Consumer Advertising Law Blog

Is A Certified Electronics Recycler® a Trademark or a Type of Recycler?

If you’ve ever wondered what to do with your old cell phone or laptop, you’re not alone. According to the Basel Action Network (BAN), a Seattle-based non-profit, “e-waste” is the fastest growing toxic waste stream in the world, and too much of it is currently being dumped, burned, or exported to less developed countries that lack the technologies needed to manage toxic materials without harming human health and the environment. In April, BAN launched its e-Stewards® Certification program, which allows individuals and organizations to identify recyclers that comply with BAN’s standards for the handling, recycling, and reuse of electronic waste. In connection with the program, BAN wants to use the phrases “electronics recycler,” “certified recycler,” and “certified electronics recycler” to describe those recyclers who have obtained e-Stewards® status. The problem? The phrase “Certified Electronics Recycler” has been registered as a certification trademark by another non-profit that claims to certify recyclers. On June 7, BAN sued the International Association of Electronics Recyclers, Inc. (IAER) and its successor, the Institute of Scrap Recycling Industries, Inc. (ISRI), for cancellation of the Certified Electronics Recycler® certification mark and for a judicial declaration that BAN’s use of the phrase does not constitute trademark infringement. (BAN originally petitioned the U.S. Patent & Trademark Office to cancel the Certified Electronics Recycler® mark but recently opted to pursue a federal court complaint instead.)

In its Complaint, BAN alleges the phrase “electronics recycler” is a generic phrase which is a commonly used industry term to describe an entity that recycles electronic equipment or parts, and that “certified electronics recycler” is commonly used to describe an electronics recycler that has been certified or accredited by a private or public standards-setting organization. The continued use and registration of the Certified Electronics Recycler® certification mark, BAN argues, erroneously suggests that only ISRI can certify a genuine “certified electronics recycler,” which harms BAN, its e-Stewards program, and the public. Second, BAN alleges defendants have abandoned the IAER certification standards, which were originally associated with defendants’ certification mark, and are currently misusing the mark in connection with a different set of standards adopted by ISRI. BAN argues that because the certification mark “Certified Electronics Recycler” has not been used consistently with one set of consistent standards, the use of the phrase as a certification mark is inherently misleading and confusing to the consumer, and should be cancelled under the Lanham Act’s trademark cancellation provisions.

The amount of electronics waste expected to increase 8% per year (according to BAN). At the same time, there is an increased desire by all of us who want to upgrade our cell phones and laptops in an environmentally responsible way and the government that we dispose of this waste in an appropriate manner. If one company or organization can claim ownership and rights to the Certified Electronics Recycler® mark, will that organization have a competitive advantage over other standards-setting organizations in certifying electronics recycling companies? The federal court in Seattle, Washington is currently poised to answer this question. 

- Suzanne Wilson, Anna Manville, and Elizabeth Frank

Protecting Your Trademark Is No Laughing Matter

The online retailer ThinkGeek is known for having some pretty bizarre items, but none are wackier than the annual April Fool’s Day products. This year’s lineup included Canned Unicorn Meat, billed as “the new white meat.” Below a picture of a block of sparkly meat, the product page explains how a group of Irish nuns care for aging unicorns and “fatten them on a diet comprised entirely of candy corn.” A diagram of the cuts of unicorn, including “magic,” “giggles,” and “rainbows,” completes the page.

The product led the National Pork Board (NPB), owners of the trademark THE OTHER WHITE MEAT, to send a cease and desist letter warning ThinkGeek of possible infringement. The letter objected to the product’s slogan—“Pâté is passé. Unicorn - the new white meat.” It also noted that other websites, in linking to Canned Unicorn Meat, had used the phrase “The Other White Meat.”

THE OTHER WHITE MEAT has been in use for over twenty years, with over $550 million spent on advertisements using the slogan. A 2000 study found it to be the fifth most well-known advertising slogan in the United States. Based on this and other evidence, the Patent and Trademark Office recently found the slogan to be a famous mark and refused to allow a salmon distributor to register THE OTHER RED MEAT because it would cause dilution by blurring the distinctiveness of the NPB’s mark.

In a blog post, ThinkGeek asserted that it has “nothing to worry about--this kind of use is protected as a parody.” Confident in its legal position, ThinkGeek had a field day at the NPB’s expense, posting a portion of the letter—which it called the “best-ever cease and desist”—and implying that the NPB’s lawyers thought the product was real. ThinkGeek’s parent company even issued a Press Release, apologizing for “caus[ing] a national crisis and misguid[ing] American citizens regarding the differences between the pig and the unicorn.” Almost immediately, bloggers got in an the action, exclaiming that “the pork people had no sense of humor” and “weren’t in on the joke.”

