Trademark Infringement Threats on Twitter,

Facebook and Other Social Networking Websites Policing and Protecting Against Brand Infringement and Counterfeiting by Website Users

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THURSDAY, AUGUST 9, 2012

Presenting a live 90-minute webinar with interactive Q&A

Ian C. Ballon, Shareholder, Greenberg Traurig, Palo Alto, CA

Jennifer L. Barry, Partner, Latham & Watkins, San Diego, CA

Paul W. Garrity, Partner, Sheppard Mullin, New York, NY

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Emerging Trademark Threat

@ Twitter, Facebook, MySpace

Presented By:

Ian Ballon, Greenberg Traurig LLP

Jennifer Barry, Latham & Watkins LLP

Paul W. Garrity, Sheppard, Mullin, Richter & Hampton LLP

August 9, 2012

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Agenda

Current IP trends surrounding Twitter, Facebook and MySpace

Infringement risks arising from social networking sites

Regulation of social media marketing

Issues of secondary liability

Best practices to protect brands

Q&A

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Current IP Trends

Social networking sites can actually be useful for

business

Celebrities

Business advertising

http://twitter.com/starbucks (2.7 million followers)

http://www.facebook.com/costplusworldmarket (over

534,000+ “likes”)

Exposure for company’s leader/personality

Networking/BD

Small business infrastructure

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Current IP Trends

With any opportunity, of course, comes risk

Expense

Content and graphics

Personnel

Legal issues

Overload

Too many sites!

LinkedIn, Flickr, YouTube, WordPress, Digg . . .

Infringement

Our central topic today

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Social Media Account Litigation

Impersonation/parody litigation

LaRussa v. Twitter

Imposter registrations of Twitter usernames.

Claims for violation of right of publicity.

Brandjacking litigations

Oneok v. Twitter, Tanner Friedman v. Doe, Coventry First v. Does

Imposter registrations of Twitter usernames.

Claims for trademark infringement, cybersquatting.

Cases settled shortly after filing, with the usernames being disabled.

Poached Facebook fans

Complexions v. Facebook

Dispute between two identically named but geographically separated day spas

Facebook takes down plaintiff’s page

Plaintiff seeks restoration of page, alleged to be “a valuable trade asset.”

Ownership disputes

Deck v. Spartz

Brand claims in @OMGFacts Twitter account

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Domain Names in Court

Knight-McConnell v. Cummins, 2004 WL 1713824 (S.D.N.Y. July 29, 2004)

“[D]efendant's use of the plaintiff's name in the post-domain path of a URL and placement of URLs using the plaintiff's name in the post-domain paths on chat forums, discussion boards, and search engines do not give rise to any source confusion.”

Interactive Prods. Corp. v. a2z Mobile Office Solutions, Inc., 326 F.3d 687 (6th Cir. 2003)

the post-domain path of a URL “merely shows how the website's data is organized within the host computer's files” and does not suggest an association between page and mark holder

Goforit Entertainment v. Digimedia (N.D. Tex. Oct. 25, 2010)

“as a matter of law, third level domains are not ocvered by the ACPA.”

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Trademark Policies of Social Media Sites

Twitter: "Using a company or business name, logo, or other trademark-protected materials in a manner that may mislead or confuse others or be used for financial gain may be considered a trademark policy violation." (Emphasis added).

MySpace: "MySpace respects the intellectual property of others, and requires that our users do the same. You may not upload, embed, post, email, transmit or otherwise make available any material that infringes any copyright, patent, trademark, trade secret or other proprietary rights of any person or entity. It is MySpace’s policy to terminate, in appropriate circumstances, the membership of repeat infringers."

Facebook: "You will not post content or take any action on Facebook that infringes or violates someone else's rights or otherwise violates the law."

LinkedIn: "Don’t undertake the following: Upload, post, email, InMail, transmit or otherwise make available or initiate any content that: (…) Infringes upon patents, trademarks, trade secrets, copyrights or other proprietary rights."

Twitter

Impersonation Policy: Impersonation is pretending to be another person or entity in order to deceive. Impersonation is a violation of the Twitter Rules and may result in permanent account suspension.

Parody, Commentary, and Fan Accounts Policy: Twitter users are allowed to create parody, commentary, or fan accounts (including role-playing). Twitter provides a platform for its users to share and receive a wide range of ideas and content, and we greatly value and respect our users’ expression. Because of these principles, we do not actively monitor users’ content and will not edit or remove user content, except in cases of violations of our Terms of Service.

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Social Media Injunctions

Grooms v. Legge, 2009 WL 962067 (S.D. Cal. 2009) Preliminary injunction entered barring “the unauthorized use of

photographs, graphics, and designs bearing [plaintiff’s names and marks] whether published or not published including, the worldwide web, Facebook, MySpace, traditional media channels, word of mouth, or in any other type of marketing or advertising.”

TDC Int’l Corp. v. Burnham, 2010 WL 330374 (E.D. Mich. 2010) Defendant had been enjoined from using plaintiff’s mark, but nevertheless

created a Twitter account under plaintiff’s name.

On motion for contempt, Court orders the defendant to “disappear from the internet.” Court orders disclaimer on web site.

