of a Temporary Restraining Order and Preliminary Injunction: Full blown litigation, in most cases, should be a last resort. If, however, a competitor is directly infringing a client's mark, there may be no other available avenue for stopping the infringement. There are many factors that go into the analysis of whether litigation is advisable. Consideration should always be given to potential counterclaims, especially those that could seek to cancel a client's mark. Cost, of course, is another critical factor. Trademark litigation can cost hundreds of thousands dollars. To avoid client relation issues down the road, it is imperative that a litigation budget be developed and weighed against the relative value of the mark in issue. III. Conclusion. There are many tools that are available for addressing the infringement and misuse of trademarks on the Internet. It is important to be diligent in whatever enforcement methodology is employed. Periodic monitoring of marks with some regularity, whether it be monthly, quarterly or on some other basis, will best facilitate the preservation of a client's portfolio. Given the high cost of enforcement, strategic choices will often have to be made to maximize the protection of a mark within a given budget. In the long run, a carefully constructed policy strategy will be highly valued by clients who must preserve the value of their intellectual property.
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