Couple Wins Domain Name Trademark Dispute Against Toyota!

I don’t know about you, but I get pretty tired of hearing about one court case after another that goes against common sense, decency, and even human dignity. But here’s one that came down yesterday (July 8th) that we in the Internet Marketing world really need to cheer about.

Unfortunately, due to the hullaballoo surrounding another crazy court case ruling in the same area the same day that got national, if not world-wide press, this case will probably go completely unnoticed by the news media.

To make matters even more tantalizing, the winning party in this case was a couple who used the internet to promote their business, and they represented themselves, pro se. That is, they couldn’t afford a lawyer, so they took on the largest automaker in the world in an appeal of a trademark suit all by themselves — appealing a case they’d already lost.

And they WON the appeal! WOO-HOO!

Trust me, THIS CASE IMPACTS YOU AND ME!

Here are a few snippets from the decision:

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The Tabaris are using the term Lexus to describe their business of brokering Lexus automobiles; when they say Lexus, they mean Lexus. We’ve long held that such use of the trademark is a fair use, namely nominative fair use. And fair use is, by definition, not infringement. The Tabaris did in fact present a nominative fair use defense to the district court.

. . .

The district court enjoined the Tabaris from using “any . . . domain name, service mark, trademark, trade name, meta tag or other commercial indication of origin that includes the mark LEXUS.” A trademark injunction, particularly one involving nominative fair use, can raise serious First Amendment concerns because it can interfere with truthful communication between buyers and sellers in the market-place.

To uphold the broad injunction entered in this case, we would have to be convinced that consumers are likely to believe a site is sponsored or endorsed by a trade- mark holder whenever the domain name contains the string of letters that make up the trademark.

. . .

In performing this analysis, our focus must be on the “ ‘reasonably prudent consumer’ in the marketplace.”

. . .

The injunction here is plainly overbroad—as even Toyota’s counsel grudgingly conceded at oral argument— because it prohibits domain names that on their face dispel any confusion as to sponsorship or endorsement. The Tabaris are prohibited from doing business at sites like independent- lexus-broker.com and we-are-definitely-not-lexus.com, although a reasonable consumer wouldn’t believe Toyota sponsors the websites using those domains. Prohibition of such truthful and non-misleading speech does not advance the Lanham Act’s purpose of protecting consumers and preventing unfair competition; in fact, it undermines that rationale by frustrating honest communication between the Tabaris and their customers.

. . .

When a domain name making nominative use of a mark does not actively suggest sponsorship or endorsement, the worst that can happen is that some consumers may arrive at the site uncertain as to what they will find. But in the age of FIOS, cable modems, DSL and T1 lines, reasonable, prudent and experienced internet consumers are accustomed to such exploration by trial and error.

They skip from site to site, ready to hit the back button whenever they’re not satisfied with a site’s contents. They fully expect to find some sites that aren’t what they imagine based on a glance at the domain name or search engine summary. Outside the special case of trademark.com, or domains that actively claim affiliation with the trademark holder, consumers don’t form any firm expectations about the sponsorship of a website until they’ve seen the landing page — if then. This is sensible agnosticism, not consumer confusion.

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It’s hard to imagine judges in an appeals court writing this stuff! Or even lawyers, for that matter.

I AM NOT MAKING THIS UP!

Take a look at this article on the Law.com site. At the top of the article is a link to a PDF file containing the text of the court’s decision. It’s only 22 pages long, and is amazingly easy to read.

http://su.pr/5f204D

-David