Thursday, August 21, 2014

When should TM claimants use the Madrid system?

Also via Lexology, Baker & McKenzie has an article setting out the pros and cons.  Highlights include the information that central attack leads to 2% of international registrations being withdrawn, and a handy checklist to determine whether Madrid is a good option (for marks central to a business or new marks not variants on old one, they recommend no).

News for storage jars, Thai military coup edition

Via Lexology, Rouse Legal penned The IP Upside of Thailand's Military Coup.  Law enforcement priorities!

Dastar and karaoke

Slep-Tone Entertainment Corp. v. America’s Bar & Grill, LLC, No. 13 C 8526, 2014 WL 4057442 (N.D. Ill. Aug. 15, 2014)

Slep-Tone sued defendants for violations of the Lanham Act.  Slep-Tone makes karaoke accompaniment tracks sold under the trademark “SOUND CHOICE.” It also alleged a distinctive and protectable trade dress, which includes (a) the use of a particular typeface, style, and visual arrangement in displaying lyrics; (b) the Sound Choice marks; and (c) the use of particular styles in displaying entry cues for singers, namely a series of vanishing rectangles to indicate the cue. [As an aside, I would be interested to see the proof of these allegations with respect to karaoke audiences, as opposed to operators of establishments that host karaoke, who are the alleged wrongdoers in these cases and thus presumably unconfused.]

Slep-Tone originally released CDs encoded in a special format known as “CD+G” (“compact disc [audio] plus graphics”) allowing for synchronized playback of audio and video suitable for prompting singers with lyrics cues. These tracks can now easily be ripped to a computer hard drive and format-shifted to MP3+G or WAV+G.  Slep-Tone’s media-shifting policy attempts to impose rules on media-shifting karaoke operators.

Defendants provide  karaoke services through karaoke accompaniment tracks, stored on hard drives.  Slep-Tone alleged that they used “counterfeit” tracks displaying the Sound Choice marks and trade dress without authorization, likely causing users [who?] to believe that Slep-Tone created the tracks or authorized the services.  [We’ll hear more about Dastar below, but since our focus has to be on physical origin, I wonder whether consumers would have any opinion at all about physical origin here.]

Defendants argued that Dastar barred these claims, since Slep-Tone’s marks and trade dress were inherent, indivisible parts of its copyrightable karaoke tracks.  Thus, allowing Slep-Tone’s claims would improperly create a “species of mutant copyright law.”  Slep-Tone alleged that the marks and trade dress were completely separable from the copyrightable content.  A prior case, Zuffa v. Justin.tv, rejected a trademark claim by an organizer of pay-per-view MMA fighting against a website that allowed users to upload and share video streams.  The trademark claim was based on the defendant’s display of trademarks, including the eightsided ring where championship bouts took place, when the video was streamed from defendant’s site.  Zuffa held that extending protection over marks inherent to the video, such as the ring, would prevent display of the video even after the copyright expired.  However, the court didn’t dismiss claims relating to the display of trademarks which were not an inherent part of the video broadcast.

At this stage, the court found that Slep-Tone adequately alleged that it was not impossible to display the copyrightable material without the mark.  [I think this is an interesting attempt to make Dastar work, but I’m not sure it succeeds.  Much depends on the facts; arguably this is just the “Scylla and Charybdis” problem discussed in Dastar, where the Supreme Court attempted to solve the problem by removing Scylla (no liability for nonattribution) but not necessarily removing Charybdis (possible liability for attribution, where attribution consists of something more than copying the expressive work).  Consider: the title of a work alone is uncopyrightable.  That implies that work-title = work for copyright purposes. But it must be the case that a trademark claimant can’t require a copier of a public domain work to use a different title for it.  Is the work separable from its title for Dastar purposes?  An additional wrinkle is that Slep-Tone isn’t claiming copyright infringement because, as I understand it, it doesn’t have the rights to do so; under other circumstances, its selection, coordination, and arrangement of the visuals might well themselves qualify as a copyrightable derivative work of the lyrics.  The Dastar problem, then, could be much deeper.]

