Kentucky Court Votes Keyword Ads = TM Use in Commerce–TDI v. Golf Preservations

By Eric Goldman

T.D.I. International, Inc. v. Golf Preservations, Inc., 2008 WL 294531 (E.D. Ky. Jan. 31, 2008)

In a thinly reasoned opinion with meager facts, a Kentucky federal court meekly voted that keyword advertising is a trademark use in commerce, at least for purposes of a motion to dismiss.

The case involves competitors in the golf course drainage system installation business. Bailey worked for the plaintiffs before starting up his own competing venture. The plaintiffs claim (among other things) that Bailey misappropriated trade secrets when he walked out the door and that his new venture engaged in trademark infringement by buying keyword advertising (apparently the “XGD” trademark, which as of today still triggers a Google AdWords ad for the defendant).

The court describes the precedent cited by both sides regarding the “use in commerce” question (a2z and 1-800 Contacts on the defense; GEICO, American Blinds, Buying for the Home, Edina Realty, JG Wentworth, Rescuecom v. Computer Troubleshooters, Paisola) before throwing up its hands and punting:

The Court has given careful consideration to the arguments and authorities presented by both parties. In light of the uncertain state of the law on the specific issue presented in this case, the Court does not find the Defendants’ arguments sufficient to warrant dismissal of the Plaintiffs’ Lanham Act claims at this stage in the proceedings.FN1 Accordingly, the Court finds that the Plaintiffs have alleged facts sufficient to ‚Äústate a claim to relief that is plausible on its face.”

In the footnote, the court notes that the plaintiffs alleged other conduct beyond just buying keywords. The case doesn’t recount these facts, but they might very well support a use in commerce determination without needing to address the keyword advertising issue at all.

Either way, this case reinforces the pattern that Second Circuit-controlled courts aren’t finding trademark use in commerce from keyword triggering and all other courts are. In that respect, this ruling is reminiscent of the American Airlines v. Google ruling, where the court declined to dismiss the complaint without any substantive explanation.