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Court Says Use of Metatags by Rival Unlikely to Confuse

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Sep 16, 2004 10:36 AM PDT    Text size: 
CAMDEN, N.J. — In a case of interest to mainstream and adult webmasters, a federal court has ruled that a competing company doesn’t commit trademark infringement by using a rival’s trademarks in metatag coding of its website to alert potential customers searching for the availability of a rival’s goods.

While the U.S. District Court of New Jersey held that metatags can cause initial interest confusion, it said that metatags in which a competitor’s mark is used “truthfully to identify the competitor’s goods” are permissible under the Lanham Act, which defines the scope of a trademark, the process by which a federal registration can be obtained from the Patent and Trademark Office for a trademark and penalties for trademark infringement.

The legal dispute arose when Devco Corp. seeded its website with metatags keyed to the brand name Bijur to attract attention of potential surfing customers searching for replacement parts for machinery made by Bijur Lubricating Corp. It also used the captions “Replaces Bijur” and “Bijur Replacement Parts” on its web pages to identify listings of compatible parts.

Later, Bijur sued Devco for trademark infringement, among other charges. After a consent to a preliminary injunction, Devco motioned for summary judgment.

The court on Aug. 26 granted Devco’s motion, holding that Devco’s use of the Bijur trademarks does not cause a likelihood of confusion and that Devco also is entitled to use the Bijur name in its metatag coding.

“[J]ust as the Lanham Act permits Devco to inform customers through its website that it sells replacements for Bijur parts, it allows Devco to provide that same information in its metatags,” Judge William H. Walls wrote for the court.

The court relied heavily on the trademark case, Playboy Enterprises Inc. vs. Netscape Communications Corp., 354 F3d 1020 (9th Circuit, 2004).

In that case, Chicago-based Playboy had sued Netscape for linking to advertisements of its competitors when users entered words such as "playboy" and "playmate" in search engines. Playboy had claimed that the practice, known as "keying," damaged its brand because its trademarks were associated with other products.

The 9th U.S. Circuit Court of Appeals reversed a court's 2002 dismissal of the suit, allowing it to head to trial. But the case, which had been closely watched in the search-engine advertising field, was settled in January.

The court ruled that Devco’s use of the trademark qualifies as a permissible “nominative use” of the mark.

According to the Playboy ruling, use of the trademark is deemed nominative where:

— The product in question is not “readily identifiable” without use of the mark;

— Only so much of the mark “as is reasonably necessary to identify the product” is used; and,

— The user does nothing that would suggest sponsorship or endorsement by the trademark owner.

The case is Bijur Lubricating Corp. vs. Devco Corp., No. 00-5157.

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