Nearly $300,000 awarded to plaintiff in keyword case against competitor

United States of America
In Binder v Disability Group Inc (Case CV 07-2760-GHK (Ssx), January 25 2011), the US District Court for the Central District of California has held that the use of the plaintiff’s registered trademark by a competitor to trigger advertisements linking to the competitor’s website constituted trademark infringement, false advertising and unfair competition. It awarded nearly $300,000 in damages to the plaintiff, as well as attorneys’ fees and costs.
The plaintiff, Binder & Binder, offers legal services for clients with social security disability claims under the mark BINDER & BINDER, and owns several federal trademark registrations for various BINDER & BINDER marks. The defendants operate a competing disability advocacy service and - for a period of eight months - purchased and used the plaintiff’s BINDER & BINDER trademark as a keywords to trigger advertisements that linked to the defendants' website.

Initially, the court held that the use of the plaintiff’s trademark through Google AdWords constituted a “use in commerce” in connection with the sale or advertising of the defendants’ services. Next, in applying the Ninth Circuit's Sleekcraft likelihood of confusion factors with emphasis on the "internet trilogy" (ie, similarity of the marks, relatedness of the goods/services and simultaneous use of the web as a marketing channel), the court concluded that the defendants’ use of the plaintiff’s trademark to trigger advertisements linking to their website created a “strong” likelihood of confusion and, therefore, constituted trademark infringement, as well as false advertising and unfair competition. 
In particular, the court found that:

  • the plaintiff’s mark and the mark used by defendants were identical;
  • the services provided were identical;
  • both parties marketed their services through the internet;
  • the plaintiff’s mark was strong; and
  • the defendants intentionally chose the plaintiff’s mark based on its strength and appeal in the market. 
Additionally, in reaching its decision, the court relied on evidence of actual confusion in the marketplace, although it stated that, even without evidence of actual confusion, “there would be more than enough evidence to establish a likelihood of confusion”. With respect to establishing actual confusion, the court noted both deposition testimony of several individuals and that 16 of 17 people polled in a survey believed that, when they clicked on the defendants’ website following their search, they were actually being brought to the plaintiff’s website.
Ultimately, the court concluded that the defendants’ infringement of the plaintiff’s mark was wilful and awarded the plaintiff nearly $300,000 in enhanced, 'lost profit' damages, as well as attorneys’ fees and costs.
Susan M Natland and Jeffrey H Larson, Knobbe Martens Olson & Bear LLP, Irvine

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