Defendants also argued that first sale protected them because media-shifted tracks weren’t materially different from the original.  This is a version of my question about what consumers would think about source, though I wouldn’t frame it as first sale—and neither would this court.  While defendants argued that there was “no discernable difference in the bar patron’s experience in seeing, hearing, and perhaps singing along to a media-shifted karaoke track within the bar’s premises,” Slep-Tone alleged that the media-shifted tracks were unlawful counterfeit copies.  First sale doesn’t include copied items “merely because they may ‘pass’ for the original item,” and Slep-Tone alleged more than resale of original goods.

Trademark question of the day

Timesify makes any website look like the New York Times, so that your neighbors don’t know you’re reading something junky.  “In a matter of seconds, the article on how ‘Miley Cyrus Peed on a Tree’ will appear on a page that looks like The New York Times — and with a headline and photo from a bonafide, recent New York Times piece, like ‘Iraqi Relief Flights Rescue Dozens, but Leave Thousands Behind.’” What are the trademark implications?  Dilution?  There’s no sale, so can there be post-sale confusion?  Post-browse confusion?  Or should that be Times-browse confusion?  (I couldn’t help myself.)  There are even internet classic copyright issues: the pictures on the original site are swapped out for Times pictures—it’s not clear whether this is done through direct image linking or some other way.

Wednesday, August 20, 2014

Is porn generic for pornography?

Hey, it's a porn case and not a Pom case!

Calista Enterprises Ltd. v. Tenza Trading Ltd., --- F.Supp.2d ----, No. 3:13–cv–01045, 2014 WL 3896076 (D. Ore. Aug. 8, 2014)

Calista and Tenza (porntube.com) compete in the adult entertainment industry to stream videos.  This case involves trademark claims and counterclaims, including counterfeiting (more evidence for Mark McKenna’s concerns that infringement is collapsing into counterfeiting).

Porntube.com is operated by non-party DreamStar, which is managed by a person who is also a shareholder of a company (FUX) that is a shareholder of Tenza.  Content producers upload content to Porntube.com; Tenza makes its money through (1) third-party ads on Porntube.com and (2) payments from content producers when visitors click through and make a purchase.  Tenza uses “search engine placement services” to promote its content, but its primary marketing tool is its affiliate program.  Operators of other adult sites include links to Porntube.com, and Tenza compensates affiliates on a per-clickthrough basis.  Tenza has registered PORNTUBE for its services.

Calista, working with several other corporations, runs websites that that “categorize” and link to third-party websites that stream pornographic videos.  In 2009, DreamStar invited Calista to participate in an affiliate program for an adult site, 4tube.com, and then invited it to join a similar program for fux.com.  In 2011, DreamStar asked Calista to join the affiliate program for Porntube.com, and was one of the most productive affiliates in the Tenza affiliate program. Calista registered a number of domains containing the words “porn,” “tube,” or “porn” and “tube” in various combinations. Some were used as part of Calista’s participation in these affiliate programs.

Calista’s first registration of a domain name including “porntube,”freshporntube.com, was in 2009. After that until January 2011, Calista had 15 websites with domain names containing both “porn” and “tube” in various combinations. After that August of 2013, Calista used at least an additional 17 domain names containing some permutation of “porntube.”  There were at least 14 domain names including “porntube” verbatim, also including goldporntube.com, bookporntube.com (my personal favorite), and cubeporntube.com.

In 2013, Tenza used the UDRP to challenge 13 Calista domain names; a panel ruled in Tenza’s favor, triggering this suit by Calista.

The court denied summary judgment to both parties on whether Porntube was a valid mark.  Calista argued that “porn” and “tube” are both generic, making “porntube” generic.  Calista’s expert stated that “What most consumers refer to categorically as ‘tube sites’ represents the largest segment (by popularity and traffic counts) of all known adult entertainment streaming video web sites online.”  Tube sites, he said, are video aggregation sites. 

