When Do Inbound Call Logs Show Consumer Confusion?–Adler v McNeil

September 18, 2023 · by Eric Goldman · in Marketing, Search Engines, Trademark

This case involves Jim Adler, a/k/a the “Texas Hammer,” a Texas lawyer who has spent $100M+ on advertising to build his brand. The defendants run a call-center service that attracts prospective legal clients and then makes compensated referrals of the prospective clients to lawyers. The defendants bought competitive keyword ads on Adler’s trademarks, which Adler objected to. The district court initially dismissed Adler’s trademark claims, but the Fifth Circuit unfortunately revived the claims citing initial interest confusion (UGH). In this ruling, the magistrate recommends against granting summary judgment to Adler on the trademark claims, likely sending the case to trial.

The parties most vigorously contest the “actual confusion” evidence. In particular, Adler highlights that “from 2018-2021, there were 1,595 instances of callers mentioning ‘Jim Adler’ or ‘The Texas Hammer’ in the defendants’ call logs.” This sounds like a lot of potentially confused consumers, but the court isn’t persuaded by the volume. First, only 94 of those references were “actual leads processed by Quintessa from its competitive bidding campaign (the campaign that bids on the Adler Marks).” Second, the court says that the 94 instances is an unpersuasive fraction of the defendants’ total call volume. (The court redacts the denominator, so we can’t compute the fraction). Because the fraction is so low, the court concludes that a “holistic view of the data shows that any alleged confusion that may have occurred was de minimis.”

[Note: I’m a little confused about why the court uses the defendants’ total call volume as the denominator, as opposed to the total call volume resulting from the competitive keyword ads, but maybe the court meant that and the details got lost in the redactions. If not, the court seemingly chose a denominator that led to an artificially low ratio.]

In support of the fraction being unpersuasive, the court notes the risk that Adler’s census of the call logs includes misdials and hangups (what might be “fleeting” confusion), disgruntled Adler clients, other critics, and clients who were legitimately seeking to switch lawyers. The court summarizes that it can’t grant summary judgment when it’s not clear “how – if at all – to extrapolate from the few dozen examples that Adler provides to how many callers may or may not have been actually confused or rather only distracted.”

[Note: Tussling over call logs for legal intake recently came up in the Lerner & Rowe case, which this court unfortunately didn’t cite even though it was quite analogous. There, the court similarly whittled down the number of references in the call logs for various reasons and also used a potentially dubious denominator.]

Rather than use the 9th Circuit’s reconstructed four-factor likelihood of confusion analysis for keyword ad cases articulated in Network Automation, the court instead analyzes the full “digits of confusion” factors from the Fifth Circuit. Most of those factors don’t apply or make sense in the keyword ad context, so the court says several are neutral. It’s not enough to push Adler’s case over the summary judgment line.

[Note: the judge also approved a different order that I can’t find. The approval says: “Defendants’ Motion for Partial Summary Judgment on Plaintiffs Claims for Dilution, Misappropriation, Tortious Interference, and Request for Disgorgement [Dkt. No. 101] is GRANTED in part and only as to Adler’s request for disgorgement for its claim of trademark infringement under the Lanham Act DENIED in part.” It sounds like this narrowed the case solely to the trademark infringement claim.]

For background on the legal battles over keyword advertising by lawyers, see this article.

Case citation: Jim S. Adler PC v. McNeil Consultants LLC, 2023 WL 5600128 (N.D. Tex. July 27, 2023). [Note: the case was embargoed for some time to resolve redactions, but the judge approved it..]

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When Do Inbound Call Logs Show Consumer Confusion?–Adler v McNeil

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