Referencing TM in Online Ad Copy May Be TM Use in Commerce–Hamzik v. Zale

April 24, 2007 · by · in Marketing, Search Engines, Trademark

By Eric Goldman

Hamzik v. Zale Corp./Delaware, 2007 WL 1174863 (NDNY April 19, 2007)

Another lawsuit against an advertiser for buying keyword advertising. In this case, the plaintiff claims a trademark in the term “Dating Ring” and says that Zales.com buys the keyword “Dating Ring.” Zales.com responds that it simply broad-matched the keyword “ring.” The court sidesteps the broad-matching issue but agrees with the defendant that simply buying a keyword isn’t a trademark use in commerce, joining the Merck court (also from a Second Circuit-based district court) in holding that such “internal uses” by advertisers don’t qualify as a TM use in commerce. However, the court then distinguishes the Rescuecom and Merck precedent because Zales.com’s ads displayed the term “dating rings” in the ad copy. The court says that this may constitute a trademark use in commerce, so the case survives defendant’s motion to dismiss.

Three observations:

1) This court is right to consider the actual ad copy rather than trying to manufacture a blanket rule governing all different implementations of keyword advertising. However, two caveats: (1) not all trademark references in the ad copy should qualify as a trademark use in commerce; for example, IMO, a comparative reference isn’t a TM use in commerce even if it’s made in the ad copy–this is a “commercial referential use” that I will blog on soon, and (2) by requiring the judge/jury to look at the actual ad copy, this can make the lawsuit more expensive for both parties due to the costs of factual investigations, proof and adjudication.

2) This ruling implicitly supports the wisdom of Google’s policy allowing trademark owners to block TM references in the ad copy (the GEICO case also implicitly validated the policy).

3) This is yet another case (see also the Picture It Sold case) where the court doesn’t seem to understand broad-matching. It wouldn’t have changed the results of this case, but at some point courts will need to get it!