Tenza argued that “tube” alone wasn’t generic, and that “porn” was merely suggestive because one expert called “porn” a term that was “a fun word” and “a bit tongue in cheek” compared to “pornography.”  (“Mommy” is a bit tongue in cheek for a child who’s reached a certain age, but it’s still generic for mother.) Calista’s expert Marc Randazza also said that “porn” is used in phrases such as “food porn and nature porn,” phrases that have “nothing to do with sexuality,” indicating that “porn” is a more socially acceptable term than pornography.  (“Brain food” isn’t food; I don’t see how that’s relevant to whether porn is generic for porn, nor do I think the existence of casual and more formal words for the same thing means that either word is non-generic—compare “pub” and “restaurant” and “eatery” or “refrigerator” and “fridge”; not to mention the fact that casualness could be a big part of why a term might be competitively necessary, a key justification for genericness doctrine.  None of this is to say I think “Porntube” is obviously generic, but “porn” plainly is.)  But the court concluded that the parties’ “conflicting explanations of the meaning of the words ‘porn’ and ‘tube’” prevented it from finding the composite term generic on the ground that both components were generic.

More generally, “generic individual terms can be combined to form valid composite marks.”  Dictionary definitions aren’t determinative of public understanding.  The key inquiry is whether there is evidence that to the consuming public the primary significance of the term is to identify the service or product and not its source.  There was a genuine dispute of material fact about whether the terms “tube” and “porn” are, in isolation, generic terms, and an additional question about their composite use.

On the composite question in particular, Calista pointed to over 3200 registered domain names uisng “porntube,” with more using the variant “porn-tube” and “tubeporn.”  Tenza’s own expert explained his “conservative” belief that one-quarter to one-third of all free adult-entertainment websites describe themselves as being a “porn tube.”  Tenza argued that there was no evidence of use of these domain names.  Of the “porntube”-using domain names listed by Calista in response to an interrogatory, there were at most 45 unique registrants. Tenza’s argument that this potential use was de minimis presented a question of fact, as did Tenza’s criticism of using Google search as a mechanism of determining use.

Calista argued that Tenza itself used “porn tube” generically to describe a type of video. Tenza’s website title description says: “Watch FREE porn videos at PornTube.com with new porn tube videos added daily.” Tenza also used “porn tube” in various captions of videos, though it wasn’t clear whether the references were to material on the website or external material.  Tenza’s expert described this as an attempt to describe the content of videos, “written with the widest variety of high traffic catch phrase and search terms.”  Tenza argued that although these references should have been capitalized, used as one word, and followed by ®, these small errors do not mean that Tenza meant to use the phrase “porn tube” to indicate the type of product rather than the source.  The court found this to be a jury question.

Dictionary definitions were also not dispositive, as the parties disagreed about which dictionaries to use, and Tenza maintained that Webster’s Third was more appropriate; it didn’t mention “television” as a definition for “tube.”  (Really?)  Again, there was a genuine dispute of material fact.

Generic use in media:  Calista argued that it identified several dozen generic uses of the phrase “porn tube” in adult-entertainment news sources and magazines, television news shows, and academic journals. Tenza’s expert conceded that with some media sources, the phrases “tube site” and “porn tube” were used interchangeably.  Tenza argued that these references were “hearsay” (no, they weren’t, because they weren’t offered for the truth of the matter asserted), and offered articles that didn’t use “porn tube” generically but instead used “tube site.” This question was again better left for a factfinder, which could use the media evidence to find either for or against genericity.  Likewise with testimony about the opinions of people in the trade.

Consumer surveys: The court first resolved some evidentiary disputes: consumer surveys were relevant here because the legal standard required the court to look at the composite mark as a whole; combinations of old words to create new phrases can be nongeneric.  Tenza’s survey might be excludable because the expert defined “adult streaming video” wrongly (he thought it meant live interaction), but that didn’t matter because even if the survey were excluded summary judgment for Calista would be inappropriate.  Other weaknesses in the survey universe (e.g., failure to exclude respondents who were part of the adult entertainment industry) went only to weight, not admissibility. 

Calista also challenged the survey’s reliability because, immediately after asking, “Would you say PORNTUBE is a brand name or a common name,” the survey asked “Which of the following are names of adult entertainment streaming video websites of which you have heard?”  While Calista argued that this would inflate the number of respondents claiming to recognize Porntube, the court didn’t find it enough to doom the survey.  The survey first asked about several different names or terms, with “Porntube” the fifth listed. Then the survey listed ten adult-entertainment streaming websites, including listing “porntube” last.  Calista’s criticisms might carry weight, but the survey questionnaire didn’t suggest its own answer.  “[T]he first question, about recognizing certain words as brand names or common names, is not directly related to the next question, which asks survey participants if they are aware of certain adult-entertainment streaming video websites.” Thus, Calista’s objections went to weight and not admissibility at this stage.

