Fifth Circuit Says Keyword Ads Could Contribute to Initial Interest Confusion (UGH)–Adler v. McNeil

August 17, 2021 · by Eric Goldman · in Marketing, Search Engines, Trademark

Jim Adler runs a personal injury law firm that claims trademarks in JIM ADLER, THE HAMMER, TEXAS HAMMER, and EL MARTILLO TEJANO.

The defendants run the Accident Injury Legal Center, which runs a lawyer referral service. It bids on the Adler trademarks for “click-to-call” keyword ads. The ads “are designed to display generic terms that consumers might associate with any personal injury firm.” Adler sued for trademark and related claims. The district court dismissed Adler’s complaint.

The Fifth Circuit panel reversed. It says that the Fifth Circuit has never addressed initial interest confusion in the context of keyword ads. However, “[b]ecause meta tags direct internet traffic and are invisible to the internet user (absent the user taking additional steps), meta tags are similar to keyword advertising” (citing a non-precedential metatags opinion from 20 years ago). UGH, NO. Keyword ads have an entirely different technological architecture than keyword metatags, keyword ads have different economic drivers than keyword metatags, and keyword metatag lawsuit are even more stupid than keyword ad lawsuits. It’s 2021 FFS.

The court summarizes the applicable legal standard:

We agree with Southwest Recreational, the Ninth Circuit opinions, and the treatise author [McCarthy] that in the context of internet searches and search-engine advertising in particular, the critical issue is whether there is consumer confusion. Distraction is insufficient.

OK, I guess. Consumer confusion has always been the key to trademark infringement, so the court isn’t exactly making a radical statement. Indeed, the Ninth Circuit essentially said the same thing about consumer “diversion” a decade ago in the Network Automation case. But what facts constitute initial interest confusion, as distinguished from standard consumer confusion, if consumer distraction is disregarded? Perhaps the court has bait-and-switch on its mind, but if so, it should use that term rather than the amorphous and pernicious non-synonym “initial interest confusion.”

The court says “Adler made specific factual allegations describing how the use of the Adler marks as keyword terms — combined with generic, unlabeled advertisements and misleading call-center practices — caused initial interest confusion. This pleading included factual matter beyond the mere purchase of trademarks as keywords for search-engine advertising, and the district court should have considered those allegations….The generic nature of McNeil’s advertisements is relevant because it enhances rather than dispels the likelihood of initial interest confusion.” This sure sounds like a bait-and-switch analysis.

The court also disagrees with the district court’s conclusion that “Adler’s claims fail as a matter of law because McNeil’s use of the Adler marks is not visible to the consumer….We conclude that whether an advertisement incorporates a trademark that is visible to the consumer is a relevant but not dispositive factor in determining a likelihood of confusion in search-engine advertising cases.”

Thus, the court remands the case back to the district court because it survives the motion to dismiss. The district court presumably will take a fresh look on summary judgment.

This is the second time this year that a federal appellate court has embraced initial interest confusion. The other was the Eighth Circuit ruling in Select Comfort v. Baxter. At least the Fifth Circuit had prior IIC caselaw (the Elvis Presley v. Capace case from 1998) that purportedly guided it; the Eighth Circuit was working from a clean slate and could have easily adopted a more modern approach. Still, the Fifth Circuit’s unnuanced and antiquated handling of the initial interest confusion doctrine is dispiriting. I cannot believe courts are still treating the initial interest confusion doctrine as a helpful jurisprudential tool in 2021, after everything we’ve learned in the past decade about consumer behavior online. It’s a defect of the common law tradition; bad doctrinal memes rarely die, and even those fading away are just one ill-advised case from being resurrected.

Case citation: Jim S. Adler, P.C. v. McNeil Consultants, LLC, 2021 WL 3508713 (5th Cir. Aug. 10, 2021)

BONUS:

Plaintiffs allege that the marketing rights that Stevens and Hughes purchased from Google and Facebook directed searches for the Blaux brand to https://www.shopezcoolbreeze.com/, where Stevens and Hughes sold products that competed with the Blaux portable air conditioner. This, on its face, pleads a use in commerce

DFO Global Performance Commerce Ltd. v. Nirmel, 2021 WL 3475596 (S.D.N.Y. Aug. 6, 2021). What are “marketing rights”??? The court’s determination is basically Rescuecom redux, but it wasn’t cited.

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Fifth Circuit Says Keyword Ads Could Contribute to Initial Interest Confusion (UGH)–Adler v. McNeil

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