Summer 2012 Issue
Amerigas Propane, L.P. v. Opinion Corp.,
2012 WL 2327788 (E.D. Pa. June 19, 2012)
Defendant Opinion Corp. (“Opinion”) operates PissedConsumer.com, a consumer-review website that allows third parties to post negative reviews about businesses. Opinion publishes the negative reviews to a subdomain or URL that uses the business’s name (e.g., businessname.pissedconsumer.com), includes the business name in the site’s metatags, and utilizes the Google Adwords feature to present third-party advertising, including advertisements of a featured business’s competitors. In addition to profiting from the posted advertising, Opinion offers paid “premium reputation management services” that allow a targeted business to respond to complaints and otherwise manage its PissedConsumer.com page. Plaintiff Amerigas Propane, L.P. (“Amerigas”), one of the companies targeted by Opinion, sued for trademark infringement, unfair competition, and various state-law claims.
Opinion sought to dismiss the complaint, claiming, among other things, that it did not use AMERIGAS as a trademark and that its use of the mark was protected under the doctrine of nominative fair use as part of protected critical speech. The court disagreed.
On the issue of whether Opinion’s use of AMERIGAS qualified as a trademark use, the court concluded that use of a mark to trigger Internet advertisements and market “premium reputation management services” satisfied the Lanham Act’s “use in commerce” requirement for trademark infringement.
The court also disagreed with Opinion’s nominative fair-use defense. The Third Circuit uses a two-step approach for analyzing whether the nominative use is fair and therefore permissible. First, a plaintiff must prove that confusion is likely. Once confusion is demonstrated, the burden shifts to the defendant to demonstrate that its use of the mark is nonetheless fair by showing that (1) the use of the plaintiff’s mark is necessary to describe both the plaintiff’s product or service and the defendant’s product or service; (2) the defendant’s use is only so much as is necessary to describe the plaintiff’s product; and (3) the defendant’s conduct or language reflects the true and accurate relationship between the plaintiff and the defendant’s products or services. Applying this two-part analysis, the court concluded that it was “premature to make any findings with respect to nominative fair use without the benefit of discovery,” as the factors were fact-intensive and required evidentiary support. In reaching its decision, the court rejected an earlier case in which the district court held that inclusion of the word “pissed” in a domain name was sufficient to prevent a reasonable consumer from being confused.1 The court distinguished that case as it involved a motion for a preliminary injunction, not a motion to dismiss for failure to state a claim.
The court upheld Amerigas’s claim on initial-interest confusion, holding that while Opinion did not directly sell similar products to Amerigas, it provided advertising links to Amerigas’s competitors that were probative of the type of damage caused by initial-interest confusion. While acknowledging that there were no cases of initial-interest confusion within the Third Circuit, the court signalled that initial-interest confusion was applicable.The court rejected Opinion’s attempted reliance on the Communication Decency Act (“CDA”), which provides immunity for passive website operators. Noting the allegations that Opinion not only solicited negative reviews, but wrote negative reviews itself, the court held that the CDA was inapposite.
This decision is one of the first cases in the Third Circuit to address initial-interest confusion in keyword advertising. It also suggests that infringers cannot shield themselves from infringement behind criticism-style URLs.