Think Keyword Metatags Are Dead? They Are (Except in Court)–Reflex v. Luxy

Check your calendar. Yes, it’s 2021. But trademark plaintiffs and judges are still partying like it’s 1999. The plaintiff is Seeking Arrangements, one of my favorite websites to base my Internet Law exams on. The defendant is a competitor, Luxy. The court summarizes the alleged trademark problems:

Defendant used the phrase “Online Arrangement” and Plaintiffs’ trademark “Seeking Millionaire” as metatags on its website to direct consumers who searched for “Seeking,” “Seeking Millionaire,” and “Seeking Arrangement” to its own website and mobile application. Defendant has also used Plaintiffs’ trademarks “Seeking Millionaire,” “Seeking Arrangement,” “Whats Your Price,” “Carrot Dating,” and “Seeking” as search terms in the Apple Appstore and Google Play Store to yield LuxyApp as a search result.

(There’s also a copyright claim for Luxy copying the plaintiff’s TOS/privacy policy. REALLY? FFS. This is a topic I used as a sample exam idea in the 1990s).

The court starts its trademark analysis nostalgically: “Turn back the clock to the Internet’s nascent age—1999.” (How about this: let’s not). The court recounts the perennially problematic Brookfield case and how the 2004 Playboy v. Netscape and 2011 Network Automation cases modified it. All of that background leads to nothing, because the court ignores all of that discussion and turns instead to the standard multi-factor Sleekcraft likelihood of confusion test:

  • Mark strength: The trademarks Seeking Arrangement, Seeking Millionaire, and Whats Your Price are descriptive (“they describe Plaintiffs’ app’s purpose—to arrange meetings and relationships with high-value partners”), and plaintiffs claim they invested a lot of money in the marks. So this factor favors the plaintiff (how???).
  • Competitive proximity. The parties are competitors.
  • Mark similarity. “Luxy” is different from the marks at issue. (HUH??? The issue is using the plaintiff’s marks in the keyword metatags and as triggers for keyword ads).
  • Actual confusion. Plaintiff hasn’t presented any evidence of it, but the court says that’s OK because I guess the court doesn’t expect to see these allegations in the complaint?
  • Marketing channels. The litigants use the Internet, but who doesn’t, so normally the court would say this factor is irrelevant. But the court keeps talking: “because of the Internet’s—and Apple’s Appstore, in particular—ubiquity with everyday life, users are more likely to believe that all companies are available in the Appstore. Thus, if users were looking for Plaintiffs’ app by typing Plaintiffs’ trademarked phrases into the search bar, and only Defendant’s app appeared, it would be reasonable for that user to, at the very least, associate Defendant’s app with Plaintiffs. Or, at the most, confuse Defendant’s app with Plaintiffs’. This situation is different from the websites in Network Automation and Playboy, which were clearly distinguished with ad designations. The search results here do not have those same disclaimers. The situation is even more precarious in the Google Playstore. There, both Plaintiffs’ and Defendant’s apps are available and neither have the ad label when searching Plaintiffs’ phrases” WHAT??? All of the judge’s factual assumptions beg for citations. Plus, does this mean that rival apps can’t advertise themselves as rivals or engage in comparative advertising because the app stores aren’t properly labeling the ads, even if the advertisers are engaging in nominative use? HEY APP STORES–FIX THIS.
  • Purchaser care. “These types of apps attract two groups of people. The first group is, theoretically, more sophisticated and less likely to be confused since they are successful individuals looking for relationships. But second group [sic], in theory, is less sophisticated and just looking to find a way to ‘hook up’ with members of the first group. This latter group is less likely to exercise care in which app they select to find potential mates.” Every sex worker just took massive umbrage at the judge’s condescending stereotypes about the role of online marketing in their financial and safety decisions. It’s really offensive.
  • Defendant’s intent. The factor slightly favored the plaintiff because “Defendant intended to use Plaintiffs’ mark in its metatags so its app would appear in search results. And, at least with Apple’s Appstore, one cannot compare Plaintiffs’ app with Defendant’s as Plaintiff’s app is not on the Appstore.” 😠

The court concludes “Plaintiffs have alleged enough likelihood of confusion to make it past the pleading stage.” This may not sound objectionable because the court could still dismiss the case at a later procedural stage. However, it’s actually a significant loss for the defense for this case to proceed because it opens up expensive discovery. Indeed, the parties are embroiled in discovery disputes right now. That’s what happens when judges aren’t aggressive enough about dismissing bogus cases at the early procedural stages.

Regarding the counterfeiting claim, the court refuses to accept that keyword metatags categorically can’t create counterfeiting. Instead, the court decides to let this one proceed to summary judgment too. So yes, here we are in 2021, fighting over whether keyword metatags could be both trademark infringement and counterfeiting. As Grumpy Cat would say:

Case citation: Reflex Media, Inc. v. Luxy Limited, 2021 WL 4134839 (C.D. Cal. July 13, 2021)

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