However, parody is not a defense to infringement per se, but rather an argument that there is no likelihood of confusion—a necessary element of infringement—because consumers will know that the parody is a joke. A parody, though, must make fun of or criticize the trademark or its owner; using a trademark to make fun of something else is not a parody. Thus, to be a parody, Canned Unicorn Meat must be meant as commentary on THE OTHER WHITE MEAT or the NPB. If Canned Unicorn Meat does not qualify as a parody, ThinkGeek may face liability for infringement or possible dilution of the NPB’s famous mark. And there would be nothing magical about that.

- Suzanne Wilson and Karen Otto

“Ambush Marketing” and the World Cup: How Does an “Official Sponsor” Protect that Position?

What comes to mind when you see thirty women wearing orange mini-dresses? If you said ambush marketing, you may be correct. Companies spend substantial sums to sponsor high profile events, such as the FIFA World Cup. The benefits of sponsorship generally include exclusive advertising rights associated with the event. Occasionally non sponsors may use techniques known as “ambush marketing” to leverage their own marketing campaigns at high profile events. Ambush marketing is not always easy to police. Even if legal action is available, it is often only available after the ambush has occurred.

The World Cup is a prime target for ambush marketing given the worldwide attention it attracts. Recently, Bavaria NV, a Dutch beer brewery (which is not an official sponsor of the World Cup), sent more than thirty women wearing orange mini-dresses to a match in order to promote the brewery’s ongoing beer advertising campaign in the Netherlands. An equal opportunity ambusher, Bavaria enlisted a group of men to attend matches at the 2006 World Cup wearing orange lederhosen with a distinctive black tail that displayed the company’s name. A South African budget airline has also attempted to use the World Cup’s popularity to its advantage.

In response, FIFA (as well as other international sporting organizations) has developed a global rights protection program. The program entails close collaboration with local authorities in an effort to address ambush marketing strategies as soon as possible. Moreover, South Africa, in anticipation of the World Cup, passed anti-ambush marketing legislation that outlawed the misuse of registered marks and unfair competition. Although these rigorous action steps may help FIFA’s policing efforts, the challenge for an “official sponsor” remains how to effectively protect against ambush marketing before it occurs.

In the United States, the US Soccer Federation obtained a preliminary injunction against retailer The Sports Authority (TSA) over TSA’s use of advertisements during the World Cup that included official US Soccer trademarks. In its complaint, US Soccer alleged that TSA's advertising campaign infringed on Dick’s Sporting Goods’ official sponsorship relationship with US Soccer. While the ads had already appeared during the US-England match, the injunction was filed to prevent TSA from running the ad during the US-Slovenia match on Friday, June 18 -- the day after the order was obtained.

The Lanham Act provides potential remedies for ambush marketing that results in consumer confusion, or the likelihood of consumer confusion, regarding the relationship between the company being advertised and the targeted sporting event. However, US courts also recognize a company’s First Amendment right to engage in commercial speech if consumer confusion is not threatened. Accordingly, organizations such as FIFA, as well as its official sponsors, will no doubt continue to look for new and better methods of protecting their relationships and the benefits that sponsorship provide. The beginning of Wimbledon this week will undoubtedly give rise to a whole new array of ambush marketing opportunities and the corresponding policing challenges.

- Suzanne Wilson and Andrew Macurdy

No Decision on Legality of Search Engine’s Sale of Keywords

Last month, Google Inc. and Rescuecom Corp. settled their long fight over Google’s sale of the RESCUECOM mark as a search engine keyword, which permitted Rescuecom’s competitors to display “sponsored listings” when Internet users searched for Rescuecom. The dismissal settles Rescuecom’s trademark infringement and dilution claims, and comes after the parties took their dispute up to the Second Circuit, which found in favor of Rescuecom and remanded the case for further proceedings. The dismissal itself contains no clues as to why the parties finally decided to end their six-year dispute.

The Rescuecom case is just one of many trademark infringement and dilution cases filed in the US and in Europe against Google’s sale of third party trademarks as keywords in its AdWords program. For years, Google has defended these sales, and its “suggestion” tool that prompts customers to purchase the trademarks of others, by claiming that these sales do not fall within the definition of “use in commerce” under the Lanham Act’s trademark provisions. This has been a thorny issue for trademark owners, particularly in the Second Circuit, which includes New York. Last year, the Second Circuit’s decision in favor of Rescuecom cleared the way for trademark plaintiffs who sought to proceed past the complaint stage in lawsuits against search engines to be able to prove the substance of their trademark claims. Rescuecom Corp. v. Google, Inc.¸ 562 F.3d 123 (2d Cir. 2009). After last year’s appellate decision revived Rescuecom’s trademark infringement lawsuit against Google, many trademark owners were waiting to see how Rescuecom’s claims would proceed on their merits at the trial court.

