Jurisdiction and Trademarks in the Digital Age

Posted on Aug 15, 2024 in Law & Jurisprudence

Jurisdiction

Definition – Authority of a Court

• Authority of a court to hear the facts of a particular controversy
• Authority of a court to decide cases between the particular parties before the court – personal

Requirements for Jurisdiction

The court must have two things:

• Subject matter jurisdiction over the plaintiff
• Personal jurisdiction over the defendant

Personal Jurisdiction Over Plaintiff

Never an issue – a court’s personal jurisdiction over the plaintiff occurs when the plaintiff walks into the courthouse and files the lawsuit.

Personal Jurisdiction Over Defendant

The defendant usually does not voluntarily submit to the court’s jurisdiction.

Types of Personal Jurisdiction

• General Jurisdiction: Continuous and substantial contacts, even if not related to the lawsuit before the court.
• Specific Jurisdiction: Isolated and sporadic contacts that are related to the lawsuit before the court.

State Long Arm Statutes

• List specific types of contacts a state deems sufficient for exercising personal jurisdiction over an out-of-state defendant.
• Allows the state to exercise personal jurisdiction over an out-of-state defendant in all instances where it meets constitutional due process requirements of “fair play and substantial justice.”
• A long-arm statute can be challenged on grounds that it does not satisfy due process in a particular case.

Georgia Long Arm Statute

1. Transacts any business within this state.
2. Commits a tortious act or omission within this state.
3. Commits a tortious injury in this state caused by an act or omission outside this state if the tortfeasor regularly does or solicits business, or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered in this state.
4. Owns, uses, or possesses any real property situated within this state.

Two-Part Test for Personal Jurisdiction

1. Are the defendant’s activities/conduct covered by the state’s long-arm statute?
2. Does the out-of-state defendant have sufficient “minimum contacts” with the forum state to satisfy the constitutional due process standard of fair play and substantial justice?

Fair Play and Substantial Justice Standard

Constitutional requirement met if:

• Defendant “purposefully availed” herself of the “privilege” of conducting activities in the state. Ex: Regularly shipping product to the state.
• Defendant could be considered to have “fair warning” that her activities would subject her to the jurisdiction of the state – i.e., foreseeability.

Merely causing harm in a state is not enough for personal jurisdiction over an out-of-state defendant.

Young v. New Haven Advocate (4th Cir. 2002)

Personal Jurisdiction – Application to Internet Activity

Trademark

• Trademark: A word, symbol, or phrase used to identify a particular manufacturer/seller or their products and distinguish them from those of another (Lanham Act). Ex: Nike swoosh.
• Service Mark: Same as a trademark but used to identify a service provider or service itself. Ex: Yahoo! logo or Delta triangle.
• Trade Dress: Overall look or feel of a product or service. Ex: Delta plane.

Trademark Requirements

• Must be distinctive – capable of identifying the product to the exclusion of similar products.

Inherently Distinctive Trademarks

• Arbitrary: Real words that have no inherent relationship to a product or service.
  • Amazon – when used to identify an online book seller.
  • Apple – when used to identify a computer.
• Fanciful: Made-up words.
  • Exxon
• Suggestive: Suggests a quality of the product or service.
  • Coppertone

Non-Distinctive Marks

Do not qualify as trademarks.

• Descriptive: Such as geographic origination, characteristic, or use of a product.
  • May qualify if the mark acquires a “secondary meaning.”
  • GA Peach cannot, but NYC Cheesecake can.
• Generic: A word that is the name of a general category of product.
  • When a formerly distinctive mark loses its distinctiveness, it loses trademark protection – it becomes generic.

Trademark Registration

• Registration with the USPTO (United States Patent and Trademark Office) is not required.
• Benefits:
  • Provides constructive notice of the mark’s existence.
  • Evidence of ownership of the mark.
  • Can invoke the jurisdiction of federal court.
  • Facilitates registration in foreign countries.
  • Shifts the burden of proof to a third party who contests the trademark on the grounds that it is generic (see RSI v. Freebies).

