Keyword Advertiser Headed to Trial–Soaring Helmet v. Nanal

By Eric Goldman

Soaring Helmet Corp. v. Nanal, Inc., 2011 WL 39058 (W.D. Wash. Jan. 3, 2011)

I previously blogged on this case in 2009 when Soaring Helmet sued Google for selling keyword advertising triggered on its trademark. Soaring Helmet quickly dropped Google from the suit but continued against the keyword advertiser.

Soaring Helmet makes…(wait for it)…motorcycle helmets and related motorcycle riding gear. The registered trademarks at issue here involve “VEGA” for motorcycle helmets and protective clothing. The case goes on and on about how Soaring Helmet doesn’t deal with Internet-only retailers because its brick-and-mortar retailers hate the price competition (reinforced by Soaring Helmet’s resale price maintenance). The implicit anti-consumer/anti-competitive nature of Soaring Helmet’s distribution system should have been a huge strike against it, but the opinion seems rather unconcerned with it.

The defendant runs Leatherup.com, an Internet-only retailer of motorcycle gear. The court recaps the allegations about the defendant’s activity:

On or about September 1, 2008, Nanal bought the keywords “vega helmets” through Google AdWords. Albert Bootesaz, president of Nanal, testified that the keywords were suggested by Google after he entered “helmets” as a search term. At the time that he bought the keywords “vega helmets” he thought that it referred to a solar system or a star. Nanal ceased using the keywords “vega helmets” in April 2009 after receiving a cease and desist letter from Soaring Helmet’s counsel. Nanal also took the additional step of incorporating a negative instruction to Nanal’s Google AdWords campaign so that LeatherUp.com’s advertisements do not appear when the

word “Vega” is searched. Mr. Bootesaz also testified that the word “Vega” has never been used on the LeatherUp.com website and he has never directed that the word be incorporated into the website in any manner.

Contrary to Mr. Bootesaz representation, Ms. Demund provides evidence showing that the LeatherUp.com website advertised the “XElement Vega Leather Jacket,” which was neither manufactured nor licensed by Soaring Helmet. As of November 22, 2010, Ms. Demund testified that the XElement Vega Leather Jacket was still being offered for sale on eBay.com and Cobragear.com. [citations omitted]

Because of the latter allegations, the court handles the discussion glibly. For example, on the trademark infringement claim, the court’s discussion is unclear whether the defendant referenced “Vega” in the ad copy or only as a keyword trigger. If the defendant only used Vega as an ad trigger, then perhaps the court could have resolved this on summary judgment (in the defendant’s favor, natch).

The false advertising discussion is more troubling. The court says “Nanal’s president admitted both that he used “vega helmets” as an Adword through Google and that his company was not authorized to, nor did it, sell vega helmets….The falsity of Nanal’s advertisement creates a presumption of deception and reliance.” Wait a minute, did I miss something there? How is having an ad triggered by the Vega keyword make a false statement? Depending on the ad copy, for example, there could be an express comparative advertisement; but even if the defendant’s ad just merely referenced its own goods, there’s no reason to assume that the “Vega” keyword is incorporated into the advertiser’s statement. At minimum, the court did a lousy job articulating how it derived a false statement here. Compare Jurin v. Google and Heartbrand Beef v. Lobel’s discussing the search engines’ (lack of) liability for false designation of origin.

As a result, the court sends this case to trial on the trademark infringement, false advertising and other claims.

[Note: I still have to blog the 1-800 Contacts v. Lens.com decision from last month]

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