Orion Bancorp v. Orion Residential Finance, 2008 WL 816794 (N.D. Fla. March 25, 2008) Default judgment both restricted defendant from purchasing keywords

and required activation of plaintiff mark as negative keyword.

Tormented Souls v. Tormented Souls Motorcycle Club, 2012 WL 1314128 (E.D.N.Y. April 17, 2012) Contempt for violation of settlement requiring defendants to take “all

steps necessary” to remove trademark references from social media.

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Emerging Regulation Of Social Media

Financial Industry Regulatory Authority

Food and Drug Administration

Federal Trade Commission

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Financial Industry Regulatory Authority

Issued a Regulatory Notice (10-06) entitled “Social Media Web Sites” in January 2010

The NASD rules regarding suitability apply to a firm or its personnel recommending a security through a social media site.

Firms must have a general policy prohibiting any associated person from engaging in business communications in a social media site that is not subject to the firm’s supervision.

FINRA does not consider a third-party post to be a firm communication with the public unless the firm or its personnel either is entangled with the preparation of the third-party post or has adopted its content.

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Food and Drug Administration

FDA since November 2009 has been trying to come up with rules concerning social media and FDA regulated products.

FDA is developing multiple draft guidelines on fulfilling regulatory requirements when using tools associated with space limitations; on-line communications for which manufacturers, packers, or distributors are accountable; use of links on the Internet; and correcting misinformation.

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Federal Trade Commission

Guides concerning the use of Endorsements and

Testimonials (the “Guides”) updated in October 2009.

FTC’s changes make it explicit that the principles in

the Guides apply to a company’s marketing of its

products or services through social networks.

A blogger with a “material connection” to an

advertiser is subject to the Guides.

Any claim by such blogger will be attributable to the

advertiser, and must be substantiated.

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Liability for User Content & Conduct

Copyright - Notice and Take Down

– Direct, contributory, vicarious and inducing infringement

– DMCA safe harbor

Trademark – De Facto Notice and Take Down

– Direct, contributory and Inducing infringement and vicarious

in some circuits

– No DMTA safe harbor but increasing de facto recognition

for notice and takedown

Potential Preemption of State IP claims under the

Good Samaritan Exemption to the

Telecommunications Act of 1996 (47 U.S.C. § 230)

(the “Communications Decency Act”)

– Defamation and other non-IP claims

– State IP claims: Ninth Circuit law vs. district courts in other

circuits 19

Secondary Trademark Liability

No DMTA

But the standards of liability are tougher: Sony Corp. v. Universal City Studios, Inc., 464 U.S. 417, 439 n.19 (1984)

Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 546 U.S. 844, 854 (1982) – Liability may be imposed where a manufacturer or distributor

Intentionally induces another to infringe a trademark or

Continues to supply a product to someone who the defendant knows or has reason to know is engaged in trademark infringement

– Service: Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc., 658 F.3d 936 (9th Cir. 2011).

Tiffany (NJ) Inc. v. eBay, Inc., 600 F.3d 93 (2d Cir.), cert. denied, 131 S. Ct. 647 (2010) – eBay does not take possession of goods; no allegation of inducement

– District court (not challenged on appeal): Where liability is premised on the conduct of a user of a venue (as opposed to a manufacturer or distributor of a product) an initial threshold showing must be made that the defendant had direct control and monitoring over the means of infringement. Lockheed Martin Corp. v. NSI, 194 F.3d 980 (9th Cir. 1999)

– A service provider must have more than general knowledge or reason to know that its service is being used to sell counterfeit goods (district court had explained that the standard is knowledge or reason to know, not reasonable anticipation). “Some contemporary knowledge of which particular listings are infringing or will infringe in the future is necessary.”

– eBay responded every time it received a notice of specific files and had a policy of terminating repeat infringers

Sellify Inc. v. Amazon.com, Inc., No. 09 Civ. 10268, 2010 WL 4455830 (S.D.N.Y. Nov. 4, 2010) (granting summary judgment under eBay where there was no evidence that Amazon.com had particularized knowledge of, or direct control over, disparaging ads and terminated its contractual relationship with the provider after receiving notice but allegedly had failed to act in response to an earlier phone call)

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Secondary Trademark Liability A different result might obtain when the site or

service is not like eBay (i.e., a responsible site

with extensive assistance to ip rights owners):

– Louis Vuitton Malletier, S.A. v. Akanoc Solutions, Inc., 658 F.3d

936 (9th Cir. 2011) (jury verdict for $31,500,000 in statutory

damages for contributory trademark infringement against two

Internet hosting companies and the individual who owned them)

Web host that received but did not respond to 18 NOIs relating

to PRC websites that solicited inquiries for counterfeit products

(and its owner) held liable following a jury trial for contributory

trademark and copyright infringement ($10.5 Million in

statutory TM damages, trebled)

Affirmed on appeal, but TM damages reduced to $10.5 Million

in joint and several liability. The Ninth Circuit applied to the

Lanham Act a provision of the Copyright Act that authorizes

only one statutory damages award against all defendants held

jointly and severally liable for copyright infringement.

