Planetary Motion, Inc. v. Techsplosion, Inc.
Byron Darrah developed a program called "Coolmail" and distributed it for free under the GNU GPL by uploading to a website where others could download it. Four years later, defendant launched an email service called "CoolMail." A few days after that, plaintiff launched their own email service called "Coolmail." The next year it sued defendant. After defendant filed an answer with defenses and counterclaims, plaintiff purchased all of Darrah's rights to his program, including his trademark.
District court found that Darrah's distribution of Coolmail was enough to establish ownership rights in the Coolmail mark.
What is meant by "use in commerce" in the Lanham Act?
Can distributing software for free create trademark rights?
Because Darrah distributed his software for free without the intent to form a business or sell under the mark, his actions are insufficient to create trademark rights.
For ownership to be established, evidence must show adoption and use "in a way sufficiently public to identify or distinguish the marked goods in an appropriate segment of the public mind as those of the adopter of the mark, is competent to establish ownership, even without evidence of actual sales."
According to the Lanham Act, a mark on goods is used in commerce when "it is placed in any manner on the goods or their containers or the displays associated therewith or on the tags or labels affixed thereto, or if the nature of the goods makes such placement impracticable, then on documents associated with the goods or their sale, and the goods are sold or transported in commerce".
The use of "use in commerce" in the Lanham Act was intended to show Congress's authority, rather than limit the law's application.
Here, Coolmail was widely distributed, people associated the name with the software, and the mark accompanied each release and was used as the name to refer to the program. It is common to distribute software under the GPL instead of charging for it. These customary practices of the industry determine the sufficiency of use.
The GPL does not cede the mark's ownership to the public domain. Being charitable also does not mean that one cannot have ownership of his trademark if he is still competitive. By not placing the software in the public domain, Darrah showed that he was engaging in competitive activity to distinguish himself from other developers and to better improve the application.
Darrah's activities constituted a "use in commerce" sufficiently public to create trademark ownership rights.