Sunday, March 18, 2012

Are Google Keywords Protectable?

Mary Kay, Inc., v. Amy L. Weber
601 F.Supp.2d 839

This case answers the age old question, “When is a touch of pink a touch too much?”

Mary Kay is a distributor and wholesaler of cosmetics. Mary Kay relies primarily on a network of independent sales representatives to sell the products to consumers. In Mary Kay parlance, they are Independent Beauty Consultants (“IBCs”) and the top one each year gets a special pink Cadillac as a reward (Fun fact: This is the only example of a custom color created by Cadillac). At the time Defendant Ms. Weber was involved, Mary Kay simply sold the products to the IBC, who then disbursed with them as she saw fit. Mary Kay had no influence over the price or methods, but did require each IBC to order at least $200 worth of product each month.

Ms. Weber appears to have done this for some time, but eventually stopped placing orders. To dispose of her leftovers, she began selling on eBay. Ms. Weber found a ready market, and began buying and selling Mary Kay products through eBay, eventually setting up her own eBay store, “marykay1stop.” When marykay1stop came to the attention of Mary Kay, legal letters were exchanged, culminating in a conversation with a paralegal at Mary Kay. As a result, Ms. Weber changed the name of her store to Touch of Pink and registered

Doubt Ms. Weber will be driving one of these anytime soon.
Ms. Weber asserted fair use as an affirmative defense. After a look at the relevant case law, the court found that using a trademarked name to attract search results is protected through fair use. The court noted, citing a law review article, that Internet search engines would be rendered useless if sellers were not allowed to include trademark names as search terms. Fairly describing a cosmetic as Mary Kay brand is an accurate description that enables users to find what they are looking for. This was held despite the fact that Ms. Weber had purchased 79 Google keywords relating to Mary Kay at a cost of $20,000 per month.

The court did note that even if the fair use defense was available to the defendants, there was still a likelihood of confusion analysis. The court used the “digits of confusion” test, including the following seven factors, reviewed in turn.

1) The type of the mark allegedly infringed and 2) the similarity of the two marks: The court found these to be nearly identical.

3)The similarity of the products or services: Again, they are nearly identical.

4)The identity of the retail outlets and purchasers: Neither had retail outlets, but both sold to individuals interested in Mary Kay cosmetics. Although Mary Kay sells through IBCs, they also make products available directly through their website.

5)The identity of the advertising media used: Both use Internet based advertising, including Google.

6)The defendant’s intent: The court looked to the disclaimer stating that there was no relationship between the Weber site and Mary Kay. The court noted that it was hidden on the bottom of the About page, and furthermore that such disclaimers do not carry evidentiary weight if they are confusing or not prominently displayed. Overall, the court found this factor to weigh neither for nor against confusion.

7) Any evidence of actual confusion: There was evidence of at least one customer of Ms. Weber contacting Mary Kay customer service, as well as a market research survey conducted by Mark Kay. There were evidentiary issues which mostly discounted the survey, but overall the court found evidence weighing in favor of confusion.

Weighing these seven factors, the court found that there was a genuine issue of material fact as to confusion, and based on this, denied summary judgment for defendant Weber.

This case contained a careful analysis of Internet business principles. The court was able to draw distinctions between print and online advertising, and also thoughtfully understood the use of trade names as search engine identifiers. It appears that this was the last time this case was before a judge, so we unfortunately do not get to read the dramatic conclusion.

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