Tenza argued that its survey plus that of Calista’s expert proved nongenericity.  Calista’s expert surveyed 247 qualified respondents and found that 49% of the respondents recognized “porn tube” as a brand name, while the remainder called it common or weren’t sure. Tenza’s expert by contrast found that 79% of the 840 qualified respondents identified “PORNTUBE” as a brand name, and 51% said yes when asked if “PORNTUBE” was as an adult-entertainment website they had heard of.

Ultimately, the overall question of genericity was for a finder of fact.

So too with infringement. Although Calista used “porntube,” it also added arbitrary and suggestive words, which might or might not be enough to change the sight and sound of the domain names enough to distinguish its use.  The difference between the parties’ services—an affiliate site that categorizes videos and directs viewers to other sites, versus a destination site that provides content—also might or might not matter.  For actual confusion, Tenza’s survey found that “for Calista’s prefixed websites using the phrase ‘PORNTUBE,’ between 24 and 34 percent of the consumers believed that the sites were associated with ‘the PORNTUBE brand.’” Tenza was also served with a DMCA takedown for largeporntube.com, owned by Calista.  Again, this wasn’t enough—a jury could find it more than de minimis, but the court wasn’t going to do so at this stage.  Marketing channels were the same, but that doesn’t matter because everyone uses the internet, per Network Automation.

On consumer care, blessedly the court didn’t treat Playboy’s assertions about the easy divertability of adult entertainment consumers as binding, deeming it “dicta.”  Neither party presented evidence on “the psychology or ‘divertability’ of a consumer of adult-entertainment streaming videos on the Internet, thus Playboy is not particularly helpful to either party on this issue.”  However, since the content on both parties’ sites was free, that tipped in favor of finding likely confusion.

Intent: because of the debate over genericity, Calista’s intent was also ambiguous.  As for likely expansion into other markets, “[t]he Court finds, and both parties agree, that given the identity of the parties’ respective services, this factor is unimportant,” which seems to contradict the court’s earlier, more uncertain holding on the relatedness of the services (not to mention its counterfeiting reasoning, up next).  Regardless, there was a genuine dispute of fact on likely confusion as a whole.

Counterfeiting: A counterfeit is “a spurious designation that is identical with, or substantially indistinguishable from,” a registered mark and that is applied to the goods (or services) covered by the registration.  The court found a genuine dispute about whether Calista’s domain names were “identical with” or “substantially indistinguishable from” the registration, given the dispute over the validity and strength of Tenza’s mark.  A mere “colorable imitation” is not counterfeiting. 

Plus, it was disputed whether PORNTUBE “was registered for use on the same goods to which the infringer applied the mark,” since proximity of the goods was in dispute.  The parties disagreed about the relationship of an affiliate website to a destination site.  “Although both websites offer clips of adult-entertainment streaming videos, there may be a meaningful distinction between the way in which these clips are offered to consumers.”  Summary judgment denied to both sides.

Comment: Missing here is any discussion of what the registration says, which ought to be dispositive, but may have been overlooked because of the increasing identity between infringement (which supposedly just looks at consumer confusion) and counterfeiting.  FYI: “Entertainment services, namely, providing a website featuring adult entertainment; Entertainment services, namely, providing a website featuring photographs, videos, related film clips, and other multimedia materials in the field of adult entertainment.”  I don’t see a limitation to destination sites.

Cybersquatting:  Again, there was a genuine dispute on whether Calista’s domain names were “confusingly similar” to Porntube.  Some of the statutory bad faith factors were also debatable, especially given the genericity dispute.

Calista argued laches.  The Lanham Act has no explicit statute of limitations, so the court borrowed—here from fraud, which it thought was the most analogous state claim (2 years); going past the limitations period would trigger a presumption of laches.  Calista argued that Tenza’s principle knew of Calista’s tubepornmix.com website as early as October 2009 and knew about Calista’s goldporntube.com in June 2010, while he was working with Calista through the 4tube.com and fux.com affiliate programs.  He sent Calista an error log report that referenced goldporntube.com in March 2011, and Calista was one of Tenza’s top affiliates for more than two years, so Calista argued that Tenza should’ve known about the domain names.

