Feature: Trademarks and metatags don’t mix

Trademark infringement, thanks to the Internet, isn’t always as easy to identify as it used to be. Invisible uses of a competitor’s service or trademarks in the metatags of another company’s Web site can form the basis of trademark infringement claims, says Michael Bevilacqua, a senior partner and co-chair of the technology transactions and licensing group with the law firm Hale and Dorr LLP, in Boston. “Many Web site operators have assumed that by avoiding use of a trademark in the text of a Web site, they are avoiding liability for trademark infringement,” Bevilacqua says. “That’s not a safe assumption anymore.”

Web sites add and change trademark use

Historically, trademark infringement was based on the visual use of a service mark or trademark, Bevilacqua says. If a competitor used a company’s mark in a manner likely to confuse customers and divert business away from the company and to the competitor, the company would take action to protect its trademark. In most instances, the corporate attorney would send a strongly worded “cease-and-desist” letter to the competitor wrongfully using the mark. If the competitor continued to use the mark, the company would then file a lawsuit.

The “invisibility” of metatags put a new wrinkle in determining trademark infringement, Bevilacqua says. Using a trademark in a metatag (the HTML code that lays out for display a site’s content) is an invisible use of the mark. “Most Internet search engines hit the metatag field when conducting searches. A Web site may therefore attract hits by placing terms within its metatags, even if such terms are not used in or relevant to the Web site content,” Bevilacqua says.

“Use of trademarks in metatags is interesting because you don’t see the mark. The federal district courts haven’t arrived at the same conclusion on this issue,” Bevilacqua says.

Trademark infringement finding in the Prozac metatag case

Pharmaceutical developer Eli Lilly & Company manufactures and markets the drug Prozac and also owns the trademark in the United States. Naples, Fla.-based Natural Answers marketed “Herbrozac,” a mood-enhancing herbal supplement, through the Internet.

“In addition to its use of ‘Herbrozac’ as a brand name, Natural Answers also used the term Prozac in its Web site metatags, although the word did not appear on the [Natural Answers] Web site,” Bevilacqua says. Nevertheless, Eli Lilly frowned on the use of the mention of Prozac in Natural Answers’ Web site metatags. The pharmaceutical company filed a lawsuit in 1999 in the Seventh Circuit federal district court against Natural Answers for trademark infringement, trademark dilution, and violations of state unfair competition laws.

Although Natural Answers was not successful in setting itself apart from the hundreds of sites a Prozac Web search brings, the appeals court still found in favor of Eli Lilly on the metatag question (No. 00-1375, 7th. Cir. 11/21/2000). Using Prozac in metatags on Natural Answers’ Web site, said the appeals court, is like Natural Answers putting up a sign in front of its store with another company’s trademark on it.

Trademark basics apply on the Internet

Trademarks, experts say, protect the public interest. Through branding and the use of recognizable trademarks, consumers are able to accurately identify the source of goods and services.

Trademarks also protect a company’s name and goodwill, whether in traditional markets or on the Internet.”The rules for trademark infringement in Web sites are really no different from other media. Whether it’s print or electronic, you can’t use other companies’ trademarks,” Bevilacqua says.

Confusion is important factor in infringement

In print or on the Web, confusion, or the likelihood of confusing buyers, is the most important issue in determining trademark infringement, Bevilacqua says. When courts look at confusion in trademark infringement claims, they review “the strength of the mark, the similarity of the marks, the sophistication of buyers, the similarity of the goods, actual confusion, good faith in adopting a trademark, quality of the defendant’s products, and other factors,” Bevilacqua says. “It’s a subjective test with no one factor being generally more important than the others.”

The court found a likelihood of confusion in the Eli Lilly metatag case, the attorney says. The court stated that “Natural Answers’ use of ‘Prozac’ as a metatag … is evidence of Natural Answers’ intent … and creates a risk of confusion.” Bevilacqua says it was clear infringement. “Natural Answers was clearly using a competitor’s trademarked product and was trying to drive customers away from the competitor and trying to create confusion.”

Legitimate uses of competitors’ trademarks

“Comparison advertising, whether in print or on a Web site, is one of the few permitted uses of another company’s trademark,” Bevilacqua says. If a company runs a legitimate comparison advertisement on its Web site, mention of a competitor’s trademark in the metatags of the page with the comparison ad would be an acceptable use of the mark, Bevilacqua says.

Bevilacqua also sites an additional acceptable use of another company’s trademark in Web site metatags: product distributors with a license from the manufacturer to use the product trademark. “There is some legitimate interest in using the trademark. The distributor has a right to sell the product.”

As a rule of thumb, Bevilacqua protects his clients’ marks when the trademarks are used in a competitor’s Web site source code without permission or in an unacceptable manner. “I have taken the positions that any unauthorized use of a client’s trademark in a competitor’s metatags is infringement,” he says.

Traditional and invisible infringement

Net Protection surveyed 4,000 intellecual property specialists in Europe and the United States and found significant increases in traditional and Internet-based intellectual property infringement between 1998 and September 2000.

Infringement types and increases:

* Metatag infringement up 1,280 per cent

* Copyright infringement up 105 per cent

* Parody sites up 2,200 per cent

* Internet-based counterfeiting up 1,650 per cent

Source: Net protection