Internet Trademark Case Summaries

Finance Express, LLC v. Nowcom Corp.

564 F. Supp. 2d 1160 (C.D. Cal. 2008)

Plaintiff Finance Express sold software that facilitated Internet-based communications between car dealers and lenders. Finance Express sold its products through its www.financeexpress.com website, and owned trademark registrations for the marks FINANCE EXPRESS, DEALTRACE, TRACKER, and TRACKER DMS. Defendant Nowcom sold competing software. Finance Express alleged that Nowcom infringed its marks by: (1) registering domain names containing Finance Express’ marks, including trackerdmsonline.com, trackerupgrade.com, tracker-dms.com, new-tracker-dms.com, and financeexpressdms.com; (2) linking two of the domain names to a Nowcom website containing “a misleading press release” that encouraged Finance Express clients to switch to Nowcom; (3) using Finance Express’ marks in Nowcom’s website metatags to enhance search engine results; and (4) purchasing keywords containing Finance Express’ marks. Finance Express sued for trademark infringement, cybersquatting, and false designation of origin, among other claims, and sought a preliminary injunction. The court granted Finance Express’ motion on its trademark infringement claim. Regarding the strength of the marks, the court viewed the DEALTRACE mark as suggestive and the remaining marks as descriptive but protectable through the acquisition of secondary meaning based on Nowcom’s intent to confuse consumers through its deliberate copying of those marks. Regarding the Lanham Act’s use-in-commerce requirement, the court determined that Nowcom’s “numerous commercial transactions using Finance Express’ trademark[s]” in domain names, as keywords, and in metatags all constituted use in commerce of Finance Express’ marks. Moving to the likelihood-of-confusion analysis, the court analyzed only the three key likelihood-of-confusion factors in the context of the web. The similarity-of-the-marks factor weighed in favor of Finance Express because Nowcom’s domain names and keywords were “strikingly similar” and “almost identical” to Finance Express’ marks. The relatedness of the parties’ products also favored Finance Express because the parties were direct competitors. Finally, the marketing channels factor favored Finance Express because both firms used the Internet as a marketing channel. Nowcom defended its keyword purchases, arguing that the inclusion of its URL on the keyword-generated banner advertisements alleviated any possible initial-interest confusion. The court disagreed. Although Playboy v. Netscape suggested that banner ads clearly identifying the advertiser might eliminate the likelihood of initial-interest confusion, the court found that “a website address located in small font at the bottom of [Nowcom’s] advertisement is not sufficient to overcome the initial interest confusion that results from Nowcom’s practice of keying.” According to the court, the result might have been different had Nowcom’s name “appeared in large font in the first line of the advertisement, or perhaps even if it appeared anywhere in the text of the advertisement.” The court also found a likelihood of confusion with Nowcom’s use of Finance Express’ marks in its metatags. Rejecting Nowcom’s fair-use defense, the court stated that “Nowcom is not using the terms . . . as descriptive terms to fairly and accurately describe its webpage” or describe products for sale on its website. Rather, Nowcom’s actions created initial-interest confusion, stating that “Nowcom’s use of Finance Express’ marks in metatags is intended to confuse consumers and to capitalize from Finance Express’ goodwill.” Finally, the court rejected Nowcom’s argument that an injunction was not necessary because it had ceased use of the infringing domain names based on Nowcom’s continued use of the Finance Express marks as keywords and in metatags. The court thus enjoined Nowcom from registering, operating, owning, or promoting any website whose domain name or content uses any of Finance Express’ marks, and from using any of those marks or combinations thereof in metatags or purchasing them as keywords.