Tenza argued that it didn’t have constructive knowledge, because the early communications occurred before its principal actually became involved with Tenza.  It also argued that the error log wasn’t sufficient notice, and that even assuming it was on notice then, it filed its UDRP action on March 25, 2013, only 17 days past the two-year laches time period. This created a genuine dispute of material fact on when Tenza knew or should have known.

Laches also requires prejudice.  Calista argued that it expanded its business during the time Tenza should have acted to protect the mark, and that Tenza’s delay caused Calista prejudice because it was building a valuable business around the disputed domains.  This would depend on when Tenza was on constructive knowledge, so it didn’t allow summary judgment for Tenza.

Tenza did win summary judgment on Calista’s claim for damages for loss of revenue it otherwise would’ve received for being a Tenza affiliate, legal fees, and lost domain name value. Calista didn’t identify evidence in response to Tenza’s motion for summary judgment. As a matter of law, Calista wasn’t entitled to money damages, though if it ultimately prevailed on its Lanham Act claims it could still move for an attorney’s fees award.

Gripe sites protected despite use of URL and "Official" language

Board of Directors of Sapphire Bay Condominiums West v. Simpson, 2014 WL 4067175, No. 04–62 (D.V.I. Aug. 13, 2014)

The board is a condo association using  the name Sapphire Bay Condominiums West.  Simpson bought a condo at Sapphire Bay in 2003, and, following a dispute with the Board, created a number of gripe sites criticizing the Board, its members, and its lawyers.  In 2004, the Board sued for violations of the Lanham Act and analogous state claims, seeking an injunction and damages.  Nope.  The websites were noncommercial, the mark wasn’t famous, and the websites weren’t likely to confuse.

Some notable facts: Simpson registered “sapphirebaycondos.com” under his own name and operated a website purporting to be “The Official Website of Sapphire Bay Condominiums West – St Thomas, VI.”  However, directly beneath the site’s slogan was “‘I don’t give a damn’ management,” and the home page linked to subpages with language such as “Lawyer Lies and Five Board Members Commit a Crime.”  After the Board’s C&D, Simpson rebranded the website as “The Owners Official Website For the Elimination of Dishonesty on the Board of Directors of Sapphire Bay Condominiums West, St Thomas, VI.” 

Simpson also denied affiliation with the entity to which he transferred the domain name, but the court found that he operated and directed it.  Simpson also registered a bunch of trade names similar to the Board’s: “Sapphire Bay West,” “Sapphire Bay West Condos,” “Sapphire Bay Condos West,” “Sapphire Bay Condominiums West,” “Sapphire Beach Condominiums West,” and “Sapphire Beach West” with the Corporations and Trademark Division of the V.I., registrations that were revoked because they were already registered or were similar to trade names already registered to Bay Resorts, Inc.

In 2004, the district court preliminarily enjoined Simpson from using sapphirebaycondos.com, or any derivative thereof, as a domain name for any website under his ownership or substantial control. It also ordered him to cancel the domain name sapphirebaycondos.com (which seems like a mistake for a preliminary injunction, since it may be irreversable), and to stop representing himself using the names above.  The preliminary injunction was affirmed on appeal without opinion.  (Among other things, the district court found the Board’s mark to be “famous,” and found the websites to be commercial speech because Simpson intended to harm the Board financially.  Whatever we think of trademark law’s expansiveness today—and I have a lot of thoughts—we may ultimately look at the early 2000s as peak indifference to free speech in trademark law.)

He complied, but erected virtually the same website under the domain name “usvicondos.com,” which has been operating continuously ever since.  Simpson, not giving up, admitted he contributed content to the website, but claimed that a man named “Randolph Lindsay” operated and controlled the website.  The court found that, in fact, Simpson and Lindsay were one and the same, though it didn’t matter to the outcome.  (It's notable how little Simpson's denials mattered here, because liability simply wasn't supported by the other facts.  Some courts might've stretched the Lanham Act out of distaste for a defendant who wouldn't admit he was responsible for the websites.)

