Internet Trademark Case Summaries

Cleary Bldg. Corp. v. David A. Dame, Inc.

2009 WL 4506414 (D. Colo. Dec. 1, 2009)

Plaintiff Cleary Building Corporation (“Cleary”) manufactured and built pre-engineered structures and owned federal registrations for multiple CLEARY BUILDING marks (the “Cleary Marks”).  Cleary contracted with defendant David A. Dame (“Dame”) for the construction of a building (the “Dame Building”).  In January 2009, shortly after construction began, Dame raised concerns about the construction and refused to admit Cleary into the construction site until Cleary addressed his concerns.  Five days later, Dame again refused to allow Cleary access to the building until his newest concerns were addressed.  Two weeks after the second incident, Dame and a Cleary representative walked through the building and created a list of issues.  They repeated the walk-through process the next month to create another list.  In April 2009, Cleary attempted to contact Dame about a final walk-through to address any remaining issues, but Dame refused to allow Cleary access.  As of May 2009, Dame promoted the Dame Building for sale in at least two online advertisements, in which he provided links to his website www.myclearybuilding.com.  The website featured Cleary’s blueprint plans for the Dame Building, including at least one of the Cleary Marks, as a background image for the home page.  Dame also published misleading statements about the Dame Building on the website, including that Cleary “declared the project finished” when, in fact, Dame refused to give Cleary access to the building to address final issues.  Cleary sued Dame for cybersquatting, trademark infringement, dilution, by tarnishment unfair competition, and false advertising.  The court denied Dame’s motion to dismiss Cleary’s complaint.  First, the court agreed that Cleary’s cybersquatting claim did not allege sufficient facts showing Dame’s bad-faith intent to profit from his use of the Cleary Marks because Dame clearly made a noncommercial or fair use of the Cleary marks on his website.  Dame’s website was “nothing more than a gripe site” to “tell his story” about his complaints with Cleary.  The court further noted that likelihood of confusion as to the source, sponsorship, affiliation or endorsement of Dame’s site was not “plausible.”  Although the website did not have a disclaimer, the title page read “My NEW building by Clearing Building Corp.” (emphasis in opinion) and contained information about Dame’s experiences with Cleary regarding the building’s construction.  The court stated that it would be unreasonable to conclude that consumers viewing Dame’s website would be confused about the site’s source or sponsorship.  Regarding Cleary’s claim that Dame had a bad-faith intent to profit from his use of the Cleary Marks, Cleary alleged that Dame registered and used the domain name to gain an unfair advantage in negotiations with Cleary and

offered to take down the website if Cleary met his demands.  The court disagreed, noting that Dame offered to remove, rather than sell, his website to Cleary.  Even if Dame was using the website as a “bargaining chip” to exert pressure on Cleary to settle, such use did not constitute an offer to sell the site to Cleary.  The court thus found that Cleary did not plead sufficient facts to support its cybersquatting claim.  Second, the court noted that to survive a motion to dismiss on a trademark infringement claim, a plaintiff must plead sufficient facts to state a plausible claim that the defendant used plaintiff’s mark “in connection with any goods or services.”  Here, Cleary argued that Dame used the Cleary Marks in commerce because: (1) Dame advertised the sale of the Dame Building in at least two online advertisements; (2) Dame included links in his ads to his website, which featured the Cleary Marks; and (3) Dame’s website contained false or misleading statements about Cleary and/or the Dame Building.  The court rejected this argument, stating that it could not draw a reasonable inference that Dame used the Cleary marks in commerce.  In the Tenth Circuit’s decision in Utah Lighthouse Ministry, the defendant’s use of the plaintiff’s mark on a gripe site that linked to a newsgroup containing advertisements for plaintiff’s competitors was deemed “not in connection with the sale of goods or services,” because the link to the advertisements was “too roundabout and attenuated” and was in connection with the expression of the defendant’s opinion about the plaintiff’s goods or services, rather than a sale of goods or services.  The court similarly held here that Dame’s use of the Cleary Marks on his website was not a commercial use.  The fact that Dame provided links to his website in several online ads did not mean that he used the marks in connection with goods or services because his website did not link to the online advertisements.  Rather, the online ads linked to the website, which was similarly “too roundabout and attenuated” for a finding of commercial use.  Dame’s use of the Cleary Marks to express his opinion about Cleary’s goods and services thus did not support Cleary’s claim of trademark infringement.  Finally, the court also dismissed Cleary’s dilution, unfair competition, and false advertising claims because they also required a showing of Dame’s commercial use of the mark.