Last November, we discussed a Forbes column authored by Eric Goldman in which the Director of the High Tech Law Institute and Associate Professor at Santa Clara University School of Law noted that “there have been countless trademark lawsuitsover competitive keyword advertising” during the last dozen years, but most trademark infringement lawsuits fail. On May 14, Goldman wrote another column in which he again said that trademark owners “rarely win keyword advertising lawsuits in court,” and another recent lawsuit reinforced that sentiment “despite a number of key facts” that appeared to be in the trademark owner’s favor.
In General Steel Domestic Sales, LLC v. Chumley, the Littleton, Colorado-based corporation sued former General Steel salesperson Ethan Chumley for trademark infringement, unfair advertising and false advertising. Chumley launched Armstrong Steel and ran Google AdWords ads on the keyword “General Steel,” so the defendant’s website would appear in search results when that term was entered. Additionally, Chumley’s company allegedly issued press releases containing false claims attributed to a fictitious employee, his website contained additional false claims and he published Internet postings in the name of General Steel’s CEO. While Judge Philip Brimmer ultimately ruled for General Steel on the false advertising claims, the defendants prevailed on the trademark claims.
Goldman noted that the court rejected “a common argument by trademark owners” that “potential customers entering the term ‘general steel’ into a search engine are searching exclusively for that company, as opposed to executing a broader search for all companies selling similar products.”
“This is really a devastating loss for the plaintiff—and for trademark owners generally,” Goldman wrote. “On its face, this case looked like a sure win for the trademark owner. After all, the ad copy referenced the trademark in a non-comparative way—usually thought to be a ‘no-no’—plus the advertiser engaged in false advertising elsewhere. If a trademark owner can’t win a case with those attributes, when can it win a competitive keyword advertising case? … As it turns out, the answer is ‘rarely.’”
In a separate column earlier this month about the Florida State Bar’s attempt to ban keyword advertising by lawyers, Goldman concluded that “we’re actually near the end of the legal battles over keyword advertising.” If you have a possible trademark misappropriate claim, our Los Angeles trademark infringement attorney can help you determine your best possible legal recourse. You can learn more about intellectual property litigation by visiting our website, and you can contact our firm at (323) 653-3900 or complete the form on this page to let our Los Angeles trademark infringement lawyer review your case.
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