Domain Names

• Second level and top level.
• Ways to protect a trademark used in a domain name:
  • Administrative proceeding through ICANN.
  • Lawsuit for trademark infringement.
  • Lawsuit for trademark dilution.
  • Lawsuit for cybersquatting.

Uniform Dispute Resolution Process (UDRP)

• Administrative (non-judicial) proceeding in which the complainant (trademark owner) must show:
  • The domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights.
  • The registrant has no rights or legitimate interests in the domain name.
  • The domain name is being used in bad faith.
• Remedies – cancellation of the domain name or transfer of the domain name to the complainant.
• Parties have the right to litigate in court.

ICANN’s UDRP v. Trademark Infringement

“Use in Commerce in Connection with a Sale of Goods”

• PETA v. Doughney, 4th Cir. (2002) – “In connection with the sale of goods” where the defendant’s use of the trademark prevented users from accessing the plaintiff’s products/services.
• Bosley v. Kremer, 9th Cir. (2005) – Not “in connection with the sale” where the website is used to complain about a product/service without any commercial purpose.

Consumer Confusion

• Similarity of marks.
• Strength/kind of mark.
• Similarity of goods.
• Similarity of sales channels/target customers.
• Consumer sophistication/criteria used in making a purchase.
• Intent to cause confusion.
• Actual confusion.
• Length of time the defendant used the mark.
• Converging markets.

Fair Use Defense to Trademark Infringement

Nominative Fair Use

• Use of a trademark to identify, describe, or refer to the trademark owner’s goods or services.
• Ex. Playboy v. Welles

Test for Nominative Fair Use

• The product/service must not be readily identifiable without the trademark.
• Use only so much of the trademark as is reasonably necessary.
• Do nothing to suggest sponsorship or endorsement by the trademark holder.

Trademark Infringement and Gripe Sites

• Bosley Medical v. Kremer
  • Use of a trademark in a domain name of a gripe site is not “in connection with the sale of goods.”
• Taubman v. Webfeats
  • Trademark-identical gripe site domain name – shopsatwillowbend.com.
    • Not in connection with the sale of goods (at least with shirtbiz.com and webfeats.com links removed).
    • No consumer confusion.
  • Pejorative gripe site domain name – taubmansucks.com.
    • No consumer confusion with “sucks” in the name.
    • Protected by the First Amendment as critical commentary.

Trademark Dilution

“The lessening of the capacity of a famous mark to identify and distinguish goods or services, regardless of the presence or absence of (1) competition between the owner of the mark and other parties, or (2) the likelihood of confusion….”

• The mark must be famous and distinctive.

Types of Dilution

• Dilution by Tarnishment: Defendant’s conduct has caused the plaintiff’s mark to be associated with unwholesome, unsavory, or shoddy quality products. Consumers associate the lack of prestige or quality of the defendant’s product with the plaintiff’s unrelated goods.
• Dilution by Blurring: When over an extended period of time, a famous trademark’s value is diminished by its use on dissimilar products.

Anti-Cybersquatting Consumer Protection Act (ACPA)

“A person shall be liable in a civil action by the owner of a mark, including a personal name which is protected as a mark,… if that person had a bad faith intent to profit from the mark…”

Bad Faith Guidelines

• Domain-name owner has no other apparent use of the mark.
• Domain-name owner offers to sell the name to the trademark owner for profit.
• Domain-name owner registered multiple domain names showing a pattern.

Metatags

• Used to index the content of a website for search engines.
• If a website owner places a competitor’s trademark in the site’s metatag, internet users searching for the trademark could be directed to the website; could be:
  • Trademark infringement.
  • Trademark dilution.

Other Internet Trademark Issues

• Deep Linking: “Hyperlink” that bypasses the home page of the “linked” site, may:
  • Give the internet user the false impression that products or services displayed on the “deep linked” page belong to the wrong company – i.e., the company whose website contained the link.
  • Deprive the linked site of possible revenues from banner ads placed on its home page.
• Framing: Technology that allows the user of a website to view content from another site while still looking at the original site.
• Keying: A search engine sells trademarked terms, i.e., keywords, to parties other than the trademark holder to influence the sponsored ad portion of search results.