Seattle Trademark Lawyer

You gotta love it when the Ninth Circuit says it doesn’t believe one of the litigants.

That’s pretty much what happened Aug. 8 when it reviewed the Southern District of California’s order dismissing the defendant in CollegeSource, Inc. v. AcademyOne, Inc.

In that case, plaintiff CollegeSource sued AcademyOne for unfair competition, misappropriation, and a number of computer-based claims on the ground that its competitor in the business of helping students transfer colleges had taken material from its websites.

AcademyOne, a Pennsylvania company, moved to dismiss based on its lack of contacts with California. After jurisdictional discovery, the district court granted AcademyOne’s motion.

CollegeSource appealed, which led the Ninth Circuit to find it didn’t buy AcademyOne’s story that it didn’t purposefully avail itself to the California forum. Here’s a sample of what AcademyOne was selling that the court wasn’t buying:

“AcademyOne’s assertion that it was unaware of College-Source’s California place of business prior to its receipt of the cease-and-desist letter is implausible, to say the least. CollegeSource and AcademyOne were direct competitors in a relatively small industry. Three AcademyOne employees registered for trial memberships with CollegeSource in order to evaluate their competitor’s product. AcademyOne’s vice president for marketing, Johnson, telephoned and emailed a CollegeSource sales representative in 2005, seeking to purchase CollegeSource’s catalogs. AcademyOne’s executive director for product strategy, Munkittrick, sent several emails to CollegeSource’s CEO in 2005 and 2006 seeking to schedule conference calls. CollegeSource’s CEO, Cooper, declared, ‘Our California phone number and address is prominently displayed on our website’s ‘Contacts’ page.’ It is unclear how AcademyOne employees would have learned to contact the relevant officers at CollegeSource other than through the latter’s website or a reference that would have made CollegeSource’s California location clear. It is difficult to believe that a conference call could have been scheduled without consideration of the time zones (and therefore the locations) of the participants.” 

The court added: “It is also difficult to believe that AcademyOne, a newcomer to the college transfer market, was unaware of the location of its principal competitor, which it contacted several times in order to propose a business relationship. In any case, it is undisputed that AcademyOne maintained the misappropriated catalogs on its websites for several months before delivery of the cease-and-desist letter — and CollegeSource alleges, for several weeks thereafter — affording ample opportunity for AcademyOne’s employees to encounter CollegeSource’s URL and terms of use, and so to discovery that the catalogs came from CollegeSource. We also note that CollegeSource had earlier rebuffed AcademyOne’s attempts to purchase this very material. AcademyOne’s assertion that it was fortunate enough to obtain for free, unintentionally and unknowingly, the material that it had once unsuccessfully attempted to purchase strains credulity.”

Since the Court found AcademyOne had purposefully availed itself to California, it concluded the district court erred in finding it lacked personal jurisdiction over the dispute.

The case cite is CollegeSource, Inc. v. AcademyOne, Inc., __ F.3d __, 2011 WL 3437040, No. 08-1987 (9th Cir. Aug. 8, 2011).

With this injunction, consumers shouldn’t see the branded helmet at right.
Rawlings’ helmet at left (and right with Under Armour’s logo)

Last June, Rawlings Sporting Goods Company, Inc., sued Under Armour, Inc., alleging that Under Armour had put its trademark on Rawlings’ batting helmet in promotional materials without Rawlings’ permission (STL post here).

The parties have settled. Rawlings got a permanent injunction, which Western District Judge Marsha Pechman entered Aug. 8. The permanent injunction follows the preliminary injunction Rawlings obtained last year (STL post here). 

The injunction is simple given the claims in the case. It enjoins Under Armour from putting its logo on Rawlings’ COOLFLO-branded helmet in any advertising and promotional materials.

The parties agreed to bear their own costs and attorney’s fees.

The case cite is Rawlings Sporting Goods Company, Inc. v. Under Armour, Inc., No. 10-933 (W.D. Wash. Aug. 8, 2011).

In Trafficschool.com, Inc. v. Edriver Inc., defendants own and manage DMV.org, a for-profit, advertising-driven Web site that provides visitors with information about renewing driver’s licenses, buying car insurance, beating traffic tickets, and the like.

Plaintiffs market and sell a traffic school and driver’s ed courses to consumers. They compete with defendants for revenue generated from sponsored links.

Plaintiffs sued for false advertising on the ground that defendants got an unfair leg up on the competition by misleading consumers into believing that defendants’ DMV.org Web site is a government Web site (“DMV” being a common abbreviation for Department of Motor Vehicles).