Though the dismissal itself contains no settlement terms, news reports state that Rescuecom was ready to settle because it learned recently that Google had removed the RESCUECOM mark form its suggestion tool five years ago, which, when combined with Google’s stated policy of not allowing trademarks in ad text, would diminish the use and visibility of the RESCUECOM mark in competitors’ sponsored listings. Rescuecom is claiming victory in this settlement, trumpeting the dismissal as “A Case of David versus Googleiath” in a recent press release (available here). According to the press release, Rescuecom achieved two of its three objectives (i.e., removal of its mark from the suggestion tool and from the text of advertisements), though Rescuecom admits that it did not obtain relief on its third goal of preventing use of its mark as a keyword “trigger” for advertisements.

Google is still involved in other trademark keyword disputes but, with the settlement of Rescuecom, has avoided a trial on the merits of such a case for now. Meanwhile, Rescuecom is embroiled in another lawsuit, a declaratory judgment lawsuit it filed against Best Buy, which, ironically, seeks to prove that Rescuecom’s purchase of the GEEK SQUAD mark as a keyword is a fair use, among other things. See Rescuecom Corp. v. BBY Solutions, Inc. (NDNY filed Oct. 14, 2009).

- Suzanne Wilson and Catie Rowland

Beware! Growing Danger of False Patent Marking Suits

Marking a product with the number of its underlying patent is good practice––it provides notice of the patent and is a prerequisite for certain types of damages in infringement actions. Falsely marking a product, however, can create problems and recent developments in false marking law merit a closer look at marking practices. Recent cases have increased the potential bounty available in false marking suits. 

Section 292 of the Patent Act provides that: 

Whoever marks upon, or affixes to, or uses in advertising in connection with any unpatented article, the word “patent” or any word or number importing that the same is patented, for the purpose of deceiving the public . . . Shall be fined not more than $500 for every such offense. 

35 U.S.C. § 292(a). Under § 292(b), half of the $500 fine is kept by the plaintiff, and the other half goes to the United States. According to the statute, “[a]ny person may sue for the penalty.” This provision is not new, but recently the Federal Circuit made clear that the $500 fine is awarded for each wrongly marked article. Previously, some courts had not interpreted “offense” to mean each wrongly marked article.  

In Forest Group, Inc. v. Bon Tool Company, 590 F.3d 1295 (Fed. Cir. Dec. 28, 2009) the lower court, and a court in a parallel proceeding, had issued claim constructions of the patent-in-suit that required elements not met by the plaintiff patentee’s own products. Despite these orders, the plaintiff continued to label its products with the patent number. The lower court then issued a single $500 fine to the plaintiff based on this continued marking in the face of the court orders. The Federal Circuit affirmed the lower court’s decision that the plaintiff had engaged in false marking, but announced that the marking statute “clearly requires that each article that is falsely marked with intent to deceive constitutes an offense . . . .” The court remanded the case for a determination of the total penalty based on each item sold with the false marking. 

The Federal Circuit did not provide clear guidance on what it takes to prove an intent to deceive, but it did make clear that its opinion was not meant “to suggest that multiple claim constructions or summary judgments are required before the requisite knowledge for false marking can be found.” Indeed, more frequently, false marking problems arise when marking continues even after the patent has expired. If false marking is proven, a company that sells thousands of units of product a year may quickly find itself on the receiving end of a large fine if it knowingly marks its products with inapplicable patent information.

The key lessons: (1) Implement a regular program to ensure that markings are removed when a patent expires. (2) Review markings after claims construction and summary judgment decisions. (3) Seek an independent counsel’s opinion when false marking is a potential problem. (4) Only use “patent pending” after filing for patent protection.

- Monty Agarwal and Aaron Schur

Google AdWords Gets Cleared by European Advocate General from Keyword Trademark Infringement Claims

The Advocate General of the European Court of Justice today gave his opinion on three cases concerning Google’s AdWords system, which permits advertisers to purchase third-party trademarks as keywords to trigger sponsored links in search results. The opinion is not binding on the ECJ, but the court often follows the Advocate General's opinion in the majority of cases. The three cases encompassed by today’s opinion are: Google France v Louis Vuitton, Google v CNHRR and Google v Viaticum Luteceil, (Joined Cases C-236/08, C-237/08 and C-238/08).

These cases were brought to address on a large scale issues frequently confronted by brand owners in their efforts against counterfeiters. Specifically, counterfeiters frequently purchase keywords from Google that correspond to registered trademarks such as “Louis Vuitton. ” When an Internet user searches for “Louis Vuitton,” this triggers advertisements in Google’s search results that redirect consumers to websites where they can purchase counterfeit merchandise (e.g., “Louis Vuitton Replica” and “fake Louis Vuitton handbags”). The Advocate General’s resolution of the questions posed to the ECJ is bad news for trademark owners.