The Board sought a permanent injunction and damages based both on sapphirebaycondos.com and usvicondos.com.  The Board didn’t clarify whether it was seeking Lanham Act liability under §43(a)(1)(A) or (B), so the court analyzed both. A threshold issue was whether the websites were commercial, “because the Lanham Act only regulates commercial speech.”  (Note the burbling circuit conflict here.)  Making that determination requires considering (1) whether the speech is an advertisement; (2) whether the speech refers to a specific product or service; and (3) whether the speaker has an economic motivation for the speech.

The Board didn’t allege that Simpson sold goods or services, but claimed that his websites were commercial because they caused economic injury.  That didn’t make them commercial speech.  The websites didn’t advertise goods or services; they didn’t refer to a specific product or service provided by Simpson, but instead alleged, among other things, corruption by Board members.  There was no showing that Simpson’s speech was economically motivated.  The purpose was of course to attack the Board, but there was no evidence of motive to benefit Simpson, or a competitor of the Board’s, economically.  The district court concluded that the speech was commercial for purposes of a preliminary injunction, but that wasn’t on a full, formal record. 

Also, as the court sort of adverted to in a footnote, the law of gripe sites has changed a lot in ten years.  (Ten years!)  The preliminary injunction relied in part on Jews For Jesus v. Brodsky, 993 F.Supp. 282 (D.N.J. 1998), aff’d, 159 F.3d 1351 (3d Cir. 1998), in which the court found commercial use where the defendant used the domain name jewsforjesus.com to host a website critical of the Jews for Jesus religious organization.  “However, key to the court’s reasoning was that the website contained a hyperlink diverting visitors to an organization offering competing goods and services.”  (Note of course that the organization was not a “commercial” one in the ordinary sense.)  Simpson’s site contained links, but not links that “divert[ed]” visitors to “any website connected with goods or services.”  Likewise, Planned Parenthood Federation of America, Inc. v. Bucci, No. 97–0629, 1997 WL 133313 (S.D.N.Y. Mar. 24, 1997), aff’d, 152 F.3d 920 (2d Cir. 1998), found plannedparenthood.com infringing for a site that promoted (but did not sell) an antiabortion book, served a commercial purpose “similar to a publisher’s publicity kit.”  That didn’t describe Simpson’s sites.

Once you discount the appeal in this case and Jews for Jesus, “[t]he Third Circuit has not decided whether the use of another’s trademark in connection with a noncommercial gripe site violates the Lanham Act.”  But several other circuits have protected such sites in similar circumstances (all since 2004).  Because Simpson’s websites were noncommercial, the Lanham Act claims failed. 

However, even if the sites counted as commercial, the Board would still lose under the multifactor confusion test. The court went through each version of the websites—the “Official”sapphirebaycondos.com site; the same URL using the slogan “The Owners Official Website For the Elimination of Dishonesty …”; and the usvicondos.com site.  Most of the factors could be applied to all three.

The Board had a descriptive mark and submitted no evidence on market recognition, money spent on advertising, or anything else other than use for over forty years: a weak mark.  Condo purchases require sophistication and attention.  There was no evidence of actual confusion over ten years, only that the websites made some potential purchasers reluctant to buy and that some renters asked about the sites. 

Potentially interesting bit about marketing and advertising channels: the court appealed to the paucity of search results to find that this factor favored Simpson even though Simpson’s site was the top Google result:

While the Board argues a Google search of the trade name “Sapphire Bay Condominiums West” first returns Simpson’s Website Three, the Board failed to mention only thirty-three results are generated from searching this term. Of those thirty-three results, over half are related either to this litigation or websites operated by Simpson. The Board does not allege (and did not prove) it has a website or any commercial advertisements on the Internet. Many, if not all, of the remaining Google search results direct users to third-party generated content providing information about Sapphire Bay Condominiums West.

[Obligatory note about Google personalization here.  For me, I got about 23,100 results for the search, with quotes, and Simpson’s site was indeed the top result, followed by two sites discussing earlier rounds in this case, followed by a review of the actual condos.]