At trial, the Central District of California held that defendant had engaged in false advertising in violation of Section 43 of the Lanham Act and imposed a permanent injunction but did not find the case was “exceptional” as needed to award attorney’s fees.

Both sides appealed. On July 28, the Ninth Circuit agreed that defendants had violated the Lanham Act. Indeed, it found defendants’ conduct was so misleading to consumers that the district court erred in not awarding fees. 

“Defendants challenge the district court’s finding that their deception was willful — and thus ‘exceptional’ under Horphag [Research Ltd. v. Garcia, 475 F.3d 1029 (9th Cir. 2007)] and Lindy Pen [Co. v. Bic Pen Corp., 982 F.2d 1400 (9th Cir. 1993)]. But the district’s willfulness finding is supported by evidence that defendants planned to mislead site visitors and knew that their conduct confused consumers. Defendants associated their website with URLs and search terms that falsely implied DMV.org was a government site. They had in their possession hundreds of emails sent by consumers who contacted DMV.org thinking it was a state agency. And DMV.org’s director of customer service testified that he voiced concerns about these emails to senior management.

“Defendants claim that they reacted by ‘explain[ing] away any confusion’ and adding disclaimers to the bottom of each web page. But defendants knew that the disclaimers were ineffective, because adding them didn’t end the stream of emails sent by consumers who thought they’d contacted their state DMV. There was overwhelming proof that defendants knew their statements confused consumers and did little or nothing to remedy it. The district court could reasonably infer that they willfully deceived the public.”

The case cite is Trafficschool.com, Inc. v. Edriver Inc., __ F.3d __, 2011 WL 3198226, Nos. 08-56518, 08-56588, 09-5533 (9th Cir. July 28, 2011).

This morning I awoke to a good trademark law story on NPR.

It’s about New Mexico farmers’ efforts to protect the brand behind the New Mexico chile pepper.

They lobbied for legislation that essentially creates a certification mark out of those words.

Right now, there aren’t any direct restrictions on using “New Mexico” in connection with chiles anywhere else. As the story put it, “For now at least, anywhere else in the country, a leather shoe could be called a New Mexico chile.”

New Mexico farmers recognize their chile peppers are prized. Their chiles also cost more to produce than, say, chiles from “old” Mexico. New Mexico farmers pay workers $7.25 per hour, while that’s what workers in developing nations make in a day.

So, unscrupulous growers outside New Mexico can call their chiles “New Mexico chiles” and grab a free ride on the New Mexico chile pepper’s reputation — without charging the premium price. Indeed, that’s reportedly what they’ve done.

Now, doing so would constitute a false designation of origin, which violates Section 43(a) of the Lanham Act, but that’s slightly beside the point.

The point is, New Mexico chile farmers have the right idea. Make their brand mean something specific. Like Champagne wine (which only comes from the Champagne region of France; blog post here), Parmesan cheese (which only comes from the Parma region of Italy; blog post here), and Wild American shrimp (which only are caught in the wild in the East Coast and Gulf of Mexico regions of the United States; blog post here). That way they can command the premium price they reportedly deserve, while stopping undeserving third parties from getting a free ride on their reputation.

A good lesson other producers can learn from.

IPKat’s blog post on the story — all the way from London — here.

An injunction’s got to be specific enough so it can be understood and enforced.

That’s the problem the Ninth Circuit had with the District of Nevada’s injunction against a home inspection company that encouraged home owners to file construction defect claims against a developer in violation of the Lanham Act and Nevada Deceptive Trade Practices Act.

The district court’s injunction prohibited the defendants from “soliciting and/or performing residential inspections and/or providing inspection reports … by means of illegal, unlicensed and false practices.”

The order gave several examples of prohibited practices: “(1) falsely representing that the defendants are ‘properly licensed under Nevada law to perform structural inspections; (2) properly licensed under Nevada law to … perform, provide or communicate inspection reports; and/or (3) are acting as representatives or agents under the authority of Del Webb.’”

Yet, even with these examples, the Ninth Circuit found “the general prohibition against using ‘illegal, unlicensed and false practices’ is too vague to be enforceable. The examples of prohibited past conduct do not sufficiently define what additional future conduct will be covered.”

The court noted that “Rule 65(d) requires an injunction to ‘state its terms specifically’ and ‘describe in reasonable detail … the act or acts restrained.’ ‘The benchmark for clarity and fair notice is not lawyers and judges, who are schooled in the nuances of [the] law,’ but instead the ‘lay person, who is the target of the injunction.’”

Therefore, the court vacated the vague portion of the injunction.

The case cite is Del Webb Communities, Inc. v. Partington, __ F.3d __, 2011 WL 2854086, No. 10-15975 (9th Cir. July 20, 2011).