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Potential Federal Preemption

of State IP Claims under

47 U.S.C. § 230

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230(c)(1): No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider

230(c)(2)(A): No liability on account of “any action voluntarily taken in good faith to restrict access to or availability of material that the provider or user considers to be obscene, lewd, lascivious, filthy, excessively violent, harassing, or otherwise objectionable, whether or not constitutionally protected...”

– Scope: Defamation, privacy, most state civil and criminal claims, federal civil (but not criminal) claims.

– Preempts inconsistent state laws.

– Excludes: federal criminal claims, claims under the ECPA or “any similar state law” and “any law pertaining to intellectual property.”

Different approaches: – Fair Housing Council v. Roommates.com, LLC, 521 F.3d 1157 (9th Cir. 2008)

Multiple choice questionnaire written by Roommates.com vs. white space

– FTC v. Accusearch, Inc., 570 F.3d 1187 (10th Cir. 2009) Solicitation + payment: interactive computer service information content provider

Confidential phone records

– Nemet Chevrolet, Ltd. v. Consumeraffairs.com, Inc., 591 F.3d 250 (4th Cir. 2009) (commercial gripe site; 8 posts allegedly written by the defendant) (JOP) “immunity is an immunity from suit rather than a mere defense to liability and is effectively lost if a case is erroneously

permitted to go to trial”

Conduct as content: – Doe v. MySpace, Inc., 528 F.3d 413 (5th Cir.), cert. denied, 555 U.S. 1031 (2008)

– Doe II v. MySpace, Inc., 175 Cal. App. 4th 561, 96 Cal. Rptr. 3d 148 (Cal. App. 2009)

– Inman v. Technicolor, S.A.., Case No. 2:11-cv-00666-GLL, 2011 WL 5829024 (W.D. Pa. Oct. 2011)

Are State IP Claims Preempted? – Perfect 10, Inc. v. Ccbill, 488 F.3d 1102 (9th Cir.), cert. denied, 552 U.S. 1062 (2007) (right of publicity claim).

But see: Doe v. Friendfinder Network, Inc., 540 F. Supp. 2d 288 (D.N.H. 2008)

Atlantic Recording Corp. v. Project Playlist, Inc., 603 F. Supp. 2d 690 (S.D.N.Y. 2009) (Judge Denny Chen)

Parisi v. Sinclair, 774 F. Supp. 2d 310 (D.D.C. 2011) (declining to “extend the scope of the CDA immunity as far as the Ninth Circuit” but dismissing publicity claim under newsworthiness exception)

Gauck v. Karamian, 805 F. Supp. 2d 495 (W.D. Tenn. 2011) (assuming that right of publicity claim fell outside the

CDA as a law pertaining to intellectual property) Fraley v. Facebook, 830 F. Supp. 2d 735 (N.D. Cal. 2011)

User Generated Criticism

DeVere Group GmbH v. Opinion Corp., _ F. Supp. 2d _, 2012 WL 2884986 (E.D.N.Y. 2012) (dismissing claims based on use of DeVere’s trade name in text on PissedConsumer.com and in the DeVere.PissedConsumer.com subdomain; applying Second Circuit law in finding initial interest confusion inapplicable in this case);

Ascentive, LLC v. Opinion Corp., 842 F. Supp. 2d 450 (E.D.N.Y. 2011) (denying plaintiffs’ motion for preliminary injunction)

Amerigas Propane, L.P. v. Opinion Corp., Civil Action No. 12-713, 2012 WL 2327788 (E.D. Pa. June 19, 2012) (denying defendant’s motion to dismiss claims based, in part, on the defendant’s use of plaintiff’s mark in the subdomain, www.amerigas.PissedConsumer.com; applying Third Circuit law on initial interest confusion).

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How Do I Protect My Brand While Taking

Advantage of These Sites?

Register trademarks with each site

Monitor sites to determine if trademark is

being used without permission

Internal monitoring

Third party vendors

Law firm monitoring

Understand basic terms of service of each site

Report alleged infringement to social

networking site

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How Do I Protect My Brand While Taking

Advantage of These Sites?

Develop P&P for use of sites by employees

What to post (and NOT to post) on company’s

behalf

Guidelines for personal use

Develop and implement anti-counterfeiting

programs

Insurance considerations

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Reference Materials

Terms of Use

http://twitter.com/tos

http://www.facebook.com/terms.php?ref=pf

http://www.myspace.com/index.cfm?fuseaction=misc.t

erms

“Protecting Your Rights in 140 Characters or Less:

Trademark Protection on Twitter” http://www.lw.com/thoughtLeadership?empid=07665

“Creative Business Uses of Twitter” http://www.businessweek.com/the_thread/blogspotting/archives/2008/04/creative_busine.ht

ml?campaign_id=rss_blog_blogspotting

http://twittercounter.com/

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Ian Ballon

ballon@gtlaw.com

650.289.7881 (Palo Alto)

310.586.6575 (Los Angeles)

Jennifer Barry

jennifer.barry@lw.com

619.236.1234

Paul W. Garrity

pgarrity@sheppardmullin.com

212.634.3057