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Edgar Online, Inc. v. Dan Parisi

Plaintiff claims a common law trademark in the mark "Edgar Online." Plaintiff registered the domain name "edgar-online.com" with NSI in August 1995, and commenced operation of a website at that domain in October 1995. Plaintiff has used the mark continuously since 1995. Since 1997, plaintiff has spent almost $1 million advertising this mark. Apparently, plaintiff's web site permits users, for a fee, to conduct searches of the SEC's EDGAR database.

Defendant owns the domain name "edgaronline.com" which he registered in May 1996, after plaintiff registered its "edgar-online.com" domain name, and after it commenced operation of a web site at that address. Defendant commenced operation of a web site at "edgaronline.com" by at least April 1999. Defendant receives no fees from the operation of this web site. Apparently, defendant's site, like plaintiff's, links users to the SEC's EDGAR database. Defendant's site lacks certain "enhanced features" found on plaintiff's site, however.

Claiming that defendant's activities constituted false designation of origin, unfair competition and trademark infringement in violation of both the Lanham Act and New Jersey state law, plaintiff sought a preliminary injunction enjoining defendant from further use of the domain name "edgaronline.com." Finding that plaintiff was likely to succeed on his claim of false designation of origin, the court issued the requested injunctive relief.

"An unregistered mark is [entitled to] protect[ion under Section 43(a) of the Lanham Act] only 'if the public recognizes it as identifying the claimant's goods or services and distinguishing them from those [of] others.' This is the case if the mark is inherently distinctive or if ... [it] has achieved secondary meaning ...". The court held that, under this standard, plaintiff had submitted evidence sufficient to establish that its unregistered mark was entitled to protection because it was either suggestive or arbitrary (and hence inherently distinctive) or, if merely descriptive, had acquired the requisite secondary meaning with the public based on plaintiff's evidence of use and advertising.

To prevail on its 43(a) Lanham Act claim, the court held that "plaintiff must further prove: (1) that defendant uses a false designation of origin, as defined in the Act; (2) that such use of a false designation occurs in interstate commerce in connection with goods and services; (3) that such designation is likely to confuse, mistake or [cause] deception, and (4) the plaintiff has been or is likely to be damaged."

The crucial issue here was whether defendant's use occurs in commerce in connection with goods and services. Relying on Jews for Jesus v. Brodsky, 993 F. Supp. 993 F. Supp. 282 (D.N.J. Mar. 6, 1998) aff'd. 159 F. 3d 1351 (3d Cir. 1998) the court concluded that it did, notwithstanding its conclusion that plaintiff "does not earn revenues from his website." Said the court:

As in Jews for Jesus v. Brodsky ... [defendant] uses a domain name that is virtually identical to plaintiff's name mark, he thereby impedes some Internet users from reaching plaintiff's website and interferes with plaintiff's distribution of its services. In Jews for Jesus, confronted with such circumstances, the Court determined that the false designation of origin occurred in interstate commerce "in connection with goods and services" within the meaning of Section 43(a). The same is true here."

The court further held that plaintiff had shown that it was likely to establish both that defendant's use of the "edgaronline.com" domain name constituted a false designation of origin, and would confuse consumers. In reaching this latter conclusion, the court pointed to the similarity of the marks used by the parties, the services they offer, the audience they seek to reach and the channels of communication they use to reach this audience. Said the court:

The Court determines that it is self-evident that defendant's false designation of origin is likely to cause confusion. By merely omitting a hyphen in typing the domain name for plaintiff's website or by omitting a space in typing the name of plaintiff's company, consumers access defendant's website, rather than plaintiff's. In addition, once there, they find data similar to what they would expect to find on plaintiff's website, but lacking the enhanced features which are the only justification for plaintiff's charge of a fee for its service. Thus, inevitably, unsuspecting consumers will reach defendant's website when searching for plaintiff's; and it seems highly likely that some will leave the website, still believing they have accessed the EDGAR database using plaintiff's service and disappointed with what they believe to be plaintiff's website's features for which they have paid a fee.

Lastly the court rejected defendant's fair use defenses. Defendant's first fair use defense, advanced under the Lanham Act, was based on its claim that it was not using plaintiff's mark in its trademark sense, but only as an accurate description of the product it was offering. The court rejected this claim on the grounds that it believed that defendant had adopted the name in a bad faith attempt to take advantage of plaintiff's mark and the audience it attracted. Defendant's second fair use defense was based on the First Amendment. The court rejected this argument on the grounds that defendant's use was not part of a communicative message entitled to First Amendment protection, but rather a means of identifying the source of a product or service, which, under Planned Parenthood was not entitled to First Amendment protection.