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Shade's Landing, Inc. v. James C. Williams

In this trademark infringement action, the court denied plaintiff's motion for a preliminary injunction, enjoining defendant from continuing to use a domain name that plaintiff contended infringed its common law trademark.

Plaintiff operates two web sites. The first is operated at the domain "home-market.com." At this location, plaintiff offers home owners a referral service where they can obtain the listings of various professionals, including real estate agents, mortgage brokers and landscapers. Plaintiff's "home-market.com" web site went operational in or about May 1996. Plaintiff operates a second web site at "shadeslanding.com." Here, plaintiff advertises its business of providing web site development services to real estate agents and others. This service is offered nationwide.

Defendant operates a web site at "home-market.net" which site apparently commenced operation sometime in 1998. Defendant offers web site development services to real estate agents in portions of Minnesota. At present, visitors to the home-market.net home page are greeted only by a counter. Defendant hosts the sites it develops for its clients at the address "home-market.net/name of client." Defendant currently operates sites for approximately 55 clients.

Claiming infringement of its common law trademark in the mark "home-market," plaintiff brought this suit under the Lanham Act and Minnesota Deceptive Trade Practices Act and sought a preliminary injunction, enjoining defendant from continuing to use the "home-market.net" domain. For the reasons stated below, the court declined to issue the injunctive relief.

To be entitled to an injunction for trademark infringement, the plaintiff must first establish that it possess a valid trademark. Plaintiff admittedly did not have a federally registered trademark. The court held that on the record before it, the plaintiff could not establish that it possessed a valid common law trademark before defendant commenced the use at issue.

The court determined that plaintiff's mark was descriptive and not suggestive. As such, to establish its entitlement to a protectable mark, the plaintiff had to establish that its mark had developed a secondary meaning in the mind of the public before defendant commenced the challenged use. Plaintiff attempted to establish such secondary meaning by showing that it was the first listing on search engines in response to the search term "home-market" and by virtue of the fact that 1500 people accessed plaintiff's site in an unspecified two week period. The court held that this evidence failed to establish the requisite secondary meaning. Plaintiff's reference to search engine results did not show how many consumers had actually accessed plaintiff's site, and therefore failed to show that many consumers had associated "home-market" with plaintiff. Plaintiff's evidence of use failed to satisfy the court because plaintiff "does not indicate whether this [use] occurred before or after defendant began using the Home-market.net web site. This evidence therefore fails to show that plaintiff's web site acquired secondary meaning before defendant's alleged infringement began."

In any event, determined the court, plaintiff had failed to establish a sufficient likelihood of consumer confusion to be entitled to the requested injunctive relief. Though the two domain names were very similar, the court pointed to the fact that the plaintiff's mark was not strong, that the products offered at the sites with similar names were distinct, that there was no evidence that defendant adopted his domain name in bad faith, and that there was "only the barest evidence of actual confusion" as support for the absence of sufficient likelihood of confusion.

Finally, the court noted that the balance of the hardships favored the defendant, given that each of its clients operated its web site at the domain at issue, and had taken a number of steps to advertise their web sites, such as printing the applicable url on various marketing materials, including letterhead and business cards. Granting the requested injunctive relief would force these third parties to reprint these marketing materials, and to lose customers while their sites were in the process of being relocated.