Because Simpson didn’t sell anything, the “extent to which the targets of the parties’ sales efforts are the same” factor was “inapplicable.”  As for the relationship of the parties’ goods/services, the court noted that the Board was involved in real estate and maintenance services.  Simpson criticized the Board. There was no evidence that consumers would likely think that any of the websites, “whether characterized as ‘Official’ or not,” provide condominium rental, real estate, or maintenance services, so this factor also weighed against  confusion. The plausibility of the plaintiff entering the defendant’s market was “inapplicable,” since there was no reason the consuming public might expect the Board to offer a service critical of itself or that it would be likely to do so.

Now we get to the similarity of the marks and defendant’s intent, which the court analyzed separately for each website.  For the “Official Website” version, similarity weighed in favor of likely confusion.  The “Elimination of Dishonesty” version of sapphirebaycondos.com was “vastly dissimilar” to the Board’s mark.  The slogan contained the Board’s trade name, but “the phrase read in its entirety denotes an entity or organization diametrically opposed to the Board,” and similarity weighed against likely confusion.  Even more so for the usvicondos.com version, which didn’t use a similar URL and did use the “Elimination of Dishonesty” slogan.

Intent: “there is no question [Simpson] erected the websites with the intent to attack the Board.”  Plus, the “Official Website” version with the initial domain name showed an intent “to use the Board’s mark as if it were his own,” which favored a finding of likely confusion as to that first version.  For the second version, he “still used an intentionally confusing domain name to draw what would presumably be the Board’s customers.”  But the changed slogan made clear that the second version wasn’t officially sanctioned.  In its full context, intent didn’t weigh for or against anyone as to this version.  (Not even a mention of initial interest confusion!  More evidence for Eric Goldman that IIC is dead.)  And for the usvicondos.com version, intent weighed against finding likely confusion.

Weighing all the factors, none of the sites were likely to cause confusion.  “No consumer could reasonably believe the Board is promoting rental or real estate services through self-effacing websites.”  And this was true even with the “Official Website” version, which described the Board as providing “‘I don’t give a damn’ management” and featured a prominent picture of what presumably was the Board’s flooded parking lot.  Version one contained text links such as “SBCW Board Members ... Could Go to Jail for Obstruction of Justice ...” “No reasonable consumer would believe the Board operated a website for the purpose of promoting its own malfeasance and criminal conduct.”

Now, to false advertising: The Board didn’t specifically identify what allegedly false statements Simpson made, but the first website version did contain the literally false statement “The Official Website of Sapphire Bay Condominiums West – St Thomas, VI.”  Still, analyzing the website in its full context, “it contained many statements and photographs which are ambiguous or possibly literally true.”  This included the photo of the flooded parking lot, as well as a photo of garbage “piled on what appears to be the Board’s premises.”  Construing the website as an ad, these were ambiguous or literally true.  (That doesn’t make the “Official” statement anything other than literally false—however, that would qualify as unbelievable in context and therefore puffery/immaterial.)  The subsequent versions had nothing that was literally false, only the ambigous statement “The Owners Official Website For the Elimination of Dishonesty on the Board of Directors of Sapphire Bay Condominiums West, St Thomas, VI.”  It wasn’t clear whether this was the official website of all condo owners, or the official website of particular owners who want to eliminate dishonesty.  If you add in punctuation (“Owner’s”), then it’s literally true: it’s Simpson’s official website for eliminating dishonesty.  Since the Board didn’t provide evidence of actual deceptiveness, the claim failed.

The Board didn’t specifically allege a federal dilution claim in its amended complaint, but because the preliminary injunction was based in part on that claim, the court here addressed it.  (We owe thanks to this judge for fixing a terrible-all-the-way-through opinion in the politest possible fashion, and thoroughly to boot.)  Of course, noncommercial uses are specifically excluded under §43(c)(3)(C).  Even if Simpson’s use had been commercial, the Board would still lose because the mark isn’t famous.

Coordinate state-law claims, and tortious interference claims, failed for similar reasons.  (I’m omitting, among other things, the discussion of the Virgin Islands’ general adherence to the Restatement of Unfair Competition, though the court specifically notes that “misappropriation” can’t be used to get around the requirement of likely confusion when it comes to trademarks.)