Trademark Law and Practice, Pages 171–176

Rescuecom Corp. v. Google, Inc.

United States Court of Appeals for the Second Circuit, 2009

Facts:

Plaintiff Rescuecom was business that would help businesses begin to use computers as well offer a call center for technical support with computer issues. Much of its business was done over the Internet, and to facilitate this, it purchased ads on several sites, including that of the defendant Google, a popular search engine.

Rescuecom's competitors also bought ads on Google, including for the keyword "Rescuecom", a trademark of plaintiff. This meant that when one searched for "Rescuecom", his search results would include ads for plaintiff's competitors. Defendant's ad services automatically recommended keywords to purchase ads for. Some of these competitors received recommendations to purchase ads for the "Rescuecom" term, which induced them to do so. While these ads had labels that said "sponsored link", plaintiff sued Google for using its trademark in a manner that made it appear as though it endorsed its competitors in the sale of Google's advertising services.

Procedural History:

District court dismissed the action for failure to state a claim because plaintiff did not allege that defendant's use was a "use in commerce."

Issue:

Did Google's use of plaintiff's mark constitute a use in commerce?

Defendant's Arguments:

  • Internal computer use of a trademark cannot constitute trademark use.

  • Showing competitors' ads when searching for plaintiff's website is no different than a vendor using "product placement" to display similar items next to each other and likewise does not constitute trademark infringement.

Reasoning:

  • It has not been stated that using a trademark in an internal database precludes a finding of trademark violation. Regardless, Google's use was not just internal, as it actually displayed both plaintiff's trademark and that of its competitors on its search result pages.

  • Product placement is not an automatic shield against liability. It is foreseeable that a vendor could arrange products in a way that would trick customers into purchasing a brand other than intended. Product placement still constitutes a use in commerceβ€”it just is a benign use that is not likely to cause consumer confusion. The practices alleged here are also not as benign as product placement, but whether they are benign or confusing is not at issue now.

Holding:

Yes, Google's use was a use in commerce. Vacated and remanded.

Takeaway:

"Use in commerce" is required for infringement.

Note:

After the vacated judgment and remand, Rescuecom dropped the suit and claimed that Google had conceded to its demands and made the ads more distinct. However, Google had made those changes years before the suit and did not change anything further as a result of the lawsuit.