WhenU pops up with another victory

In Wells Fargo & Co v WhenU.com Inc, the US District Court for the Eastern District of Michigan has refused to issue a preliminary injunction against WhenU's pop-up advertising. The court held that the ads, which promote rival companies and pop up when internet users access the plaintiff's websites, do not violate trademark or copyright law.

The district court dismissed the claims filed against WhenU by the plaintiff banking service providers Wells Fargo and Quicken Loans Inc. It rejected their arguments that WhenU's pop-up ads infringe their trademarks on the following grounds:

• WhenU's pop-up advertising does not use the plaintiffs' trademarks to identify products or services. The only marks appearing in the pop-up ads are the marks of companies that are advertising through the When-U pop-up network.
  
  
• WhenU is not using the plaintiffs' marks to hinder access to their websites. There was no evidence, said the court, that consumers are unable to reach the plaintiffs' websites as a result of the simultaneous appearance of WhenU pop-up ads.
  
  
• The placement of WhenU's pop-ups in close proximity to open windows for the plaintiffs' websites does not amount to improper framing.
  
  
• WhenU's use of URLs (uniform resource locator) containing the plaintiffs' names in the directory that it compiles in order to return contextual pop-up ads does not constitute use of their marks. The court rejected the contention that their inclusion in the directory was likely to create initial interest confusion.

The court also relied heavily on the absence of any credible evidence that viewers of WhenU pop-up ads are likely to be confused into believing that there is an affiliation between the plaintiffs and WhenU. The court noted that all WhenU pop-up ads are labelled as coming from WhenU and include a notice stating that the ad "is a WhenU offer and is not sponsored or displayed by the website you are visiting". In addition, the court focused at length on weaknesses in the likelihood of confusion survey evidence proffered by the plaintiffs.

The court also rejected the plaintiffs' copyright infringement claim. This allegation turned on their argument that WhenU ads modify the pixels on a computer user's on-screen display, creating a "derivative work". The court rejected this contention for a number of reasons. First, the plaintiffs' expert witness admitted that pixels form part of the hardware of a computer, and are owned and controlled by the computer user. The plaintiffs therefore own no property interest in the content of a user's pixels. The court further noted that, to qualify as a derivative work, a work must be fixed and thereby independently copyrightable. The pixels on a computer screen are updated every one-seventieth of a second and as such are far too transitory to be independently copyrightable.

This is WhenU's second victory in three months. In September, the US District Court for the Eastern District of Virginia entered a summary judgment dismissing trademark and copyright claims against it (see Important U-Haul pop-up decision should help clarify legal landscape).

David Fleming, Brinks Hofer Gilson & Lione, Chicago